Wednesday, March 30, 2005

Lessons from economics

Katie sent me an email a few months back that she thought I would enjoy. It is titled The Entrepreneur As American Hero.

Professor Walter E. Williams discusses how free market forces benefit the average consumer and finishes up with what he calls Williams' Law.
Whenever the profit incentive is missing, the probability that people’s wants can be safely ignored is the greatest. If a poll were taken asking people which services they are most satisfied with and which they are most dissatisfied with, for-profit organizations (supermarkets, computer companies and video stores) would dominate the first list while non-profit organizations (schools, offices of motor vehicle registration) would dominate the latter. In a free economy, the pursuit of profits and serving people are one and the same. No one argues that the free enterprise system is perfect, but it’s the closest we’ will come here on Earth.

I completely agree. It is time we start eliminating government run schools.


Jonathan said...

And ending government-run (i.e. public) services results in such things as this or this. Having an organization with a profit motive controlling, say, food safety, frightens me - I believe that their for-profit stance would result in corner-cutting all over the place, and would ultimately compromise the safety of food.

Take schools as another example. What motivation would a private company have to guarantee any level of quality? When they start losing money, they would let teachers and other staff go, resulting in a situation far more unstable than what exists in many districts today. Or, try this one: to save money, let's cut out unnecessary programs such as lunch. It all depends on the relationship between SchoolCo and the local government, or their end consumers, the parents. Extreme, yes, but I believe it's a reality.

So why do you think that public schools (or public services, to extrapolate) should be eliminated?

Kevin Heifner said...

Looks like I know what to post about if I want comments. :)

Those are some scary articles that you point to. However, they do not represent a true open market place. I'm talking about America, other markets/countries have unique problems.

Now on to the government school issue.

You ask what motivation SchoolCo has to not cut programs or let teachers go. The motivation is that parents could take their children down the road to SchoolInc which just hired the teacher let go and which does offer a better lunch program. Or another parent might believe that a better science program was worth sending a lunch to school everyday.

You can argue that the poor would not have a choice. To that I would say that the poor are the only ones that do not have a choice today. If you have the resources you can choose a better school today, like I have.

Jonathan said...

Yeah, you know what sets me off. :)

I would say that even our system is not a truly open market; and likewise privatization of public services here will lead to disaster. (History points me to the privatization of the water supply in early New York City's development and the Manhattan Company as an example of a complete failure to privatize a public utility. The profit motivation greatly outweighed their desire to create a safe public utility, as it nearly always seems to.)

So, schools.

While you see the privatization of schools as parents choosing to send their children to a school, I believe it will occur differently; namely, I think that districts will outsource school management functions to a corporation.

If SchoolCo has a five-year contract that they "won", and their revenue source comes from public funds but not from individuals themselves (as I see it, this would be the evolution of public to private schooling), then they are only accountable to those politicians who elected to use them. They can cut corners and save money wherever possible, promote their corporate agenda, and your children would be the victims. You might not even know what would be happening. Because politicians will be choosing companies to administer schools in their district, will people have much more of a choice than they do now? Even now, if you don't like your district, move.

As you anticipated my next move, yes, all of this is really horrible for those who cannot afford to make a better choice. Now, at least, there are public initiatives to put in place magnet schools or achievement programs or even school improvement programs. Accreditation's a good example of how school quality could be maintained or improved. Other notable programs are voluntary transfer, school lunches, etc.

I agree that public schools here need some work, but killing them off just makes life harder for those who need public services the most.

Kevin Heifner said...

I'm not exactly sure what kind of system you are describing. I don't want any kind of system where the parent is not in control of the funds. Give parents funds equal to what the local school district would receive and let the parents use it at any institution of their choice or use it for home schooling. Folks in rural communities without much choice could elect to pool funds and hire their own teachers.

I know that this is a very dangerous slope for existing private schools. The question would be if the private school should except the funds. Even if they didn't come attached with stipulations, they would likely have stipulations added in the future.

The current schools are a disgrace. For example:

In 2000 the percentage of fourth-grade students performing at or above the Basic level or reading achievement was 63%. Performance at or above the Proficient level (the level identified by NAGB as the level that all students should reach) was achieved by 32% of fourth-graders.

Only 23% of eighth-graders tested proficient in math; 39% tested below even the basic level.

American's 12th graders came in 19th out of 21 countries in math on the TIMSS. We only beat Cyprus and South Africa. And in advanced math we came in last.

Recently the Department of Education reported that 57% of seniors could not perform at the most basic level.

And on and on.

BTW, the expenditure (1999-2000) per pupil in average daily attendance in public elementary and secondary schools was $7,086.

Something has to be done, and throwing more money at the problem is not going to help.

Jonathan said...

There's a huge leap from reorganizing and regrouping a system to throwing more money at it to ending it entirely; which position do you support?

I'm still not clear why you feel public school programs should be terminated. Are bad test scores enough to warrant dismantling public education? Why not take the top public schools, determine what works for them, and propagate those methods and structures to other districts?

Perhaps the real reason the public school system is failing for so many children is because of a lack of support at home and in their communities? Moving to private education would absolutely destroy these children's chances of getting any education. How would privatized education help in these instances?

Kevin Heifner said...

If possible I would like to save the school buildings and the buses. :) I think the time for reorganizing is over. We need a complete overhaul. I don't see that is at all possible in the current system. Therefore, we need an alternative that parents can choose that will force the existing system to adopt.

In my mind the goals of a school system is to teach reading/writing/arithmetic/science/history/art/music/health. Since it is impossible to teach these topics without teaching a Worldview then parents need to be able to choose a school that matches their Worldview. The current school system has their hands tied so badly that they are unable to achieve their objectives.

You ask if we should dismantle our public education because of bad test scores. I say that if my car doesn't run then I don't need it. The goals of our schools should be to teach. If they are not doing that then why have them? They don't even provide good day care (too dangerous).

I agree that the public school system is not the only thing that is failing our children. However, that is the topic at hand. I completely agree that the modern family bears much of the blame.

Yo-Robot said...

Should everyone forget that most education systems that are on top of the discussed list (in which United States scores 19th) are almost all public?