Tax-Credit Debate Shaped by Report Of Bell Committee
Washington--The Senate Finance Committee, in a replay of action that took place less than a year ago, last week heard debate over the Reagan Administration's proposal to establish federal tax credits for parents who pay private-school tuition.
Unlike last year's hearings, however, last week's deliberations focused on a new element in the tax-credit debate: the findings, released two days before, of the National Commission on Excellence in Education.
President Reagan, in a letter to the committee's chairman that was read at the hearing by Secretary of Education Terrel H. Bell, said that "after reviewing the findings of the commission, I am more convinced than ever that passage of tuition-tax-credit legislation is needed now. It will enhance the measures the commission recommends for excellence in both our public and private schools."
But a number of the committee's members strongly disagreed with that supposition, arguing that, contrary to the Administration's position, there is no evidence that competition between private and public schools will result in educational improvement.
The Administration's bill would allow parents to take a tax credit of up to $100 next year for every child they send to a private school. The credits, which cannot exceed 50 percent of the cost of tuition, would eventually rise to a maximum of $300 per child two years after the law goes into effect.
Parents with an annual adjusted gross income of $40,000 or less would be eligible for the full tax credit.
Those with an income of between $40,000 and $60,000 could claim a partial credit.
In addition, the bill would not extend credits to students who attend schools that discriminate on the basis of race.
In his letter, President Reagan noted that the report of the commission on excellence "places a heavy emphasis on the role that parents must play in renewing our country's educational standards."
"I have remarked before that without a race there can be no champion; without competition to excel in our educational system we will not have excellence," the letter continued.
"Making alternatives affordable to those parents who want them, by allowing them to keep some of what they now earn to spend on their children's education, will provide competition as public and private schools seek to improve the quality of education they offer to attract and retain students."
In a spirited exchange with Secretary Bell, Senator John H. Chafee, Republican of Rhode Island, contended that the Administration "has no evidence to substantiate the claim that competition will result in educational improvement."
"What sort of evidence do you have to support this claim?" Senator Chafee asked Mr. Bell. "What sort of figures do you have to back you up?"
"The President is simply expressing his belief in the marketplace and how it gives us incentive to excel," Mr. Bell replied. "I know he has a feeling ..."
"Forget his feelings," Senator Chafee interrupted. "Where's the evidence?"
Choice and Freedom
"I think that we can show you evidence that where there is choice and freedom, there is excellence," Mr. Bell responded.
"This has nothing to do with choice," Senator Chafee said. "What you are proposing is that by giving money to private schools you will somehow improve public education. I want to see evidence."
In supporting the Administration's proposal, Senator Robert J. Dole, the Kansas Republican who chairs the committee, cited a recent study conducted by the Congressional Research Service.
That study found that the bill, when fully effective in 1985, would cost the government less than $800 million per year. By contrast, he said the study also showed that public schools currently receive federal tax subsidies totaling more than $13.7 billion per year.
"The cost of the tuition-tax-credit proposal is not insignificant," Senator Dole said. "But in light of the long-term economic benefits to be obtained from encouraging investment in human capital and promoting greater diversity and competition in education, these costs are a sound and prudent investment in our nation's future."
In testimony delivered later in the hearing, Albert Shanker, president of the American Federation of Teachers, said, "If the Reagan Administration was really sincere about the report [of the excellence commission], it would not have the nerve to come back to Capitol Hill and beg Congress to pass tuition-tax-credit legislation."
'A Nation at Risk'
"Does the President think the American taxpayers are fools?" Mr. Shanker said. "Forty-eight hours ago, [the commission] warned that we are 'a nation at risk' because of significant declines in school standards and that we must rearm ourselves. And the way to do that, according to the panel, is through broad-based taxpayer support for our schools. How does Mr. Reagan expect to galvanize public support when at the same time his Administration reels off multibillion-dollar programs calling for tax credits and vouchers that will not make our public schools stronger, but only weaker?"
"Tuition tax credits are an essential vehicle for providing free choice in education," countered Richard B. Dingman, legislative director of the Moral Majority, in prepared testimony. "To require that all students without economic means attend only government schools is to impair the right of access to divergent thoughts for today's youths."
"Public schools in America have been treated with the status of an established church," Mr. Dingman added. "Everyone, no matter what they believe, is required to support them. Those who disagree or want something else for their children are only allowed to have access to it after they have paid their dues to the establishment."
Vol. 02, Issue 32