Capital Gains Program Promises Cash for DC Students

WASHINGTON, DC (WUSA) -- The idea of money in their pockets excites some District students. Some children already know what they would do with extra dollars. One boy would buy a laptop computer and another student would save his earnings.

"It's good because every two weeks you get paid and put money in the bank," said Anthony Chavis, an 8th grader.

The ability to earn real money for doing the right things at school is a cotroversial idea, but some students at Kelly-Miller Middle School say they are eager to participate in the Capital Gains Program.

"People ain't had money. It's better now for people to have money than not having money," said Christopher Johnson, a Kelly-Miller 8th grader.

DC Schools Chancellor Michelle Rhee joined in a rally to kick off the program at the school in Notheast DC. She approved the pilot program that pays kids to do the right things in school. "The reality for so many of our kids is that there are a lot of incentives to do all the wrong things out on the street, and we believe that having positive incentives for doing the right thing is a good counter balance to that," said Rhee.

About 2,700 middle school students at 14 schools will get the opportunity to earn cash. The 6th through 8th graders at Kelly-Miller can collect up to $200 a month for doing what they should when it comes to prompt attendance, good behavior, wearing uniforms, doing homework and improving academics. Eighth grader Imani Robertson knows what is required to collect.

"Do what I'm supposed to do with my uniform. Do my work. Pay attention. Change my behavior," she said.

An economist from Harvard designed the pilot program to provide more tangible inspiration for children from low-income neighborhoods. Roland Fryer is the principal investigator for Harvard's American Inequality Lab. He says the experiment underway in DC, New York and Chicago city schools provides the kind of monetary encouragement that other children receive in higher income families.

"It's dinner after they get a good grade on a test. Shiney red cars at graduation. They have structured incentive programs in a lot of families. We're just trying to do that for poor kids who don't have the resources to actually do these types of things," said Fryer.

Harvard is covering half the cost of the $2.7 million dollar project. The District will pay the rest. Fryer says if paying students doesn't improve academic performance, he will be the first to admit it. For now, he and Rhee are willing to try new innovations to keep kids enrolled and inspired.

"It's that we can't keep doing the same things we've been doing. I mean education is a crazy industry, right? They say we've been failing these kids every year. Let's just do the same thing again next year. So, the only thing I'm really convinced of is innovation," Fryer said.

The students will get $2 for every point they earn through the incentives program. Individual savings accounts are being established at SunTrust Bank for the cash earners. The bank is also providing money management training for the kids.

"Smart money managers is what we're hoping to build out of this program. We think that when you start early with a discipline that they can acquire through this program, I think it stays with you for a lifetime," said Scott Wilfong, president & CEO of SunTrust Bank, GWR-MD.

Some critics have said paying students to achieve sends the wrong message. However, Rhee points out that only 8% of the District's middle school students are proficient in math and 12% in English, testing statistics she says must change.

"Our kids have the ability to do so much more. I know this...and so, everything that we can do to capitalize on that potential and on the abilities that they have, we're absolutely going to do," Rhee said.