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California is experiencing an educational paradox, according to Herb Morgan, a candidate for state controller — the state’s chief fiscal officer, accountant and auditor.
The Golden State, Morgan said, has spent billions of dollars educating public school students but has failed to boost educational outcomes despite the influx of taxpayer funds.
California’s K-12 education funding rose from $97 billion in 2019 to $151 billion for the current budget cycle, said Morgan, who tracks and lists state expenditures through his “California Radical Transparency” website, a political and financial oversight initiative designed to track and decode state spending.
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Herb Morgan, a candidate for California controller, speaks at an affordability town hall at Hotel Zessa in Santa Ana, Calif., on Wednesday, March 18, 2026. Morgan heavily criticized the spending of billions of dollars on California public schools, despite worse student outcomes. (MediaNews Group via Getty Images)
Per-student spending jumped from $16,300 to $27,400 over that same period, said Morgan, an investment professional.
“Why is it if we’re spending all this money, why aren’t we getting the results? It’s because we have a broken accountability feature in state finances,” Morgan told Fox News Digital.
The disconnect between funding and classroom outcomes is not a lack of resources, Morgan said, but a breakdown in financial accountability at the state level, which he said allows billions of dollars to vanish into local bureaucracies without proper oversight.
He noted several instances of alleged financial mismanagement and fraud schemes involving schools and school districts: the A3 Education Charter Network, where $400 million was allegedly diverted from the state by inflating enrollment numbers; the Scale Leadership Academy, where a founder was charged with siphoning $16 million in public funds; and the Magnolia School District in Orange County, where a former financial executive embezzled $17 million.
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Students head to class after returning from summer break at Anaheim High School in Anaheim, Calif., on Wednesday, Aug. 10, 2022. (MediaNews Group via Getty Images)
In July, incumbent State Controller Malia Cohen praised the signing of legislation to strengthen financial oversight of California’s local educational agencies.
“Every dollar intended for California’s students should reach the classroom and not lost to fraud, waste, or abuse,” she said at the time. “Public trust depends on strong financial oversight, and this legislation gives California better tools to strengthen accountability, improve transparency, and detect fraud before it diverts resources from the students who need them most.”
Students in Lindsay Rachal’s class listen to Garden Grove Unified School District Superintendent Gabriela Mafi at Rosita Elementary School in Santa Ana, Calif., on Thursday, Feb. 12, 2026. (MediaNews Group via Getty Images)
Meanwhile, California trails states with significantly lower budgets. Mississippi spends around $12,000 per student, amounting to less than half of what California spends per pupil.
However, Mississippi reports higher average standardized test scores in 4th and 8th-grade math and reading, according to data from the National Assessment of Educational Progress (NAEP).
Still, Morgan criticized Cohen and her office’s oversight record.
“It’s a lack of desire. But more than a lack of desire, it’s just a lack of skill,” he said. “Running the fourth-largest economy in the world is a big, big job.”
Fox News Digital has reached out to Cohen’s office and the California Department of Education for comment.
Given the rise of artificial intelligence, Morgan said, AI-driven oversight can eliminate fraud across California’s massive state budget.
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“The state controller has the constitutional authority over any recipient of state money, as far downstream as it goes,” he said. “We don’t need to look for needles in the haystack anymore. We just reach in and pull out the needles.”
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