Wednesday, March 30, 2016

The Undeniable Case for School Choice

When it comes to public education, just about everyone accepts that some level of government (local, state, or federal) needs to be involved. There are probably many different reasons for this opinion, but the leading justifications seem to basically fall within one of three buckets. Two are based on emotional or moral considerations, while the other is rooted in economics. Broadly speaking, I think they can be summarized as follows:

  • Emotional: It's for the children. Right up there with veterans, children are probably about the most popular group that a policy can favor. No one wants to raise taxes to bail out a bank, but just about everyone might be willing to support the children. Most voters have children or at least young relatives, and supporting them, through the government or otherwise, is seen as an almost indisputably good thing.
  • Moral: Equality of opportunity. A good education can be a gateway to an economically prosperous future. If education was left to the whims of the market, the people who are born poor, through no fault of their own, would have a lower chance to succeed than everyone else. Thus, public education is, at least theoretically, an excellent way for government intervention to even the playing field. (In practice, unfortunately, public schools in poor areas have still proved to be markedly worse than public schools in affluent areas.)
  • Economics: Positive Externalities. We all benefit from living among a well-educated population in many ways. For instance, well-educated people tend to make more money, meaning a larger tax base for the government and either more government programs that may benefit us (infrastructure, etc.) or a reduced tax burden on each of us individually. Additionally, we stand to benefit from the new businesses that educated people may create or the existence of an able workforce. And, the depressing presidential election notwithstanding, an educated population will tend to make better decisions about politics, leading to a more competent and less onerous government. We would all benefit individually from these things even if we had no hand in providing it. Thus, some economists would suggest that education produces what is known as a "positive externality" in economics. That is to say, there are some benefits from the educational transaction (between student and school/teacher) that accrue to third-parties external to the transaction. Since some of the societal benefits of education aren't captured by the person paying for the education (the student or their family), the idea is that we would have less education in society than would be ideal. (This concept also works in reverse for negative externalities like pollution. The polluting factory imposes a cost on the society. But because the polluter and its customers might not have to bear the full costs of that pollution (which are largely born by the local population), it follows that the factory would pollute more than what we might think of as the social optimum.)
Depending on who you ask, some economists might describe this phenomenon--where too little education or too much pollution is generated relative to social preferences--as an example of market failure.* They would therefore advocate government intervention to step in and set things right.
For many people, these arguments, individually or in combination, clearly justify the need for public education spending. Typically, this also translates into support specifically for public schools and teachers. Endorsing public education spending and supporting public schools are seen as two parts of the same whole, but they are not.

All of the arguments advanced above only justify the need for public funding of education. They say nothing at all about public administration. We confuse these concepts at our peril.

When it comes to administration of education, we should all want the most efficient and effective** system we can get. It's possible that that will be a government-run school system. It's also possible that privately administered schools competing against one another will develop a superior model. Given our knowledge of how well competition tends to work in other industries, I personally suspect the private schools will tend to outperform, especially for poorer students. But before we try both models, we can't know in advance which schools will work better. And we also should not assume that we know what features are most important to individual students and parents. To figure that out, we need to empower those students and parents to make their own education choices.

Put another way, we need to have school choice.

I realize that may seem like a loaded phrase to many. Particularly on the left, the idea of school choice is very taboo. It can be seen as a terrible cocktail of empowering private education corporations, encouraging flight from poor (mostly minority) schools that are already struggling, and an assault on teachers to boot. For example, this article covers much of that ground.

However, a new article from the Foundation for Economic Education makes a powerful, intuitive case in favor of school choice. Under the school choice model it envisions, private schools would be allowed to compete alongside public schools for student enrollment. If a student decides to enroll in the private school, the money that would normally be allocated to the public school per student, gets sent instead to the private institution. Thus, the model is still publicly funded, but now there is an element of competition. Common sense suggests this should be the best solution for all of the concerns that matter. If the public schools are superior to the private schools, then students and parents will continue to use them and private schools won't stay in business for long. But if the private schools are preferred, then students and parents get an educational experience they prefer to the one available now. If education is really a priority, this is a win-win, no matter what part of the political landscape you hail from. Here's the full piece:

Public Education is Superior and Must Be Protected from Competition

*Though it's not relevant to the discussion at hand, I should clarify that I don't subscribe to the idea that government intervention is required in either of the examples mentioned here. In the case of education, the problem is essentially a slippery slope-style argument. If one accepts the idea that the existence of a claimed positive externality is sufficient to justify government intervention, there's almost no end to the things that could be justified in this same name. For example, there's a positive externality to living among healthy people--this could justify government intervention in healthcare. Parks generate public externalities--so maybe government should be able to use eminent domain to build a park and increase the overall social welfare. And so on. You get the idea. Validating the idea of public externalities as a case for government intervention puts us on a path to a government that can do almost anything.

On negative externalities, the argument is generally based more on property rights. This can't solve all cases, but a stricter enforcement of property rights is adequate to solve many environmental externalities. See this video on the Coase Theorem for more information if you're interested.

**It's almost certain that some readers will want to quibble with the definition of effective education and perhaps also suggest that private schools will be inferior on this count. Thus, allow me to clarify what I have in mind when I say effective--whatever individual students and parents deem to be best for their circumstances. And I know, it's at least conceivable that that could mean a child going to a private religious-based school where the biology textbook of choice is the King James Bible. (Not that there's anything wrong with being a Christian--just using an extreme example.)

But no matter how wrong we might think that is, it is very difficult to justify substituting our judgment or, in reality, a random bureaucrat's judgment, in place of the parent's and student's judgment. On what grounds can we claim to know more about their circumstances and needs than they do? Because we read a survey in an academic journal somewhere? Because Finland had some good test scores recently and they do x? I would suggest there's a very high burden of proof here, and it rests squarely on those who want the government to make other people's decisions for them.

Moreover, a government that can impose the "right" decision on the curriculum across the board can also impose the "wrong" decision on curriculum across the board. And for every case where there's a private religious school teaching students something harmful about sex ed., science, etc., I bet I can find at least one example where an American state or local government is trying to force a similarly crazy idea on all students under their jurisdiction.

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