Tag: education

CEOs to Governors: Raise Production Goals and Quality Standards

A group of CEOs called on the nation’s governors this week to raise U.S. business standards. Speaking at the National Press Club in Washington, DC, the CEOs declared that state governments have been misleading consumers about the quality of the goods they’re buying. One retired Fortune-500 CEO declared that:

America’s standing as the most innovative and prosperous nation on earth depends on our ability to boost business’ productivity. As business leaders, we are pledging to stand with governors who commit to high production and product quality standards in scientific and technological fields.

Even today, most readers probably recognize the preceding paragraphs as satirical (I hope!). The idea that it would be helpful to have bureaucrats set production volume and quality standards for high-tech industries is ludicrous on its face. How tragic it is, then, that this event actually took place… with one small twist: the CEOs were calling for more central planning in science and technology education.

Having spent nearly 20 years studying the relative productivity of different types of school systems, it is hard for me to understand how such brilliant business leaders could have arrived at such a profoundly mistaken conclusion. If they care at all about the goals they have set out to achieve, they would be well advised to stop listening to those who are currently advising them, and to look at the evidence on what actually does raise educational productivity. I’ve summarized that evidence in a short piece for the Washington Post, in a journal paper reviewing the past 25 years of worldwide research, and in a book surveying 20 centuries of school systems.

Distilling the findings of that work into a single sentence: it is the freest and most market-like education systems that, throughout history, have done the best and most efficient job of serving both our individual needs and our shared ideals.

Teachers, it turns out, are people. And like other people, they respond to the freedoms and incentives of their workplaces. As a result, the same structures and conditions that optimize the operation of other industries also optimize the operation of school systems. Xerox makes good copiers and Intel makes good chips because they have competitors who will eat their lunch if they don’t; because they have the freedom to explore new and better ways of serving their customers; and because they are rewarded very handsomely for innovations that successfully serve those customers.

Want education standards to rise? Give educators those same freedoms and incentives — and stand back.

No Profile in Courage Here, Either

Yesterday, speaking at Facebook headquarters, President Obama assessed the guts of Rep. Paul Ryan (R-Wisc.) and other congressional Republicans and concluded that their deficit reduction plan isn’t “particularly courageous.” That might be accurate – their plan lacks specificity and could target a lot more for elimination – but it’s pretty rich for the President to throw out such a conclusion. After all, his whole strategy appears to be the bankruptingly lame-but-safe crying of doom for cute kids and other supposedly defenseless people no matter what the size of the proposed cut to a social program or how ineffective the program has been. That, and the constant lamentation that “the rich” – a small and therefore electorally weak group of voters – don’t pay their fair share. (And the constitutionality of federal programs? That doesn’t even get a mention.)

Representative of this cowardly course is the President’s mantra about “investing” more in education-related programs despite blaring evidence that the programs don’t work or, as is the case with federal student aid, actually make the problem they’re supposed to solve much worse. But the President wants votes – like most politicians, he wants lots of people to think he’s giving them great stuff for free – so he’s not doing the mildly courageous thing and telling people “look, these programs don’t work, we have a titanic debt, and I’m going to cut things that might sound good but aren’t.” No, he’s doing things like going to community colleges and, in front of cheering groups of students, talking about mean Republicans and how he wants to protect students just like them by keeping the federal dollars flowing.

That’s no profile in courage, nor is it a responsible way to deal with the federal government’s gigantic problems.

“Winning”

I have an op-ed in the Huffington Post today arguing that it’s possible to ensure universal access to education without compelling anyone to support types of instruction that violate their convictions. This eliminates the central objection that the ACLU and ADL have given for their opposition to private school choice. Indeed, if those organizations really care about freedom of conscience, they should prefer the policy solution I outline to the status quo system in which every taxpayer is compelled to support a single government organ of education. Or is there some other reason why the ACLU and ADL oppose liberating American education?

Feel free to chime-in in the comments section on Huff Po.

Ditching Collective Bargaining Won’t Control Public School Costs. Here’s What Will…

Lawmakers in Wisconsin and elsewhere are seeking to eliminate collective bargaining rights for public school employees as a means of controlling runaway spending (it has tripled in real terms since 1970, despite stagnation or decline in student achievement at the end of high school–see the last chart in this post). But even if collective bargaining is forbidden to state school employees, the savings will likely be negligible.

Surprising as it may seem, that conclusion follows directly from the research on school employee unions, which I reviewed last year for the Cato Journal. Differences in spending between school districts with and without collective bargaining are modest to non-existent. Does this mean that the unions are impotent and that their members have been wasting their $600 annual dues payments? Not quite.

Though employee compensation varies little from one school district to the next, based on the presence or absence of collective bargaining, public school employees enjoy far better compensation than their private sector counterparts. The combined salary and retirement benefits of public school teachers are 42 percent larger than those of private school teachers (see link above).

Public school employees win this generous compensation premium through political action backed by monumental campaign contributions. Democrats receive the overwhelming share of these contributions (93% from the NEA; 99% from the AFT, see Cato Journal link), but many Republican lawmakers are also swayed, fearful that the unions will finance their primary opponents the next time they face voters.

To further increase their clout, union leaders have sought to grow their membership. More members mean more dues revenue with which to influence legislators. In this regard, too, they have been enormously successful: the number of public school employees has grown ten times faster than the number of students for two generations—a major factor in the system’s exploding cost and collapsing productivity (see figure below).

Public school employees clearly understand that union membership has benefitted them handsomely in both compensation and job security. Over the past forty years, union membership as a share of the public school workforce has increased from 42 percent to 70 percent. Even if collective bargaining were eliminated tomorrow, school employees would have every reason to continue funding the self-interested political action that has served them so well in the past.

So what would provide a counterbalance to unsustainable union demands?

To find the answer, it helps to know that while union membership was rising in the public sector it was falling steadily in the private sector—to just 6.9 percent of the workforce in 2010 (see figure below). The reason is simple: when a business makes excessive concessions to a union and is thereby forced to raise prices above those of its competitors, it loses customers. As it loses customers, it lays off workers. If this situation continues, the business fails. Private sector unionization is thus self-regulating to a significant degree.

Public school employee unions, by contrast, have no direct competitors. They cannot drive their employer out of business because there is only one employer in the sector and its existence is mandated by law. The only real solution to the spiraling cost of our state school monopolies is thus to open them up to private sector competition, so that both parents and taxpayers have an alternative to the no-longer-affordable status quo.

There are several ways of doing this, of which education tax credits seem the most promising. In Florida, Arizona and other states, taxpayers can claim a dollar-for-dollar credit for donations to non-profit scholarship organizations. These organizations, in turn, subsidize private school tuition for low-income families. In Illinois and Iowa, families who pay for their own children’s education are eligible for tax credits to directly offset part of the cost.

Though most of these programs currently impose tight caps on the total value of credits available, they are already generating substantial savings to taxpayers while simultaneously expanding the choices available to families. Florida’s k-12 scholarship donation credit saves taxpayers $1.49 for every dollar it reduces state revenue, and the new private sector competition has improved achievement in public schools.

So while curtailing collective bargaining won’t rein in out-of-control spending, introducing real private sector competition will. And as the final figure reveals, we have got to get spending under control….

…..

Update: I should add that, as NRO’s Rich Lowry notes, the plan for the state to stop garnishing public school employees’ wages and sending the money to the union is highly commendable. If employees want to pay union dues, they should be free to do so, but the choice should be theirs.  Of course, since public school employees benefit very handsomely from the status quo monopoly (see below), it’s likely that most will continue to pay voluntarily for the lobbying and political contributions that will preserve their above-market compensation. So it’s still the case that introducing private sector competition is the best way to control education costs.

I Hope to See a LOT More of This…

In Indiana the other night, two grassroots groups–one on the left, the other on the right–got together to discuss the merits of state schooling, home schooling, and private school choice programs. There doesn’t seem to have been any high-profile organization orchestrating the event. It was just two groups of citizens getting together to try to find the best way forward on education policy. Let’s hope this is the beginning of a trend.

How to Think & Talk About Vouchers & Ed Tax Credits

School Choice Week is here, and there are a lot of people trying to spread the good word about the benefits of increasing educational freedom.

But what benefit of choice is best to focus on?

You can make at most a few points in an oped or on talk radio. On TV, and even in print reporting, you’re lucky to get one point across. And with friends and family, and even politicians, you need to keep the focus where it will do the most good.

So, should you focus on how horrible inner-city schools are, how many lives are destroyed in a failing government system? Maybe. Depends on the person, certainly.

But the evidence suggests that the best message overall is one that focuses on the financial benefits of school choice (and this is even before the financial crisis). People think about vouchers and education tax credits differently. And be careful trying to pull at Democratic heart-strings with arguments that choice will increase educational equity for poor kids … there’s evidence that it backfires!

Take a look at this slide presentation that describes how the public thinks about private school choice, what you should emphasize, and what you should be careful with … it’s not just my opinion, it’s based on evidence from a unique message experiment:

“… your month, or even your year”

At one time or another over the past two decades, most school choice supporters have felt like the subject of the “Friends” theme song; that it hasn’t been their day, their week, their month, or even their year.

Things are different now. For one thing, choice programs have proliferated and grown over time, more are being introduced this year than perhaps ever before. And for another, well, this IS their week: the first national School Choice Week.

Events are being held all over the country to celebrate the idea that families should be able to easily choose the best schools for their kids, and that schools should have to compete for the privilege of serving them.

Here at Cato’s Center for Educational Freedom, we’re dipping into the future to see what it holds. How are large scale public/private school choice programs working out in countries that have had them for two or three decades? To find out, we’ve invited the founder of the largest private school chain in Sweden and a Chilean economist researching his own nation’s program to share their experiences and findings on Friday at noon.

Given how alien for-profit k-12 schooling appears to most Americans, imagine the reaction Peje Emilsson got in 1999 when he proposed founding a chain of for-profit schools in Sweden. Already the founder of a multinational communications firm, Peje broached the idea with some of his nation’s top entrepreneurs and economists. If you’d like to find out what they had to say, and how his idea has turned out in practice, you won’t get another chance any time soon. Hope you can join us on Friday – to register for free, click here!