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Last week I criticized the Obama administration’s education funding plans for requiring school districts to spend money on technology, which has a very poor record of improving student learning outcomes. So this week, I should equally give credit where it’s due: the administration’s $4 billion “Race to the Top” fund for education. As Derek Thompson at the Atlantic summarizes it, the funding provides incentives and conditions for meeting standards but does relatively little to dictate to states how they achieve those standards. That’s a great formula for driving innovation—one that has worked very effectively for the X Prize Foundation.

There is one great big catch to this formula though and it’s probably the best part of the Race to the Top fund. To be eligible for money from the fund states must tie teacher and principal assessments to student performance. This would seem a fairly common sense approach to teacher assessment—how else would you measure them?—but shockingly at least two states (New York and Wisconsin) have laws explicitly banning using student performance to assess teachers! In practice most estimates are that 95% of teachers are assessed without any reference to student performance even though it’s not banned.

As we’ve written about before there isn’t yet conclusive evidence that pay for performance for teachers makes a material difference in learning but there is strongly suggestive evidence that this is the case. And it’s especially important to start doing teacher assessment based on student performance because of all of the other innovations and experiments that are changing the way teacher’s are trained. As the Washington Post notes today, enrollment in alternative teacher certification programs, including Teach for America, is skyrocketing given high unemployment. If we don’t measure teachers by student performance then we won’t learn how best to prepare new teachers or how to retrain and equip existing teachers.

The data that begins coming from such assessments should be closely followed by education funders and used to further the experiments that seem to be working. And we should all give credit to the Obama administration for a big move in the right direction.

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