Trapped Inside the Mime’s Box

Kevin Carey, policy director at the think tank Education Sector, asserts that when it comes to higher education libertarians are boxed in, unable to find a solution to out-of-control college costs that won’t violate at least one, basic libertarian principle:

This puts libertarians in somewhat of a box. On the one hand, they tend to be hostile toward the tens of billions of public dollars that flow into colleges every year. The more colleges cost, the greater the claim on the average citizen’s hard-earned money and thus reduction in their precious liberty etc., etc.

But the best way to bend down the long-term higher education cost curve and thus reduce government spending is to increase government regulation in the form of mandatory reporting. So it’s a pick your poison situation for the Cato folks — would you rather have Big Brother’s hand in your wallet or his eye on your business? You really can’t avoid both.

Now, I don’t want to seem obnoxious about this. After all, in the same piece that produced this quote, Carey notes that “while my politics are pretty far from Cato’s and I often think they’re wrong, they tend to be wrong in interesting ways.” I thank him for that (I think), though I should note that the impetus for his piece is a paper that comes from the John William Pope Center – the same paper I discuss here – not from Cato. So it might not even be Cato that Carey finds interesting. Regardless, here’s my potentially obnoxious-sounding reply:

Without even discussing the extremely dubious assumption that more regulation will lead to lower college costs, wouldn’t the best, most direct way to “reduce government spending” obviously be to, well, reduce, or even stop, government spending?

Of course it would, and that is the obvious solution for libertarians! It would get Big Brother out of our wallets and kill whatever justification subsidies might give him to gaze into our business. And it wouldn’t just make libertarians feel better – the benefits would accrue to almost everyone. If students and donors, rather than taxpayers, were to cover much more of colleges’ costs, taxpayers would save money, colleges would be unable to charge as much as they currently do, and schools would have to focus much more on their customers and patrons.

So there is no either-more-regulation-or-higher-costs box. Indeed, the only box that libertarians could possibly be trapped in is a mime’s box – a purely illusory one that someone has to really, really want to believe in for it to have any sort of existence at all. 

Having broken free of the invisible, intangible box, let me address one other thing that Carey brought up both in the discussion held at Cato, and his latest commentary:

The problem is that colleges aren’t just going to unilaterally release lots of new information on their own. Nor would it help matters much if they did; for data to matter it has to be standardized in a way that allows for comparison. That’s why companies report one set of quarterly financial results to the SEC, not 50 different sets to each state. Given that higher education is a national market this leads to a similar national solution: The federal government should compel colleges to release much more information about success as a condition of receiving direct or indirect federal aid.

The idea that a market that happens to be national in scope somehow requires federal control is both very common, and very inaccurate, simply equating “national” with “federal” and moving on from there. Even worse, though, is the even more basic assumption that to get something good, or just standardized, government control is required.

Whether it’s McDonald’s or Ruth’s Chris, an item on the menu in Beverly Hills is going to be essentially the same as in New York City. Why? Not because Washington says it must be, but because that keeps the customers coming. Or consider the QWERTY keyboard: It became the national standard by free-market, not government, forces. And how about the Model T, which was driven by Americans from Maine to San Diego? It was standardized not because the federal government said “this is a national car, so we must make it the national standard,” but because one company produced it and it was freely chosen by customers from sea to shining sea. And how do we choose automobiles today? Not by going to some federal report on what a car should be (though perhaps that day is coming) but, often, by consulting such trade mags as Road and Track.

Clearly, we don’t need government to set standards or inform consumers – markets will do those things themselves. But that markets will set their own standards is just part of the story. Sometimes – indeed, almost all of the time – you simply don’t want a single standard: Vegetarians don’t want a great steak. Many people would rather click than type. The English major fascinated by Chaucer doesn’t need a cyclotron. The working mom often doesn’t want the same education as the parentally funded 18-year-old.

And then there is the gigantic – but usually ignored – problem of government failure: Government regulation and standardization is very costly. It can be used to crush the opponents of the politically well-connected rather than advance the common good. It can have crippling unintended consequences. And, as former Dickinson College president, Clinton-era Department of Education assistant secretary, and current George Mason University professor A. Lee Fritschler made clear at the discussion of the Pope Center’s paper, it also simply fails – a lot. Indeed, based on his experience at the Department of Education, Fritschler is adamant that the feds are simply incapable of effectively regulating higher education.

So once again, Carey sees a mime’s box. This time, though, it’s not one he imagines entrapping libertarians, but one he thinks Washington can drop on the ivory tower to make it work right. It’s a different box, but just as illusory.