Karl Borden and Edward A. Rauchut are senior research fellows at the Constitutional Heritage Institute of the Nebraska Center for Public Policy in Omaha.
Here in Nebraska, such arguments hold less appeal for a state with many small school districts and a population largely satisfied with the performance of its government schools. Even in our two major urban areas, the Omaha and Lincoln school districts get generally high marks from local residents and display few of the characteristics of the urban battlegrounds that New York City, Los Angeles, Jersey City, N.J., and others have become.
What is more, discussions of school choice that dwell on the failings of our schools, while often appealing on a visceral level, miss the real point of privatization, and along the way also manage either to alienate or leave behind many would-be supporters of privatization efforts. These litanies of the schools’ failings also alienate many hard-working and capable professionals, making political enemies of the possible allies who labor within a system that, by its very nature, stifles initiative and ability. In the same way, we leave behind many citizens who, by and large, are satisfied with their government schools and see little reason to change them.
But the real reason to develop a private alternative to our government education system is not that the present system is universally abysmal. It is not. The reason to privatize is that, no matter how good a government system is, everything we know about how organizations work in a free market economy tells us that a competitive, private system would work better.
The empirical evidence of the superiority of competitive markets as the organizing principle for the conduct of a nation’s business affairs is at this point in our history overwhelming, and there are today few in the world who have not recognized that free markets consistently outperform command-and-control, centralized economic systems by virtually any measure. But while there may today be broad public recognition of the free market’s victory over socialized systems, there remains a general ignorance of the reasons for that success. Failing to understand why free markets work where socialized systems do not, we too often fail to generalize the implications of that success to other elements of our culture, our schools included.
Free markets work because they function in harmony with fundamental economic laws that constrain human behavior. An engineer designing a suspension bridge understands that his design is constrained by the fundamental laws of physics. That there are equally valid, and equally immutable, laws of economic and organizational behavior is less well understood. But just as we create better bridges when we work in harmony with the laws of physics, so, too, we can create better schools if they are designed in harmony with the laws of economics.
Two fundamental economic concepts serve as a conceptual foundation supporting educational privatization: the “diffusion of knowledge” and the “inevitability of uncertainty.” An understanding of these two concepts helps explain why the most effective educational system cannot have as its model the present government educational monopoly.
With reference to the diffusion of knowledge, the essential characteristic of a modern society is not the centralization of knowledge, but its transmission throughout the globe. Knowledge is found everywhere. Data surround us. The mass of information with which each of us is confronted daily surpasses that which the most educated person a hundred years ago would confront in a lifetime.
Centralized bureaucracies, relying on one-size-fits-all approaches to decisionmaking, are inherently incapable of amassing, processing, and deriving decisions from the sea of data that surrounds us. And contrary to the bureaucrat’s belief, there is no one, right way to construct a school curriculum. Just as it is impossible for a committee of educational professionals in Washington, or even in Lincoln, Neb., to decide for every family, for every child, which textbook is best and which lesson plan is most effective.
Just as knowledge is diffused, so our responses to it must be diverse. And this is precisely why free markets work best. Private markets, relying on competitive approaches to meeting an infinite diversity of individual tastes and values, allow individuals to make choices based on their own knowledge of what is best for themselves and their children. And private markets inevitably provide responses to a greater diversity of tastes and priorities than do central bureaucracies. Government schools are like the former Soviet Union trying to manufacture automobiles. The Soviets, equipped with their command-and-control economic system and centralized knowledge base, reasoned it would be better and more efficient to make just one kind of car for everyone. The result was the Trabant, a noisy, smelly, underpowered, and ugly plastic body that survived in the marketplace less than six months after citizens were given transportation choices that our free markets produced.
It is time to trade in our educational Trabant.
Regarding the inevitability of uncertainty, just as it is not possible to know everything that is, so it is not possible to plan with certainly for what will be. That the future is unknown is inherent in our universe, and centrally planned approaches to organizing human behavior and institutions inevitably make the mistake of charting but a single course into the future.
Whether it is the federal government attempting economic planning on a grand scale, or the local school district trying to predetermine where to build the next $25 million educational superstructure, governments have a historical tendency to assume the future will be like the past and to place the public’s eggs in a single basket of plans for tomorrow.
Private markets work differently. They open the door to change, innovation, redesign, imagination, and experimentation to anyone with the daring to try something different and the talent to attract an audience. Competition takes us into the future with a myriad of alternative answers to questions we haven’t even asked yet, while central planning designs solutions to yesterday’s problems. It is not by accident that the United States has produced the lion’s share of the world’s Nobel laureates, or that free enterprise economies lead the globe in technology and science. When the future presents a challenge, it is met in the marketplace with a thousand responses. Not all of them work. But not all of them have to.
Offering parents the choice of private or government schools, and empowering that choice with a voucher, is not the jump into the void that choice opponents characterize. Nothing could be further from the truth. A dispassionate look at the economic and organizational systems in the world that provide an astonishing array of goods and services to our species cannot avoid the conclusion that diffused decisionmaking systems work, and that central planning does not. Competition is a necessary element of any system of enterprise. And only a free market can provide for the diversity of product and ideas capable of generating true innovation and responding to a rapidly changing world.
And what is more, while we can predict with certainty that the educational services produced by competition will be better than those produced by a government monopoly, we cannot predict what the nature of those services will be. If this sounds like a contradiction, it is not.
Could anyone in 1980 have predicted the range and diversity of telecommunication services that the competitive long-distance market offers today? Could anyone have even predicted the telephone design alternatives available since the government ended Western Electric’s monopoly on the phone-manufacturing business? We have seen the same phenomenon repeat itself in every instance of the release of an industry from government-regulated monopoly or oligarchy. From trucking to airlines to energy, competition has produced products and services that no government regulator or monopolistic provider had anticipated.
That ability to respond to an uncertain future with impossible-to-predict solutions is what will produce a private educational market with an array of services that cannot be foreseen. What will the private schools of the 21st century look like? How and where will teachers teach? What kinds of materials and techniques will they use? How a free market will respond to these questions is unanswerable today. We can no more predict the answers than we could have predicted cellular phones in our back pockets back in 1980.
There is, however, one thing we can say with certainty: A privatized system of universal education, based on the fundamental laws and principles of free market economics, will outperform our current socialized, centrally planned educational system.
Ultimately, however, as Denis P. Doyle noted in a recent study on where present-day government-school teachers send their own children to school (“Where Connoisseurs Send Their Children to School,” 1995), the instrumental economic argument will often make little progress in the face of overwhelming ideological and bureaucratic opposition. We conclude, therefore, by joining Mr. Doyle in his moral imperative: “No matter how one examines the data, teachers and their organizations owe the public an answer to this question: If they reject the institutions in which they are teaching and feel free to choose a private alternative, on what basis should the poor and dispossessed be denied this option?”
Why, then, should we support parental choice? In the final analysis, as Denis Doyle concludes, “it is the right thing to do.”
