Frustrated by 25 years of failed school reforms, a growing number of districts are adopting “pay for performance” plans. These plans offer cash payments to teachers and administrators for boosting their students’ scores on standardized tests. Yet history shows that any pay-for-performance gains are mostly illusions. Not only do they fail to improve student achievement, they are also destructive, encouraging administrators and teachers to cheat by manipulating statistics, or by teaching to the test. Inevitably, children wind up the losers because curricula are narrowed to include subjects that can be taught by drill and repetition and that are easily measured.
For all of the flaws in the idea, a bigger issue is at stake: our inability to resist these “political fixes” that divert efforts to address the root causes of education’s failures at the schoolhouse level.
Pay-for-performance was first tried in England around 1710. Teachers’ salaries were based on their children’s scores on examinations in reading, writing, and arithmetic. This early payment-for-results system had great appeal because it promised to help keep children from poor families in school, where they might learn the basics. It became fixed in the English system of education in 1862 as part of the Revised Education Code, where it remained for more than 30 years.
History shows that any gains from pay-for-performance plans are mostly illusions.
As historical accounts show, English teachers and administrators became obsessed with the system’s financial rewards and punishments. It was dubbed the “cult of the [cash] register.” Schools’ curricula were narrowed to include just the easily measured basics. Drawing, science, singing, and even school gardening simply disappeared. Teaching became increasingly mechanical, as teachers found that drill and rote repetition produced the “best” results. One schools inspector wrote an account of children reading flawlessly for him while holding their books upside down.
Payment-for-results in the English system degraded teaching as a calling, because teachers now had to pay close attention to the Education Code. It clearly spelled out standards for their students’ success or failure (and their own). Grants were given to the schools, and teachers had to haggle with individual school managers for their share. One teacher of the time elaborated: “I do not deny that many teachers do overwork the youngsters in a terrible way, but the poor souls really act under the pressure of the law of self-preservation. They must either meet the requirements of their superiors or become professionally extinct.”
The effect was to erode teachers’ creativity. An inspector wrote that the Education Code “did all the thinking for the teacher; it told him in precise detail what he was to do each year.” Another recalled, “Every teacher in the country takes his orders from the Code, studies the Code, and devotes his energies to satisfy or to circumvent it.” The results were not always benign. Some teachers falsified records by including names of good students who had died or who had moved from the district. They poured energy into fooling inspectors by flashing signals to students who were being examined, telling them when to add, subtract, multiply, or divide.
When payment-for-results was finally dropped in the 1890s, the overwhelming judgment was that it was unsound policy. Cynics referred to schools as “grant factories” and children as “grant-earning units.” The English experiment with payment-for-results had created almost irresistible incentives that in the end demeaned teachers and sacrificed children’s education for financial gain.
Payment-by-results appeared briefly in Canada in 1876, causing conservatives to rejoice because it made teachers and students work harder to avoid failure. The Canadian experience showed that test scores could be increased quickly, so long as the subject matter could be narrowed and measured. But, as in England, the system caused teachers to focus their energies on students who were most likely to succeed, helping them cram for examinations while ignoring the others. In 1883, a public outcry ended the experiment abruptly.
Almost a century later, in 1969, the idea emerged in this country as “performance contracting,” not long after big-city schools began to desegregate. Making American schools accountable became a top priority for the efficiency-minded Nixon administration. President Richard M. Nixon, like English politicians a century earlier, expressed concern over the lack of educational achievement among the growing population of urban poor. He stated:
“The outcome of schooling--what children learn--is profoundly different for different groups of children. ... School administrators and school teachers alike are responsible for their performance, and it is in their interest as well as in the interests of their pupils that they be held accountable. ... [T]he avoidance of accountability is the single most serious threat to a continued, and even more pluralistic educational system.”
Shifting the focus of education from the student to the pocketbook erodes teachers' professional judgment and demeans the process of education.
So began a huge experiment with performance contracting designed to overhaul the public schools. But, unlike the 19th-century English experiment, American educators now had the advantage of using standardized tests to measure outcomes. School funding could be scientifically tied to students’ test scores. The original experiment, housed in the U.S. Department of Health, Education, and Welfare’s offices of education and housing and urban development, aimed to increase reading and math scores for 300 high school and junior high school students in the public schools of Texarkana, Ark. The district was under great pressure from hew to desegregate, and local officials were desperate to close the performance gap between black and white students.
The Arkansas district offered the federal government a money-back guarantee--funds would be returned for students who failed to pass at a specified level. And students would get free transistor radios, green stamps, and free rock music. The experiment provided incentives for everyone--administrators, teachers, and students. The New York Times’ education writer, Fred Hechinger, called it as “American as apple pie.” Other journalists observed that performance contracting touched the American consciousness with its “you get what you pay for” philosophy, and the belief that “private industry know-how can solve any problem.”
A preliminary evaluation indicated astonishing results. Students averaged gains of more than two grade levels in reading and one in math after only 48 hours of instruction. Buoyed by those preliminary results, supporters of the idea hailed the Texarkana experiment as a success, and new performance contracts were announced.
But scandal quickly clouded the growing enthusiasm, with accusations that one of the key contractors was caught teaching to the test. The contractor was fired, but the idea moved forward in 18 cities, where private contractors taught reading and mathematics using a variety of incentive schemes.
The now-expanded initiative ran into trouble. Contractors were disorganized and, despite the public rhetoric, few companies were willing to actually commit themselves to a money-back guarantee. Also, despite hopes that contractors would bring innovative teaching practices to the classroom, most used conventional methods augmented by teaching machines and incentives for students. Finally, education experts warned federal officials against using standardized-test scores as the ultimate benchmark for student achievement because they were unreliable.
Scandal and the lack of results ultimately doomed performance contracting, and it was declared a failure. Like the earlier English and Canadian experiments, performance contracting once again showed how financial incentives failed to produce expected gains, while at the same time generating damaging educational effects.
Today, districts around the country--Denver; the District of Columbia; Fairfax County, Va.; Hartford, Conn.; Minneapolis; and Montgomery County, Md., to name just a few--are rushing to embrace the idea. While none has suggested such harsh financial consequences as the earlier experiments, much can be learned from those past efforts to help focus the education reform debate in more productive directions.
Tying changes in student test scores to teachers’ or administrators’ pay presents powerful incentives for educators to first consider “what’s best for me?” instead of “what’s best for the child?” Shifting the focus of education from the student to the pocketbook erodes teachers’ professional judgment and demeans the process of education.
The record is rife with examples of how payment-for-results schemes have led to dishonest behavior--falsifying records and teaching to the test. No doubt, safeguards would have to be established to catch cheaters, but this would only further diminish teachers’ crucial role.
There is little doubt that one of the villains is standardized testing. While testing is only a means to making payment-for-results work, it has far-reaching effects. Standardized tests, created by people who have nothing to do with local schools, eclipse educational judgments made by teachers and parents. Just as the English Educational Code served to narrow the curriculum and drain creativity from teaching a century ago, standardized tests have much the same effect today.
Few reforms that are forced on the schools (especially destructive ones like payment-for-results) will ever penetrate the classroom and positively change the teaching and learning processes. Teachers are every bit as adept at deflecting or sabotaging reforms of this kind today as they were at deceiving English school inspectors in the 1800s. Politically driven reforms like pay-for-performance are nothing more than reflections of public frustration. And rather than helping to solve the root causes of failure, they paralyze us and deflect public attention from reforming educational systems at their core.
Policy leaders must redefine their roles, from legislating reforms to supporting changes that emanate from the schoolhouse, if changes are to endure. Politicians, board members, superintendents, and union leaders must clear the way of obstacles to make innovation in the schoolhouse possible, and provide necessary resources. But only teachers, parents, and students working together at the schoolhouse level can improve the systems by which teachers teach and students learn.
A version of this article appeared in the November 03, 1999 edition of Education Week as The Illusion of Paying Teachers For Student Performance