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The Justice Department Should Sue My School

The recent decision by the Justice Department to sue to prevent the Merger of AT&T and T-Mobile, has given those of us who advocate the spreading free market capitalism a ray of hope.  It has been difficult watching the Obama administration and its seemingly conscious disregard for this all important building block of our society.  Not even his Commerce department has shown an understanding of the importance that free market competition has in giving consumers low price, high quality, and innovation.  We have found an ally, however, in the justice department of all places.  Whether you agree with the merger or not, the justice department, in its opposition, is making the point that more competition creates lower prices, greater options, and higher quality.  You may think that this is obvious, and everyone knows this, but throughout our country there are those who advocate less competition and choice, which lead to higher prices and less quality.  You can see it in the recent healthcare debate or how to “create jobs”, but there is no greater example than in our nations education system.

Public education is a quazia monopoly.  Many may argue with this, since people can send their children to private schools.   This is false since your money still must continue to fund the public school even if you make this choice.  What if the government made TV’s, and if you didn’t like the TV they were selling, and wanted a different one, you still had to pay the government for the TV that you didn’t buy.  That is the system that we have in education.  One could argue that this is even worse than a true monopoly, because it actually rewards the public schools if they do a bad enough job.  Even with this terrible deal described above for consumers, there are some who still take their children out of the public school system to choose private schools.  This leaves their tax dollars in the school without the child to educate.  Call it a bonus for creating a bad product.

Our education system could not be further from the competitive market that the justice department is arguing to keep in cell phone service.  By all measures the cell phone market over the past 20 years has produced high quality, more options, and reduced costs.  It is debatable as to whether reducing the competitors by one will truly tip the scales to cause a loss of all the qualities we expect from free market competition.  You would have difficulty, however, finding someone who advocates that one cell phone company with no competitor would be better than what we have now, yet that is system we have in public education. 

Some argue that education is “special”.  A cell phone is simple to see if it works well, gets good service, and has the features you want.  “A cell phone is not a child, and any comparison would be cold.”  “We cannot leave the education of our children to the vagaries of the market, it is too important.”  It is actually the fact that it is so important that we need the system that gives us the best results.  We already have a competitive market in education in this country that is considered the best in the world for producing exceptional results.  It’s called College.  It is not a perfect market in that there are various federal and state government grants which cause higher costs, but it is has competition, and high quality due to the consumer choice aspect.  Even if K-12 was continued to be funded by local property taxes, just adding the aspect of consumer choice would create a much better product.

Regardless of the merits of this particular merger, let’s use this moment to understand the greater point about what should be everyone’s desire to create competitive markets everywhere they do not exist today.  Where better to begin than the critically important area of education.  We have a system in our K-12 education that is worse than a monopoly, with incentives geared in the opposite direction of quality results, and yet it is not obvious to everyone what we should do.  Let’s implement the system that has given us low cost, broad choice, and high quality in most other areas of our society.  Educating our kids should be at least as important as our cell phones.

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One comment on “The Justice Department Should Sue My School

  • I find it interesting that this site is all about free markets and yet you applaud the government striking down a merger. A true monopoly can only be maintained by the only entity allowed the use force: the government. Monopolies created in the market have short lifespans and decline even without government intervention (e.g. Standard Oil market share before anti-trust). In the mean time, they provide the services that consumers want and so they continue to support the company. What is wrong with consumer choice?

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