Is Universal Preschool Beneficial? An Assessment of RAND Corporation's Analysis and the Proposals for California
Publication Date: May 2006
Publisher(s): Reason Foundation
Proposition 82 would entrench a $2.3 billion per year government-run universal preschool program into state law. The Proposition 82 effort was launched on the heels of the RAND Corporation's March 2005 study, The Economics of Investing in Universal Preschool Education in California. The RAND study paints an extremely optimistic and rosy picture about how government-run preschools would benefit society, concluding that they would generate "between $2 and $4 in benefits for every dollar expended." This report assesses RAND Corporation's cost benefit analysis and finds that it significantly overestimates the upsides and drastically underestimates the downsides of universal preschool and the California proposal. Using RAND's own data and alternative assumptions based on the studies they reference, it is easy to demonstrate that universal preschool generates losses of 25 to 30 cents for every dollar spent. And these losses are calculated before including any of the additional universal preschool program costs that RAND ignored in its analysis.