Education

It seems self-evident that quality education should be among our highest priorities. Without delving into platitudes about the children being our future, suffice it to say that improvements in education carry great multiplier effects.

Better educated children yield better candidates for both advanced schooling and high-quality jobs. Higher literacy rates and higher incomes promote lower crime rates and reduced poverty, all of which is a self-reinforcing virtuous cycle. In that sense, a good education benefits not only its direct recipients, but also the system that provides it. Unfortunately, the reverse also holds true. Gaps in the availability or affordability of quality education tend to have all of the reverse effects, prompting a negatively self-reinforcing cycle.

This in part serves to explain why pockets of chronic poverty and underemployment can coexist alongside pockets of relative affluence and prosperity. Near the root of such problems, one often finds a disparity in the quality of the school system. The New York State School Report Card for 2004-2005 published by the State Education Department suggests just such a problem, particularly among public high schools.

The primary problem with public education is simply that it is cursed with being a government product and government products tend to be low quality (or at least of inconsistent quality).

The problem is not that too little money is being spent on education. On the contrary, the other curse of government products is that they tend to be expensive and wasteful. Even if you don’t have children or if you send your children to private or parochial school, you still get to bear the cost of that waste.

Instead, if we can introduce market-based performance and efficiency incentives within our school system, service quality will necessarily improve and costs will necessarily fall.  Among the largest benefits of this cost reduction would be our ability to increase the percentage of expenditures that go to the primary drivers of product quality – teachers and educational materials - rather than wasteful bureaucratic byproducts.  By reining in this waste and by encouraging cost-effective performance improvement by properly incentivized administrators, we can divert more money directly to attracting and retaining the best teachers, armed with the best equipment. As wasteful costs come down and as quality rises, we should soon begin to see the vast multiplier effects of a sound school system take root.

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