There’s still $4 billion in “stimulus” money dedicated to education, and the Foundation for Educational Choice has some ideas for how to spend that money in a way that will produce long-term savings.

A new report by Brian Gottlob suggests that the money be distributed to states for the purpose of creating school scholarships. While “Race to the Top” funding (which has also come out of the stimulus bill) was sold as a way to push school reform, many people, including the foundation’s chief executive, Robert Enlow, say that it has simply gone to prop up existing institutions. A $4 billion scholarship program, by contrast, could be a potent force for reform if it compels public schools to confront the prospects of more students leaving for private schools.

Gottlob says that even after the money runs out (he envisions a 5-year timetable), states could still save up to $1.6 billion a year. That’s because many private schools, contrary to common expectations, actually spend less than public schools. Minnesota could save almost $30 million a year (PDF) on an ongoing basis, more than all but six other states.