Education and Free-Market

*Edit: Links didn't carry over.*

A friend of mine sent along this article and asked for thoughts I figured why not just post it?

Article:


Education, Entrepreneurship, And The President



Today, President Barack Obama addressed school children across America. Political emotions are running hot, the Drudge Report has highlighted the speech for days and it has been daily fodder for blogs, radio and television. Personally, we believe that our children should learn to respect and honor the Office of The President of the United States of America – no matter who sits in that office or what their politics are.



Typically, students are exposed to politics and government indirectly through their parents, teachers, or the media, and more directly on their eighth-grade trip to the state capitol or to Washington, DC. Reversing this process, by bringing the politician into the classroom, is what bothers people.



So, why are we writing about this? Because the speech is about economics, that’s why. The President told the kids, “Every single one of you has something you’re good at. Every single one of you has something to offer. And you have a responsibility to yourself to discover what that is. That’s the opportunity an education can provide.”



He adds, “Maybe you could be a good writer…maybe you could be an innovator or an inventor…maybe you could be a mayor or a Senator or a Supreme Court Justice…You can’t just drop out of school and drop into a good job. You’ve got to work for it and train for it and learn for it.”

Good stuff.



“Where you are right now doesn’t have to determine where you’ll end up. No one’s written your destiny for you. Here in America, you write your own destiny. You make your own future.”

Great stuff.



These are the things many of us tell our kids every day. The American system of free market capitalism and democracy has provided an amazing array of opportunities for those willing to work hard. In America, unlike under communism or feudalism, freedom not only allows choices, but provides them. In the Soviet Union, at the height of communism, the government planned just about everything.

It decided on individual careers (who would be a doctor or bus driver). It divvied up the pie. In a free market, the forces of supply and demand do this. They push and pull people to sectors and jobs that best utilize individual talents – where people are the most gifted.



As a result, resources (labor and capital) are shifted to where they are best used and most profitable. Entrepreneurs who treat capital well are rewarded with more of it, while those that treat capital poorly face the loss of it. Education is an important step in this environment, and increases the odds of success, but it does not provide a guarantee of success.



In fact, public education (especially in the inner-city) is failing many children as the President speaks. And it’s not all the kids’ fault. The schools are publicly run and face little to no competition. Vouchers, which would provide that competition, are universally condemned by teachers’ unions

because they don’t like competition. In a competitive environment, voucher money would leave public schools and so would students to go to schools that worked.



Nonetheless, the President finished his speech by saying, “Your families, your teachers, and I are doing

everything we can to make sure you have the education you need….I’m working hard to fix up your classrooms and get you the books, equipment and computers you need to learn. But you’ve got to do your part too.”



This is the one part of the speech we completely disagree with. While we certainly understand the President’s desire to be the bearer of all gifts to all people, it is not his money or time that is supporting the school system. Hardworking American taxpayers are the ones supporting the school system with their tax dollars. And it’s their children attending the schools. In a truly free market system, they would be the ones that directed the resources. But the public school system is not a free market. As a result, the government directs the resources and the system remains inefficient and less effective than it could be.


B rian S . Wesbury - Chief Economist

Robert Stein, CFA - Senior Economist

Thoughts:

If I were Emperor the first thing I would do is eliminate any system of education that did not explicitly train people to work in my regime, or that taught critical thinking in the form of the Scientific Method or otherwise.

Anywho:

I'm always suspicious of 'free market' arguments where 'free market' is not clearly defined. I know that as Good, Patriotic (same thing), Freedom-Loving Americans we're not supposed to question the motivations or wisdom of the masters of our markets. Our markets are good because they're 'free'. No, they're not free as in they don't cost money they're free in the sense that...

You know what? How about a nice creamy McCafe? You'd like that wouldn't you? What's wrong? You don't feel like a refreshing McCafe? Is it the corn syrup? Why don't you want corn syrup? Is it because you hate corn? You know the American-Indians gave the Pilgrims corn and then they founded America. You don't hate America do you? No, I didn't think so. Have a McCafe, you may be an instant winner. Drink it!

As for these guys I'd take a look at their backgrounds as far as a few minutes of internet research allows:

If it's this Robert Stein and this Brian Wesbury or (I have a hard time reconciling the pictures bad with faces, no excuse I know) these guys:

They and / or their mentors are all products of the US public school system. One might say that they can see as far as they do because they stand on the shoulders of those who came before them. I'm not saying that there aren't problems with the system as it is, but to eliminate public education in the name of the 'free-market' as these gentlemen do not explicitly state but strongly imply is absurd.

As they state in the last paragraph it's the 'hardworking American taxpayers' that are supporting the pubic school system and that 'they would be the ones that directed the resources'. In a Representative Democracy (which I'd say we strive to be, if not then some form of Republic) the public directs its resources through its representatives in its elected government.

Now, are there 'inefficiencies'? Yes. But through government we at least make an effort to represent the interests of a broad section of the population and make an attempt to move forward by examining potential courses of action from as many points of view as possible, hopefully finding the steadiest course.

Situations where individuals can take action based solely on their own interests, without temperance (regulation via some third party, in our case an elected government, hopefully) lead to the formation of oligopolies and cartels and monopolies among other things. Don't get me wrong, these systems are great if you control them (or have controlling shares or whatever you want to call it) but they're not so pretty if you don't.

(Hint: We Don't)

And by the way, when the hell did people start taking all of their advice from bankers? What the hell does anyone think a banker is going to advise them to do but to give them all of their money. It's what they do.

My friend takes a look at public education here and can speak more comprehensibly about the issue(s) than I ever could.

tl;dr;

These guys and / or their mentors owe their station in life to the US public education system. They make their living by convincing people to give them money with the promise that they will create more money with it. While I might take seriously what they have to say about a prospectus describing the distribution of assets for a pension fund, I'm highly suspect of their advice for just about anything else.

Of course, these guys are Economists and I'm just Some Guy.

(Incidentally I had never heard of them, we all live in our little bubble, nice to get out of it sometimes.)

Let's pass a law saying that police must end all crime by 2014.

Seems like kind of a silly idea, doesn't it? Well, it would make about as much sense as Bush's 2001 No Child Left Behind law, which requires 100% of students to be proficient in reading and math by 2014.

To believe that schools can accomplish such an outcome simply because the federal government has instructed them to do so, we'd have to believe that schools are the single, decisive factor determining student achievement. In other words, according to NCLB, all socio-economic factors, parental education level, parental involvement, individual motivation (or lack thereof), and variations in native intellect can all be overcome, in every case and in every circumstance, by public educators -- just as long as you tell them they have to do it.

Later this year, NCLB will be up for renewal. Undoubtedly the Democratically controlled Congress will make some revisions to the law. What is not yet clear is how extensive those revisions will be, and what changes will be made. What does seem apparent is that NCLB and the fundamental notions underlying it, aren't going anywhere anytime soon. Which is too bad, because it's a junk law. Here's why.

Standards

"Standards" simply refers to the list of stuff that we expect students to know and be able to do. Without clear standards, you can't have accountability... right? I mean, you'd have nothing to hold people accountable for. And if you want a genuinely educated populace, those standards need to be high. So that's one major pillar of the NCLB law: high standards.

Except that, NCLB does absolutely nothing to improve standards, and one could easily argue that the law has lowered educational standards far more frequently than it has strengthened them. NCLB does not set any specific standards for student performance. Instead, it mandates that each state must write its own standards. Now, undoubtedly this is a step in the right direction. Every state should have clear, concrete standards for every subject area. Unfortunately, even while complying with NCLB, many states have standards which are weak, vaguely worded, short on specifics, short on content, and often just plain low. Bush's law doesn't contain any mechanism for evaluating the quality of state educational standards, or for ensuring uniformity across the states. There is no standard for the standards.

Given that it is up to each state to set its own standards, and then test whether its students have met those standards... it's not too surprising that test scores are on the rise. One simple explanation is that standards are being lowered so that more students appear to be proficient.

Testing

Under NCLB, standardized tests are the mechanism used to determine whether students are learning, and therefore whether schools are doing their job. Standards + Testing = Accountability. That's the essential formula of NCLB.

Contrary to what many people seem to think, there is no federal "NCLB test." Rather, the law mandates that each state is to administer its own tests in reading and math, and then submit the results to the federal government. While this is a tremendous windfall for private testing companies who write the tests, it's not the most reliable measure of student achievement.

In reality, the tests vary in difficulty level from state to state. Even if we set aside all the other questions and concerns surrounding the use of standardized tests to gauge student achievement and educator effectiveness (maybe we'll save all that for a later post), we still must face the fact that reading and math proficiency in Missouri are not the same as reading and math proficiency in Massachusetts, and No Child Left Behind provides no means to distinguish between the two.

(In New York City, teachers administer the tests within their own classrooms to their own students, with minimal [if any] supervision. Relying upon the results of tests administered under such conditions involves a pretty big leap of faith in teachers' integrity. Funny that legislators and the general public don't tend to trust teachers' competence, motivation nor professionalism. Yet they predicate billions of dollars of spending on this blind trust in teachers' honesty regarding test results.)

Accountability

This word gets thrown around a lot in contemporary education policy discourse, but it doesn't often get examined. Underlying all the discussion is an implicit assumption: schools haven't been properly educating children, because nobody has been holding them accountable for doing so. Increased accountability - holding teachers and administrators (and maybe even state governors, if Obama has anything to say about it) responsible for their own student outcomes -- is supposed to have a direct, positive effect on student achievement. In fact, that's the whole essence of the law. Logically, it presupposes that schools or individual teachers could be doing much more to educate children, but they simply haven't done so, only because they haven't been motivated to do so. They've been lazy, because nobody has been holding them accountable.

Yet NCLB doesn't hold educators accountable for their administrative or pedagogical practices, or even their students' actual achievements; it only holds them accountable for test results, which we've seen are essentially meaningless.

NCLB provides minimal guidance and weak support for struggling schools, totally failing to address the underlying issues and entrenched problems which cause students to fail in the first place. For example, the law offers a supposedly research-based reading curriculum whose development and implementation have been rife with corruption and mismanagement.

The law also mandates that schools which fail to make Adequate Yearly Progress for two years in a row must offer free after-school tutoring to students. This tutoring is provided by private companies, who have earned literally billions of dollars for providing their services. But the private tutoring companies are chosen by the individual states at their own discretion. NCLB includes no standards, no oversight and no accountability for these companies. It simply requires states to shell out piles of cash to them, with absolutely no way of measuring their effectiveness, and no apparent desire to do so.

Without a universal standard and without a reliable means to test progress toward that standard, accountability becomes a farce and NCLB becomes a very expensive exercise in futility. It allocates billions of dollars to private companies with no oversight or accountability. It does very, very little to provide real support for struggling schools or to address underlying problems which cause schools and therefore students to fail.

President Obama and Education Secretary Arne Duncan appear to favor a stronger role for the federal government in public education, and they appear inclined toward strong accountability measures. It remains unclear how much of Bush's educational policy Obama will retain, but using NCLB as a template is probably a shaky foundation for real reform. It's a junk law that accomplishes nothing other than piling even more money onto the heap of wasted educational spending in America.