The (Further) Case for the Free Market in Education

Kerry McDonald – February 9, 2023

In 1964, Leonard Read wrote a powerful essay celebrating the free market in education. Read, who founded FEE nearly two decades prior to promote individual and economic freedom, recognized the ways in which government control of the K-12 education sector constrained choice and prevented diversity and abundance of learning options.

In “The Case for the Free Market in Education,” Read asked us to imagine that education had been freed from government interference and was instead “restored to the free, competitive market.” 

“What would happen?” wondered Read. “No one knows!” he answered.

Rather than a flaw, Read recognized that the unknown of what would inevitably emerge from this restoration would be its strongest feature. In a free market, education would become an entirely decentralized sector based on voluntary association and exchange, with entrepreneurial individuals creating various learning opportunities and families deciding for themselves which ones they prefer for their children. Consent would replace coercion in education, sparking endless possibilities.

As Read put it:

“Creative thought on education would manifest itself in millions of individuals. Such genius as we potentially and compositely pos­sess would assert itself and take the place of deadening restraints. Any person who understands the free market knows, without any qualification whatsoever, that there would be more education and bet­ter education. And a person with a faith in free men is confident that the costs per unit of learning accomplished would be far less…The free market is truly free: it is free of restraints against creative action; it presup­poses free exchange; its services are as free as the sun’s energy.”

Some might argue that we already have a free market in education outside of government-run schools, with private schools free to operate and compete for families who have the means to exit an assigned district school for private options. Yet, here too the government interferes in the private sector to varying degrees. Compulsory schooling laws in all states mandate school attendance, and most states require private schools to be registered with local or state officials. Some states influence private education more directly with various curriculum and evaluative requirements. And in a few states, such as Iowa, private schools can’t even exist without being accredited by the state department of education or one of only a few accrediting organizations approved of by the state. 

How this works in practice is heartbreaking. I wrote recently about a Sudbury-model school in Des Moines, Iowa that spent months trying to get launched but finally had to give up in 2021 because state regulators would not allow such an out-of-the-box educational model to exist in their state. Sudbury schools, modeled after the well-known Sudbury Valley School in Massachusetts, are found across the US and around the world. I featured the Sudbury model and Sudbury Valley throughout my Unschooled book. These schools embrace an educational philosophy of democratic self-governance and non-coercive, self-directed learning, with no adult-imposed curriculum requirements, classes, or evaluations. Sudbury Valley continues to operate today, more than 50 years after its founding, and has many successful alumni, including the Academy Award-winning documentary filmmaker, Laura Poitras

Yet, states such as Iowa won’t allow certain types of schools, like Des Moines’s Sunrise Sudbury School, whose cofounder is a former high school physics teacher with a graduate degree in teaching, to open their doors. 

Beyond such outright coercion in the private education sector are more subtle overreaches. Many states erect regulatory hurdles for private education providers, especially those that challenge the conventional schooling status quo. Zoning and occupancy restrictions can prevent experimental models, such as microschools and learning pods, from getting off the ground or growing, as can restrictive child care licensing laws that can ensnare non-traditional programs aimed at school-age children in a daycare regulatory morass. I talk more about these regulatory roadblocks in my State Policy Network report. Advocates in some states, such as Utah, are trying to push back against government overreach in the private education sector to encourage greater education entrepreneurship and innovation. 

By removing both the overt and subtle government control of education, and unleashing a free, competitive education market, a panoply of educational models will emerge, representing a wide assortment of different educational philosophies and approaches. As in any healthy, dynamic market, some of these models will succeed and others will fail. Quality programs that are responsive to parents and learners will gain popularity and traction, while undesirable and unresponsive programs will wither. 

We see early glimpses of a free, competitive education market in states such as Arizona, which has comparatively low private education regulations and has cultivated a culture of choice over the past several years, aided by expansive school choice policies that enable parents to opt out of a government school assignment. In Arizona, and increasingly elsewhere, parents are regaining responsibility for their children’s education and finding the best educational fit. This might include enrolling in one of many private school, learning pod, or microschool options, collaborating with others on homeschooling efforts, taking advantage of tutoring services, using individualized curriculum resources and materials, and exploring a host of learning supports. 

Auspiciously, Read spoke about this more than a half-century ago when he predicted the positive outcomes of a free market in education: 

“While one cannot know of the brilliant steps that would be taken by millions of education-conscious parents were they and not the government to have the educa­tional responsibility, one can im­agine the great variety of coop­erative and private enterprises that would emerge. There would be thousands of private schools, large and small, not necessarily unlike some of the ones we now have. There would be tutoring ar­rangements of a variety and in­genuity impossible to foresee. No doubt there would be corporate and charitably financed institu­tions of chain store dimensions, dispensing reading, writing, and arithmetic at bargain prices. There would be competition, which is cooperation’s most useful tool! There would be a parental alertness as to what the market would have to offer. There would be a keen, active, parental respon­sibility for their children’s and their own educational growth.”

Read would likely say, and I would agree, that today’s school choice policies that redistribute taxpayer funds from government-run school systems to individual students to use as they choose are still rooted in government compulsion and distort the restoration of a fully free, competitive education market. Indeed, without vigilance, it’s possible that these policies could lead to even greater government regulation of private education—a tragic potential consequence. 

But these policies, especially in low-regulation states such as Arizona, are showing that they can help to loosen the government’s grip on education, which is the first step in restoring a free, competitive education market. These policies help to put parents back in charge of their children’s education, and encourage the proliferation of new and diverse learning options through entrepreneurship and innovation. They don’t go nearly far enough, though. As Read explained, the only way to achieve a truly free education market is to eliminate compulsory attendance laws, remove government influence over curriculum, and end forced taxation of education.  

Read concluded his influential essay by stating that the “myth of government educa­tion, in our country today, is an article of general faith. To ques­tion the myth is to tamper with the faith, a business that few will read about or listen to or, if they do, calmly tolerate.” Today, more parents, educators, and entrepreneurs are tampering with that faith and challenging the government’s outsized role in education. They are increasingly seeking new and different education options, and building what they cannot find. They are pushing ahead despite many regulatory barriers, and creating bottom-up education solutions that outshine top-down incumbents. 

These parents, educators, and entrepreneurs are becoming champions of a truly free market in education. And, as Read reminded us in his final line, “becoming is life’s prime purpose; becoming is, in fact, enlightenment — self-education, its own reward.”

Originally published at Kerry McDonald is a Senior Education Fellow at FEE and host of the weekly LiberatED podcast. She is also the author of Unschooled: Raising Curious, Well-Educated Children Outside the Conventional Classroom (Chicago Review Press, 2019), an adjunct scholar at the Cato Institute, education policy fellow at State Policy Network, and a regular Forbes contributor. Kerry has a B.A. in economics from Bowdoin College and an M.Ed. in education policy from Harvard University. She lives in Cambridge, Massachusetts with her husband and four children. You can sign up for her weekly email newsletter here.

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