Education Tax Credit & Competition

Lack of competition breeds complacency and stagnation. Competition, on the other hand, brings change, innovation, and improvement to most all systems and entities. The same is true for education. Sometimes it seems as though we are trying to make all of our schools equal. What we need to do is try to make all our schools better, and the best way to do that is to get our schools all competing with each other at every level.

Ron Paul had an idea, which probably should be implemented, and certainly should be considered. His idea was as follows:

“The best interim option for reform would be to give a tax credit for all educational expenses.”

Dr. Paul did not go into detail, but I believe his idea would work best if the tax credit was transferable. For example, if a poor family who paid no taxes wanted to send their child to the local parochial school, they could transfer the tax credit to the school and the school could sell the tax credit and simultaneously verify the child was in school. The proceeds the school received from the sale of the tax credit would pay for the child’s tuition.

Consequently, if such a tax credit was transferable, then even parents who paid no taxes could send their children to any school, provided their child was admitted, and there was a market for the tax credits.

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