The advocacy groups are already sending up a cry of distress in response to the news that, as The New York Sun reported on Wednesday, Schools Chancellor Klein is considering doing away with District 75, the separate school district that administers special education throughout the city. It’s a battle that other chancellors have either lost or shrunk from. But it would be well worth fighting and winning.

This is one reform that is worth considering simply on the educational merits. A recent book on including special education students in regular schools and classrooms summarized the research by noting that, “In general, students with disabilities in inclusive settings have shown improvement in standardized tests, acquired social and communication skills previously undeveloped, shown increased interaction with peers … and are better prepared for postschool experiences. There is also evidence that inclusive settings can expand a student’s personal interests and knowledge of the world, which is excellent preparation for adulthood. The positive effects of inclusive education on classmates without disabilities have been well documented.”

A 2002 study by Patricia Rea, Virginia McLaughlin and Chriss Walther-Thomas compared the performance of two groups of students. The first group were 36 “learning disabled” middle school students served in inclusive classrooms. The second were 22 similar students in separate “pullout” segregated programs. The 36 students mingled with non-special education students in the “inclusive” program ended up with higher grades, higher test scores, and better attendance.

In the Summer 2002 number of City Journal, a deputy mayor in the Giuliani administration, Anthony Coles, described some of the problems with the current special education regime in New York. The city for the most part segregates special education students from the general population. “Once assigned to special ed, a student has about a 2 percent chance of returning to mainstream education. Yet since 1975 the city’s special-ed population (largely African-American and Hispanic) has grown 370 percent, from 35,000 students to 161,000,” wrote Mr. Coles. Furthermore, it seems that most of the students in the program aren’t disabled as much as they are being simply fobbed off by the school system. Wrote Mr. Coles: “A recent study found that only 15 percent of special-ed students actually met the state’s criteria as being learning-disabled. Many of the rest have been diagnosed with such ill-defined problems as ‘learning disabilities’ or ‘hyperactivity.'”

Some of the special-ed increase is no doubt genuine, the result of decreasing stigmas and better diagnostic techniques. Some of it may be the result of school administrators who realize that special-ed students bring the school system more federal and state funds. In any event, New York, with about 14% of students receiving special education services, slightly outpaces the national level, which is about 11%.

Incidental to the educational benefits of inclusion are cost savings. The extra money that comes into the city for special-ed students could be spent to make things better for everyone, including the special-ed students. Some of the savings from shutting down the segregated special-ed bureaucracy could help bridge the city’s $6 billion budget gap. Experts who have studied the matter in depth indicate that in New York City, there may be as much as $300 million to be saved by this reform. This seems like a lot, but remember, under the current system, it costs the city about $28,810 for every special-education student, compared with about $8,944 for every student that is not in special education.

One of the reasons this reform failed in years past may have been that there wasn’t enough pressure do what was right for the children. But what is in the city’s fiscal interest, in this case, felicitously coincides with what’s in the best interest of the special-education students. While in the past there hasn’t been enough of an incentive to integrate and include children who deserve better than a second-class education, in our current fiscal crisis we can’t afford not to.