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11:00 PM, Feb 9, 1997 • By CHESTER E. FINN JR.
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YOU DECIDE: Which is doing a better job of public education, Arizona or Kentucky? Similar numbers of children attend school in the two states. About a quarter of them live in single-parent families. Arizona has more minority youngsters, but Kentucky has more below the poverty line. On the National Assessment of Educational Progress in 1992 and 1994, the two states had nearly identical (low) scores. Yet Arizona spends a thousand dollars less per pupil on public education than Kentucky, an overall difference of some $ 400 million a year.

In any report card on state-level education performance, you might suppose that Arizona would fare better than Kentucky, at least earning a higher grade for efficiency. Arizona might also be lauded for its bold, shake-the-system " charter school" program, which in its second year already enrolls 2 percent of the state's youngsters in these innovative public schools, while a question could be raised about Kentucky's cumbersome, hyper-centralized reform plan, already in Year Six yet still reporting flat test scores in middle and high schools.

So one might suppose. But only if one were naive about the priorities of the education establishment, which on January 16 trundled out a bulky new " report card" on public education -- Quality Counts -- that conferred a grade of "B" on Kentucky, "C-" on Arizona.

This 238-page coffee-table-size tome -- laced with ads from textbook publishers, computer firms, consultants, teacher colleges, and school reform projects (including my own Hudson Institute's) -- was written by the staff of Education Week, the country's premier newspaper about K-12 schooling, with funding from two private foundations. Considerable fanfare attended its release, and elected officials throughout the land can expect to see the pages grading their states waved about by school lobbyists during the legislative sessions now beginning.

Quality Counts has all the trappings of objective social science. Statistics were gathered on "75 specific indicators." "Thousands of pages of data" were reviewed. Education Week's own ample archives were plumbed. Experts were surveyed (me included). Teachers, principals, and superintendents were polled. And on and on.

The result of all this effort is three different kinds of measure for each state: achievement scores in 4th-grade reading (1994) and 8th-grade math (1992); six letter grades; and a severalpage essay.

The achievement numbers, though lamentable, are solid, based on the widely respected National Assessment, and the authors deserve credit for resisting pressure to adjust those scores by race. As they rightly note, "We can no longer use the excuse of a student's background to justify low achievement." Indeed, when appraising the products of U.S. schools in hard-hitting language such as "rife with mediocrity," Quality Counts lives up to its title.

The test scores, however, are old news. It's the letter grades that are new, that have caught the eye of U.S. educators -- and that will be dangled in legislative drafting sessions and budget hearings this winter. Moreover, because this is the first of a series of annual report cards, these letter grades are sure to be watched in coming years. Voters and taxpayers may reasonably wonder what is being graded.

The answer is mainly school "inputs," especially money. As if to make amends for its tough stance on pupil achievement, nearly all of the report card's other indicators buttress the school establishment's hoary assumptions and encourage its obsession with funding. Indeed, three of a state's six letter grades are tied directly to dollars:

* "Adequacy of resources" blends current per-pupil spending, its rise over the past decade, and the state's "relative fiscal effort," i.e., how heavily it taxes itself to support public schools. (Straight A's to New Jersey, West Virginia, and New York, a lone "F" to Bill Clinton's Arkansas.)

* "Allocation of resources" melds the portion of the state education budget that goes for instruction, the sums devoted to technology, and a measure of how many school buildings are falling down. (No "A"s here. "B"s to Georgia, Indiana, Tennessee, and Virginia. "F" for Alaska.)

* "Equity of resources" tracks the uniformity of per-pupil spending across the state's school districts. (Hawaii, which is all one district, naturally gets an "A" as does West Virginia. The lowest marks are "D"s for California, Rhode Island, and Texas.)