Creativity, Cartels, and the Supply Side of Choice-Based Reform

One of my looooooong-standing frustrations is that talk about school choice, competition, markets, and the rest tends to be soaked in confusion, apology, spin, and invective. It feels like almost everything of note gets lost in debates about whether “school choice works” and amidst hoary claims of “privatization.”

Three recent developments point to some of the issues here. One is the announcement that the Broad Residency for Urban Education has been accredited as an educational leadership program. The second was the reaction to a  conducted by Huriya Jabbar and released by Tulane’s Education Research Alliance for New Orleans that found that thirty New Orleans principals said they mostly compete by marketing rather than by tackling their academic programs or school operations. (This shouldn’t unduly surprise—I wrote a book about this phenomenon more than a decade ago.) Third, just the other day, a USA Today column called for shuttering a Kansas City charter school whose students recently won the National Society of Black Engineers Robotics Competition because its test scores are only average.

Before offering my take on all this, let’s recall a few basics about choice, competition, and markets.

First, there are two basic spheres in a democracy: the public and the private. And the lines between them can be much blurrier than we might imagine. Public policy gives private employers guidelines regarding employment, health care, workplace safety, and marketing, while whole swaths of nominally “public” activity—from operating bus systems to cleaning toxic waste—are performed by privately managed firms.

Second, while the public sphere appeals to many in schooling, keep in mind that the more “public” the oversight, the more likely it is that schools and teachers will be very much under the thumb of elected officials and voters. The private sphere provides more autonomy from those political dictates, but substitutes the discipline of the market.

Third, Milton Friedman opined decades ago that the “market is not a cow to be milked,” that markets are no more (and no less) than a mechanism for channeling human ingenuity, energy, and talent. If markets are dysfunctional, corrupt, or inhospitable to law-abiding enterprises, the results will be too. So market incentives and structure matter, a lot.

Fourth, “choice” alone does not create a market. There’s lots of choice in school systems like Charlotte-Mecklenberg and Seattle. The thing is, choice is only half of the market equation. Markets are about both supply and demand—and, while “choice” is concerned with emboldening consumer demand, the real action is typically on the supply side. That’s where challengers emerge to take on established cartels and challenge comfortable assumptions.

Finally, the role of the supply side is too often underestimated. That is where promising new models emerge, successful providers scale, and problem-solvers are free to create and build. Teacher advocates have railed against “privatization,” ignoring the fact that moving schools along the public-private continuum in this way can offer educators the opportunity to reimagine the schoolhouse, create schools they yearn to teach in, emphasize the metrics they think are appropriate, and put teachers in charge. Meanwhile, plenty of self-proclaimed choice advocates have treated the supply side as an inconvenient afterthought, seemingly all too happy to create new cartels on their terms. Thus, they can tout new regulations, new requirements, and more test-based “accountability” with remarkably little attention to how these may suppress problem-solving or squelch promising schools.

Those three developments we started with? They reflect how a lack of appreciation for the supply side has led us to undervalue new entrants, understate the risks of intrusive regulation, and ignore the creative potential of “competition.” Broad’s entry as a new provider of leaders is a pioneering development. It challenges the cartel of existing providers and blazes a trail that others can (and should!) follow. Long-term, I think that’s vastly more important than the frustrating push to tweak entrenched programs. And it’s a reminder of why the institutional obstacles that make this so tough to do are so problematic.

That’s why I find so disconcerting the high-profile call to shut down a charter school with average test scores—especially one that excels in ways not reflected in reading and math scores. It eschews the ability of schools to expand in varied ways, instead bowing to a prefab, thoroughly bureaucratized notion of what good schools look like and how the performance of all schools should be gauged. Meanwhile, Jabbar’s finding that most schools compete in less-than-impressive ways rings true, but that is largely a product of the incoherent incentives in K-12 choice settings (see here for an extended discussion) rather than evidence that “competition doesn’t work”—which seems to be the take of some observers and outlets.

My bottom line: Both the pro- and the anti-school choice crowds tend to ignore what should be the central issue when it comes to markets, which is their immense creative potential and the way they can shatter comfortable cartels. Advocates miss this because they’re busy promising that choice “works,” and talking about creative potential is rife with uncertainty. Critics tend to favor a caricatured view of markets and a romanticized view of public control (at least, when they’re not denouncing “political interference”), so they don’t think of markets in these terms.

The result is everyone tends to talk about markets and competition as a “cow to be milked.” This means that much discussion around choice has been about identifying “exemplars” and then scaling them. That is a bureaucrat’s view of markets. A bureaucrat thinks: “We’ll have a burst of market creation, supersize the ‘successes,’ and then leave this messiness behind and build a better cartel.” I welcome Broad’s accreditation, love that it happened, and think that the program has a ton to offer. But I get nervous when well-meaning observers suggest that maybe this is the “right” model for the next half-century. That would be a dismal deal, because it would sacrifice the dynamism, potential, and human creativity that are at the heart of every vibrant market.

—Rick Hess

This post originally appeared on Rick Hess Straight Up.

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