CURMUDGUCATION: The Free Market vs. Customers

CURMUDGUCATIONThe slightly-cranky voice navigating the world of educational “reform” while trying to still pursue the mission of providing quality education.

Source: CURMUDGUCATION: The Free Market vs. Customers

The Free Market vs. Customers

I write so much about the free(ish) market that one might assume that I hate it. I don’t. I think the profit motive, properly harnessed and directed, can accomplish a great deal. Making money is not inherently bad.

However, there are certain things that the free market will not do, and those weaknesses are in direct conflict with the purposes and goals of public education.

If you want to see what the problems would be, all you have to do is look around right now at every other sector of Trumpistan, where the Privatizer-in-Chief and the members of his Free Market Fan Club have been pursuing a particular set of goals.

This week the FCC took some steps to “relieve thousands of smaller broadband providers from onerous reporting obligations.” More specifically, they removed some regulations that require ISPs to publish pricing and service information. This is seen by some as a first step of a general assault on net neutrality.

Meanwhile, some environmental regulations are already rolling back, a trend that is expected to accelerate under the new EPA head. Elizabeth Warren’s Consumer Financial Protection Bureau is under attack. And in the education world, for-profit colleges that were feeling some pressure under Obama (though, seriously, how much pressure really) are feeling like there’s a fresh new day a-borning.

These and the many government actions like them come from the same basic free-market complaint, addressed to government:

“We could make a lot more money if we didn’t have to [insert regulation you don’t like here].”

Free market fans (like Betsy DeVos) prefer to argue that free market business needs no regulating because customer reactions provide all the regulation needed. If the business fails to do a good job, customers can vote with their feet, and free market justice is served by the invisible hand.

This is bunk, and any successful business people know it’s bunk.

In fact, between “this company is awesome and I love them” and “these guys suck and I’m going to start foot-voting right now” is a whole grey area where businesses actually operate. Awesome-love is really expensive to provide, so the smart business play is to figure out just how little you can get away with providing before the foot-votes start to hurt.

Government regulations are a pain in the ass because they interfere with the search for that sweet barely-enough spot. Auto makers might love to cut the costs associated with things like air bags and seat belts, but regulations won’t let them. Industries could be far more profitable if they didn’t have to follow environmental regulations. Internet providers could make way more money if they were allowed to give special treatment to rich customers. Any business could be more profitable if it could pay workers the very lowest pay it could get away with.

If Donald Trump possesses anything like a business genius, it would be this– he has really pushed the boundaries on “the least you can get away with.” Lying to investors and refusing to pay contractors, as well as extracting pay-to-play bribes good treatment, Trump has dared people to walk with their feet or hold him to any code of conduct. And he has mostly won. Like that annoying kid in your fourth period class, he has a genius for figuring out exactly how little he has to actually do to get by.

This is what the privatizers want to see– a world in which the bare minimum required to run a school is hugely lowered bar. They want a friendly federal government, someone prepared to listen to them when they say, “We could make so much more money running this school if we didn’t have to [fill in any school function or service here].” We could make so much more money if we didn’t have to serve high-needs students. We could make so much more money if we didn’t have to pay teachers more than minimum wage. We could make so much more money if we didn’t have to pay prevailing wages to our contractors. We could make so much more money if we didn’t have to meet all the items on this list of regulations.

Can government go way too far when it comes to regulation? Absolutely– particularly when it’s going in the wrong direction.

But what the privatizers promise to do to education is put the needs of the business operators ahead of the needs of the students. In the business world, that is common and results in a kind of sorting– the business chases away some customers and focuses on the smaller assortment of customers whose needs best match what the business wants to do as its bare minimum.

That’s a rational business approach, but it is an immoral approach to education. And it creates a hugely unbalanced contest. On one side, we have the businessmen and hedge funders and national charter chains plus the elected and unelected government officials who are looking out for their interests. On the other side, we have parents.

That’s why it’s absolutely necessary that government stand up for those parents and for the interests of those students. That’s why it’s up to government to set boundaries, to determine what the barely acceptable minimum will be (because businesses will always sink to that low bar). That’s why it’s up to government to stick up for citizens, and not the invisible hand.


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