January 25, 2019 8:00AM

School Choice Is about Embracing Free Enterprise

When did economic growth, and the standard of living of average people, really begin to take off? What caused it? There are many theories, but as Andrew Coulson discusses in the School Inc. clip below, there is good reason to believe not when banking was invented, or factories, or some technological change, but when earning a living through free enterprise—profitable commerce—stopped being seen as, well, kind of tawdry. It is a feeling we continue to struggle with when it comes to education. 

There is, of course, profit made throughout public schooling, if that’s defined as taking in more revenue from providing a good or service than is spent to produce it. Whiteboard manufacturers, construction companies, publishers—all are typically for‐​profit. Indeed, while absent a free market we don’t know what the “right” amount is to pay educators, and many public school teachers may well be underpaid, few likely lose money on their jobs. In other words, they make profits. Which is not to say they are “in it for the money.” No doubt they care about and enjoy working with kids, but they do need money to live. And it turns out the primary motivation of successful entrepreneurs and business people is not raking it in, but producing something they care about. Does anyone think Steve Jobs was actually indifferent towards computers and just wanted to get rich?

More important than who is making a profit are the overall incentives if profit is matched with funding through students. While the first‐​blush reaction to profit is understandable—shouldn’t children trump mammon?—thinking it through reveals why profit and paying customers are beneficial to all. They incentivize schools to respond directly to parents, who control the money and best know their children, while also making schools compete for teachers’ services. In addition, they encourage schools to compete with each other, incentivizing them to try new ways of educating to attract more families. And when schools find better ways to educate and are more profitable, it incentivizes others to copy the innovations, taking them to scale. Freedom also allows educators to specialize in the needs of unique subsets of kids and, of course, is crucial to achieving social harmony and equality in our diverse society.

As School Choice Week 2019 nears an end, perhaps no message is more important than, simply, “embrace freedom.” It is the key to so much that we need in education.