What was it about Piketty’s extraordinary overnight success? In part it was because this was an economist breaking ranks with fellow neoclassical economists whose ideas have, since the 1980s, shaped political projects and agendas around the world. Drawing on the works of Adam Smith, they argued a free market would lead to greater wealth production and that this in turn would trickle down, leading to all boats rising.
However, Piketty’s work shows precisely the opposite. And he is not alone in drawing this conclusion. The OECD in 2014 published work that confirms Piketty’s analysis. Not only has wealth trickled upward, but huge wealth is now concentrated in a tiny percentage – the 1% - whilst the middle and working classes have lost considerable ground in terms of their share of wealth. What characterises the most unequal? They all embraced neoliberal policies from the 1980s onward. From being a relatively more equal society in the 1970s, the USA is now more unequal in the distribution of wealth and income than at any point over the past century. This also is the case for the UK, Portugal and Spain.
Nobel Laureate, Joseph Stiglitz, former chief economist of the World Bank, recently described the policy mix as a complete failure in that it has produced a more unequal society. Similarly Paul Krugman – also a Nobel Laureate of economics, shows that each time in the USA there have been tax cuts for the rich, this has led to a decline in economic productivity. When the top tax rates were increased, this led to economic growth.
Yet since the 1980s, many governments around the world have adopted this market-based/ privatisation agenda. And education has not exempted from this. What countries are committing themselves to is a particular logic: that education will be more efficient if it operates according to the rules of competition (choice, standards, information about performance, and so on leading to better quality) and that private firms will deliver goods and services more efficiently than governments (leading to cost savings). Typical mechanisms to deliver this market-based model include vouchers, charter schools, academies, free schools, market-based teaching, or test-based accountability. The assumption driving this model is that private management (if not ownership), with few regulations, will deliver better learning outcomes.
Now the problem with this model (for example, of no or low levels of taxation for the wealthy, tolerance of tax havens, tax breaks for non-domicile residents, tax breaks for foundations), is that public education is as it says on the box: public, and dependent upon state redistribution. When those earning and owning the most do not pay their share of tax, then either the state spends more than it receives – hence borrowing more to pay the bill, or letting more and more of the tax burden fall to middle and working class families, with those least able to, shouldering a bigger share of tax relative to income and outgoings.
The market model has also been promoted by private interests who see that they can make a profit from delivering education services – either as managers and providers of schools, or in testing and other key services. Yet the temptation to exclude particularly kinds of children because their results on tests are likely to be lower, or to choose those students who are expected be high performers, also means public education becomes not so much ‘public education’, but a sector that can be exploited for private gain.
The market model can be contrasted with a public investment model; a comprehensive education system premised on universal access, the preparation of citizens for the economic and wider political society, and equality. The mechanisms to ensure quality include the preparation of high quality teachers, equitable funding to schools, high quality infrastructures, and whole child pedagogy. The drivers of outcomes are that public ownership, public responsibility, and accountability through democratic processes will ensure better quality teaching and learning environments for teachers and students and thus better learning outcomes. In the strong state-public investment model the state is able to draw upon a progressive taxation system in order to invest in the public interest, rather than depending upon families to find the resources for the own individual, inevitably unequal, investments.
So what evidence might we look at that would enable us to see that the difference between ideology and evidence regarding which governance model for delivering socially-just education? Can we do the sums, and what do they add up to? In a forthcoming book on the issue, academics, Frank Adamson, Bjorn Astrand and Linda Darling-Hammond demonstrate the differences between a weak state-market model, and a strong-state public investment model. Pairing Sweden with Finland, Chile with Cuba, the USA with Ontario they draw a series of conclusions about each model. The evidence is quite stark.
They show that when we do the sums and add up the evidence, no country is able to show notably better results arising from a market investment model. Rather, over time, deep-seated inequalities begin to reveal themselves in such a way the entire system suffers. This reality has led Stanford education economist, Martin Carnoy to argue that the negative aspects of inequality and markets, especially as they play out at the bottom of the social scale, seem to offset any positive effects of parent’s freedom to pick and choose among schools”.
Similarly, those US states with the highest overall performance have been least involved in chartering or privatisation, while those with unregulated market based reforms perform worst overall.
One question we might ask here is why? What are the dynamics at work? Professor Marius Busemayer and colleagues at Konstanz University, Germany, give us some of the answer. They argue that if elites favour private education because of the benefits that are derived, and if low income groups prefer more socialised systems because of the benefits a public system will bring, much then depends on whether there is an easy opt-out clause, or opt-in incentives for the middle classes regarding a state investment model versus a market model. The middle classes are more likely to pursue a state investment model if they can valorise some advantage here. But this has benefits for the working classes in that the middle class is likely to work politically hard for better public education, and in this case, there is a trickle-down effect (assuming no systems of tracking are put into place) because a diverse school mix works best for those with fewer resources.
It is clear private interests into public education simply do not go! And the sums are not that difficult to calculate. This is a question of political will – as the evidence is increasingly compelling that market models are divisive and dividing. An education system committed to a public investment model and not a private market model would not only have a radical effect on politics, but it will lead to greater levels of economic productivity and social equality, and not more for a tiny elite. And that is definitely something worth struggling for!