Do we really need someone in Sacramento writing three paragraphs in the California Education Code containing 1,132 words that lay out the rules for school field trips? How about state approval of lesson plans for farm labor vehicle training? Of course not. And from these, we see an opportunity to break the gridlock in our state capital. Sacramento is awash with discussions of deals about the budget (though apparently, despite the talk, there is no deal). The proposals generally involve pain from cuts in resources for many programs and services that is "balanced" by pain from increased tax rates. Not surprisingly, many legislators have been reluctant to sign on to such "deals." The negotiators, and the public, do not see how their lives are improved through the proposals. So we are left with the unwelcome choice between an unsustainable fiscal condition for the state that leaves our future in doubt or further cuts that seem unacceptably draconian. We offer a real deal: Our children are our future, so Part One of the deal must be improving the quality of K-12 education, because California rates 47th in student achievement out of the 50 states. We also have a stubborn state budget deficit, and the main word being used in addressing it is "cut." A better term for Part Two of the deal is "reform." When one makes that change, the money will be there. Close the deal by avoiding the drag on the economy of higher tax rates, because the state's long-run fiscal health depends on economic growth. How can this deal be put together? Nobody doubts that teachers in classrooms determine the quality of education for California's children. But, if you look at kindergarten through 12th-grade spending in California, you see that a very large proportion of the money does not go anywhere near students. More than 30 percent of funds appropriated for schools never makes it within sight of the classroom, according to the state Department of Finance, but instead is siphoned off by bureaucrats, administrators and ancillary personnel in Sacramento, in the counties and in school district offices. What if we simply eliminated these noninstructional activities? By conservative estimates, this outside-the-classroom spending amounts to more than $15 billion, enough to close the budget gap. We need to consider just what results from this spending. First, there is the drag on achievement that is introduced by the enormous army of non-teachers. Start with the Sacramento cadre. They have to show that they are doing something with their time, so they use the one device they have - writing more regulations and making sure that the school districts heed the regulations. In addition to constraining what each district does, these rules require an army of district counterparts to monitor compliance. These rules apply to the 1,000 school districts in California. Who actually thinks that they can write a set of rules that will work in Los Angeles with its 700,000 students and in the rural districts, many of which have fewer than 100 students? There is an endless number of crazy regulations like those on field trips and farm vehicle training. Arguably, some are worthwhile, but that does not mean that the state should try to control them from Sacramento. These are not even the important issues. The education code also describes the background, employment conditions and responsibilities of virtually everybody who walks through a school door. This might make sense if the required credentials really identified effective teachers, good principals and productive school personnel, but they do not. Moreover, the local labor markets vary greatly. Let principals have the ability to judge the competence and quality of incoming and incumbent teachers. Their judgments, based on performance in the classroom, will yield results that are clearly superior to what comes from a rule-based system. An essential element of the deal is striking down the dysfunctional regulatory structure. Tell the schools what they are supposed to accomplish and hold them responsible, but do not try to tell them how to accomplish their mission. Now, you say, we really could not eliminate everybody outside of the classroom. When we turn responsibilities back to the schools, we need to hold schools accountable for student outcomes. So a system of accountability needs to be in place, administered at the state and district levels, with metrics that are understandable and available to parents. We also may need a few experienced hands who can advise school principals. So, to be conservative, let's leave a little money there for the accountability (and for the reporting that the bureaucrats in Washington require). Then let's close the deal. CLARIFICATION Education reform is key to solving budget crisis, Insight, April 10, F6 Due to editing, the attribution of this figure was misconstrued: "30 percent of funds appropriated for schools never makes it within sight of the classroom." The estimate is the authors' calculations based upon data from the National Center for Education Statistics of the U.S. Department of Education ("Digest of Education Statistics," 2009). The estimate was supported by private correspondence that relayed California Department of Finance data to the authors.