Let’s Not Lose Sight of a Real Education Market

Over the last few days Jay Greene, the Fordham Institute’s Kathleen Porter-Magee, and several other edu-thinkers have been arguing about whether national curriculum standards would destroy a competitive market in education, and a market that already provides the uniform standards Fordham wants Washington to impose. But let’s be very clear: We haven’t had a real market – a free market – in education for a long time.

Sadly, I’m afraid Jay started this whole mess, though he certainly knows what a free market in education would look like and I don’t think he intended to confuse the issue.  Indeed, he doesn’t use the term “free market,” but mainly writes about the “competitive market between communities.” His argument is that Americans over time picked standardized curricula and schools by moving to districts that provided such things. He is no doubt at least partially right, though the case is hardly open and shut. Indeed, there is strong historical evidence that district consolidation and uniformity was often pushed on small districts from outside, especially in urban areas. It is also quite possible that many people moved to districts with uniform offerings not in search of such offerings, but in search of something else that happened to coincide with them. Most notably, industrialization brought many people to cities in search of employment, and school uniformity often came with that. Finally, the economist whose work inspired Jay’s post notes that while he believes small rural districts died largely due to residents abandoning them, he concedes that there is a “lack of direct evidence connecting rural property values with local decisions about consolidation.”

Those caveats aside, Jay’s point is a still good one that I have made before, most notably when discussing schooling and social cohesion: People will tend to have their children learn many ”common” things because that is the key to personal success. People will learn what they need to in order to work effectively and successfully in society.  Moreover, people will simply tend to gravitate toward things that work.

So the main problem in the Greene-Fordham debate is not that Jay’s points are necessarily wrong, it’s that “competitive market between communities” is too easily misconstrued as “free market,” and it fails to acknowledge the gigantic inefficiencies that come from government monopolies, whether controlled at the district, state, or federal level. Those include the massive, expensive waste that fills the pockets of special interests employed by the system; constant conflict over what the schools will teach; and at-best very ponderous competition – if you want a better school you have to buy a new house – that quashes crucial innovation and specialization. Worse yet, it leads to the following kind of crucial, damaging misunderstanding by Porter-Magee:

For more than a decade we have been conducting a natural experiment where we let market forces drive standards setting at the state level. The result? A swift and sure race to the bottom. A majority of states had failed to set rigorous standards for their students—and had failed to create effective assessments that could be used to track student mastery of that content. In fact, the whole impetus behind the Common Core State Standards Initiative was to address what was essentially a market failure in education.

This is wrong, as they say, on so many levels!

First, we do not have real market forces anywhere at work in the current, NCLB-dominated regime. Using the quick list of market basics that John Merrifield lays out in his Policy Analysis on school choice research, a truly free market needs ”profit, price change, market entry, and product differentiation.” None of these are meaningfully at work in public schooling, with profit-making providers at huge tax-status disadvantages; public schools artificially “free” to customers; high legal barriers to starting new institutions that can meaningfully compete with traditional public schools; and requirements that all public schools teach the same things, at least at the state level. 

Moreover, if you want to talk about competition between states – which is more in line with what Jay was discussing – under NCLB all states have faced the same, overwhelming incentives to establish low standards, weak accountability, or both: If they don’t get their students to something called “proficiency” – which they define – the federal government punishes them! In light of that, of course they have almost all set very low “proficiency” bars. But that is about as far from “a natural experiment where we let market forces drive standards setting” as you can get! Indeed, it is a brilliant example not of market failure, but government failure!

Ultimately, Jay’s point is right: People on their own will tend to select educational options that are unifying, as well as gravitate to what appears to work best, so there is no need for the federal government to impose it. Moreover, as Jay points out, there are huge reasons to avoid federal standardization, including that special interests like teachers unions will likely capture such standards. But that problem has been at work with state and local monopolies, and it, along with myriad other government failures, will not be overcome until we have a real market in education – a free market in education.