What are markets for?

Markets are a tool with many uses, and we employ them broadly in our society because on balance they create a lot of good. Kevin Welner doesn't see it that way, however, especially in education (PDF):

This points to what should be the fundamental progressive response?the critique that many progressives seem hesitant to seize: that educational opportunities should be among the most precious public goods. While public education does provide an important private benefit to children and their families, it also lies at the center of our societal well-being. Educational opportunities should therefore never be distributed by market forces, because markets exist to create inequalities?they thrive by creating ?winners? and? ?losers.?

Progressives may be hesitant to seize this critique because it's wrong and misunderstands markets. First, Welner ignores consumers. If Wal-Mart and another retailer compete, in a well-functioning market the consumer wins by paying lower prices, enjoying higher quality, or both, regardless of whether Wal-Mart or its competitor wins a given customer's business. Markets don't exist for the sake of competition, or to provide wealth for "winning" competitors. Competition is intended to serve end users.

Second, education markets, unlike the ones in business, are not usually tasked with allocating profits. Even in places where for-profit charter operators are permitted, profits for those operators should not be a primary or even secondary concern of the education system. Instead, markets provide a mechanism for empowering parents, decentralizing decision-making, and fostering a variety of educational approaches.

Best of all in our current environment of stretched resources, the autonomy afforded by a market-based approach allows schools to tailor their approach to available resources better than one-size-fits-all approaches. Rocketship is successful by using a small number of high-quality teachers blended with online learning; KIPP's model stresses lots of seat time in a more traditional classroom environment. Students are better off with both options, which tap different kinds of teachers, than with schools that all require the same kind of educator.

The goal should not be instruction that looks identical in schools across the country to ensure an empty kind of parity among students. It should be an equally effective education, adapted to students' and parents' needs, so that all children can reach their potential. The market approach is not perfect and needs careful tending, as Fordham's Terry Ryan has demonstrated in Ohio recently, but it is certainly not the regressive corporate bogeyman Welner is wringing his hands about.

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