When School Choice Meets Reality

More than twenty years ago, as a researcher for the Missouri House Republican Caucus and State Rep. Jim Talent, I prepared a study on how to wind down the St. Louis School Desegregation program. The one option the report didn’t consider was School Choice because, well, it was a flawed theory. And now the situation with the Normandy School District, and its possible bankruptcy, is making clear just how flawed it actually is.

The theory of School Choice sounded compelling. Let the principals of the free market improve our educational system. Instead of forcing children to go to their neighborhood schools, provide vouchers allowing them to attend any school in their district or even region. This will force schools to compete for students, rewarding the good schools and forcing the bad schools to improve. Competition will lead to a better education for all students.

But the free market doesn’t work this way in the real world. Lots of mediocre companies hang on for years or even decades, getting away with selling an inferior product. Why would we assume school districts would behave any differently? Why would we assume that under-performing districts that lose students would suddenly improve? The Normandy District has been aware of the possibility of losing students for several years, but didn’t manage to improve educational outcomes enough to keep it from happening.

And now it will have an even harder time improving education. Normandy will now be forced to pay $15 million of its $50 million budget to pay for the tuition and transportation costs of the transferring students. But the Normandy District’s expenses are not completely tied to the number of students. A school, like any other operation, has fixed and variable costs. Even if a quarter of the students leave the high school the fixed costs remain the same; the lawn still has to be mowed once a week. So what happens? Variable costs would have to be cut disproportionately; teachers would have to be fired and the number of students per class increased. Conceivably Normandy could face a situation where many of the teachers have been fired but the high school itself remains open with a skeleton staff. Can anyone truly suggest that this is improving the educational opportunities for the remaining Normandy students?

Many of the Normandy students transferred to Francis Howell. In the free market, successful companies capitalize on demand to increase their capacity. Should Francis Howell attempt to increase its student capacity? What if the administration at Francis Howell is better at educating students than projecting market demand? What if Francis Howell passes a school bond to expand and accept all of the Normandy students, but then Normandy students change their minds? It might be doing a good job of serving the students it has but still not able to make its construction bond payments and so be forced to close. This happens all the time in the free market – successful companies eventually fail because they over expand or grow beyond the skills of their management teams. Why would schools be any different?

These aren’t imaginary problems but decisions the market makes every day. Even a cursory attempt to imagine how market principles would actually work when applied to the real decisions facing Normandy and Francis Howell very quickly highlights just how far-fetched the idea of School Choice is.

But these are strange times for the Republican Party. It wasn’t that long ago that the party was known for its rational, hard-nosed pragmatism – Republicans used to be skeptical of theories that couldn’t be grounded in real world examples. Now the party is so intent on avoiding any solution that involves a role for government that it shoe-horns virtually every issue into the theory of the free market, whether it fits or not. The Republican Party has traded its hard-nosed pragmatism for think tank optimism.

Somebody once said “Reality is where think tank ideas go to die”. Reality is now in the process of killing school choice. Our country will be better for this – we can go back to having a real conversation about what we need to do to improve our schools. But the tragedy of the process will be the collateral damage. Thousands of Normandy School District students will receive an even worse education while the theory dies.

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