"Vouchers without Competition," Frederick Hess, Weekly Standard, 5.10.04

Weekly Standard

Vouchers Without Competition
Why conservatives' favorite education reform won't live up to its promise.

by Frederick M. Hess

05/10/2004, Volume 009, Issue 33

THIS SPRING will see a milestone in American public education: The nation's first federally supported voucher program will be launched in Washington, D.C. The program will offer school vouchers worth up to $7,500 to about 2,000 students in the District of Columbia schools. Thrilled at this breakthrough after a decade of stop-and-start efforts, voucher advocates have rendered grand pronouncements about its likely impact on D.C. public schools.

Sorry to spoil the party, but these claims smack of Great Society-era wishful thinking. In truth, the D.C. program is unlikely to drive systemic improvement, which was always the ultimate promise of vouchers. The idea is that school choice not only benefits individual students by allowing them to move to better schools, but also unleashes competitive pressures that will force entire school systems to improve. The first claim is incontestable; the second is deceptively utopian.

The trouble is, school systems can't bear to subject themselves to true competition. Sure enough, the D.C. program is choice without consequences, "competition" as soft political slogan rather than hard economic reality. This is not only because the program is capped at about 3 percent of public school students and rewards the public schools with $13 million in new funding. More fundamentally, the program ensures that public schools have nothing to lose--and maybe something to gain--when students depart for private schools.

But competition only works when it hurts--when people have something to lose. Markets yield efficiencies precisely because they are unforgiving of failure. This harshness can make an unflinching embrace of markets difficult for reformers primarily interested in expanding parents' choices. For many voucher or charter-school proponents, "competition" is more a rhetorical device than a serious tool to promote educational excellence.

In the private sector, when competition is genuinely threatening--as when American automakers and electronics manufacturers were almost wiped out by Japanese competitors in the 1980s--firms either reinvent themselves or yield to more productive competitors. Unions make painful concessions or watch jobs vanish.

The absence of competition means that public schools, like other government agencies, typically are not subjected to this kind of discipline. No matter how inefficient, employees have little to fear. Subjecting school systems to real competition would indeed produce more effective schools --and other benefits as well. It would provide quality control beyond that afforded by standardized testing, empower entrepreneurial educators to offer alternatives to reigning orthodoxies, and permit good schools to multiply without waiting for permission from resistant district leaders.

Imagine the Wal-Mart manager who was told that losing customers would have no impact on her salary, evaluation, or job security and that attracting new customers would require her to hire more employees, assume greater responsibilities, and perhaps erect a trailer in the parking lot to handle the added business, all without extra compensation or recognition. In such an environment, only the clueless would strive to compete.

But this is exactly how schools--even most "choice" schools--compete today. Take the principal of a typical elementary school in Washington, D.C., that was built to house 400 students and currently enrolls 375 students. What happens if that principal loses 75 students to charter schools, or would happen if she were to lose 75 to the new voucher program?