School-to-Work: A Large Step Down the road to Serfdom; G. Wolfram

School-to-Work:A LargeStep Down the Road to Serfdom by Gary Wolfram I t's been five years since Congress enacted the "School-to- Work Opportunities Act." School-to-Work is a federal program that ostensibly is designed to improve the work skills of children in the nation's government schools. The theory is that our education sys-. tern should prepare children for jobs in today's society.This is funded by the billions of dollars the federal government is willing to provide states that adopt approved plans and programs for channeling students into occupations. By inducing individual states to participate, the federal government can establish a "national framework" for "comprehensive reform." To date all 50 states, Puerto Rico, and the District of Columbia have received state development grants, and 43 states have received implementation grants. In addition, 61 communities have received local partner ship grants.

The heart of this reform is to require each K-12 student to have comprehensive career guidance by no later than the seventh grade and to adopt a "career major" within an occu pation area. The choice of occupation areas is to be made by a local planning board based on government economic projections of "need." On graduation, students receive "certificates of mastery" that are linked to national skill standards being developed by the federal gov ernment's National Skill Standards Board. The certificate of mastery is designed to Gary Wolfram is the George Munson Professor of Political Economy at Hillsdale College. 15 create a system of certification for all occupa tions. Once every state and every student are involved in School-to- Work, the federal gov ernment can, through its taxation and regula tory power, "encourage" businesses to require that new hires have a certificate of mastery.!

The Federal Role in Education As Nobel laureate F. A. Hayek made clear in his 1960 book, The Constitution ofLiberty, the federal Constitution was meant to provide a written foundation to protect the individual from his government. As such, the Constitu tion provides the federal government with explicit powers and through the Tenth Amend ment clearly states that "The powers not dele gated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people." One would search in vain through our Consti tution for a statement that the federal govern ment has been delegated power over the edu cation of our children. That is why, tradition ally, government control of education has been at the state and local levels. For a number of reasons, the founding fathers were correct in not assigning the fed eral government a role in education. The first can be classified under what Hayek, in his final book, called "the fatal conceit."2 It is impossible for a central planner to know what is the appropriate education for the millions of individual children who are in school every day. Only parents can.know what is appropri16 THE FREEMAN/IDEAS ON LIBERTY • SEPTEMBER 1999 ate for their child. To think that a federal bureaucracy in Washington, D.C., can better determine even a portion of what is to be taught in schools from Miami, Florida, to Anchorage, Alaska, is at best misguided and at worst a threat to our liberty.

In the context of the School-to-Work Act one might argue that the federal government is not mandating a particular program. Indeed, states may choose not to participate at all, though naturally they find the money irre sistible. But this is too superficial a view. Most state governments succumb to what I call the buffalo strategy. If I don't shoot the buffalo someone else will. If Kansas.does not adopt an approved plan, it will not receive the taxpayers' money and some other state will. The strategy may be rational from the per spective of a state government, but there are costs. In the short run, educational priorities will be altered to fit the terms of the federal program. In the long run, there will be a fur ther loosening of our constitutional moorings and another step toward government planning of the economy. The statute requires that each state's plan be approved by the federal government for the state to receive the money. Thus, it is likely that the federal bureaucrats who approve the state plan may influence what the state pro gram will be. Indeed, the statute itself has some requirements to indicate what the plans should look like. For example, students are to be counseled in their career plans by not later than the seventh grade in an attempt to get them to identify their career majors (Section 102), and students are to be encouraged to enter nontraditional careers (Section 4).

One cannot read the Act without getting a clear indication that the Congress is attempt ing to redirect education into a worker training role and away from a classical liberal arts curriculum. Whether this is good public policy is not the question at this point; the issue is whether the federal government was intended under the Constitution to engage in it. As Frederic Bastiat wrote some 150 years ago in The Law, when government becomes involved in education, people begin to lose a sense of whose responsibility it is to educate their children.3 Education becomes thought of as the responsibility of government; all edu cation issues will become political issues; and people will blame the government for its inevitable failure to do what it claims it can do. Today we prove that Bastiat was right as we engage in a political discussion about whether a primary mission of schools should be specific job training, as opposed to provid ing general knowledge such as reading, writ ing, history, mathematics, art, music, geogra phy, and so on.

Are schools likely to be any more efficient at job training than they are at basic classical education? If not, the short-run response may be to call for more resources to go into edu cation, but the long-run response will be fur ther complaints and dissatisfaction with gov ernment's actions. The Political Economy of School-to- Work Public-choice theorists have recognized that all state action is human action, again something that Bastiat made clear a century and a half ago. This means that the political process is determined by the incentives creat ed within the system. Federalist No. 10 warned us that factions or special interests will attempt to use the political system to direct resources to themselves.4 School-to-Work is a case where special interest groups, in particular business, will have every incentive to influence the curricu lum of the schools. Once we have opened the door wide to the business community to help determine what job skills will be taught in the schools, each employer will attempt to get the specific training used in his particular indus try into the curriculum. Employers will also assist in determining which "career majors"

the seventh-grade students will be steered into. It is only rational that each employer should seek to have students directed into his industry in order to increase the supply of skilled labor. This reduces job-training costs and wages. The issue is not whether this is illegal or immoral. The issue is that the system is SCHOOL-TO-WORK: A LARGE STEP DOWN THE ROAD TO SERFDOM 17 designed for this to happen and thus it is like ly to happen. This leads us to question whether dollars are likely to be spent better by School-to-Work bureaucrats than by taxpay ers. The answer is no. MarketsversusCentralPlanning In Socialism, his seminal work on the fail ure of central planning, and in later works, Ludwig von Mises showed conclusively that government planners cannot succeed because information indispensable to efficient produc tion is always decentralized and beyond any one's capacity to gather. 5 Hayek followed Mises in analyzing how the price system allows the market process to solve this prob lem and make the most efficient use of resources. He warned against attempting to plan a society rather than relying on markets.

The collapse of socialist Europe proved Mises and Hayek to be correct. Yet the lesson has not been fully learned in the United States. The School-to- Work program is embedded in the paradigm of central plan ning. It is based on the idea that businessmen and educators can get together and plan a cur riculum that will teach specific skills for spe cific industries and assist 12-or 13-year-olds in finding their careers. This is the antithesis of the market process and cannot possibly result in an efficient use of resources. Markets are dynamic. Those who were in seventh grade ten years ago and are now grad uating from college could not have known the many new jobs that would be created. Whole industries have arisen, and some have col lapsed. The Bill Gates of the future will not be represented at the committee determining the right career for the right child. To think that today's educators and businessmen are capable of advising young students on career choices is to engage in the fatal conceit.

Schools should provide a strong education in basic academic skills. A person well grounded in these can easily be taught the specific skills needed for a particular job. High job-training costs, often used to ratio nalize School-to- Work, can easily be lowered if graduates are taught to read, write, and think well. We already ask too much of schools in a vain attempt to replace the fami ly. To burden them with job training is asking more than can be delivered. There are hundreds of proprietary schools in the United States that can provide job train ing for students, and they have every reason to respond to changes in market circumstances. No one can realistically believe that the polit ical process of "cooperation" between schools and business can result in anything other than a political outcome. Finally, we must also beware of "scientific results" showing that students who go through School-to- Work programs get jobs at faster rates than students who don't. This is a case of what Bastiat called the seen and the unseen.

We can see the positive results from an expen diture by the government, but we cannot see what would have been done with the money had it remained in private hands. D 1. The National Center on Education and the Economy has been the driving force behind the Schoo1-to-Work program. It is commit ted to developing an integrated system of education, job training, and employment. For further discussion see Diane Fessler, "Schoo1-to Work: It's the Law," at www.fessler.com. 2. F.A. Hayek, The Fatal Conceit: The Errors of Socialism (Chicago: University of Chicago Press, 1988). 3. The Law (Irvington-on-Hudson, N.Y.: Foundation for Economic Education, 1998 [1950 translation of 1848 French version]). 4. For a survey of the economists' analyses of this phenomena under the title "rent seeking," see Robert Tollison, "Rent Seeking: A Survey," Kylos, 1982, pp. 575-602. 5. Ludwig von Mises, Socialism: An Economic and Sociological Analysis (Indianapolis: Liberty Fund, 1981 [1922]).

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