Free Market Education?

Milton Friedman became a conservative rock star by espousing the idea that every societal function could be dramatically improved by making it part of the ‘free market’.  In the religious pantheon of true-believer capitalists, Milton is right up there with Adam Smith, Ayn Rand, William Buckley, Friedrich Hayek and a few others.

One of Milton’s most famous assertions is that education needs to be privatized.  Parents should be given a ‘voucher’ for education and they should have freedom of choice.  This, in Milton’s opinion, would create a competitive industry for schools that would ensure high quality education and provide a means for low-income students to escape the poor educational environment that currently exists.

On the surface, this sounds reasonable.  Why not have schools compete for students?  Wouldn’t this result in better run schools with great results?  Wouldn’t the competition be the crucible out of which an excellent education would emerge?

But is education close enough to traditional capitalist endeavors to work in this model?  How is the success of education measured?  If schools become commodities that parents choose based on effectiveness, how will the logistics work?  Will ten first-graders in a neighborhood be going to ten different schools all over the city as the parents attempt to find the best school for their child?  How would transportation work in such a scenario?  What kind of sociological nightmare would that engender?

The first question that needs to be answered is whether schools are indeed broken today.  From a public perception perspective, it is not entirely clear what people think.  About 75% of parents are happy with their oldest child’s education, while only 50% of the general public is happy with education in general.   This is similar to the fact that only 16% of people have faith in the government yet 75% like their own representatives!!

 And in the last 5 years the partisan divide has worked its way into these polls.   Republicans are more likely to be unhappy with public education than democrats.  There is some suspicion that the Common Core plays a big role in this divide, as more conservative parents regard this as a governmental way to control and impact the culture through education.

What is clearly broken is education for the poor.   Schools in poor neighborhoods are typically dramatically different and inferior to those in middle-class or wealthy neighborhoods.  The charter school movement, a publicly funded, privately-run option, has become increasingly popular in poor neighborhoods and 50% of charter school students are either black or Hispanic.  There appears to be some success in these programs, though it is not clear that it is really helping those students who most need help.

Another option, floated more often by conservatives, hearkens back to Friedman’s ‘voucher’ concept.  In this case, a voucher is given to a certain number of applicants who can then use it to pay for private school.  Critics argue that these vouchers simply siphon money away from hard-pressed public schools and gift it to religious and other private schools to help them make ends meet.  They also skim off the best of the minority students, who are not really the disadvantaged or under-performing population in the public education system.

One does not have to be a liberal or even a cynic to believe that the current school voucher system is simply a way for middle or upper middle class parents to get their private and religious schools funded so that their own tuition bills are either reduced or eliminated.

For the sake of analysis, let us imagine two different future public education options.  One is where every family is given a voucher for education and their children can go to whatever school they choose, and all schools are privately run.  The second would also have privately run schools, but otherwise it would be similar to the current public school situation in that children would go to the schools in their neighborhoods.  There would be no vouchers – everyone would attend a for-profit, privately-run school.

In both cases the schools would have to be certified and evaluated on a regular basis.  In the first case, it seems likely that every competing school would want to minimize the attendance of weak or problem children because those children would drag down the metrics and make the school less competitive.   It would introduce two interwoven but problematic competitions – the one to maximize metrics and educational benefit, and the other to attract the best students.  The natural evolution of such a system would be for the best students to aggregate at certain schools and the poorest (and probably underprivileged) to collect at schools that are struggling.  Sound familiar?

Additionally, unless there were rules to prohibit parents from sending their children to schools outside their geographical area, a true voucher system would create havoc in terms of neighborhoods, busing, and many other aspects of family life.  Parents would very likely hop from school to school, seeking out the best program for their children.

The second scenario, where the schools are for-profit, but structured in the same way that they are now, might be an interesting experiment.  The big challenge would be to effectively measure how successful schools are.  Comparing one school to another to determine whether each privately run school should continue to get funding would be a tremendously complicated process. 

Schools would focus entirely on whatever criteria allowed them to stay in business and would cut back any expense that did not contribute to that goal, because cutting back expenses means more profit.  For all their inefficiencies, public schools and their staff have the mostly intangible, overall welfare of the child at heart.  A for-profit school would not be motivated in a similar way.

School populations that are resistant to improvement because of a variety of issues – absenteeism, lack of parental support, behavioral issues, pre-school preparation, etc. – would be unattractive targets for the for-profit corporations.  It is not hard to imagine a revolving door of companies attempting to work their magic in these low-income, traumatized neighborhoods with no more success than the public schools that preceded them.  It is not clear at all that education in these environments will ever improve substantially until the basic problems of poverty, broken homes, unemployment and drug abuse are addressed.  To believe that some clever entrepreneur is going to come up with the silver bullet is a kind of naïve fantasy.

In general, I am highly skeptical of claims that the invisible hand of the free market is the solution to such thorny issues as education and healthcare.  These are complex systems that are quite different than the basic consumer/product model that works so well in basic capitalism.  We need to accept the fact that some aspects of our society truly need to be analyzed and planned, rather than blithely consigned to the whims of the free market.

The Growth Paradox

“Whatever is not growing is dying”

Really?  This provocative statement, attributed to various famous people, is accepted by many as an axiom of life and business.  If a business is not increasing in revenue and size, then it is stagnant and on the path to eventual decline and disaster.

We expect our country to grow in economic output.  We expect our population to expand.  We expect our productivity to increase.  Europe and Japan are considered to be in jeopardy because their populations are not increasing, but rather are slowly decreasing.

Every business measures itself by growth - revenue and profit year over year.  And when a business seems to have reached a saturation stage in its current product, then it embarks upon new products or services.  Starbucks, not content to be the ubiquitous coffee shop, begins serving wine.  Uber expands into public transportation.  Amazon becomes a web services and cloud provider.

This mantra of growth may seem logical on one level.  Growth is change and we human beings seem to be addicted to change.   When things stay the same, we get bored and depressed.  We need new challenges and new vistas to inspire us.

But does change always have to equate to growth?  If one accepts that personal growth really means change then that opens up multiple avenues that do not necessarily imply something becoming larger or increasing.  One can vastly alter one’s world without being part of something that is ‘growing’.

The problem with growth is that it ultimately impinges on something or reaches some limiting point.  Growth can eventually begin to damage both the thing that is growing and its environment.  Moreover, the growth of one thing can harm or even destroy the existence of another thing.  There is certainly a balance in nature that can be damaged by growth, and there is often also a balance in the affairs of humans that can be similarly destructive.

The growth of Walmart is a good example.  Walmart brought endless availability of goods and cheap prices to communities throughout America.  But its growth destroyed the small stores that previously thrived and may have been a contributing factor in the demise of small town America.  Amazon did the same to bookstores and is now leading the Internet’s general annihilation of brick and mortar establishments.

This growth is fueled by the societal imperative to acquire more material things, i.e. to consume, and to live ever more exotic lives.  This is why the Consumer Confidence Index is one of the most important statistics of our economy.

On one level all of this growth is the ‘march of progress’.   But on another level it can be deeply disruptive and perhaps ultimately harmful to society and the world at large.

The growth in population in many countries is a major threat to survival.  The growth in energy demand is the major contributor to global warming.  The growth in disposable items (plastic bottles, bags, etc.) is accelerating the pollution of oceans, animal habitats and human living spaces.  The growth in social media is contributing to the radicalization of society.  The growth in mega-corporations is contributing to social and political turmoil.  The growth in automation is causing a loss of middle-class jobs and increasing the disparity in wealth.

Why is growth such a prized attribute?  I suppose it is somewhat natural to want to grow things, to seek expansion.  Growth is a sign of success in most ventures.  Our oldest myths and religions extoll the virtues of growth.  “And you, be ye fruitful, and multiply; bring forth abundantly in the earth, and multiply therein.” (Genesis).  But like many of the long-prized assumptions of our civilization, this exhortation may have outlasted its relevance.

Is a business truly doomed to failure if it is content to stay a certain size?  Is a land necessarily in decline if its population decreases rather than increases? I suspect that the growth axiom is not nearly as axiomatic as one might imagine!

We cannot control or even really discourage the allegiance to change.  We have learned that any dictatorial or centralized planning and directives are unlikely to be successful.  But perhaps we can slowly impact the extent to which change is interpreted as growth.  On a personal level, we can certainly ‘grow’ in many ways without acquiring more or demanding more of the earth’s resources.  Learning new things, experiencing the fullness of the existing natural world, interacting with one another in innovative ways, and creating new non-material activities can slowly take the place of our acquisitive habits.

And in the business world, perhaps an investor consciousness can be cultivated that prioritizes long term sustainability and societal harmony as goals over short term profitability.

If we human beings are going to survive into the next century then our ‘growth’ will certainly have to be curtailed in some respects.  It will require changes in lifestyle, in our daily routine, and in our mindset.  But with our minds, bodies and souls freed from the need to constantly get bigger and acquire more possessions, perhaps we will find that we are actually ‘growing’ in a more sustainable and pleasant manner.

Our Racial Divide

The divisive nature of our current President and the long history of racial tension in our country have converged to create an unstable and potentially explosive atmosphere. 

Trump is a master of race-baiting and dog-whistle racial tactics.  He entered the political stage with his absurd and transparently racist support of the birther movement, questioning our first non-white President’s legitimacy.  He has continued to utter, incite and provide cover for the type of racist and xenophobic outbursts that only a few years ago would have doomed any public figure associated with them.  Somehow, under the guise of defying ‘political correctness’, Trump is able to emerge unscathed after even the most scurrilous comments.

Some of his closest associates voice their absolute confidence that Trump is not personally a racist, but this beggars belief.  And ultimately his own personal feelings are moot if he is using racial animus as a political weapon.

There is a substantial and apparently rapidly growing segment of US society that feels empowered to give full throat to racist and xenophobic tropes.  Under Trump’s watch this type of behavior has crawled out from under the rocks and crevices and spread its disease with only tepid disapproval from conservatives.  This is a shameful display of political self-interest.

But there is also a troubling chasm over race between the much larger, moderate segments of society that would characterize themselves as liberals or conservatives.  Many liberals are convinced that both institutional and individual racism are at the core of many of our current national challenges and that our racial problems have never been adequately addressed.  They believe that aggressive measures to lift the status of blacks, whether in the form of reparations or other affirmative action style policies, are the only way to reach a more positive and egalitarian status quo.

Conservatives, on the other hand, feel that the ‘race card’ is overplayed and that the woes of African-Americans and Hispanics are a mix of self-destructive cultural traits (drugs, crime, single parent families, etc.) and the historical cultivation of dependency through liberal, welfare-style programs.  They believe that reparations or other affirmative action programs will simply exacerbate the problem.

Most conservatives sincerely believe that they are not racist, that they judge people individually on their merits.  The notion of ‘implicit bias’ is viewed as a form of guilt-shaming.  They point to the rise of South Asians and other non-white immigrant groups as evidence that American economic life still rewards hard work and diligence, and that Americans will embrace and accept anyone who has ‘American’ values.

Liberals point to the enduring legacy of slavery and the ubiquitous signs of ‘white privilege’ as proof that a more dramatic effort must be made to solve the race problem.  They see under-funded schools, housing bias, excessive incarceration and a host of other indications that people of color struggle under a much more onerous burden than either whites or recent immigrants. 

The fervent call to ‘address’ the race issue resonates in liberal circles but results in conservatives rolling their eyes.  The question is:  How can any kind of meaningful progress be made on this incredibly divisive issue?

The first thing that must be done is, in my view, clear beyond any reasonable doubt.  All Americans should unequivocally condemn, and demand the eradication of, racist and xenophobic speech, including the type of ‘racist whispering’ speech that Trump and some members of congress use.  

Addressing the problem of immigration through negative stereotypes of gangs, rapists and job-stealers appeals to the worst in ourselves and is a quick path to hate speech and violence.  Soft-pedaling or rationalizing groups who promote hate speech and allowing rallies to erupt in outbursts of ‘Send Her Back’ are simply unacceptable flirtations with racist and xenophobic hysteria.  They are shameful for any political figure, but especially pathetic for the President.  The full congress needs to hold Trump accountable for such abominations.

Addressing the broader and more complex problems of people of color, including police relationships, jobs, crime, healthcare, breakdown of the family, drugs and economic progress must be done on a less emotional and more data-driven basis.  Both sides must learn to avoid the demonization that is at the heart of our current political discord.  Conservatives who don’t believe in affirmative action or reparations should not be dismissed out-of-hand as racists protecting white privilege.  Liberals who call for more aggressive policies to bridge racial divides should not be labelled naïve, welfare-state socialists. 

The issues are complex and deserve thoughtful analysis and consensus-building.  We now have capabilities to analyze such problems through big data and modeling techniques that can give us insights that were unobtainable before.  It is time to start using technology to help counter some of the hysteria and acrimony that social media has engendered.  We need to study problems such as these rather than simply spit out sound bites and platitudes.  Cooler and more compassionate heads must prevail, or we are doomed to an ever-increasing level of conflict and distrust. 

We are already seeing the rotten fruit of Trump’s cynical racist strategy in recent violence.  If we do not take measures to renounce this despicable practice and thoughtfully address the core issues, then we can only expect things to get worse, and perhaps much worse.