|Socialism's finest: the Trabant|
[This article by economist Gary Wolfram appeared in the May 2001 issue of Perspective, published by the Oklahoma Council of Public Affairs. Dr. Wolfram (Ph.D., University of California Berkeley) is Munson Professor of Political Economy at Hillsdale College and a former member of the Michigan State Board of Education.]
In 1955 Milton Friedman wrote an article discussing the role of government in education, in which he made the salient point that there is a fundamental difference between arguing that government should provide education and that government should produce education. His position was that production of education through government schools could not be justified, even if there were reasons for government to subsidize education. This is where he introduced his proposal for providing vouchers for students to use for education that would be produced through the market system that produces most other goods and services.
Twenty-five years later, in 1980, he wrote that public schools were suffering from the malady of “an over-governed society.” In this article he pointed out the failures of K-12 education in the United States, and described the system as “an island of socialism in a free-market sea.” He argued that Dr. Max Gammon’s theory of bureaucratic displacement—that is, in a bureaucratic system increases in expenditure will be matched by falling production—“applies in full force to the effect of the increasing bureaucratization and centralization of the public school system in the United States.”
It is now more than 20 years later and we have allowed our education system to continue as a socialist system, when it has been obvious to us and the rest of the world that such a system is fundamentally flawed. The collapse of eastern European socialism was inevitable. It is only through consumer choice and a system where producers are rewarded for making efficient use of resources (and punished for making inefficient use of resources) that our standard of living will increase. The result of holding tight to the socialist model for production of education has been similar to the results the Soviets had with their production system—poor quality of product and shortages. The collapse of our educational system is just as inevitable as was the Soviet system.
Peter Brimelow has written of five classic symptoms of socialism: (1) politicized allocation of resources, (2) proliferating bureaucratic overhead, (3) chronic mismatching of supply and demand, (4) susceptibility to top-down panaceas, usually requiring more input, and (5) qualitative and quantitative collapse. The average reader will immediately be aware that this describes the state of K-12 education in Oklahoma and the rest of the United States as we enter the 21st century. Let’s take a closer look.
Politicized Allocation of Resources
The various organizations that make up the educational system—teachers unions, school board associations, principals associations, etc.—all aggressively involve themselves in the political process. This is inevitable, since what is produced, how it is produced, and how much is spent on producing it are all set by the governmental process, be it at the local, state, or federal level. Should resources be used to teach evolution? This is a political question to be determined through political means. Should there be an aide for every teacher or every other teacher? What should be the number of aides if there is a special education student in the room? Should phonics be used to teach reading or should whole language be used? These are all political questions.
As is the case nationally, the number of administrators in Oklahoma’s education system has been on a continual climb, according to the Digest of Education Statistics. At the district level alone, officials, administrators, and their support staff rose by 72 percent from 1987 to 1998—from 1,538 to 2,643. The salaries of these bureaucrats have risen to levels far beyond that of the average taxpayer. And consider this: a press release issued last year by the Oklahoma House of Representatives indicates that during the 1998-99 school year, Garrett Elementary School in Beaver County paid $54,098 to a superintendent managing a district with 19 students. Plainview Elementary School in Cimarron County paid $52,044 to a superintendent managing a district with 17 students.
Mismatching of Supply and Demand
In a market system any mismatch of supply and demand is quickly removed through the workings of the price system. If there are more engineers than are demanded by producers, then the wages of engineers fall and less people wish to become engineers. If there is a shortage of plumbers, then the wages of plumbers will rise and more people will become plumbers.
Because Oklahoma’s education system more closely resembles the socialist system than the market system, excess numbers of history teachers will not result in a lowering of the wage of history teachers, nor will a shortage of science teachers result in an increase in the wage of science teacher. As a consequence mismatches continue for years, with history teachers teaching science as the solution.
Top-Down Solutions / More Money
As the public becomes upset with the output of the educational system, the reaction of those who control the system is to issue a mandate that all schools must follow. As does every State Board of Education, Oklahoma’s SBE requires that all schools file plans, take tests, use computers, etc. Oklahoma schools are being forced to comply with more federal mandates as the federal government becomes a place where special-interest groups battle for education resources. Each of these mandates is designed to spend money rather than actually solve the problem.
Though Oklahoma ranks 41st among the states in K-12 spending per pupil, it still spends nearly $5,400 per pupil on a statewide basis. Oklahoma’s low ranking is not the result of its frugality, but the fact that the education system nationwide is based on the socialist model. Expenditures on K-12 education have nearly doubled in Oklahoma over the past 15 years—from $1.57 billion in 1984-85 to $3 billion to 1999-2000—while student enrollment increased only 5.6 percent. Of course, the market does not work this way. In a market system, each individual business judges what is necessary to make a better product. If the business is successful it will please its customers and make a profit; if not, it will lose customers and go bankrupt.
In the face of this large increase in expenditures, the system has failed to improve. According to the 1998 National Assessment of Educational Progress (NAEP), more than two-thirds of Oklahoma’s 4th graders cannot read proficiently.
A full 34 percent are at “below basic” competency levels, which essentially means they can’t read.
And new NAEP figures released last month are not encouraging. “Despite years of funding new reading programs,” The Wall Street Journal reported April 9, “average reading scores for U.S. fourth-graders haven’t risen at all in eight years, and scores for the worst readers have dropped significantly.” It’s small wonder that when the editors of Education Week looked at NAEP scores in 1997 they didn’t even bother to give states a letter grade, saying “all would have failed.”
The system’s failure is evident even after the students leave. For example, The Daily Oklahoman reported March 31 that 37.2 percent of first-time freshmen entering college enroll in remedial courses. University of Oklahoma president David Boren told regents last year that more than 48 percent of OU students admitted on the basis of their 3.0 high-school GPA needed remedial courses. As Boren delicately put it, “I’m sorry to say this may be a statement as to how well students are being prepared in the rest of our education system.” One is reminded of Joseph Sobran’s observation: “In one century we went from teaching Latin and Greek in high school to offering remedial English in college.”
In sum, few would argue that America is not still “a nation at risk.” As economist Eric Hanushek says, “Nobody would argue that student performance has improved during the past three decades.”
In addition to Peter Brimelow’s symptoms of socialism I might add this one: increasing centralization of the production process with less choice for consumers. The number of school districts in Oklahoma has fallen from 5,142 in 1925 to 544 in 2000. This allows for greater centralization of authority and fewer places where parents may choose to send their children.
The education system in Oklahoma, as in the 49 other states, is fundamentally flawed. It is essentially a socialist model, which cannot solve the problem of the decentralization of information about what your child’s needs and wants are. Nor can it solve the problem of providing incentives to ensure the efficient use of resources. Good schools do not get more customers, nor do bad schools go out of business. Pouring more money into this system will not result in a better education, but rather in a more politicized educational environment. For the sake of the children of Oklahoma, we must tear down the Berlin Wall of the education system and make use of the market process for education—as we do for food, shelter, and all the other goods and services that we have in such abundance.