Diane Ravitch on “the Nature of Markets”

“It is in the nature of markets that some succeed, some are middling, and others fail.”  That is the primitive, static view of markets proposed by Diane Ravitch in her book-length, passionate diatribe against choice and accountability.

The great economist, Joseph Schumpeter, saw it another way.  Markets “creatively” destroy middling performers by giving successful ones room to expand—until they themselves are “creatively” destroyed by still better producers. Because market destruction is creative, economies generally grow rapidly after recessions have taken their toll on the unproductive.

Ignoring basic economic principles, Ravitch asks us to keep intact our hopelessly disabled school system, now stagnant for half a century or more. She thinks she can get American schools to adopt her favored curricular reforms—even though they have refused to do so despite her multi-decade advocacy.

Amazingly, she rages against the very school choice arrangements that are creating schools willing to try out the curricular reforms she favors. She condemns charters, which are still emerging from infancy or, at best, entering their early adolescence.  Her judgments resemble those offered by buggy whip makers—“Get a Horse”—when cars first arrived or RCA Victor’s evaluation of early pocket transistor radios.

What makes charters so important today is not their current average success but their long-term capacity to innovate–unless governments and unions and do-gooders prevent them from doing so. Left unfettered, many charters will become laboratories of technological innovation that give us the best hope of finding a way out of the current quagmire (a topic explored further in my forthcoming Saving Schools: From Horace Mann to Virtual Learning.)

It is “in the nature of markets” that those who make the best use of new curricular materials and new technologies will become dominant—to the benefit of us all.

Abiding by the law of creative destruction, RCA Victor eventually disappeared as an independent entity.  Ravitch’s naïve concept of the marketplace is even more at risk.

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