education in a publicly funded common school, but they also believe in freedom of mobility in a way that allows affluent Americans to live together in locales able to easily support good schools and that tends to concentrate poverty and disadvantage, often in urban areas. Most Americans believe that all children should be taught to high standards, but they also believe that schools should be local institutions governed by local preferences. None of these commitments is unworthy, and each has a claim for attention. But given these conflicting values, no model of either the finance system or of the education system as a whole could ever be consistent with all of them.

Despite these basic features of the U.S. education system and the competing values within which it is rooted, the committee concludes that the finance system can and should be changed in ways that will align it better with the broad objectives of fairness and school improvement. When making such changes, the challenge is to balance differing values in a thoughtful manner. The following sections highlight our conclusions about the major directions in which the system should be pushed.

FOCUSING ON ADEQUACY

In the committee's view, the emerging concept of funding adequacy, which moves beyond the more traditional concepts of finance equity to focus attention on sufficiency of funding for desired educational outcomes, is a useful step. At the same time, it poses risks. In addition, although adequate funding may be a necessary component of a finance strategy designed to promote goals of higher overall achievement and reducing the nexus between student achievement and family background, it must be combined with other strategies designed to increase achievement.

The concept of adequacy is useful first because it shifts discussion away from inputs to educational outputs and promotes discussion of how much money is needed to achieve selected ends. Thus, when policy makers determine education budgets, attention to adequacy should shift the discussion away from how much revenue is available to the educational outcomes that they are trying to achieve. Second, the adequacy concept could drive the education system to become more productive by focusing attention on the relationship between resources and outcomes. It will encourage policy makers and managers to ask whether existing resources are being used effectively toward the goal of higher achievement. Third, it could potentially drive the system to a more equitable pattern of educational outcomes by focusing attention on the current inadequacies at the bottom end of the resource distribution.

Nonetheless, the adequacy approach is not without challenges and pitfalls. The challenges include defining what is adequate, extending the concept to units smaller than the school district, and balancing adequate funding for education with demands to ''adequately" fund other worthy objectives. Pitfalls include the



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