Freedom is the missing ingredient in education

Evidence from history and the present day, from both home and abroad, shows that there is no conflict between the profit motive and the provision of learning and education.

If we reduce education to a simple act of voluntary exchange then it is clear that it is similar to many other services that are traded freely on an open market. Parents profit from being able to provide education for their children that they could not provide themselves and the for-profit provider will profit as long as the revenue received is greater than the costs incurred. Those children who receive the education will also be expected to profit from the experience and, finally, the wider community will profit because of the benefits associated with having a better educated community and a greater understanding of history, science and culture.  Therefore it’s a win win win win situation!

That said, while the profit motive is essential, it is not sufficient to guarantee that we have the greatest possible variety of educational opportunities available. This is because the profit motive may also encourage some companies to seek government protection against competition, resulting in a private monopoly, which brings with it many of the problems associated with a public monopoly. The key question therefore is not whether for-profit companies should be free to deliver publically-funded education, but whether there should be freedom of entry to all different types of organisations from both home and abroad. Freedom is therefore the missing ingredient in education and all current problems within the sector are directly related to the government policies which continue to restrict freedom of entry and the freedom of parents to choose.

Furthermore, to suggest that the profit motive is incompatible with education implies that freedom is also incompatible with education. However, why is freedom deemed essential within religion, the media and the publication of children’s books but deemed destructive when it comes to the delivery of children’s schooling? And why is it that political interference, central planning and a government monopoly are recognised as being completely unacceptable with the media and religion, but welcomed with open arms in education? The fact that these questions are now being asked shows just how confused and perverse this debate has now become. After all, what could possibly be wrong with promoting and protecting the forces of freedom in education?

In education markets around the world where government restrictions have already been removed, it is becoming increasingly clear that there is no single best model of a school, college or university. Instead there is a variety of different legal and organisational forms and structures active in this sector which in turn adopt a variety of different financial, management and educational models and practices to help them deliver a variety of different educational opportunities. We should also expect different models, structures and forms to emerge as markets develop and the rate of innovation begins to increase. Education is therefore best viewed as a self-organising system in which learning emerges spontaneously over time in a variety of different forms. Central planning in education is therefore redundant and instead governments must focus on creating an environment that will encourage the greatest possible variety of educational opportunities to develop. In fact central planning in education has always been redundant. The associated hidden costs and unintended consequences are now becoming increasingly obvious.

James B. Stanfield is the editor of The Profit Motive in Education: Continuing the Revolution.

12 thoughts on “Freedom is the missing ingredient in education”

  1. Posted 19/07/2012 at 15:34 | Permalink

    The facts that no state has ever achieved even close to 100% literacy without having imposed laws madating that people become educated and then invested massive amounts of public resources into the construction of non for profit state school systems, or that prior to this the only large scale schooling systems were all run by religious institutions seems to be concrete real world evidence that a for profit system of education is not something that makes sense. Otherwise the intelligent people of the 17th, 18th, and 19th centuries would have created such a market, like they created countless other markets.

  2. Posted 19/07/2012 at 19:26 | Permalink

    I hadn’t realised that the British government had achieved anything like 100% literacy in its state schooling system. My understanding is that something like 20% of everyone leaving state secondary schools these days is more or less illiterate — if so that appears to be a far worse record than was achieved before the state after 1870 crowded out fee-charging schools of various sorts. If we assume that most people who take an interest in education ‘mean well’, then it seems modest enough to claim that no single group of people is likely to have the single ‘correct’ answer and therefore a process of competition (Hayek’s ‘discovery procedure’) might well lead to many improvements in education, as it has done in so many other areas.

  3. Posted 19/07/2012 at 21:11 | Permalink

    @anonymous…There certainly have been profit making schools in lots of different situations that have been particularly successful at bringing education to the poor: but, you are right, not universally. Indeed, until the 1930s there were a lot of profit making schools in the UK (I think that inheritance tax was a big problem for them because they were family run). Surely, the reduced significance of religious institutions (which, of course, subsidised their education, therefore making it more difficult for competitors) is likely to make the profit-making sector relatively more important – and, of course, that has been the experience in Sweden. With regard to the history of education, it simply would not make sense before industrialisation for most families to spare their children for several hours a day schooling – and there would not have been the population densities to make it at all economical. Schooling developed organically and the state jumped in to the saddle of a galloping horse (as West said).

  4. Posted 31/07/2012 at 01:32 | Permalink

    As an educational researcher in the U.S., we are seeing widespread scandals and fraud in the for-profit education sectors for children and for adults.

    There are new scandals almost every week, and there is no evidence that opening up education to for-profit providers is improving average learning nationwide. It was just revealed that the largest K-12 (ages 5-18) provider has a terrible completion rate and one for-profit university that grew from 500 to 90,000 students in five years just lost its accreditation due to terrible instructor-student ratios and major quality control problems. Just yesterday, a $6.5 million fraud case at a charter school in Philadelphia was reported.

    I don’t know how people handle the profit motive on your side of the pond, but on this side of the pond, with a few notable exceptions, the profit motive mostly seems to be corrupting and distorting education. If there is money left over, why shouldn’t it go back into children’s education–isn’t any other use simply waste?

  5. Posted 31/07/2012 at 14:32 | Permalink

    Thanks for your comment Karl. I suppose that if both state and federal government attempts in the US to improve average learning outcomes nationwide over the previous half century have failed, despite the enormous increase in public funding, then it will be highly unlikley that a handful of for-profit charter schools is going to have any impact on average levels of learning. A more important measure of success would be levels of parent satisfaction or perhaps the length of waiting lists at the different schools. There is ceratily a need for much more research to be done on the attitudes and preferences of parents, who are after all responsible for their childrens education.

    I’m ceratinly aware of the recent scandals concerning for-profit providers in the US, and its great to see any examples of corruption or mismanagement are quickly being highlighted and any necessary action taken. Compare this to examples of failure throughout the public school system. First its often very difficult to get the people involved to recognise that a problem exists in the first place. It is then even more difficult to introduce the neceeassry reforms.

    To the best of my knowledge the research published to date are mixed with reference to exam results, with some for-profit charter schools performing better and others performing worse than local public schools. However it will also be importnat to take into account how long these new schools have existed and also how their performance is changing over time. Further research over a period of time will therefore be required

    However, for the sake of argument lets say that there is no difference between academic performance between public and for-profit charter schools – does this mean that parents should now be denied access to the for-profit alternative? But what if parents prefer this school for other reasons, such as strong discipline? Should parents not be free to choose or why should they be forced to attend a government school? Isnt the fact that parents have a variety of different schools to choose from better than just having one public school?

    Finally, as I mention in my introduction, the profit motive is already playing a major role in government education sectors around the world. Every pen, pencil, chair, table, computer, school building etc are all purchased on the free market and supplied by for-profit companies. In the Uk nursery education is also dominated by for-profit providers and so the profit motive is OK for children under 5 but not children over 5. Plus outside of schooling, private tutors do not provide their services because of their love of teaching but to generate a profit which will become part of their income. If it works in private tutoring why not in private schooling? Therefore perhaps its not the profit motive that is the problem but the rules of the game in which the for-profit schools operate.

  6. Posted 31/07/2012 at 20:37 | Permalink

    A couple of thoughts:

    Having overall control exercised by a for-profit corporation is very different than having kids use pencils made by companies but having overall control exercised by the government.

    In the US, both most government schools and most corporate schools seem quite unresponsive to parents’ wishes, obviously with notable exceptions in both sectors.

    The reality is that because of asymmetrical access to information, parents do not have good information about which schools will achieve well the goals they value most for their child. Heavens, I’m a researcher and look at the paltry data shared in the paper, and haven’t the foggiest idea which schools are doing well or poorly. I may know which schools have the richest kids, but as for gains across the year in the things I care about, generally no one has the data.

    As a parent, of course I want a million choices, and I’d be quite happy if you’d pay for them please. The consideration of policymakers must however be to do the thing that works best overall for the broad citizenry. Parents notified that their school failed to meet AYP in fact are not finding adequate spaces or high-quality alternatives. Education is not manufacturing, so quality can’t be scaled up in the same way.

    The long term prognosis is likely that the spread of for-profit schooling will de-stabilize our public school system, the public schools will lose political and financial support as more and more people leave the system (as happened when whites left public education in the South after mandated integration), the most needy will be left with even worse schools, and in that sense, the rich will continue to get richer and the poor poorer. This conflicts in obvious ways with our imperfectly executed commitment to equal opportunity.

    Just as “higher standards” have dumbed down our curriculum in many ways and “greater accountability” has allowed some to duck their responsibilities for education, greater “choice” will likely erode the quality of choices for a great many families. The slogan is lovely marketing, but “choice” is a double-edged sword just as your “freedom” to pollute also undermines my “freedom” to breathe clean air.

    Markets create inequalities where none existed before and amplify inequalities through processes as mundane as differential interest rates and as powerful as differential access to political power. The degree of inequality we now have in the States is a clear and present threat to our continued strength as a nation, and this has occurred in substantial part by allowing market interests to bend public policy to their liking.

    Markets do some things better and the public sector does other things better. For the broad range of goals we value (including both educational outcomes, equal opportunity, regulating the education process thoughtfully, etc.), the public sector seems broadly superior to the private sector for educating the masses.

  7. Posted 01/08/2012 at 14:17 | Permalink

    “The consideration of policymakers must however be to do the thing that works best overall for the broad citizenry”. Bastait was highlighly critical of people who adopted this point of view because they tended to place themselves above the rest of mankind in order to control, plan and patronise everybody else accrording to their fancy. I tend to agree. I have absolutely no idea what works best in education for each individual family never mind the so called “broad citizenry”. The complexity of this issue is beyond my comprehension and unless you are some kind of superhuman this task is simply not possible. Instead policymakers should simply stick to identifying the best rules of the gamne which will allow individual families to decide for themselves what works best.

    “The long term prognosis is likely that the spread of for-profit schooling will de-stabilize our public school system”. I completely agree. Choice and monopoly cannot coexist. Instead choice is supposed to prevent a government (or private) monopoly from developing or to dismantle a monopoly if one has been allowed to develop.

    “greater “choice” will likely erode the quality of choices for a great many families”. In short you believe that freedom leads to our mutual destruction and so we need to be saved from ourselves by enlighted politicians who only have our best interests at heart. In education this suggests that if parents carry out their responsibility to educate their children as expected, then this will damage or put other children at a disadvantage. Parents who want to invest in their childrens education must therfore be prevented from doing so. But why would anybody want to restrict any kind of education?

  8. Posted 21/08/2012 at 15:26 | Permalink

    James, I’m not suggesting content when suggesting what is best for the broad citizenry, so I don’t fall into the category you’re claiming I’m in. Thus, I’ll ignore that superhuman part of your post. I’m a strong supporter of homeschooling and parents having broad choices, but it appears that parents will have the best choices in the long run (especially families where both must work) if we maintain strong public support for a strong public system. Free market “choice” always appears sensible to people with money, not realizing that if the shared commitment to providing quality public education for all collapses, poor children will have roughly the same choices for education that poor families have for dining out–which is little and none.

    We have here in the US a public system which is test-driven and an increasing number of test-driven for-profit schools. The for-profit schools tend to have a pay structure that pays teachers less and pays a few executives with unclear duties more. Thus, at a time when the weakening buying power of the middle class is a central threat to our economy and to the American Dream itself, the for-profit approach is clearly inferior in these structural ways.

    You use “freedom” is the vaguest way above, the way politicians do, and then set up an outrageous straw man. I assume you know that there are a virtually infinite number of freedoms that are mutually incompatible with a similar virtually infinite number of freedoms. Your freedom to smoke in a restaurant interferes with other diners’ ability to breathe clean air, and lots of economic “freedoms” directly interfere with freedoms I’d like to enjoy. I love freedom and love talking and writing about it, but let’s now pretend it’s simple or that there aren’t trade-offs. Particularly, at various points in our history, we have learned here in the U.S. that allowing enormous freedom for the wealthy and corporations to do as they choose leads to massive wealth accumulation at the top and a weaker middle class, and all sorts of abuses of workers and the environment, etc. Maximizing economic freedom for the rich and powerful thus leads to fewer and fewer real choices for 90+% of the population. The real world requires checks and balances, and government must provide the checks and balances against the excesses and harm inevitably caused to an unfettered market.

    Here in the U.S., we’re seeing what the profit motive is doing to education, and it isn’t pretty.

  9. Posted 22/08/2012 at 12:31 | Permalink

    Thanks anon. Unfortuntely I dont think that you can avoid the superman part because again you state that “I’m a strong supporter of homeschooling and parents having broad choices, but it appears that parents will have the best choices in the long run if we maintain strong public support for a strong public system”. But how could you possibly know a) what would be the best choice for each and every parent across the US in terms of their children’s education and b) that restricting parents ability to choose will provide them with the best choice in the long run? Furthermore, in the long run, you would need to take into account not only the existing choices facing parents but also the variety of different choices that would be available to parents if they were free to choose, but which dont currently exist. This would take a superhuman effort and because circumstances are always changing you would have to have a continuous flow of superhuman efforts. Imagine that you live in an area where parents are free to choose and the government provides each parent with a voucher and a variety of different types of schooling and other educational opportunities are available. You organise a meeting with 100 other parents from the local area and all of their children who attend a variety of different schools across your city. You stand up and declare “I’m a strong supporter of homeschooling and parents having broad choices, but it appears that parents will have the best choices in the long run if we maintain strong public support for a strong public system”. You therefore suggest that all parents should now be forced to use their vouchers at the local government school. But what if some parents disagree and are repulsed by the idea? Do you really think that they will be convinced by your argument that this is a good idea because you think that they will have better choices in the long run if their choices are restricted to one or a number of different local government schools? I’m sure some would suggest that you are bonkers even to suggest that they will have better choices by restricting choices. Others will also want to know how you know what will be the best for them in the future. Another parent may also declare that while you are a brilliant neigbour, who gives you the right to tell me how I should educate my children or who the hell do you think you are attempting to interfer with how I educate my children? And when it comes to parents protecting their children it is important to recognise how angry and disgusted some of these people may be with your suggestion. For these parents all of your views about the history of excessive amounts of freedom, evil corporations and the abuse of workers will be completely irrelevant. Even those who agree with your interpretation of history will still question what this has to do their children’s schooling. Perhaps some parents may also ask, what next? Do you want to ban all children from eating any unhealthy foods? After all this would reduce obessity? Or if some parents are not capable of choosing the best kind of education for their children (i.e a government school), then perhaps you would want to restrict these parents from voting in the next election. If you know whats best in education then why not extend your superior thinking to all other areas of peoples lives? Why stop with education? Imagine what a perfect society you could create!

  10. Posted 22/08/2012 at 14:21 | Permalink

    Jame, James, James

    You’re claiming to know that privatizing education will provide a better array of options for parents, and I’m claiming to know that it’s likely to leave poor parents with the same choices they have about dining out–few to none. Your claim is as ambitiously all-knowing as is mine. In the US, the “freedom to choose” healthcare approach to privatizing Medicare would leave senior citizens having to cough up and extra ~$6400 a year, which would be quite a trick since the majority of them are living on less than $25,000 a year. Imagine how thankful they’ll be to suddenly have that “choice.” “Freedom” from reasonable government regulation gave us the BP oil spill and the worldwide economic meltdown–some things that market themselves with the banner of freedom do more harm than good.

    Whether we like it or not, governments are often tasked with the responsibility of deciding what they think is best for their citizens and nation. Do we need to spend more on buns or on butter? Should we build high speed rail? The idea that unfettered markets make all these decisions better is not scientific, it’s ideology. Our city has installed new traffic lights, but what if I personally didn’t want the new traffics lights, or wanted the new road to run somewhere else. We have governments to do a variety of things that serve the best interests of all the people and the whole nation. The idea of a nation disappears if everything is just about me, me, me, and demanding what is personally best for me. One of the most important things governments do is protect citizens from the damage caused by unfettered markets.

    I’m not asking for a voucher to homeschool our kids–our tax dollars go to support our local services, including the public schools that other people’s kids attend. I’m also not telling individual parents what choice to make, but policymakers have to pick a path, and any choice they make will require them to have foresight and make a judgment call. Because of asymmetry of information (citizens often don’t have enough information to evaluate highly complicated arenas), we trust experts to inform policymakers who make policies. If we don’t like the choices they make, we vote them out.

    There’s a lot of Orwellian language running through US educational policies these days: we have “higher standards” that dumbed down the curriculum, “greater accountability” that allowed many powerful people to duck responsibility for their contributions to our current problems, and “choice” that leads to poorer choices for a great many students and families. Just creating one seemingly desirable and aggressively marketed charter school can siphon some of the best teachers and leadership and students and families from a few dozen other schools–making a better “choice” available for only the people in the one school while reducing the quality of choices available for the people left behind in the 24 other schools. Government needs to act like a responsible grown up and decide whether such tradeoffs are good for the nation.

  11. Posted 22/08/2012 at 19:22 | Permalink

    @Karl – if you think that the financial sector was free from government (rather than having its risks completely underwritten from government) then you are going to jump to some wrong conclusions about the crash; ditto regarding BP, I am afraid. But the flaws in your argument are that you seem to suggest that the government should just come along and create a private school rather than to allow the market to evolve and, also, you have simply not separated the discussion of provision of education from that of finance – you are mixing the two issues up entirely. In Holland, for example, the vast majority of primary education is privately provided (though not through for profit schools) and state funded. And you are completely wrong to say that believing that it would not be better for the government to decide for me how much I should spend on butter (nothing actually in my case) and how much on buns than for me to take that decision myself is ideology and not scientific. Are you not familiar with the calculation debate? It is, indeed, science.

  12. Posted 23/08/2012 at 00:29 | Permalink

    The government sector didn’t do its job in either case because it had been corrupted by market forces.

    I was talking about the government deciding among its own spending categories, not doing your own shopping for you–sorry if that wasn’t clear.

    Perhaps everyone is behaving well on your side of the pond, and I hope they are, but on our side of the pond, the push for privatizing education is deeply wrapped up in the aggressive pursuit of for-profit entities who are trying to make billions off of education, and some very bad things are happening. I do understand the distinction between finances and provision, and some of the very bad things are happening with public dollars and private providers, both in K-12 and higher ed. Even when an entity does not seek to make a profit and pay investors, the people at the top can pay themselves very large salaries—salaries on another order of magnitude from what is needed to get someone to do the job.

    In the U.S., Texas was the warning foreshadowing about what would happen to the rest of us if we went the high stakes route. I’ll hope the U.S. isn’t the warning foreshadowing for what will happen to the U.K. and other countries if we all go further down the privatization route.

    It’s been fun, but I’m done, and we’ll have to agree to disagree on the rest. I have to get back to my book.

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