Published in The Tennessean, Sunday, December 9, 2012 and at FORBES with archives.
by Richard J. Grant
As a society advances, the ability to provide a “safety net” for those who have suffered some type of misfortune increases. But, perhaps paradoxically, that very advancement should also reduce the perceived need for such a safety net.
Advanced societies, which necessarily have relatively well-developed property rights and legal systems, are characterized by rising levels of productivity and income. Over time, the proportion of the population living in poverty, as measured by some objective and absolute standard, should be declining. If that is not the case, or is no longer the case, then it is a sure sign that the protection of property rights is in retreat.
Certainly, as our standards of living rise, our perceptions of what constitutes poverty might also rise. This is why various Western governments currently define poverty relative to some average income and can include families that possess automobiles, color TVs, and air-conditioned homes. Today we grant welfare assistance to families that only a few decades earlier would have been perceived as relatively well-off.
Charity presupposes wealth, and charity best benefits its recipients when thoughtfully provided in a manner that encourages the best characteristics in its beneficiaries. This is why government welfare programs tend to be very poor substitutes for private charity, especially when the funding comes from the more-distant federal level. Further, an entitlement structure creates perverse economic incentives, and political incentives generally cause such programs to expand to unmanageable levels.
Where once people were both encouraged and expected to grow out of poverty and dependency, our “safety net” programs have grown their own constituencies that lobby for their growth and perpetuation. Where once government-run schools were seen as a means to provide the children of indigent families with education and vocational training (as well as to assimilate immigrant families), such tax-funded schools soon became the norm, with many people unable to remember or imagine alternatives.
Just as businesses have great difficulty competing with government-sponsored enterprises that they are taxed to support, the private development and provision of education and training services is also hampered by regulations and tax levies that favor government school systems. With the lure of tax money, government programs tend to create their own ecosystems of politicized constituencies. The coerced nature of tax funding enables those constituencies, not only to crowd out the alternatives of natural society, but also to persist long past any need justified on welfare grounds.
Government-run school systems have run their course from the local control of earlier times to today’s increasingly centralized, politically correct leviathans that give less value for the time of their students and the dollars of their taxpayers than do private competitors. The drain on private resources reduces choice and causes homeschoolers and private-schooled families to pay twice for education. It also traps the children of most lower-income families in an inferior system from which they and their parents would dearly love to escape. The demand for places in charter schools and even in magnet schools attests to this.
The problems inherent in tax-funded schools can be alleviated by greater school choice. If the most important purpose of tax-funded schooling is to assist the indigent, it does not follow that governments should also run the schools. We know that charter schools and private independent schools generally offer better service and will correct their own problems quickly and without politicized battles.
It is disingenuous to argue against the extension of school choice through charter schools and vouchers on the grounds that such schools will not instantly come into existence or that not all areas will be equally served. First we must have the choice. Only then will we be free to innovate and to discover what works best.
Richard J. Grant is a Professor of Finance and Economics at Lipscomb University and a Senior Fellow at the Beacon Center of Tennessee. His column appears fortnightly on Sundays. E-mail messages received at: firstname.lastname@example.org
Follow on Twitter @richardjgrant1