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Education and Capitalism: How Overcoming Our Fear of Markets and Economics Can Improve America's Schools

Eric Osberg
11.19.2003

Herbert J. Walberg and Joseph L. Bast, Hoover Institution Press
November 2003

This accessible book provides a wealth of information on economic principles and neatly summarizes the many reasons they might help improve America's schools - if only the powers-that-be in education were more open to such ideas and less fearful of markets and choice (i.e., capitalism). This fear is the reason "market-based school reforms poll well but fail in the political arena." The book begins with a useful summary of the many shortcomings of our schools and then transitions into an explanation of economics and capitalism that any beginner will find intelligible. In the process it debunks many of the myths and arguments that often appear in opposition to market-based reform. The book thus clearly makes the case for school choice and goes a step further by describing the specifics of an effective voucher program.  Unfortunately, it offers a purely libertarian focus, which will no doubt give critics ample fodder to attack it for suggesting that markets are a panacea. By dismissing all arguments against choice, many will wonder if this story is too good to be true. And the authors' suggestion that the complete privatization of schooling has merit will no doubt drive public-school proponents to hysterics. But this book is worth reading - especially by those wary of market-based approaches. Because of its clear distillation of much evidence and theory, it should become part of any reformer's library. You can read it online or order your own copy at http://www-hoover.stanford.edu/publications/books/edcap.html.

Tags: Hoover Institution

Eric Osberg is the Director of Finance and Operations at the in Bethesda, Maryland, a Catholic, independent college preparatory school for girls, serving students from Pre-K–12.

From 2002 to 2010, Osberg served as the Vice President and Treasurer of the Thomas B. Fordham Institute and was also a Research Fellow at the Hoover Institution. He was primarily responsible for financial and managerial issues at…

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