Which Schools Best Serve the Public? New U.S. History, Civics Scores Point to Them

The latest 8th grade U.S. history, civics, and geography results from the National Assessment of Educational Progress – the so-called Nation’s Report Card – have been released, and as usual, things seem bleak: only 18 percent of students scored proficient in U.S. history, 23 percent in civics, and 27 percent in geography. These kinds of results, however, should be taken with a few salt grains because we can’t see the full tests, and the setting of proficiency levels can be a bit arbitrary. Also, we don’t…

Oh, the heck with all that. As a fan of school choice, just tell me if private schools did better!

Based on the raw data, they did. 31 percent of private school students were proficient in U.S. history, versus 17 percent of public schoolers; 38 percent were proficient in civics, versus 22 percent of public schools kids; and 44 percent were proficient in geography, versus 25 percent of public schools kids. That said, to really know which broad swath of schools did better – and from a parent’s perspective, it is really only the individual schools from which they might choose that matter – you’d have to control for all sorts of characteristics of their students. From what I’ve seen, what was just released didn’t do that. Thankfully, others have.

What have they found? Controlling for various student characteristics and other factors, private schools beat traditional publics in terms of political knowledge, voluntarism in communities, and other socially desirable outcomes. Why?

There may be many possible reasons, but at least one seems to be intimately connected to choice: autonomous schools select their own curricula, and families willingly accept it when they choose the schools. That means chosen schools can more easily teach coherent U.S. history and civics than can public schools, which often face serious pressures to teach lowest-common-denominator pabulum lest conflict break out among ideologically and politically diverse people. Perhaps ironically – though not if you understand how a free society works – by not being public, private schools may actually serve the public better.

So no, you can’t conclude a lot from the latest NAEP scores. But that doesn’t mean they can’t point you in the right direction.

Budget Conference Moves Forward

Negotiators for the House of Representatives and the Senate are expected to announce a deal on the budget resolution as early as today. A budget resolution sets overall spending limits for the year. If it passes, it would be the first resolution in six years, but it does little to fix the country’s long-term fiscal mess.

The original House and Senate budget proposals left much to be desired. Each proposal increased defense spending by using the Overseas Contingency Operations (OCO) account as a slush fund. This maneuver allowed each chamber to claim allegiance to the 2011 Budget Control Act spending caps, while bypassing it to boost spending.  The House budget included a version of Medicare reform, but delayed its start date until 2024. The Senate left Medicare reform off the table.

This week, budget negotiators seem to be taking disappointing parts from each chamber.

What You Should Know about Free Banking History

This is a revised excerpt from White (2015), and the first item in our “What You Should Know” series offering essential background information on various alternative money themes.


Historical monetary systems that are properly classified as free banking systems, in Kevin Dowd’s (1992, p. 2) words, have involved “at least a certain amount of bank freedom, multiple note issuers, and the absence of any government-sponsored ‘lender of last resort.” There were 60-plus episodes around the world of plural private currency issue in the 19th century (Schuler 1992). Dowd (1992) has compiled studies of 9 of these episodes, and Ignacio Briones and Hugh Rockoff (2005) have surveyed economists’ assessments of 6 relatively well-studied episodes: Scotland, the United States, Canada, Sweden, Switzerland, and Chile. Because none of the six systems they review enjoyed complete freedom from legal restrictions, they suggest that “lightly regulated banking” is a more accurate label than “free banking.” All these nineteenth-century episodes had another feature worth mentioning: banknotes and deposits were denominated in and redeemable for silver or gold coins.

When we look into these episodes, we find a record of innovation, improvement, and success at serving money-users. As in other goods and services, competition provided the public with improved products at better prices. The least regulated systems were not only the most competitive but also by and large the least crisis-prone.

Supreme Court Focuses on Equality Under Law

Vindicating conventional wisdom, today’s argument suggested that the Supreme Court will find that states must both recognize and license same sex marriage. That’s remarkable in and of itself considering that a little over a decade ago, we were still debating whether states could criminalize gay sex. But it’s not surprising, given that it represents the most rapid transformation in public opinion on any political issue.

What’s more noteworthy is the reason why the Court is poised to rule this way. While it’s certainly possible that Justice Kennedy will wax metaphysical about the “sweet mystery of marriage,” the majority opinion is more likely to rest on the technical requirements of the Equal Protection Clause. Given that provision’s enforcement of “equality under the law,” states simply cannot devise a reason to draw their marriage licensing regimes in a way that distinguishes between heterosexual and homosexual couples.

Haddock and Polsby On How Riots Occur

“This is not justice. This is just people finding a way to steal stuff,” Carron Morgan, cousin of Freddie Gray, told Kevin Rector of the Baltimore Sun yesterday.  That’s one of the most clear-headed interpretations of yesterday’s mob violence in Maryland’s largest city, which followed the convergence of hundreds of youths at 3 p.m. outside Mondawmin Mall, a shopping center on the city’s west side that also serves as a hub for bus service. In the resulting tumult, groups of rioters burned police vehicles, looted stores and restaurants, and injured more than a dozen Baltimore police officers with flying missiles. 

More than twenty years ago in the Cato Journal, distinguished law and economics scholars David Haddock and Daniel Polsby published a paper entitled “Understanding Riots” that’s still highly relevant in making sense of events like these. Employing familiar economic concepts such as opportunity cost, coordination problems, and free-rider issues, Haddock and Polsby help explain why riots cluster around sports wins as well as assassinations, funerals, and jury verdicts; the group psychology of rioting, and why most crowds never turn riotous; the important role of focal points (often lightly policed commercial areas) and rock-throwing “entrepreneurs” of disorder; the tenuous relationship between riots and root causes or contemporary grievances; and why when a riot occurs the police (at least those in places like the United States and United Kingdom) seldom manage to be in enough places at once, more or less by definition.

The Ex-Im Bank and Globalization

This is from a Wall Street Journal article about President Obama’s push for the Trans Pacific Partnership (TPP):  
Mr. Obama also warned of rising anti-globalization sentiment in Washington, reflected in Democratic opposition to the trade agreement [TPP], Republican efforts to kill the Export-Import Bank, and congressional unwillingness to approve new rules for operation of the International Monetary Fund.
I agree that opposition to the TPP often, although not always, reflects anti-globalization sentiment; I’m not familiar with the IMF issue here.  But on the Ex-Im Bank issue, I think the President has it backwards. His logic, I assume, is that subsidies from the Ex-Im Bank promote exports, and are therefore pro-globalization.  But this logic is flawed.  The reality is that all export subsidies are a form of economic nationalism, in the sense that they try to give an advantage to domestic products over their foreign competition.  This leads to escalating trade wars and international economic tension.  The pro-globalization approach would be negotiate an end to the subsidies provided by export credit agencies, and let all products compete in the global marketplace without government support for domestic industry. 

Indian Schools Are Failing

Since treaties in the 19th century, the federal government has provided educational aid to American Indians. These days, the Bureau of Indian Education (BIE) owns about 180 Indian schools, which have about 41,000 students in Arizona, New Mexico, South Dakota, North Dakota, and other states.

I examined Indian schools in this study at Downsizing Government. The schools have long failed Indian children and seem to waste a great deal of money.

The Washington Post reported similar findings:

The U.S. Bureau of Indian Education spends nearly 56 percent more money than American public schools on each student, but many Native Americans learn in facilities that are languishing in poor condition, according to federal auditors.

A report this week from the Government Accountability Office said the agency has struggled to staff, manage and repair its schools, largely because of a broken bureaucracy.

… The bureau also suffers from high leadership turnover, inconsistent accountability, poor communication between offices, a lack of strategic planning and a dearth of financial experts to manage spending, auditors said. The “systemic management challenges,” as the report described them, have hindered the agency’s efforts to improve student achievement and sustain key initiatives, according to the report.

The problems have persisted for years, despite the bureau spending significantly more than U.S. public schools in general. A 2014 GAO analysis found that the agency spends an estimated $15,000 per pupil on average, while public schools nationwide spend an estimated average of about $9,900.

… Indian Education spokeswoman Nedra Darling said Thursday that the bureau is “deep into the process of fixing the problems that the GAO highlighted.”

… “The president has asked Congress for significant increases in the budget to accomplish many of these goals and to increase staff available to serve tribal schools and BIE-run schools,” Darling said.

The last two sentences are classic: Agency leaders using their own failings as an excuse to demand more taxpayer money.

A better reform would be for Congress to advance Indian self-determination by ending the federal ownership and operation of schools and converting BIE funding to block grants. Tribal governments could then use the block grants to either competitively source school management or to pass through the funds to Indian parents in the form of school vouchers.

The important thing is to get Washington out of the business of running schools because decades of experience reveal that it is not very good at it.