Unconventional monetary policy—characterized by “zero interest rate policy” (ZIRP) and “quantitative easing” (QE), along with macro-prudential regulation—has increased the power of central banks in the United States, Japan, and Europe. In the new issue of Cato Journal, contributors revisit the thinking behind unconventional monetary policy and the “new monetary framework,” make the case for transparent monetary rules versus foggy discretion, and point to the distortions generated by ultra-low interest rates and preferential credit allocation.
When the Danish newspaper Jyllands-Posten published the cartoons of the prophet Muhammad in 2005, Denmark found itself at the center of a global battle about the freedom of speech. The paper’s culture editor, Flemming Rose, defended the decision to print the 12 drawings, and he quickly came to play a central part in the debate about the limitations to freedom of speech in the 21st century. In The Tyranny of Silence, Flemming Rose provides a personal account of an event that has shaped the debate about what it means to be a citizen in a democracy and how to coexist in a world that is increasingly multicultural, multireligious, and multiethnic.
The Cato Institute has released its 2015 Annual Report, which documents a dynamic year of growth and productivity. The thousands of individuals who contribute to Cato are passionate about freedom and committed to ensuring that future generations enjoy the blessings of liberty, unencumbered by an overreaching state that seeks to control their lives. This is Cato’s optimistic vision for the future, and it would be unimaginable without the Institute’s longstanding partnership with its Sponsors. We will continue our diligence and dedication to seeing this vision realized.
The annual Education Next poll on school reform is out, and as always it’s boiling over with hot, tasty results. I won’t hit nearly everything in it, and even the topics I do cover can be dissected much further, but I have a few parts I want to highlight.
Questions about the Common Core national curriculum standards have been my main focus in past EdNext polls, and they remain so this time around. The news isn’t good for the Core. Among respondents asked whether they support the Core, defined as standards states chose to adopt that “will be used to hold public schools accountable” – a description heavily biased with the promise of wonderful-sounding accountability – support has dropped from 65 percent in 2013 to 49 percent in 2015. Among teachers, the Core has donned its barrel and plunged from 76 percent support to 40 percent, with 50 percent now opposing it. Finally, getting rid of the accountability promise in the description resulted in just 39 percent of the public supporting the Core and 37 percent opposing, essentially a tie when margin of error is considered.
Questions about the federal role in education reveal what appear to be some serious inconsistencies. Unfortunately, 41 percent of the public thinks Washington should be in charge of “setting educational standards for what children should know,” while 43 percent think the states should be and 15 percent local governments. That means roughly 4 out of 10 people are ignoring the Constitution, as well as the federal government’s very poor track record. More encouraging, lower percentages of parents and teachers would have the feds lead on standards, and only about 1 in 5 members of the public think Washington should decide if “a school is failing” or “how to fix failing schools.” But get this: The poll also finds that 67 percent of the public thinks DC should require that all students “in grades 3-8 and once in high school” take math and reading tests. Oh, and allowing parents to opt their kids out of such tests? Only 26 percent of the public, and 32 percent of parents, support that. If there is a unifying theme here it may be that the public likes the abstract idea of national benchmarks but not centralized ramifications for performance, which we likely see reflected in the Common Core debate and No Child Left Behind reauthorization.
The myth that there’s no evidence that school choice works has more lives than Dracula. Worse, it’s often repeated by people who should know better, like the education wonks at Third Way or the ranking Democrat on the U.S. Senate education committee. In a particularly egregious recent example, a professor of educational leadership and the dean of the University of Wisconsin-Madison School of Education wrote an op-ed repeating the “no evidence” canard, among others:
The committee also expands the statewide voucher program. There is no evidence privatization [sic] results in better outcomes for kids. The result will be to pay the tuition for students who currently attend private school and who will continue to attend private school—their tuition will become the taxpayers’ bill rather than a private one. Additionally, the funds for the expansion would siphon an estimated $48 million away from public schools, decreasing the amount of money available for each and every school district in the state.
It is astounding that a professor and a dean at a school of education in Wisconsin would be unfamiliar with the research on the Milwaukee voucher program, never mind the numerous gold standard studies on school choice programs elsewhere. Fortunately, Professor James Shuls of the University of Missouri-St. Louis and Martin Lueken of the Wisconsin Institute for Law & Liberty set the record straight:
Across the country, districts are struggling with shortages of teachers, particularly in math, science and special education — a result of the layoffs of the recession years combined with an improving economy in which fewer people are training to be teachers.
So do we really have a shortage of teachers today, compared to historical levels? How big were the recession layoffs in historical context? I offer an updated chart below of the % change, since 1970, in the number of teachers and students, as well as the change in the cost per graduate of a public school K-12 education.
As the chart reveals, the recession layoffs were tiny when compared to the massive growth in our teaching workforce since 1970. To this day, we employ over 150% as many teachers as we did in 1970, to teach only 109% as many students. In other words, the number of teachers has grown 5 times faster than enrollment. That does not mean that there couldn’t be a small portion of districts in the U.S. that really need to hire teachers, but it does mean that there is no “national teacher shortage” compared to historical levels of employement. To anyone who claims otherwise, we can only ask: a shortage compared to what?
Over the next couple of days, Democratic presidential candidate Hillary Clinton will be playing up her new, $350-billion proposal primarily intended to make paying public college tuition a debt-free experience.
According to early information about the plan – I couldn’t find details on Clinton’s campaign Web page yet – under the proposal the federal government would spend $200 billion over ten years on public colleges and universities, with a condition that states also increase their higher ed outlays. The goal would be to make paying public college tuition debt-free for all. In addition, the plan – called the “New College Compact” – would give $25 billion to historically black colleges and universities, and other schools with low endowments, over ten years. Next, the proposal would allow all current student debt holders to refinance loans at lower interest rates and sign up for income-based repayment plans capping monthly payments at 10 percent of discretionary income and forgiving whatever remained after 20 years. The loan-term plan is estimated to cost $125 billion over ten years.
Of course, as with any politically good plan, it seems details on how all this would be paid for – other than to say the rich will cover the $35-billion annual price tag – will be announced at some later, likely quieter date. Ditto details on how the plan will ensure colleges spend all the new, forced taxpayer largesse on instruction rather than fluff like climbing walls and water parks that students demand and schools, increasingly, deliver. Putting off these latter details could be especially important politically because while colleges love money, they do not love strings. To keep maximum support from the Ivory Tower – typically a welcoming edifice for Democrats – you’ll want to keep the downside hazy.
Of course, the estimated price tag is just the most immediate, obvious cost of the plan. The more hidden cost would be the plan’s deleterious effects: encouraging yet more people to spend more time in programs even less tethered to real-world needs. Quite simply, when someone else pays your bills you are more likely to consume, and less likely to think efficiently about what you are consuming. That’s been the higher education problem for decades, and this plan would have someone else foot even more of the bill.
Already we see massive overconsumption of higher ed: About a third of bachelor’s degree holders are in jobs that don’t require the credential. Lots of employers seek people with degrees for jobs that don’t appear to need college-level learning. And “college-level learning” has come to mean less and lessactual learning. In other words, thanks largely to third-party funding, we appear to have a vicious cycle of credential inflation that would almost certainly get even worse as more and more people saw college as “free.” And no, it does not appear that spending more on higher education automatically increases human capital and, hence, economic growth. Indeed, government college spending may well hamper growth by taking money from the individual taxpayers who earned it – and would have used it for their real needs – and giving it away to colleges regardless of what people need.
“Free” always sounds so good. Until, that is, you think through how costly “free” can be.
In last night’s GOP presidential debate, Sen. Marco Rubio (R-FL) said in response to a question about the Common Core national curriculum standards that, sooner or later, the Feds would de facto require their use. If you know your federal education – or just Common Core – history, that’s awfully hard to dispute.
Said Rubio: “The Department of Education, like every federal agency, will never be satisfied. They will not stop with it being a suggestion. They will turn it into a mandate. In fact, what they will begin to say to local communities is: ‘You will not get federal money unless you do things the way we want you to do it.’”
That is absolutely what has happened with federal education policy. It started in the 1960s with a compensatory funding model intended primarily to send money to low-income districts, but over time more and more requirements were attached to the dough as it became increasingly clear the funding was doing little good. Starting in the 1988 reauthorization of the Elementary and Secondary Education Act (ESEA) we saw requirements that schools show some level of improvement for low-income kids, and those demands grew in subsequent reauthorizations to the point where No Child Left Behind (NCLB) said if states wanted some of the money that came from their taxpaying citizens to begin with, they had to have state standards, tests, and make annual progress toward 100 math and reading “proficiency,” to be achieved by 2014.
The answer, of course, is that they know they get what they pay for. As one father in poverty-stricken Makoko, Nigeria put it:
“Going to the public school here in Nigeria, particularly in this area in Lagos State, is just… wasting the time of day… because they don’t teach them anything. The difference is clear… the children of the private school can speak very well, they know what they are doing but there in the public [schools], the children are abandoned.” (Page 129, emphasis in the original.)
THE Ken Ade Private School is not much to look at. Its classrooms are corrugated tin shacks scattered through the stinking streets of Makoko, Lagos’s best-known slum, two grades to a room. The windows are glassless; the light sockets without bulbs. The ceiling fans are still. But by mid-morning deafening chants rise above the mess, as teachers lead gingham-clad pupils in educational games and dance. Chalk-boards spell out the A-B-Cs for the day. A smart, two-storey government school looms over its ramshackle private neighbour. Its children sit twiddling their thumbs. The teachers have not shown up.
What’s the difference? It mostly comes down to a matter of incentives. Asked why parents choose to pay private school tuition when the government schools are “free,” one government school principal in Ghana explained:
It’s supervision. Proprietors are very tough. If teachers don’t show up and teach, the parents react. Private schools need to make a profit, with the profit they pay their teachers, and so they need as many students as they can get. So they are tough with their teachers and supervise them carefully. I can’t do that with my teachers. I can’t sack them. I can’t even remove them from [the payroll] if they are late or don’t turn up. Only the District Office can. And it’s very rare for a teacher to be sacked. (Page 71.)
It’s no wonder then that private schools are proliferating in the world’s poorest areas. According to The Economist, hundreds of new private schools are opening in Lagos, Nigeria, many of them charging less than $1 a week. In poor countries, official estimates show that private schools now educate more than one-fifth of all students, double the proportion a decade ago. And even that figure probably underestimates private school enrollment since a high proportion of private schools in poor countries are unregistered. As The Economist notes, “A school census in Lagos in 2010-11, for example, found four times as many private schools as in government records.”
The market is still emerging and although the private schools tend to outperform the government alternatives, that isn’t a very high bar. Parents often lack access to information about school performance from reliable sources. Schools have an incentive to exaggerate their performance, so some in the international aid community want the government to set and enforce national standards and mandate national exams. However, there is no good evidence that national standards or testing drive performance. Moreover, as The Economist observed, ”where governments are hostile to private schools, regulation is often a pretext to harass them.”
The absence of government standards does not imply the lack of any standards. In a competitive market, schools have an interest in demonstrating to parents that they provide high-quality education. The rapidly expansion of the private sector will create opportunities for non-profit or for-profit private certifiers to separate the wheat from the chaff. Indeed, as The Economist highlights, there are low-cost ways to provide parents with the information they need:
In a joint study by the World Bank, Harvard University and Punjab’s government, parents in some villages were given report cards showing the test scores of their children and the average for schools nearby, both public and private. A year later participating villages had more children in school and their test scores in maths, English and Urdu were higher than in comparable villages where the cards were not distributed. The scheme was very cheap, and the improvement in results larger than that from some much pricier interventions, such as paying parents to send their children to school.
In a corresponding editorial,The Economist calls on the governments of poor countries to “boost” private education through school vouchers “or get out of the way.” The editorial also argues that “ideally” the governments should “regulate schools to ensure quality” and “run public exams to help parents make informed choices” but also observes that “governments that cannot run decent public schools may not be able to these things well; and doing them badly may be worse than not doing them at all.” Indeed.
Rather than lobby the often-corrupt and/or incompetent Third World governments, the best thing NGOs could do to improve education would be to grant scholarships directly to the poor and provide private certification and/or expert reviews of schools. If we want to ensure that even the world’s poorest children have access to a quality education, schools should be held directly accountable to parents empowered with the means to choose a school and the information to choose wisely.
This is the fifth post in a series covering the advance of educational choice legislation across the country this year. As of my last update in mid-June, there were 13 new or expanded choice programs in 10 states. Since then, South Carolina has adopted a new school choice program and three other states–Florida, Ohio, and Wisconsin–have expanded existing choice programs (including two voucher programs in Ohio), bringing the total to 18. That’s considerably more than the 13 new and expanded programs that led the Wall Street Journal to dub 2011 the “Year of School Choice.”