Are Public Schools Failing?

There's Only One Way to Tell: Give Parents Choices

One of the problems facing K-12 public education is that under the current system, no one can ever definitively answer the question, "Are public schools failing?" This is because, unlike much of the rest of the American economy, the public school system does not rely on prices, competition, profits, and other market feedback mechanisms to determine whether consumers are being served in the most effective and efficient manner.

How do market mechanisms tell us how well a particular service is performing? Let's assume I wanted to be a dentist. In a market economy, I could not simply decide to offer dental services and have the government assign patients to me, as it assigns students to schools today. The only way I could earn my rent money by providing dental services in a free market is if I produced a high-enough quality service at a low-enough price that consumers came to me voluntarily. In a market economy, consumers are in charge. The market makes it clear when a producer is failing to provide consumers with the quality service they want: Consumers stop buying, and the producer either improves his product or else goes out of business.

This is not generally the case in the current public school system. For example, even if School District X is not providing the kind of service that parents and students would voluntarily support with their money and patronage, it still continues to "produce" that kind of service. Parents continue to send their children to District X unless they are wealthy enough to afford both the tax bill to fund District X and the tuition costs of sending their child to a private school.

As a result of this strong financial disincentive for parents to choose nonpublic schools for their children, there is no directly observable way of telling if public schools are failing. But there has to be some measure, so government officials seek out other ways to judge how well a school is performing, such as tracking student test scores or graduation rates.

Unfortunately, test scores and graduation rates are a poor substitute for the direct observation of parents' preferred choice of schools. One reason is that test scores could be high while the tests themselves fail to reflect what parents wish their children to learn. MEAP test scores are unreliable indicators of how well a school is doing for a variety of reasons. To take just one example, if I were a teacher and my class began the year three grade levels behind and I moved them up two grade levels, they still may fail to get satisfactory scores on the MEAP. It therefore would look as if I had done nothing to improve those students' education level.

Graduation rates can be similarly unreliable, as a recent example shows. Kids First! Yes!, an education reform group, has begun to collect signatures for a 2000 ballot proposal that would automatically provide vouchers to students in districts with graduation rates under 67 percent. In one year, Detroit's reported graduation rate went from 29.8 percent in 1996-97 to 83.5 percent in 1997-98.

The only certain way to determine whether the public schools are failing is to allow families greater freedom in choosing the schools- whether public or nonpublic- their children attend. Parents can be expected to remove students from schools that are not providing what they need and want, while those schools that are performing well will be the ones that continue to attract students.

Michigan has a limited indication of how well its public schools are doing thanks to the introduction of charter schools. Charter schools have been able to attract students from traditional public schools; in fact, most charter schools have waiting lists of hundreds or even thousands of families. In addition, we have clear evidence that when charter schools perform poorly, they close down and make resources available for better schools. That has been the case for two of the 141 charter schools that operated for at least one year in Michigan.

There is nothing in the current system that will result in all public schools failing. Certainly there are many public schools that are succeeding in their mission. But mounting evidence, including a large increase in the need for remedial education in colleges and the business community, suggests that a large number of public schools are struggling to deliver a quality education.

K-12 tuition vouchers or tax credits would move Michigan's public school system closer to one with market mechanisms that show when schools are failing and offer incentives for those schools to improve. It's time for greater parental choice so that Michigan's public school system as a whole can be made betterfor all students.

Gary Wolfram, Ph. D., is George Munson Professor of Political Economy at Hillsdale College and President of the Hillsdale Policy Group, a consulting firm specializing in taxation and policy analysis. He also served as a member of Michigan's State Board of Education for six years.