Privately Funded Vouchers: Rescuing Children and Building Grassroots Support for School Choice

IN LESS THAN A DECADE, the privately funded voucher movement has become a major force not only for the achievement of its primary goal—helping children and empowering low-income parents—but also for advancing the public policy debate on school choice and building a solid base of grassroots support for parental choice in education. In addition, new programs have made it easier to make estimates of consumer demand for school choice and have established a rich and attractive environment for academic research on educational choice issues.

Since 1990, private scholarship programs have grown exponentially. Although predated by the 1990 formation of the Daniel Murphy Scholarship Foundation in Chicago, it was Golden Rule Insurance Chairman J. Patrick Rooney’s creation of a new prototype voucher in 1991 that inspired similar efforts in cities across the country. Since 1994, the Children’s Educational Opportunity Fund of America (CEO America) has used Rooney’s Educational Choice Charitable Trust model to found dozens of private scholarship programs. With each effort tailored to meet local needs, the programs serve almost 12,500 children and now operate in 41 cities nationwide with a waiting list of over 45,000 students.

Recently, entrepreneur-philanthropist Ted Forstmann and investor John Walton created the Children’s Scholarship Fund, a new $200 million program to provide scholarships to at least 50,000 low-income children. This program suddenly transformed the private voucher movement into a large-scale rescue operation that now dwarfs the past decade’s legislative efforts to save children from failing schools. For this new fund, Forstmann and Walton will each contribute $50 million and seek matching funds from local partners in cities across the country to secure the total pledge of $200 million for scholarships.

In response to this generous contribution, American Federation of Teachers President Sandra Feldman said that she would have preferred to have the money contributed directly to the public schools. Feldman wants the private sector to contribute more resources to public schools, even though enormous financial commitments from businesses have had little discernable effect.

Indeed, according to Investor’s Business Daily, more firms are realizing they can do more good by “by cutting out the public school middleman” and helping kids directly. And as Daniel Murphy Foundation President Jim Murphy asserts, “Giving kids the opportunity to go to a better school is an end in itself.”

Because privately funded vouchers go directly to parents, without the intervention of legislators, their inevitable expansion is more threatening to the public education monopoly. President Clinton’s veto of the D.C. Student Opportunity Scholarship Act may continue to protect failing schools in the nation’s capital from the much-needed challenge of publicly funded vouchers, but there is no protection against the competitive challenge of privately funded vouchers from the Washington Scholarship Fund.

When faced with the loss of students, even the worst schools begin to shape up. Giffen Elementary was the worst school in Albany, New York, when it lost about 100 students through a scholarship offer from philanthropist Virginia Gilder last year. Now, the school has a new principal, additional funding, and a dozen new teachers. In a new program in San Antonio, privately funded vouchers are challenging a whole school district and are expected to result in the creation of more private schools.

While the virtue of philanthropy brings its own reward, the response to privately funded vouchers demonstrates unequivocally that low-income families care deeply about the education of their children and are willing to make significant sacrifices to get it. Demand for the scholarships is huge.

When New York’s School Choice Scholarship program offered 1,200 scholarships last year, 22,700 families with an average annual income of only $9,634 rushed to apply. Similarly, in January, the Washington Scholarship Fund received 7,573 applications for 1,000 scholarship for students from low-income families, or 17 percent of the eligible population in Washington, D.C. in just a few months. Such overwhelming demand persuaded Forstmann and Walton to take their efforts nationwide with the $200 million Children’s Scholarship Fund.

In offering hundreds of thousands of parents the chance to rescue their children from underperforming schools, privately funded voucher programs are establishing a solid base of grassroots support for school choice. As this base grows in size and citizens make it clearer where they want to go, lawmakers will find it increasingly attractive to jump out in front of them to provide the legislative leadership necessary to make school choice a reality for all children.


Mr. Clowes is Managing Editor of School Reform News.