The Debt Ceiling Agreement and Early Ed

The legislation passed by Congress Tuesday raised the debt ceiling by $2.1 trillion and put sizeable austerity measures into place. Though the federal government has set 10-year caps on discretionary spending, which contributes to nearly all federal education and early childhood programs, at this point it’s unclear how the money Congress does appropriate in FY2012 will eventually be divvied up.

As our colleagues at Ed Money Watch explained earlier this week, there will be $2 billion in cuts to nonsecurity discretionary spending in FY2012, then funding will gradually increase over time:

Total discretionary spending in FY2011 was set at $1.05 trillion. That divides into $689 billion in security spending and $361 billion in nonsecurity spending. Of that nonsecurity spending, $68.3 billion was for education, $1.7 billion less than in the previous year.

It’s worth remembering that in the big picture of K-12 education, the federal government only provides 8 to 10 percent of overall funding– the rest comes from states and districts, as well as a small amount of private funds. In 2007-2008, the National Center for Education Statistics estimated that the country spent $599 billion on K-12 education overall– far more than that year’s total federal expenditure for the Department of Education, Health and Human Services, and other nonsecurity discretionary spending programs combined. But with many states currently feeling pressure to trim their budgets, federal dollars are now more important than ever. Preschool budgets vary immensely by state, so depending on a given state’s economic conditions, the sources of its pre-k funding, and the size of it’s preschool programs for low-income kids, cuts to federal programs like Head Start could have a major impact, or less overall impact if the state is in a position to compensate for that cut.

One caveat in the spending caps is that they can be adjusted to allow for extra funding to Medicaid and the Child Health Insurance Program (CHIP), placing both programs in a more secure position than others.

As Ed Week‘s State Ed Watch blog reported, the nation’s two largest teachers unions, the American Federation of Teachers and the National Education Association, have both expressed some concern over the debt ceiling deal, though NEA president Dennis Van Roekl also said yesterday that he is pleased the agreement granted temporary reprieve for Pell Grants, Medicaid, and Social Security.

Meanwhile, Congress is expected to get underway with the FY2012 budget when they return from recess in September. Check back for details on what’s coming for education and early childhood programs as they emerge.