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NEW YORK
CALIFORNIA
NEW JERSEY
DIST OF COL
CONNECTICUT
MASSACHUSETTS
RHODE ISLAND
NEVADA
DELAWARE
WASHINGTON
ILLINOIS
ARIZONA
MICHIGAN
PENNSYLVANIA
OHIO
WISCONSIN
OREGON
WYOMING
NEW HAMPSHIRE
INDIANA
MINNESOTA
MONTANA
COLORADO
UTAH
MARYLAND
KANSAS
JOWA
NEW MEXICO
IDAHO
VERMONT
TEXAS
WEST VIRGINIA
NEBRASKA
FLORIDA
LOUISIANA
MISSOURI
OKLAHOMA
MAINE
SOUTH DAKOTA
SOUTH

CAROUNA
NORTH CAROUNA
NORTH DAKOTA
VIRGINIA
GEORGIA
TENNESSEE
ALABAMA
KENTUCKY
ARKANSAS
MISSISSIPPI
TEN HIGHEST
TEN LOWEST

The CHAIRMAN. I understand so. Dr. Norton. They are all available. I have given a complete set of everything I have shown you to the reporter.

Senator ELLENDER. Yes.

Dr. Norton. In chart 67, New York, California, New Jersey, District of Columbia, Connecticut, and so forth, all are distinctly above average in ability to finance education, as indicated by income per capita. Mississippi, Arkansas, and so on up are much below average. The factor of amount of income appears to be a very influential one in determining the kind of educational opportunity a child gets. Putting

а it another way, a child should be very careful where he is born if he wants a good educational opportunity. If he is born down here, in one of the States at the bottom of the chart, regardless of the best

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NEW YORK
CALIFORNIA
NEW JERSEY
DIST OF COL
CONNECTICUT
MASSACHUSETTS
RHODE ISLAND
NEVADA
DELAWARE
WASHINGTON
ILLINOIS
ARIZONA
MICHIGAN
PENNSYLVANIA
OHIO
WISCONSIN
OREGON
WYOMING
NEW HAMPSHIRE
INDIANA
MINNESOTA
MONTANA
COLORADO
UTAH
MARYLAND
KANSAS
JOWA
NEW MEXICO
IDAHO
VERMONT
TEXAS
WEST VIRGINIA
NEBRASKA
FLORIDA
LOUISIANA
MISSOURI
OKLAHOMA
MAINE
SOUTH DAKOTA
SOUTH CAROUNA
NORTH CAROUNA
NORTH DAKOTA
VIRGINIA
GEORGIA
TENNESSEE
ALABAMA
KENTUCKY
ARKANSAS
MISSISSIPPI
TEN HIGHEST
TEN LOWEST

intentions in the world of the people in these States to maintain schools, the best he is likely to get is a very meagerly financed educational opportunity. The worst he will get is that he will not be in school at all. If he has the foresight to be born up here in one of the States at the top of the chart, with large income per capita, he is almost certain to be in school and he is almost certain to attend a well-financed school.

Chart 68 deals with the factor of tax effort. Are all States making adequate effort to finance education? What is reasonable effort ? For want of anything better we have taken the effort of the United States, this line running here [indicating], as par, so to speak, as 100. Most of these wealthier States up here [indicating], with a smaller percentage of children, and with generous provisions for education, are below par in effort. They make less effort than the country makes as a whole. In the first 10 States there are only 4 that make average effort, and yet for the children they have, the relatively small per

CHART 68

PERCENT OF INCOME
SPENT FOR EDUCATION

100

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MEDIAN LEVEL OF SUPPORT

PER CLASSROOM UNIT
25 30 75

125 190 ITS 200 22.5 250
NEW YORK
CALIFORNIA
NEW JERSEY
DIST. OF COL
CONNECTICUT
MASSACHUSETTS
RHODE ISLAND
NEVADA
DELAWARE
WASHINGTON
ILLINOIS
ARIZONA
MICHIGAN
PENNSYLVANIA
OHIO
WISCONSIN
OREGON
WYOMING
NEW HAMPSHIRE
INDIANA
MINNESOTA
MONTANA
COLORADO
UTAH
MARYLAND
KANSAS
JOWA
NEW MEXICO
IDAHO
VERMONT

TEXAS
WEST VIRGINIA
NEBRASKA
FLORIDA
LOUISIANA
MISSOURI
OKLAHOMA

MAINE
SOUTH DAKOTA

SOUTH CAROLINA _NORTH CAROLINA

NORTH DAKOTA VIRGINIA GEORGIA TENNESSEE ALABAMA KENTUCKY ARKANSAS MISSISSIPPI TEN HIGHEST TEN LOWEST

centage of children, they are able to provide generous financial support. But of the 10 States at the bottom of the chart, 5 make above average effort. The two lines of the bottom of chart 68 group the 10 higher and the 10 lower States as to level of support per classroom unit. The 10 higher States as a group make less than average effort to support their schools, in terms of percent of the income received by the people expended for public education. The 10 lower States in expenditure per classroom, as a group, make more than average effort to finance their schools. In short, the rich States can provide well-financed schools on subpar effort. The poorer States, in an economic sense, are able to finance their school only at a comparatively low level, even though they make comparatively high effort.

The CHAIRMAN. How do you account for that?

Dr. NORTON. The States which are wealthy have small percentages of children; the States which are poor have large percentages of children to educate.

The CHAIRMAN. The wealth of the country has been concentrated in those big industrial centers of the country, hasn't it?

Dr. NORTON. Yes. Take for illustration the Metropolitan Life Insurance Co. It has headquarters in New York City. The Metropolitan Life Insurance Co. writes insurance policies for every State in the Union and for every nation in the world. Yet for taxation purposes such great organizations and corporations are available for New York State financing. Take the stock exchange. New York State collects—I have forgotten how many millions of dollars it is, 20 or 30 million dollars, something like that simply from the fact that the stock exchange is on one side of the Hudson River instead of on the other. If it were on the other side, New Jersey would collect that. Is this money collected because of the peculiar virtue or industry of the citizens of New York State ? I doubt if any of you would claim that. It is the result of economic activity on the part of citizens all over the country.

Senator ELLENDER. That same thing may be applied to the State of Montana. I know Senator Murray can tell us that the wealth of Montana is not owned by Montanans, nor is the oil that comes from Texas owned by Texans; it is virtually all owned by big interests from the North and the East in such cities as Chicago, New York, Pittsburgh, Boston, and other cities.

The CHAIRMAN. Yes. In practically all of the States where we find these poor conditions they have a raw material economy and they have no balanced industry. They do not do any processing or manufacturing. They produce the raw material and it is shipped out of the State and the wealth and profit from it goes to the big industrial centers where the corporations have their headquarters.

Dr. NORTON. It is the nature of modern economic organization for the points of available taxation to concentrate in small areas. These areas are in a position to maintain government and education at a high level of expenditure with a low level of effort. The basis of their fiscal capacity is the economic activity of the whole Nation. The opposite is true in certain other areas. Even though they may constitute an essential element in the economic picture, in terms of tax ability they are greatly below average. The result is shown here in the lowest 10 States in school support.

Even though these lower 10 States in school support make something above average effort, they nevertheless make meager provision for the financing of education.

Senator JOHNSTON. What was it for South Carolina?
Dr. NORTON. You mean with reference to effort ?
Senator JOHNSTON. Yes.

Dr. Norton. South Carolina is making an effort of 111 as compared with 100 for the country as a whole-or 11 percent above average.

Senator Hill. Doctor, you are doing the testifying and I do not want to interrupt you.

Dr. NORTON. That is all right.

Senator HILL. You are familiar with the commission of which Mr. Owen D. Young was chairman, are you not?

Dr. NORTON. Yes.

Senator HILL. And Mr. Henry I. Harriman, former president of the United States Chamber of Commerce, was vice chairman.

Dr. NORTON. Yes.

Senator HILL. As I recall the findings of that commission, that commission found that if all the States of the Union had an adequate, uniform tax plan there would be nine States in the Union that, if they used every dollar from this tax plan for educational purposes alone, not one single dollar to go into other State functions such as roads, welfare, and health, these nine States would not have sufficient revenues to bring their educational opportunities up to an adequate level. Is that correct, sir?

Dr. Norton. That is correct, and that general finding has been made by other investigations. For example, at one time I directed a study made by Prof. Leslie Chisholm, now professor in Washington State University, in which he very meticulously applied a modern tax plan, similar to the one recommended by the National Tax Association, to every State in the Union. He arrived at substantially the same conclusions.

If you took all of the money in States at the bottom, in terms of economic ability-all they could raise by a model tax system, levied at reasonably adequate rates—you would not have enough to finance education at even average cost, leaving nothing for roads, police, or anything else that a State has to finance.

I might say, Senator Hill, as you doubtless know, this whole problem has been studied by a series of commissions. Take, for example, going back to the Hoover administration, there was at that time appointed a national advisory committee that studied this problem at great length and brought in a long report. Their conclusion, broken down to a few words, is that we will have to apply something other than State resources to this problem if we are going to deal with it adequately.

Later on another committee was appointed, I think in the second term of President Roosevelt, called the Advisory Committee on Education. Mr. Floyd Reeves directed it. They arrived at the same conclusion and reported in a 13-volume study.

Then there came the important investigation of the American Youth Commission to which you refer. This Commission was composed largely of non-educators. It started out under the chairmanship of Newton D. Baker, and when he unfortunately passed on, the chairmanship went to Owen D. Young, and the vice chairman, as you said, was Mr. Henry I. Harriman. The membership of the American Youth Commission reads like a directory of who's who in American life and industry. They studied this question at length.

They not only arrived at the conclusion you mentioned, but they arrived at the conclusion that this problem would never be solved if only the individual resources of the States are available to deal with it.

I think I would like to generalize here. I know of no national commission that has comprehensively and seriously studied this problem that has not come out with the conclusion that this is a problem that can be dealt with only on a national basis. There will be literally millions of children within the Nation denied even the most meager educational opportunity so long as each individual State's resources alone are behind the education of her children.

Now, I want to point out again the significance of the lower part of this profile [referring to chart 1], what comes from the slums of

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