From President Clinton on down, cutting class size is a hit among politicians of almost every stripe. Despite spending billions on class-size reduction at the federal, state, and local levels, recent evidence suggests policymakers should have focused more attention on smaller schools, not smaller classes.

Last year, the centerpiece of the president’s education agenda was his plan to hire 100,000 new teachers, with the goal of having 18 children per classroom in grades K-3 all across the nation. To satisfy the administration’s wishes, Congress doled out $1.2 billion to school districts for the current academic year, part of a larger $12.4 billion plan over seven years.

Many Republicans, eager to appear education-friendly, went along with the plan. Supportive Democrats were able to assuage their teacher union allies, who were thrilled at the prospect of welcoming thousands of new members. While lawmakers congratulated themselves, they forgot to mention that federal funding to pay for new teachers was cut off after three years. In California, more than half of the state’s districts did not receive enough money to hire even one additional teacher.

While the White House insists that smaller classes are the answer, the evidence tells a different story. Currently, the average classroom in the U.S. has 23 students. In Taiwan, South Korea, and Japan, all countries where student performance outpaces the U.S., average class sizes are 44, 39, and 36, respectively. Since 1961, average class size here in the U.S. has dropped from 30 students, while test scores and other indicators of academic progress have worsened. In fact, in the definitive study on the effect of class size on student performance, Dr. Eric Hanushek found that in 85 percent of the cases he examined, there was no positive relationship between smaller classes and increased learning.

While President Clinton seems to have ignored these facts, Education Secretary Richard Riley made an important observation during his annual Back-To-School Address this year. He stressed the “need to create small, supportive, learning environments that give students a sense of connection. That’s hard to do when we are building high schools the size of shopping smalls. Size matters.”

Mr. Riley is on to something. In 1940, there were 200,000 elementary and secondary schools in the United States. Today there are 62,000. Average enrollment has jumped from 127 students to 653 per school. The trend toward consolidation was cemented during the 1960s. Advocates believed larger schools would benefit from economies of scale, and average per student costs would decline. Larger schools would allow for students to specialize in certain areas. Unfortunately, the payoff to students in bigger schools never materialized.

Studies across the country have found that smaller schools, usually between 200 and 800 students, have higher graduation rates, fewer dropouts, higher achievement, and more parental involvement. In California, where Governors Wilson and Davis have spent $4 billion on smaller classes while performance continues to worsen, a recent study by three economists at Claremont McKenna College finds that the probability of a high school doing poorly on state-sanctioned testing increases dramatically as its size grows from 200 to 800 students. Another study, this one of New Jersey schools, finds that size was the most crucial determinant in student outcome after income status.

More important, several studies confirm that small schools have a strong positive effect on low-income students. In New York, a recent push to establish smaller schools has resulted in 200 so far. In Chicago, Superintendent Paul Vallas has launched an initiative where each large urban high school is subdivided into smaller schools that focus on different academic subjects. New York’s small school program is similar. Poor-performing schools are broken into smaller components, each with its own principle and staff. The Annenberg Foundation has recently given $25 million to support the drive for smaller schools in New York.

Most research suggests simply decentralizing large schools into smaller ones, and letting innovation flourish. However, the drive for small schools is yet another weapon in the arsenal for choice. Across the country, private schools operate at 60 percent the size of the average public school. One of the biggest assets of many private and parochial schools is their small size and nurturing environment, precisely the qualities Secretary Riley identified.

If poor students are trapped in under-performing urban schools, as many of them are, parents should be free to choose other options for their children. President Clinton and lawmakers on Capitol Hill should focus on school choice, like the 10-state pilot program recently voted down in the House which would have allowed low-income students to use federal dollars to transfer to better-performing schools. Rather than mandating states to hire more teachers, the federal government should let parents decide which schools are best for their children.

Thomas Dawson is a Policy Fellow at the San Francisco-based Pacific Research Institute. He can be reached via email at tdawson@pacificresearch.org.