WHY REDISTRIBUTION DOESN'T WORK

In 1984, the Texas state legislature passed House Bill 72, which was meant, among other things, to make public school finance among school districts in the state more equitable. The legislation added a billion dollars to state educational funds and created redistributive mechanisms for allocating state aid. In spite of these significant efforts, finances among the districts are found not to have been substantially equalized. This article argues that the barrier to equalization lies in the division of educational funding between the state and the local districts, and the failure to dismantle the local reliance upon the property tax. Data are presented to demonstrate the tendency of wealthy school districts to increase local expenditures when confronted with redistributive programs at the state level. Further analysis indicates the persistence of local property wealth as the best single indicator of district expenditures.