Bang for the buck has been declining for decades in American public schools. We spend at record levels, employ vast numbers of people, but student test scores have been stubbornly flat.

At the Goldwater Institute, we released a blueprint for a new school model that hopes to reverse this trend. Our roadmap, “New Millennium Schools: Delivering Six-Figure Teacher Salaries in Return for Outstanding Student Learning Gains,” scraps many current practices and focuses financial resources on what research shows makes a difference: attracting and keeping high-quality teachers in the classroom.

In response to an online news story last year, a Nevada elementary school teacher left a telling comment: she had 34 students in her classroom and she was angry.

Total revenue generated by this classroom, at $11,000 per child, was $374,000. Assuming the teacher has a total compensation package of $60,000, the question becomes, what did the school district do with the other $314,000?

That, in fact, is what she’s angry about. Her school has eight teachers in “non-classroom assignments.” These “teachers” are in addition to the administrators, paraprofessionals, specialists, and assorted others who work in schools but actually don’t teach. Whatever these people do doesn’t seem to be helping children learn: 43 percent of fourth-graders in Nevada can’t read at fourth-grade level according to national tests.

Other countries manage their schools much more effectively than America. In “How the World’s Best Performing Schools Come Out on Top,” the international consulting firm McKinsey & Company found the answer is to focus on teacher quality.

In South Korea, for example, schools have average class sizes twice as large as the United States, 49 versus 23, but score 21 percent higher on international seventh-grade math tests.

What might help explain that unexpected result? South Korean schools draw from the top 5 percent of college graduates. American schools, by contrast, recruit their teachers, on average, from the bottom third of college students.

How do South Korean schools attract the top university students? Money. Larger class sizes frees up the resources to pay South Korean teachers much higher salaries, drawing the best and brightest into the profession. If American schools paid veteran teachers as well as South Korean schools do, teachers would average more than $116,000 in annual salary.

America must stop the decades-old practice of emphasizing the quantity of school employees and replace it with a rigorous focus on the quality of each teacher.

A growing body of research shows that the skill level of individual teachers is by far the most important factor in determining how much students will learn. Students with high-quality teachers have been found to learn 50 percent more of any given subject than those with low-quality teachers for three years in a row.

This same research shows that America’s current limited-supply of high-quality teachers are clustered in suburban schools. What this means is that the students who need access to a high-quality teacher—inner-city, low-income children—are least likely to have it.

Teacher quality literally makes the difference between literacy and illiteracy for many students.

The evidence is clear: teacher quality is far more important than small variations in class size. So every child needs access to high-quality teachers. Our solution: identify high-quality teachers by measuring how much their students learn during a school year, pay them what they deserve, and give more students the opportunity to learn from them.

With schools around the country facing teacher lay-offs because of state budget deficits, is now really the time to call for increasing teacher salaries? Absolutely. Former Florida Governor Jeb Bush describes American public schools as an 8-Track in an iPod world. There is more than enough money in the system to reward outstanding performance with outstanding compensation. There’s never been a better time for schools to identify and let go their worst performing teachers.

“New Millennium Schools” proposes giving high-quality teachers a bonus for each additional student they add to their classroom. The bonus would amount to two-thirds of the per-pupil funding that the school receives.  Using Arizona’s funding for charter schools, which is modest by national standards, this would give teachers a $5,200 bonus per-child above a class size of 20. A teacher with a class size in the low 30s, about the same as when the baby-boomers went to school, would make six figures.

Six-figure teacher salaries would not only allow schools to properly reward the long-suffering, high-quality teachers already in the classroom, but also to recruit the most capable and ambitious college students.

A school’s job is to equip children with the academic knowledge and skills they need to succeed in life, not employ as many adults as possible. It’s time to focus resources on quality and give rock star teachers rock star pay.

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Matthew Ladner, Ph.D. is Vice President for Research at the Goldwater Institute.