For too long, the federal government has babied education, shielding it from the wholesome effects of private-sector competition. In fact, John Bailey explains in this AEI brief, if American education is going to improve, a sizeable portion of the funds showered on public and nonprofit education providers should be rerouted to for-profit businesses. American education should be an “ecosystem of various providers and consumers” and should be supported by private-sector-friendly policies like regulation waivers and results-based incentives. To articulate this point, Bailey draws on examples from the energy, space, and healthcare sectors: From turning over the design and construction of space shuttles to paying healthcare providers for switching to electronic records, Bailey showcases smooth-operating public-private partnerships—and casts education as far behind the curve. But his analogies aren’t perfect. Most concerning is the specter of Solyndra and similar examples of waste that lurk in various pages of the paper, surfacing periodically as uncomfortable reminders that the government often struggles to regulate and incentivize without skewing or perverting markets. So while Bailey’s argument is strong and his examples interesting, the devil will be in the details: Check back with AEI in upcoming months as it adds further installments in the Private Enterprise in American Education report series.
John Bailey, “Odd Man Out: How Government Supports Private Sector Innovation, Except in Education,” (Washington, D.C.: American Enterprise Institute, October 2011).
