Richard Meinhard, Ph.D. and
September 10, 2001
(contact information updated in 2016)
A powerful, yet flawed perspective grips the public mind such that it ignores, distorts, and rejects school choice facts and arguments. Just as the Church rejected Galileo’s scientific findings, this public school ideology rejects choice supporters’ educational findings and analysis. The public simply cannot fit a market perspective into its understanding of how the world works. We will not make major strides toward school choice if we continue to believe that simply teaching the public about the benefits of market education or tinkering with choice proposals will be enough. A new market perspective can’t be simply taught. It must develop, like any living system develops, out of its more primitive pro-government form. Our challenge is to understand this transformation. We cannot change the public’s thinking if we do not understand it.
Voters in state after state continue to defeat school choice initiatives by large margins. Choice supporters respond by debating strategies such vouchers or tax credits, whether large or small steps should be attempted, how we should deal with the critics, and what kind of information and examples should be given to the public.
But what if such strategic decisions by themselves have little to do with successfully changing the public’s fundamental point of view regarding choice? What if facts and evidence alone aren’t enough for the public to accept our ideas? What if our principles of choice and competition are not only misunderstood by the public but also actively rejected as dangerous to public education?
In his research Andrew Coulson found that five factors lead to excellence in a market education system: choice and responsibility for parents, freedom and competition for providers, and the profit motive. These make wonderful sense to him, to us, and probably to you. But what if they don’t make sense to the public? We believe something quite fundamental, what we call the pro-government perspective, organizes the thought processes of most people and renders them incapable of understanding the facts and evidence that a coherent free market mental perspective provides. Markets simply don’t make sense to them.
The logic of market principles is compelling to us but obviously not to most other people. And it’s clear that it does not matter what type of program is proposed. Small tax credits and limited voucher programs for low-income families are tolerated by the public as ways to solve particular problems but they do not convert people to an understanding of a market-based system.
Americans enjoy one of the freest and most bountiful market systems in the world yet few can explain how it works. An understanding isn’t necessary to reap its benefits. But markets promise nothing except opportunities and choices, while government can promise much.
With little understanding of markets and government monopolies, government promises and market fears can be enough reason for the public to reject market proposals. Neither critics nor choice supporters actually change the public’s underlying perspective on free markets and government. The critic’s rhetoric simply triggers already felt sympathies and a comfort with the government school system. The burden of changing public opinion rests with choice supporters. As a result, critics find it easy to defeat choice initiatives simply by playing on public fears and misunderstanding.
The real problem facing choice advocates has more to do with the public’s lack of understanding of governments and markets than it does with how to package choice proposals or what information to provide. We don’t yet fully understand the nature and depth of this problem. Support for choice clearly depends upon changing an underlying pro-government perspective that organizes the public’s thinking. We need to understand this pro-government perspective so we can find ways to transform it into a market perspective.
The Public’s Pro-Government Perspective
Choice supporters must admit a hard truth ¾ the public doesn’t yet believe in vouchers or tax credits let alone separation of school and state. We must also admit that we don’t understand much about the pro-government perspective, much less how to change it. We don’t know what controls and protects pro-government thinking, what it is about the logic of pro-government thinking that makes market principles incomprehensible.
More importantly, we don’t understand how and why some individuals change their pro-government perspective to adopt a market perspective. Did you always believe in market education, or did you begin with some pro-government notions and then change your views over time? If you think it was simply exposure to new facts, programs, and examples, stop and ask yourself about your underlying values. Did something fundamental change regarding your perspective, or did you always understand the logic and power of markets?
Pro-government beliefs form themselves into a self-protective whole; a perspective that is resistant to change in spite of facts or explanations about markets. The pro-government perspective, like any perspective, shapes what people see, think about, decide, value, and advocate about public policy. Here are some recent examples.
A newspaper article reported on the congressional debate over reforming federal education policy. Senate Democratic leader Tom Daschle asserted, “We cannot have reform without resources.” A letter to the editor about energy deregulation asserted: “So who could ever suggest it should be priced by an open market just like anything else?” Another letter advocating taxing the wealthy to support affordable housing said, “Opposition to this bill has nothing to do with its effectiveness. The true reason for opposition is simple greed.”
The pro-government perspective controls the thought of these people, the facts they observe, and the assumptions that they make — if there is a problem, government should correct it; social problems exist for lack of money for government remediation; some goods and services are privileged and can’t be provided through the market; and so on.
On the other side of the debate, a free market perspective carries different assumptions—free markets create opportunity for everyone, the individual is fundamentally responsible for self, free markets create a diversity of goods and services, market exchanges produce increasing efficiencies, and so on. The two perspectives talk different languages, use different code words, see different facts, reason differently, hold different values, and work for different programs. We all recognize these two perspectives. They form one of the most fundamental divisions between people in our society today.
Those of us trying to change the pro-government, anti-market perspective need to understand this system of thought just as physicians understand various systems of the body, scientists understand physical and biologic systems, and mathematicians understand math systems. The understanding of systems allows a scientist to explain them and how they arise, and it allows practitioners to change them. Yet surprisingly, there is very little good literature that describes and explains how the pro-government perspective operates or arises in people’s thinking.
The pro-government perspective is the problem because it is so compelling that it grips and holds much of the public’s thinking. Unless we discover why this is so and how this perspective evolves into pro-market thinking, the pro-government public will continue to reject our positions, distort our facts, and trounce our initiatives.
Perspectives at Work
Let’s look at three examples of how perspectives grip and control thought. The first comes from history; the second from our current educational research; and the third from the perspective many school choice supporters have but many opponents lack.
1. The Aristotelian Perspective
Aristotle’s science of falling bodies persisted for 2,000 years, even though scholars contested it with facts some 400 years before Newtonian science finally replaced it. Even the classic experiment of dropping different weights from the Leaning Tower of Pisa was conducted much earlier but ignored and then misattributed to Galileo. While the experimental facts showed that bodies of different weights fell at the same velocities, the Aristotelian scientific perspective was so powerful that these findings were ignored, distorted or rejected as the old perspective protected itself from change. This denial of fact and logic by Aristotelian mechanics forms a famous chapter from the history of science. It is only one of many demonstrations of the gripping power a scientific perspective, even a faulty one, can hold over thought.
2. The Child’s Perspective of weight
Even for individual concepts, we can see a gripping power at work that shapes the facts observed and the reasoning used. In experiments famous to educators, psychologists showed how students under the age of seven thought the weight of a clay ball changed when it is rolled out. Young students’ ‘perspective’ of weight convinced them that because the clay was now longer, it must weigh more.
When the researchers continued to roll the clay out, astonishingly some of these same youngsters suddenly changed their minds and asserted the weight was now less. When asked why, they said because it is now thin. Teaching, demonstrations, weighing the objects, nothing worked to change their mind. They knew as a fact that they observed that the two objects were a little bit different in weight.
Yet months later, they reasoned and saw things differently. Now they knew as a matter of logical necessity that the two clay shapes weighed the same regardless of changes in length and thickness. The two balls had to be the same because nothing was added or taken away. The students’ perspective at first distorted and misperceived facts, but then the development of a more advanced perspective allowed the students to use a different logic and to see different facts in the same experiment.
3. The Perspective of Profit
Conduct this inquiry. Ask the typical adult if the profit motive has any place in education. You’re likely to get a resounding, “No!” Then try any manner of facts or examples of for-profit companies providing quality education and see if you have persuaded the person. The pro-government perspective will not let the adult understand that both sides benefit in an economic exchange. Just as young children can’t observe that the weight hasn’t changed in a flattened ball of clay, many adults can’t comprehend that both buyer and seller gain value when they enter into a voluntary exchange.
But the logic of the pro-market perspective makes an adult see that a buyer values the good or service received more than the money spent, and that the seller values the money received more than the good or service delivered. The logic of market principles compels us to make these observations, but for those with a pro-government perspective, it makes no sense.
In this example profit is what psychologists call a centration. Just as the child centers only on the clay’s length to perceive a change in its weight, adults may center on the producer’s profit to perceive a loss for the consumer. Centrated thought lacks a larger system of reasoning that groups several factors together in order to organize its mental operations. As a result, thought is centered on isolated elements without the necessary relationships among the elements. The relationship of a two-way mutually beneficial exchange is but one of several market and system concepts that seem to be missing from the thinking of many. School choice supporters need to understand both why this is the case and how these concepts develop in people.
When a Perspective is Important
As we said, people can use and benefit from markets without understanding them. However, compare the reform of public utilities and government franchised industries with reform of public schools. No basic change in the public’s understanding of system arrangements was required for the deregulation of telecommunications, airlines, trucking, energy, etc. The basic structural relationship between consumer and provider within those markets remained constant under deregulation—consumers still paid the provider for their services. From the public’s point of view, consumers were simply given more choices, basically a good idea. The providers were already economically tied to their customers, and deregulation did not upset the thinking of the general public. No change in perspective was necessary.
School reform, however requires changing the basic consumer/provider relationship. In our system of public education, consumers don’t pay for services received, the public does. Families are not really customers. Society purchases educational services on behalf of families using a system of democratically run government schools.
For the public to accept market principles in education it must understand and accept a new consumer/producer relationship, a huge change given the public’s low level of market understanding. The public must abandon its rather thoughtless belief that education is a public good, an individual entitlement, and that it is the public’s responsibility to provide education to all children for the common good of society. Within the public’s traditional way of thinking (or lack of thinking) about services, market reforms have no place. The pro-government perspective is the public school ideology at work.
Market driven reforms make sense only within the market perspective. Voters realize that vouchers, for example, are not a mere improvement within the box but a fundamental change in the box itself, the very structure of a basic institution. The public seems to sense that vouchers are a basic change and that makes them uneasy; it seems too large, too risky, and possibly hurtful. Advocates underestimate the conceptual change in the public’s perspective that real reforms require.
Most previous education reform efforts stay comfortably within the government system box. Take for example the nationally recognized 1983 report on the state of American education, A Nation at Risk. Neither its findings nor the recommendations addressed in any way the failures of central planning, monopolies, government as a method of service delivery, third party funding, lack of consumer voice or choice, or any other system aspects of government versus market systems of delivery. The report took the system itself for granted and only attempted improvements in the performance properties of the system—content, standards, teaching, leadership, fiscal support, etc.
However, school choice is not another program improvement. It’s a systemic change, and it requires a huge change in the perspective that takes a government delivery system for granted.
The Think Tank Role
Choice advocates can continue to hammer away with think tank papers and media campaigns, oblivious to the nature of the pro-government perspective, or we can turn to research and development in an attempt to first understand the perspective and then to change it. This R&D is a natural function of think tanks. The very heart of the free-market think tank mission — to work toward a free society — brings with it two tasks. First, think tanks must be expert in markets and government systems. Second, as society’s teachers, think tanks must also be expert in understanding and changing the public’s thinking and misconceptions. These tasks form two quite different challenges.
As teachers we must not ignore the learner’s current level of understanding and ability to grasp complex concepts. We cannot teach algebra to young children who have yet to understand the whole number system. Likewise, market teachers must understand how market understanding develops out of elementary concepts of producers and consumers to the more advanced explanations of self-regulating, self-elaborating systems of exchange.
As teachers of school choice, our job is not simply a matter of presenting new facts or the history of government schooling. It is the public’s pro-government perspective itself that stands in the way of understanding the facts and explanations of how markets would work in education. The public is rejecting our advanced concepts because the pro-government perspective is compelling; it grips thinking and shapes what is seen as fact; it shapes the values and organizes the policy choices in educational systems. The public makes the wrong choices, from our point of view, because it cannot fit market understanding into its pro-government perspective of how the world works.
What Should We Settle For?
We don’t yet understand how to change the current pro-government perspective to a free market perspective. But we have clues, we have seen it happen in individuals, and we know how to study the problem and work toward a solution. If fact, there will likely be more than one optimal solution. And we can all contribute something to the effort.
Without a shift in the public’s perspective, we may have to settle for the limited successes that Moe’s recent work suggests. Yet years ago Chubb and Moe told us that the intellectual debate about school choice was over. We won. But for the public, the policy debate is far from over.
When we understand how the public’s perception of government and markets develops, we will be in a far better position to win the policy debates. Then no teacher union money or old political rhetoric will stop the evolution to a market education system.
ENDNOTES Terry Moe found that information didn’t make much difference in people’s evaluation of vouchers. On p.228 of his new book, Schools, Vouchers, and the American Public (Washington, D.C.: The Brookings Institution, 2001), he says, “As a result, the impact of information on support for vouchers may be positive, or it may be negative, depending on how these other variables come into play.” What he is saying is that there is an underlying “structure of thinking” (pp. 227,234, 253), a “genuine substance” (pp. 350, 358), “surprisingly effective at linking these things together” (p. 244),  Andrew Coulson, Market Education: the Unknown History (New Brunswick: Social Philosophy and Policy Center and Transaction Publishers, 1999) pp. 293-306.  Jean Piaget and Bärbel Inhelder, Child’s Construction of Quantities, trans. Arnold J. Pomerans (New York: Basic Books, 1974) p. 22-46. This experiment is one of a series. These were not intended to simply describe these amusing misconceptions of students in their early stages of development, but to uncover the cognitive systems that organize and produce them.  A Nation at Risk: The Imperative for Educational Reform was guided by the 18-member national Commission on Excellence chaired by David Gardner, President of the University of Utah. The Commission, appointed by Secretary of Education T.H. Bell, released its report in April of 1983 after 18 months of work. Its report was based on commissioned papers and testimony from professional groups, parents, public officials, and scholars.  Moe (Schools, Vouchers, and the American Public) uses a variable he terms “the public school ideology” to measure the effect of this perspective on people’s positions and views of vouchers.
Richard Meinhard, Ph.D. is a developmental psychologist who specializes in the development of cognitive, instructional, and organizational systems. He is a Cascade Policy Institute Academic Advisor.
Steve Buckstein is a founder Cascade Policy Institute, Oregon’s free-market think tank. In 2001 he was President and in 2016 he is Senior Policy Analyst. He can be contacted at email@example.com.
By Steve Buckstein
Oregon state legislators who voted for you to pay higher health insurance premiums and higher hospital costs don’t want you to think you’ll be paying more because they raised taxes. In their words, they aren’t raising taxes at all; they’re simply putting assessments on these services and letting insurers and hospitals pass on the extra costs to you.
Three legislators who don’t want you to pay these higher costs collected more than enough voter signatures to place Referendum 301 on the ballot in January, so you can vote No and stop these new taxes from going into effect.*
The problem is, when you see your Voters Pamphlet and ballot, you won’t see the words “tax” or “taxes” anywhere in the official statements. You’ll only read about “assessments.” Apparently, tax supporters think you’re more likely to approve them if you don’t believe they’re taxes at all. Assessments sound so much more palatable, don’t they?
Referendum supporters have asked the Oregon Supreme Court to require that the official statements refer to taxes, not just assessments. Whether this happens or not, hopefully enough voters will understand that they’re being asked to impose new taxes on services that are expensive enough already, and vote No. Learn more at StopHealthCareTaxes.com.
*Referendum 301 is now known as Measure 101 on the January 23, 2018 Oregon ballot.
Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.
View the PDF version here: 10-18-17-When_Is_a_Health_Care_Tax_Not_a_Tax-1
By Kathryn Hickok
Portland Public Schools is redrawing the boundaries of more than a dozen schools and reassigning 5,000 students, ten percent of its enrollment. According to The Oregonian: “To make sure no school ends up understaffed or overcrowded, students must be shuffled.”
In government-run school districts, kids are cards in a deck. The bureaucracy gets to deal, assigning students to school buildings based on their residences. And even when parents exercise choice by moving into a neighborhood, gaining access to special school-based programs, or enrolling in charter schools located in underused facilities, the district retains the right to shuffle and deal over.
When Oregon enacted an interdistrict open enrollment law in 2012, hundreds of Oregon parents chose schools outside their districts of residence that better met the needs of their children. Empowering parents of every income level to choose schools through open enrollment, more charter schools, and private school choice programs would be more respectful of each student’s dignity—and a better way to address his or her educational needs—than a centrally planned system in which the odds always favor the district “house.” In most aspects of life, Oregonians expect parents to judge what is in the best interests of their children. When it comes to education, the stakes are too high to treat kids like playing cards.
Kathryn Hickok is Publications Director and Director of the Children’s Scholarship Fund-Oregon program at Cascade Policy Institute, Oregon’s free market public policy research organization.
View the PDF version here: 10-11-17-Shuffling_Is_for_Playing_Cards
By Lydia White
Last week the Idaho Department of State Lands and the U.S. Forest Service signed ten agreements to allow logging and restoration on federal forest land, including land managed to benefit Idaho public schools by means of the Common School Fund.
Officials say allowing lumber companies to manage the land will create jobs while reducing the severity of wildfires raging in the western United States, costing over $2 billion this year alone. Jonathan Oppenheimer of the Idaho Conservation League says, “We’d like to see them recognize that you can still have a profitable timber sale while protecting some of those sensitive resources.”
Oregon faces similar wildfires, cost constraints, and environmental litigation, but hasn’t adopted Idaho’s successful approach, despite its Constitutional mandate to produce revenue for its own Common School Fund.
Earlier this year, the State Land Board halted the sale of the Elliott State Forest to a private company, an approach similar to Idaho’s, after backlash from environmental advocates. Instead, the Legislature passed a measure allowing Oregon to borrow $100 million in bonds to purchase the Elliott from a different state entity, all while costing Oregon’s Common School Fund billions in forgone returns.
Oregon, and other western states scourged by wildfires, should look to Idaho as it moves forward with its logging projects and adopt similar strategies proven to balance conservation and Constitutional requirements.
Cascade Policy Institute is set to publish a study of nine western states, including Idaho and Oregon, and their versions of the Common School Fund early next month.
Lydia White is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.
View the PDF version here: 10-4-17-Timber_Conservation_Oregon_Constitution_Not_at_Odds – PDF
By John A. Charles, Jr.
Some members of the Oregon Legislature think you don’t pay enough to travel. Therefore, they are considering a 298-page bill that would create multiple new transportation taxes.
The draft legislation, HB 2017, includes dramatic increases to vehicle registration fees, higher gas tax rates, a new sales tax on the purchase of motor vehicles and bicycles, and a statewide tax on all employees to subsidize transit.
In addition, a percentage of money currently paid by customers of investor-owned electric and gas utilities would be diverted to subsidize electric vehicle owners.
Billions of dollars would flow to various bureaucratic entities, with little accountability. Those of us paying the taxes would hardly know we’re paying them, and we would have no idea how the money was being spent.
The legislative strategy of simply “throwing money” at transportation is not going to work, because it’s already been tried. For example, TriMet riders only account for about 10% of all revenue in the FY 18 budget; the rest of TriMet’s income is derived from various backdoor taxes.
The agency’s most lucrative income source is the regional payroll tax, authorized by the legislature decades ago. TriMet has been raising its payroll tax rate almost every year since 2005 and will continue to do so through 2024. As a result, the agency now collects over $366 million annually from employers to subsidize transit operations. Yet, in the first decade after tax rates began rising, TriMet service actually declined.
Much of the new money went to pay for generous union contracts rather than the promised service improvements. The result: In 2016, employee benefits equaled 123% of wages. In other years the ratio has been as high as 149%. This is not a finance model that we should emulate.
The best way to improve any kind of service is to have a tight fit between what we pay as consumers and what we get in return. If we don’t know the real price, we can’t evaluate the purchase. And if taxpayers are being forced to subsidize unrelated services, there can be no fiscal discipline.
A better option would be to euthanize this 298-page monstrosity and work to implement highly-targeted user fees. The social costs of travel such as congestion, road wear, and noise pollution vary considerably by time of day, direction of travel, weight of the vehicle, and other factors. The user fees that we pay should account for these differences.
Gasoline taxes and vehicle registration fees are poor user fees because they are fixed, mostly invisible, and not time-sensitive. But new technologies now allow us to collect the full cost of each trip in real time by all modes of travel.
Some auto insurance companies already collect detailed driving data because they sell mileage-based policies. Millions of American drivers also own toll tags for use in modern tollways. And many transit operators use digital technology to collect variable fees based on distance traveled, type of service, and time of day.
User fees should be precisely calculated, and revenues should be dedicated to maintaining and improving the services paid for by consumers, with no cross-subsidization of other modes.
Transportation finance doesn’t have to be complicated. Legislators only make it that way when they don’t want you to know where the money is going.
John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.
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A report released Monday by Cascade Policy Institute recommends that cities and counties within TriMet’s service jurisdiction consider leaving the transit district.
The study shows that TriMet’s ongoing financial crisis is not just a temporary problem, but a permanent one caused by a failed business model. The agency has one of the most expensive union contracts in America, and the managerial obsession with rail transit is cannibalizing bus service. These problems go back decades, and it’s now too late to fix them.
Due to these factors, TriMet will face annual service reductions beginning fiscal year 2017. Those cuts will slowly destroy the agency. State law has long allowed jurisdictions to leave TriMet, and six communities already have: Molalla, Wilsonville, Sandy, Canby, Damascus, and Boring. Four of those cities created their own transit districts. Based on these experiences, the Cascade study recommends that more jurisdictions consider opting out and create their own transit districts.
Cascade Policy Institute’s report shows that the four cities operating their own public transit systems have lower labor costs, lower payroll tax rates, no long-term debt, virtually no unfunded liabilities for retirees, and better service than they previously had under TriMet.
Services under TriMet have continually declined since 2005, yet the TriMet payroll tax is at an all-time high of 0.72 percent.
“With major TriMet service cuts projected for FY 17 and every year thereafter, jurisdictions still paying the TriMet payroll tax should begin investigating options for leaving the district,” says the report.
According to Cascade President John A. Charles, Jr., “When TriMet was formed in 1969, the expectation among supporters was that creating a single public monopoly transit provider would create economies of scale. Unfortunately, what we really created were ‘diseconomies of scale.’ TriMet’s business model is now permanently dysfunctional, and the evidence from opt-out cities is that ‘smaller is better.’ Cities such as Sherwood, Tualatin, Lake Oswego, and West Linn should not wait for the inevitable collapse of TriMet; they should actively begin assessing the prospects for creating their own transit agencies, either as stand-alone districts or in partnership with nearby communities.”
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By Steve Buckstein
Many areas of our lives are being revolutionized by technology. Those changing the fastest are the ones subject primarily to market forces. Those changing the least are the ones controlled primarily by government.
How many of us communicate with others at a distance today the same way that we did twenty years ago? In 1992 we all had telephones at home, but very few of us had mobile or cell phones. In 1992 a few of us had personal computers, but very few communicated through email, and the first public web browser was still a year or so away.
The cell phone and personal computer revolutions came very fast, propelled by advancing technology and a capitalist market that promised great wealth to those who successfully met our seemingly unlimited consumer demand for such offerings. No one was forced to pay for any of this; no one was exploited by any of it, either. We gladly paid hundreds of dollars for the communications tools of the future. The collective value we gained likely outweighed the billions of dollars that entrepreneurs like Bill Gates and Steve Jobs earned for themselves.
Now, how many of our children still get their formal education the same way they did in 1992? Virtually all of them. The public school system is owned and run by governments and paid for by tax dollars. The adults who receive those tax dollars have a huge financial interest in making sure that competition and innovation are kept to a minimum. The revolution in personal communications that has taken place over the last twenty years is barely a blip on the K-12 education scene―so far.
One man who foresaw an online education revolution was Lewis J. Perelman. In his 1992 book, School’s Out, he predicted that our brick school buildings eventually would be replaced by what he called “hyperlearning.” Remember, this was written before most of us had even seen the World Wide Web. One aspect of “hyperlearning” is today’s online charter schools―you know, the ones the teachers’ unions are so desperate to shut down.
Another aspect of “hyperlearning” is the recent advent of the non-profit Khan Academy, which now features literally thousands of online lessons about everything from basic math to physics to economics and government. All at no cost to the learners. Online. 24/7. From any computer or smart phone, anywhere in the world. Classroom teachers who aren’t fearful of such progress are embracing this new tool to help their students. But if it rises to the level of actually competing with, rather than complimenting, traditional classrooms, look for politically powerful teachers’ unions to do what they do best: act as the status quo lobby to restrict or even outlaw such competition with their dues-paying members.
Exploited by Apple?
One secret weapon in the online education revolution may be the kids themselves. Thanks to compulsory attendance laws, most of them must attend the brick school buildings closest to their homes. Last month I was invited to talk with a class of public high school juniors about the relationship between politics and economics. After laying out my case for capitalism, including how it can enhance learning through online schools, the teacher explained that he believed more in democracy and government than in the power of the marketplace. One example he used was his feeling of being exploited by Apple because until recently it only allowed him to place proprietary applications on his iPhone, thus increasing Apple’s profits. I pointed out that he was not forced to buy anything from Apple, even its phone, if he didn’t want to. There were, and are, plenty of competitors.
I explained that in a free market, when someone sells a product and another voluntarily buys it, both sides gain value. In the Apple case, for example, if he paid $200 for his iPhone, then he wanted it more than he wanted to keep his $200. Apple, on the other hand, would rather earn his $200 than keep that phone on its shelves. Both sides won. I told the students that when Steve Jobs died last year, he was worth some $7 billion, but he didn’t exploit any of his customers to earn that money. They freely bought what he had to sell.
I then asked the 30 or so students how many of them owned any Apple products, from iPods, to iPads, to iPhones. About 25 raised their hands. I asked how many of them felt exploited by Apple. Not one hand went up, and they laughed when the teacher again said that he felt exploited. That teacher has a monopoly on those students’ time every school day this year. But in an hour and a half, I was able to give them a lesson that hopefully will stay with them when they think about the benefits of capitalism versus government control of our economy―and of our education system.
Perhaps I should have suggested the students read Capitalism and Freedom, Milton Friedman’s classic book in which he argued that economic freedom is a necessary condition for political freedom. If I am invited back I will make that suggestion, but if not, my real-world example of how they have personally benefited from capitalism may be enough to start them thinking about what is wrong with their teacher’s pro-government view, and what is right with the free market.
Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.
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By Richard Vedder, Ph.D.
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