Sunday, April 10, 2011

Q & A on Free Market Education - 1

In my article, Toward a Free Market in Education: School Vouchers or Tax Credits, I put forth a parental school choice plan that would initiate a transition from our predominantly government-run school system to a free market. Inevitably, questions would arise. For example, a correspondent on my blog submitted the following (attached to an unrelated post):

“I understand that you are a supporter of free market education, so if you don't mind I would like to ask you several questions with regards to your perspective”.

I’m not sure whether “Michael” is referring to a fully free market or my tax credit program fully implemented. Actually, it’s not entirely clear whether this correspondent is responding to my article at all, but I will assume that Michael has read it and is familiar with my plan. For an in depth look at a fully free market, see Andrew Bernstein, The Educational Bonanza in Privatizing Government Schools (Objective Standard, Winter 2010-11, subscription required).

Under your system, who decides what is taught?
Who decides curriculum across the country?

These two questions are related. We’ll start with an examination of who decides these questions under the status quo. Under our collectivized public school system, central planning government officials decide, such as local school boards or State and Federal Departments of Education. However, their decisions are not made in a vacuum. Andrew Bernstein describes the nature of the process:

[G]overnment schools create irresolvable conflicts regarding curricula, textbooks, and teacher training.

In a mixed economy [a mixture of freedom and government controls], such as America’s, competing interest groups vie to gain control of the [political apparatus], seeking to impose their preferred educational standards on the nation’s youth.

Consider just a few of the conflicts arising from the current American system. Some groups want schools to teach creationism; others want them to teach evolution. Some want schools to teach the “virtues” of socialism and the “crimes” of America; others want them to teach the virtues of freedom and the unprecedented accomplishments of America. Some want schools to teach that America is a Christian country; others want them to teach that America is a secular republic. Some want schools to teach the “look-say” or “whole language” method of reading; others want schools to employ phonics.

Such conflicts follow logically from the coercive methods by which government schools are funded, populated, and operated.

By contrast, private schools entail none of these problems.

Under my transitional plan, those hideous conflicts will continue, but only as it relates to the government-run schools. Any parent employing tax credits under my plan would in effect be opting out, and taking responsibility for what and how his child is taught. Likewise, any educator offering private educational services is left free to decide on textbooks, educational philosophy, hours of operation, teacher credentialling, and tenure policies – any matter relating to his chosen educational mission. In similar fashion to the freer sectors of the economy such as automobiles, food, or computers, the customer – in this case the parent – is free to choose from the variety of educational choices offered by educators competing for his business. Both educators and parents are acting freely and non-coercively. Neither can force their ideas on the other, nor can government bureaucrats or any other third party impose theirs on either. Children receive schooling when parents and educators agree on the terms of a voluntarily contract. Educators will thrive or fail based upon their ability to attract enough parents acting upon their own judgement. Any parent who fails to find a school they deem acceptable is free to use his tax credits to homeschool or hire private tutors.

Who decides curriculum? Someone must, and the choice is clear: either a handful of politically pressured government officials with the power to force their ideas on everyone, or millions of individual parents and educators associating voluntarily and acting on their own judgements in a legally protected atmosphere of contractual freedom. Only the second – the free market – is moral, because force is removed from the educational equation.

How do people of one state, or tax bracket even, ensure their kids get the same quality education as the next state?
It costs more to run some states, and some states have more people and expenditures. Who decides?

These two questions are also related, and really deal with multiple aspects. I’ll break it down.

Who is concerned about getting the “same quality…as the next state” in any product or service they purchase with their money? People typically seek out the best product at the best price they can find that fits their budget. In freer markets, the spread of the best quality products are not – or at least are much less -hindered by artificial state barriers. Products that successfully attract consumers in one state can quickly be offered in others as producers seek to expand sales. Likewise, in a free education market, there are no barriers to interstate education commerce, which means that the best educational institutions can offer their services anywhere. Besides, what if the next state’s schools are inferior? In a fully free national education market, those inferior schools would quickly be replaced with better ones, bringing educational standards up to the best levels available elsewhere. Under my plan, better quality private schools would flourish, and the inferior government schools would shrink as they lose students and funding to the voluntary decisions of more and more parents.

My tax credit plan is most practical at the state level, at least in the short term. Multiple states that adopt tax credits modeled after my plan can form reciprocal agreements so a taxpayer in one state can fund the education of a child of another participating state, if they like. The fact that differing levels of funding or population exist is irrelevant, because under my plan the ETL (Education Tax Liability) and AAC (Average Attendance Cost) governs. For a detailed explanation of how these limits apply, see my article.

As to the issue of different tax brackets, under my plan, there is no tax-subsidized private education. A taxpayer can claim tax credits only up to the limit of his education tax liability. They can only control the money they would otherwise have sent to the government as K-12 taxes – i.e., their own money. Beyond that, they must rely on other income or private philanthropic education scholarships or grants.

Who decides? Ultimately, whether under my plan or a fully free market, those who earned the money in the first place do.

Where does the money come from to start these schools?

Where does the money come from to start any private business? It comes from private investment capital; i.e., savings. Investment capital is not the problem in education. What’s missing is a viable market for private schools. My plan will begin to restore that market, which is currently suppressed by force of the compulsory public school establishment. Empowering taxpayers to take control of their education dollars would unleash an explosion of demand for private educational services and act as a magnet for profit-motivated investors and philanthropists alike.

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