Education and the Free Society; G. Roche

The American public school system is in large part to blame. Even in its basic struc ture and operations, this system is antithet ical to freedom; it is a command industry, meaning that all the decisions are made from the top down, and market forces of supply and demand are completely ignored. As a result, the educational establishment is cur rently spending enormous amounts of tax payer money-so much money that you can hardly conceive of it-on an educational system that has, on balance, done more harm than good for our children, our econ omy, and the future of our nation. The statistics reveal plumme~ing SAT Dr. Roche is president of HillsdaleCollegeand author of12 books. His latest book is The Fall of the Ivory Tower: Government Funding, Corrup tion, and the Bankrupting of American Higher Education (Regnery Publishing, 1994). From1966 to 1971, he wasdirectorofseminars at the Foundation for Economic Education.

From 1971 to 1990, he also served as a trustee of the Foundation. scores for college-bound students, rising crime, and declining standards in schools. Businesses are forced to devote huge sums of money and time to givingtheir employees remedial education courses. This in itself has become a multimillion-dollar industry. The tragic fact is that in public education "nothing succeeds likefailure. " Wellbefore the widely remarked Nation at Risk study was published in 1983, we knew we had a serious problem. By "we," I mean you and I-the man on the street. We were alone in our concern, for, according to the experts (in government, the NEA, and the public school bureaucracy) there was no prob lem-at least not until Ronald Reagan was elected and public spending on education was supposedly slashed. The Growth of Public Education Let us look at the real record. In the late 1980s, Detroit News syndicated columnist Warren Brookes called public education a "$180 billion monopoly." He reported back then that, in spite of one of the world's highest levels of per-capita spending, our students were ranking dead last in science and near-last in language skills and social studies among leading industrialized na tions. But in the 1980s, education spending per pupil rose by 400 percent. That kind of phenomenal increase is continuing in the 1990s. Public education is, quite simply, America's top growth industry.

It is fair to ask, then: Are our schools 279 280 THE FREEMAN • MAY 1996 better off? Are our children getting a better education? Are our workers better equipped for their careers? Are they taught a funda mental appreciation for the principles of limited government and free enterprise that lie at the core of the American experience and that must be preserved and defended if we are to prosper as a free society? The answer to all these questions is a resounding no. Between 1963 and 1989, average national SAT scores fell an in credible 77 points, from 980 to 903. Iowa achievement tests for junior and senior high school students fell ata similar rate. (Don't be fooled by any new reports, by the way, that scores are improving-that is an illu sion. Students now earn an extra 100 points simply by taking the test.) The national drop-out rate has continued to climb; a quarter of the students now in high school will not finish, and in some cities the figure is as high as 50 to 75 percent. It isjust as bad at the college level. One half of all students who enter college never graduate. Those who do-as I have already suggested-are often ill-prepared and lack the critical basic skills needed to pursue their careers.

Economic Illiterates And what about economic literacy? In test after test, more than 60 percent of the nation's high school seniors cannot define the word "profit." Only half of all college seniors can define "inflation," "productiv ity," and "fiscal policy." George Douglas observes in his recent book, Education Without Impact: "For citizens in a democ racy to be able to make intelligent decisions about public policy, it is necessary for them to have a rudimentary knowledge about the national debt, the consequences of taxes, how the Federal Reserve system works, how to make sense of the financial pages of the daily newspaper." Yet, he adds, mil lions don't know "what money is or where it comes from. " When the savings and loan industry failed a few years ago at a cost of billions, "not one person in a hundred could give an articulate explanation of what had happened. " Most students take courses called "Intro duction to Economics" but remain eco nomic illiterates. Known as the "dismal science," economics in the classroom is bor ing, complex, and biased. Teachers spend more time on Karl Marx than they do on Adam Smith, and the attitude is that anyone truly interested in preserving liberty, im proving the lot of the disadvantaged, or promoting the wise use of natural resources must look to government rather than the private sector for solutions.

We. are clearly failing to. teach the next generation about basic terms, about how the market actually works, about its underlying values, and about its relationship to our political system. These are some of the problems in Amer ican education. But what worries me even more than these problems is the fact that all the would-be reformers seem to be advo cating the same solutions. What are those solutions? More money and more govern ment control. Look, for example, at the Department of Education, which was created by Jimmy Carter. When Carter left office, the DOE budget was $10 billion. Ronald Reagan vowed to abolish the entire agency, but was unsuccessful in his effort to persuade Con gress, and by the time he left office,the DOE budget was $22 billion-more than double what it had been before. Under George Bush and now under Bill Clinton, spending has gotten so out-of-control that the Department has to borrow money from the next year's fiscal budget to pay for the current year's shortfall-the same kind of shenanigans that brought on the congressional check-kiting scandal, but you don't hear anyone in Wash ington, D.C., admitting it.

There is a great philosophical dividingline between those who advocate individual re sponsibility and old-fashioned virtues, and those who merely pay lip service. In Wash ington, D.C., it is perfectly acceptable to bend the rules in the name of "the public good." And in public education, it happens with alarming frequency. We must not for get the dictum of St. Thomas Aquinas-that the end pre-exists in the means. No matter EDUCATION AND THE FREE SOCIETY 281 how good proposed reforms sound or how much money is used to implement them, they won't work if they are solely dependent on politics. Reform has gone in the wrong direction, away from the heartland ideas and values which once informed the lives of virtually all Americans. I grew up in the Rocky Moun tains of Colorado between two peaks that formed a part of the continental divide. I went to an eight-grades-in-one-room coun try school house called Gas Creek School.

My teacher was a woman named Georgie House. Like most of the ranchers and min ers in the upper Arkansas Valley, Mrs. House knew that there was a state govern ment in Denver and a federal government in Washington. She didn't mind. So long as the government bureaucrats didn't bother her, she didn't bother them. Gas Creek School didn't have any fancy textbooks, or any computers, or even cen tral heating, but it offered an outstanding education. Without hesitation, I would match it against anything offered at public schools today. Mrs. House educated the children at Gas Creek School as conscien tiously as if they were her own. They not only learned their 3 R' s, but they learned what it is to be self-responsible, freely choosing individuals. Thank goodness for Gas Creek School and Mrs. House. But where are they today? Certainly, there are many good schools and teachers out there, but they have to fight against the system, and they have very little freedom to teach in the way Mrs. House did.

How different education used to be! In the supposedly "backward years" of the early to mid-twentieth century, we had perhaps the best educated citizens in the history of the world. But today, in nationwide tests, tens of thousands of college seniors do not know when Columbus sailed for America, who wrote the Declaration of Indepen dence, or why the Civil War was fought. And these students are not only academi cally ill-prepared; they are culturally, eco nomically, and morally illiterate. It is no wonder. They are free to take classes on death, on sexuality, on environmentalism, and on the theory of "ultimate frisbee," but they get very little in the way of rigorous academic training in history, English, economics, and math. They are also frequently taught that old-fashioned concepts like "family, God, and country" are really narrow-minded, sexist, and racist forms of oppression. The Challenge So, what are we to do? Should we simply give up on our educational system and continue to try to mend matters once stu dents are out of school and in the work place? Certainly not. We can still salvage education. And the main way to do it is to take students out of the system. We ordi nary citizens-not the NEA, not any gov ernment task force-are the ones who can reintroduce competition. We are the ones who realize that public education will not improve as long as it continues to be a protected monopoly.

There are also other ways to help re introduce competition. The Foundation for Economic Education is one sterling exam ple. For 50 years, it has advanced the cause of the free society by educating literally thousands of individuals, many of whom have been high school and college students who have had no previous introduction to free market ideas. Though FEE is a com paratively small institution, its impact has been like the ever-widening ripples caused by a pebble thrown into a pond. Moreover, FEE's success has helped inspire the estab lishment of dozens of other market-oriented organizations. J. Patrick Rooney, chairman of the Golden Rule Insurance Company-the larg est provider of individual medical insurance in the world-provides us with another powetful example of how to reintroduce competition in education. Several years ago, he established a $1 million-plus schol arship fund for disadvantaged children in Indianapolis. After more than 20 years of endless talk and debate about vouchers, tuition tax credits, school choice, and this plan or that, this man simply put his money 282 THE FREEMAN • MAY 1996 where his mouth was. He said, "Are there kids who want to go to private school who can't? Well, then, I'll do something about it right now." What Rooney has done, in essence, is to privatize vouchers.

Private vouchers start working immedi ately with no red tape and they don't create a mountain of paperwork or need hordes of administrators to manage them. Unlike "government vouchers," which so many people are calling for today, private vouch ers do not make the schools who accept them liable to future government control as supposed "recipients of federal funds. " Pri vate vouchers also create badly needed revenues for good schools, allowingthem to expand and help more and more students. And, most important of all, private vouchers place power in the hands of parents, stu dents, and teachers rather than the educa tion bureaucracy. We do not all have to have a million dollars to make private vouchers work in our communities. We can sponsor individual students, one at a time. These examples remind us that it is as easy as that to recover the self-reliant, "can-do" spirit that once pervaded this country and that is the lifeblood of the free society. And they apply to every facet of our society, not just education. Once we stop looking to Washington, D.C., for so lutions, we will find them in our own back yard, and they will turn out to be real solutions, not panaceas. D THEFREEMAN IDEASON UBERTY Fifty Years of FEE Fifty Years of Progressin Austrian Economics by Israel M. Kirzner A t this time of FEE's goldenjubilee, an Austrian economist's thoughts dwell naturally upon the pivotal role which the Foundation has played in the survival and resurgence of Austrian Economics during the twentieth· century. The state of and prospects for Austrian Economics in 1996 are far healthier and more promising than they were fifty years ago. This essay briefly sketches some highlights in the develop ments that have occurred during these five decades, and draws attention to FEE's im portant contribution in this regard.