"Advocating, or opposing, family choice

in the abstract is foolish."

R. J. Murnane (Clune and Witte, 1990)

Most high school graduates are not ready for the challenges of the modern world or higher education. Their sub-par skills pose a major threat to the vitality of our economy and political system. In 1983, a Presidential Commission found the 'nation at risk', and in 1992 the Congress found that "the current achievement levels of students in the United States are far below those that might indicate competency in challenging subject matters in core content areas." The March 25-27, 1996 Second National Education Summit emphatically made that point again. It's America's #1 political issue.

Many people attribute the poor education outcomes to the political prescription of education practices, and the absence of market forces that results from the ‘public’ school monopoly on tax dollars. "Politics permeates the educational system (Wong, 1996)," including curriculum, textbooks, teaching credentials, instructional practices - prescribed in considerable detail sometimes - and the designation of attendance areas. Most children must attend a particular 'public' school. According to the National Center for Education Statistics, 80% of K-12 children attend their assigned 'public' school. 'Public' is in single quotes because the label is misleading. They are less public (CSPP, 1970; Gatto, 1992) than other government-funded services like housing, hospitals, roads, parks, libraries, parking lots, even golf courses and marinas that are open to anyone willing to pay user fees.

Many analysts and officials have argued for more parental choice (examples: Chubb and Moe, 1990; Coons and Sugarman, 1991; CSPP, 1970; Lieberman, 1993; Walberg and Bast, 1993; and West, 1994). Others have argued against it (like TSTA/NEA, 1994; Smith and Meier, 1995; and Henig, 1994). Only two of the choice options are heard very often; 'public school choice' (open enrollment among public schools) and 'private school choice' (taxpayers help parents pay private school tuition).

There are many good examples of the narrow focus of the school choice controversy. The Center for the Study of Public Policy (CSPP, 1970: p 26) noted that a reformed education system did not have to favor 'public' schools, but CSPP still considered only policy options that did. Witte and Rigdon (1993) said that a Chubb and Moe (1990) proposal maximized consumer choice and school autonomy even though government officials "orchestrate and oversee the choice process," including price controls and control of who will operate new schools. Business Week (1992) said 'private school choice' was "at one extreme," and Doyle (1992) said it was "a fundamental transformation." Walberg and Bast (1993) admitted that private school choice made only limited use of market forces, but still said it was "comprehensive educational choice." The narrow focus persists at the highest levels; for example, it dominated a February 17, 1997 meeting in the Utah Governor's office. In addition, political defeats like California's Prop 174 apparently convinced choice advocates that too much choice, rather than too little choice, or poor political strategy, was the cause of defeat. The political setbacks of private school choice reinforced parental choice narrowmindedness.

The limited scope of public debate was clearly evident on ABC News' August 29, 1993 This Week With David Brinkley. Each panelist (George Will, Sam Donaldson, and Cokie Roberts) and guest (Polly Williams, NEA President Keith Geiger, Governor Roy Romer [D-CO], and William Bennett), assumed that whatever reforms occurred, the public school system would keep its major financial advantage. Private schools would still have to charge thousands more in tuition for less expensive services.

That narrow focus is unnecessary and dangerous. Payment by users is enforceable, so education is not a classic public good like national defense that only the government can provide. Businesses can supply education. Regulations and subsidies can address spillover and equity issues (Lott, 1987; West, 1994). The US Supreme Court (1973) said "states didn't have to provide public education (Lieberman, 1993)." There are no legal or practical reasons why the public debate should not include outright (consumer-funded) privatization, and 100% child-centered public funding, and this article will point out the many reasons why the debate should include them. The aims of this article are to evaluate those two options, and to compare them to the two options already on the table. If we resolve the choice debate in favor of substantially more parental choice, it is important that we choose the most productive version. A nation at risk must have nothing less. Comparisons of the four options are based on the following criteria derived from the school choice controversy: competition, access to education services, socialization to a common culture, stability of reforms, and formalization of education practices.

Issues like non-mainstream children, segregation, church-state separation, extremist-run schools, and transportation are frequently cited justifications for 'public' school dominance. They arise only to aid comparisons, not to rebut choice opponents’ claims. The pros and cons of collective choice (electoral politics) vs individual choice primacy in deciding the nature of publicly-funded education are not addressed. Again, the aim of the article is to explain and compare the four basic ways of increasing parental choice, not to directly advocate increased parental choice. Therefore, there is no attempt to improve upon the many studies that have examined the slight differences in the choice policies that various governments have tried or seriously considered.

100% child-centered public funding was virtually ignored between the time Friedman (1962) proposed it, and a 1997 William Allen - Eugenia Toma proposal (School Reform News, 1997), based on a November, 1996 study ordered by Michigan's Governor Engler. The study concluded that the government’s role in operating schools insulated from competition was the biggest source of inefficiency. 100% child-centered public funding keeps tax revenues as a large source of education funding, but all schools must compete for funds. 100% child-centered public funding shifts the focus from supporting a 'system' to parents' satisfaction with education outcomes. Except for the budget of the agency that disburses public funds and performs oversight functions, all of the tax dollars earmarked for education reach individual schools through parents’ choices. Parents that prefer their current 'public' school can continue to send their children there, but they receive the same level of taxpayer support if they transfer their child to a private school.

With outright privatization, parents pay school fees from their disposable income. Fees and donations fund K-12 education. Outright privatization has received more attention (Couson [1999] most recently) than 100% child-centered funding, but mentions were still rare, and it was never seriously considered. Through the early 1800s, US primary education was largely funded that way, but despite periodic, sometimes detailed, reviews [Blumenfeld (1981), Coulson, 1999; Lee and Sexton (1992), Richman (1994), Rothbard (1994), Rockwell (1992), and West (1994)], its track record is not well known. Given its major advantages, widely held beliefs about the disadvantages of outright privatization deserve re-examination.

Outright privatization and 100% child-based funding are less vulnerable to most of the typical criticisms of public and private choice proposals. For example, the most politically potent criticism of 'private school choice' has been the alleged impact on the children that stay in the 'public' schools (see Henig, 1994 and Greider, 1992 for good samples). Such allegations have long-term relevance only if some children have to stay there. With outright privatization there are no ‘public’ schools. With 100% child-centered public funding, children receive the same level of public support no matter which school their parents choose, so no one has to stay in a public school indefinitely. If the 'public' schools are not choiceworthy, 100% child-centered public funding will cause private schools to gradually replace them.

Competition, socialization to a common culture, access to instruction, stability, and formalization of educational practices are the comparison factors. Those factors dominate the parental choice debate. By replacing the traditional, more subjective evaluation factors - efficiency, equity, and freedom - they shift the debate to the importance, and desirable direction of change in each factor. Controversy over measurement, definition, and implementation methods significantly reduces the usefulness of the traditional factors.

1. Competition. Although choice advocates chronically overlook key elements of competitive markets, they tout competition as the key to school system improvement. The key elements of market competition are numerous and independent competitors, opportunities to compete (access to resources and ability to start new schools), and incentives to compete (what competitors gain or lose) for education consumers.
2. Access to Education Services. Access has two key parts: affordability and availability. The first depends on family income, and taxpayer and charity funding. Availability depends on proximity, and opportunities and incentives for product differentiation, including educators' abilities to customize services and adapt to new information.
3. Socialization to a Common Culture. This factor evaluates the degree to which children reach adulthood aware of their rights and responsibilities in a republic (Wise and Darling-Hammond, 1984). Part of socialization is exposure to a mix of children that is representative of the racial, ethnic, and economic diversity of their region.
4. Stability of Reforms. Reforms can undermine the political or economic support for key elements of the assumed outcome(s). A reform that causes some group(s) to benefit at the expense of others, or that doesn't yield broad-based academic gains, is probably politically unstable.

5. Formalization of Education Practices (curriculum, textbooks, teaching methods, etc).

Choice Within the Status Quo

With few exceptions, parents have choices now only if they can pay private school tuition on top of school taxes, or if they can move to the attendance area of another 'public' school. The financial hardship of tuition and moving costs is a major deterrent for middle and lower income families. The major similarities of 'public' schools, and the resource-poor nature of most private schools, significantly diminish the incentive to incur such expenses.

The tiny amount of parental choice available now may do society more harm than good. Higher housing costs near better schools keep the least mobile, lowest income people near the worst schools. Experienced teachers seek transfers to schools in more affluent neighborhoods, so schools in lower income areas have the least experienced teachers. The disparity-raising and segregating effects are self-reinforcing. Departures by high income family reduce the tax base (probably also parent involvement and student quality) of the worst 'public' schools, and the opposite in the popular locations (Wyckoff, 1991). Policies like busing, redistribution of tax dollars, and a smaller role for local property taxes can only partially address (while creating new problems) the disparities in education opportunities.

Open enrollment among public schools allows parents to transfer their children without having to change where they live. The single quotes on 'public' are no longer appropriate, because open enrollment makes the government's schools as public as other government facilities.

Competition: There are periodic claims that public school choice prompts meaningful competition (Clune and Witte, 1990; Armor, 1997), but there is no theoretical basis for them. Leo (1991) said that "offering choice only within the public schools is akin to offering Russians the right to shop at different state stores." Public schools are at most partially independent, and there are no profits to spur innovation or cost-cutting. Lieberman (1993) said public school choice is "trivial," because it lacked any of the conditions that characterize competitive markets. It only creates weak incentives to improve. Cobb (1992) said it would not prompt any meaningful changes in school practices. Others like Bierlein (1993) and the New Republic (1991: 8) merely wonder what motive there is to compete.

Nationally, 88% of children attend public schools; well above the threshold that the US Justice Department's Anti-Trust Division uses to define monopoly. School principals have neither the profit motive, nor the options (spread successful practices to other places) and concerns (bankruptcy), that characterize the producers in competitive market settings.

The empirical evidence is mixed and controversial. Durenberger (1990) said the Minnesota version of public school choice had created competition and improvements. Fiske (1991) gave public school choice, especially the controlled choice program in Cambridge, Massachusetts, credit for numerous improvements.

Coons (1991), Lieberman (1990), and Cobb (1992) cite detailed evidence that choice among public schools is trivial. The Texas State Teachers Association (TSTA, 1994) said that choice programs (including Minnesota and some of Fiske's [1991] examples) proved that choice should be abandoned. TSTA said choice fails because government institutions do not respond to market incentives; a strange conclusion coming from a strident choice opponent. Some conservatives make the same claim to argue for outright privatization. The TSTA's ineffectiveness finding applies to the public school choice programs that dominated their review, but there was no basis for their general condemnation of parental choice. The TSTA review included only a restriction-laden example of private school choice (Milwaukee), and no examples of outright privatization or 100% child-centered funding.

Access: Public school choice only slightly increases parents' access to services. It does not change the affordability of parents' options, but open enrollment among 'public' schools would lead to some product differentiation. Public schools would specialize to some degree, but school principals and public school teachers are not as motivated to specialize and change as private schools with the same resources would be. In addition, public schools "must avoid offending any constituency" (Cobb, 1992). Public schools' weaker incentives to customize services, and the political constraints on specialty areas, will mean that the student transfers will be from bad to better versions of very similar practices. With more extensive specialization, there are many versions of excellence, and each school can be popular for different reasons. Bierlein’s (1993) review of public school choice in England confirms that without the extensive specialization fostered by markets, some schools become popular, while others become quite unpopular.

Socialization: Open enrollment would enlarge and overlap schools' attendance areas. That could increase the diversity of a school's students. However, the modest degree of specialization that would result from public school choice would only slightly reduce the significance of student body composition as a choicemaking criterion. To understand how uniformity in education practices inflates importance of bias in making a school choice, consider the situation of a family deciding where to live, or with public school choice, where to enroll their children. Public school practices are similar, so student body composition could be the only significant difference between the top locational preferences. Without other significant differences, even mild biases become the decisive school choice factor. Though the current high degree of racial and ethnic sorting by neighborhood would make it difficult to decrease the diversity of most public schools, public school choice would make that a theoretical possibility in some places. People would no longer have to incur moving costs to act on a bias.

The slight pedagogical specialization that might occur with the elimination of formal, exclusive attendance areas would make instruction more effective, including in the area of rights and responsibilities.

Stability: If attendance-based funds exceed per pupil marginal costs, funding shifts can create losers and adjustment costs; a potential source of negative political instability that could cause a return a return to the status quo.

Many choice advocates (see Clowes [1998]) are betting on incrementalism - positive political instability - to achieve a version of "full school choice" that may still lack the key elements of a competitive market. I believe that incrementalism is a serious strategic mistake; the "kiss of death" for more meaningful parental choice according to Milton Friedman (1992). Government programs are quite durable. In addition, inappropriate generalizations by citizens, and deliberate distortions by choice opponents, could produce widespread agreement that parental choice was to blame for problems and ineffectiveness, even though the problem was not enough choice.

Formalization: Public school choice will not affect the rules that school-based educators cannot readily influence.

Private school choice means that taxpayers help parents afford private school tuition, in effect creating two publicly-funded systems. If a child transfers to a private school, less than the average per pupil 'public' school expenditure moves with them. Departures from 'public' schools (henceforth, just ‘departures’) would raise their per pupil resources. Mass departures from the worst districts would leave them with a lot of money per student. Payments to private schools could come from ‘new’ money, but that would greatly reduce 'public' schools’ incentive to change (Hoxby, 1998), and education spending would rise at the expense of other private or government expenditures.

Many voters will not recognize the major differences in the incentives underlying the parental choice options (Hood, 1991). Voters might blame problems on the concept of choice generally, so problems unique to private school choice could poison the political atmosphere for other forms of parental choice. The widely publicized Milwaukee voucher program lacks all of the elements of a competitive market, and provides very little choice, but it is constantly cited as a general indicator of parental choice effects.

Standing against those risks are the benefits of some rivalry and specialization. Even if private school choice leads to gradual 'public' school abandonment – the prediction of many choice opponents - the long-term benefits of total privatization might exceed the high cost of getting there. Private school choice could force some low income families to endure a gradual deterioration of their 'public' school.

The huge literature (see Walberg and Bast [1993] and or Lamdin and Mintron [1997]) on private school choice overlooks two key issues. The first is that there are many possible cost reduction levels when 'public' school enrollments shrink. A school district’s total costs are the sum of expenditures on facilities, district office staff, school staff and administration, teachers, and material. The average cost per student (AC) is total spending divided by the number of students. Departures would not affect some components of AC. Except for rapidly growing districts, where departures would reduce new construction, marginal cost (MC), defined here as the change in total costs with a departure, would be smaller than AC.

The gap between AC and MC would vary inversely with the number of departures and the time frame. If a few students (not enough to eliminate a teacher) transfer, MC is quite small. Even if there are enough transfers to close a school, district office staff does not shrink proportionately, and would MC stay below AC.

MC would usually be less than AC, often by a lot, and MC could vary widely. Public support per private school student well below AC could exceed MC, and amounts as high as 90% of AC have been proposed. Even if students already enrolled in private schools are excluded, 'public' school students could suffer. The level of damage done to the students that stay in 'public' schools depends on the difference between the departure-related funding loss and MC, and the sensitivity of student achievement to that gap. Extensive reviews have found no systematic linkage between 'public' school resources and achievement (Hanushek, 1996), but funding cuts greater than MC could still have an impact. Neither side of the debate can be certain of its claims about the effect of transfer-induced cuts in 'public' schools’ total revenues on students that stay in 'public' schools. Opponents’ claims that private school choice will hurt those students have helped them defeat ballot initiatives in California, Colorado, and Oregon. A gap between AC and marginal cost (MC) also slows the reallocation of resources from less popular to more popular schools.

Competition: AC > MC creates policy design trade-offs. Small departure-related funding losses would minimize the possibility of harm to 'public' school students. That's why private school choice proponents keep the loss below AC, usually well below. They feel compelled to promise that departures won’t harm 'public' schools. However, keeping departure-related losses small would reduce competitive pressures, product differentiation, the creation of new schools, and parents' ability to take advantage of existing options. Still, Bolick (1994) said that in Puerto Rico, $1500 low income vouchers (usable in a 'public' or a private school) had caused some specialization and improvement by 'public' schools.

The other competition-related issues are participation restrictions, and parents' right to supplement public funds (add-on) with their own money, and thus receive public support even if they send their children to schools that charge more than the public funding level. Most private school choice proposals preclude significant competition by restricting eligibility to low income families or schools designated 'low-performing'. The existing programs in Milwaukee, Cleveland, Maine, Vermont, and Florida are much too small to create any resemblance to market forces.

Denial of the right to add-on to the public funds, such as in Florida and Milwaukee, is a competition-killer. Without the right to add-on, the per child level of public support differs only slightly from a price control. Say the public support is $5000 per child. If add-ons were prohibited, all but the most elite schools would charge $5000. With limited access to the public support, some would charge less. Services that cost slightly more than $5000 per child would have to be purchased without public support. To receive $5100 worth of instruction, families would have to spend $5100 more than if they settled for $5000 worth of instruction. Virtually no one would forego the public support of $5000 per child for an additional few hundred dollars of instruction.

Access: Participation caps, the per child level of public support, and add-on policies affect the increase in access to private school services, including those that don't exist yet.

State governments derive their authority to regulate private schools from compulsory schooling, but public funding would increase regulatory pressures. The government must attach some conditions to taxpayer support to deter fraud and extremism. Even though setting a minimum school size would probably deter much fraud, and even the promotion of extremists’ views (Lieberman, 1993), the political process could produce other rules. Powerful unions (Beare and Boyd, 1993; Blumenfeld, 1984; Lieberman, 1993; West, 1994), and other choice opponents have a big stake in the conditions attached to the money. Private schools might also become "bland creatures of the majority" (Coleman in Clune and Witte, 1990). Since the specific impacts on private school practices are uncertain, vigilance is in order despite evidence (Bast and Harmer, 1997) that the government's present efforts to empower consumers do not include significant new regulations. Libertarians (Richman, 1994; Rockwell, 1992; and Rothbard, 1994), and some conservatives (Miller, 1992) still say that government funding will bring about a "deprivatization of private schools."

Socialization: More children would attend private schools that do not restrict their enrollment to a certain neighborhood. Increased specialization by private schools will reduce the relevance of bias as a choicemaking criterion among private schools. That private school curricula may not contain some material that the body politic would mandate is not necessarily bad. The political gauntlet filters out a lot of significant material.

Stability: Political stability is the second significant, largely overlooked issue. Small programs like Milwaukee and Cleveland are probably politically stable, but proposals like California’s Prop 174 might not have been. Private school choice could reduce 'public' schools’ already fragile political support. Bierlein (1993) noted that concern. Colorado’s Governor Roy Romer made it a key part of his successful effort to defeat Colorado's private school choice ballot initiative. He said departures would make it harder to get citizens to approve 'public' school spending, support bond issues for school construction, and vote in school board elections. Such effects, and others, already exist in Australia (Beare and Boyd, 1993), where non-government schools receive substantial sums from state and national governments. Non-government, non-secular school enrollments are growing despite declines in the total number of children. Anderson (in Beare and Boyd, 1993) repeatedly uses the term ‘political instability’ to describe the effects of large net departures from Australia’s government-owned schools. Boyd (1987) says Australia's school funding policy is "politically unstable" because Australia essentially has two publicly-funded systems.

The more accessible private schools become through private school choice, the greater the erosion of 'public' schools’ political and long-term financial support. The long waiting lists for privately-funded partial low income vouchers, indicate that substantial erosion could result from even low levels of taxpayer support. Evidence from Australia (Beare and Boyd, 1993) and Chile (Carnoy, 1996) indicates what would probably happen with unrestricted access to modest support. Departures would occur disproportionately in families willing to supplement the taxpayer funds with their own funds, and in families most actively involved in their child’s education; the students and parents whose involvement and support the 'public' schools can least afford to lose. Education outcomes may improve for society as a whole, but an accelerated decline of ‘public’ schools could hurt low income families forced to choose between them and the cheapest private schools.

Formalization: The net effect on children depends on how many shift from more rigid 'public' schools to less rigid private schools, and the nature of any increase in the regulation of private schools.

Schools would only receive tax dollars according to the enrollment choices of parents. Even the government-owned schools would derive their support like businesses; directly from the people that use their services. Present school districts would vanish or become much less important. Formal school attendance areas would vanish. Then parents are no longer penalized for choosing private schools, so low income families are no longer stuck in bad schools that could deteriorate with the departure of other children. Taxpayer-supported, private schools are then as public in terms of access and support as public schools, but private in terms of ownership and management. With the elimination of attendance areas, public schools would become truly public.

There are significant transition issues. If public schools are unable to compete, school facilities and employees would move to the private sector. Taxpayers would enjoy a windfall from facility sales in some places, but they would suffer losses where competition makes some facilities obsolete. Employee transfer is the most difficult issue. School entrepreneurs are not bound by past hiring policies and tenure decisions. Profit-seeking owners would dismiss employees that drive up expenses and drive away students. Pension protection is a second critical, though less troublesome, issue.

Once the uncertainties are resolved, many educators would appreciate the result. Educators are much more likely to realize their full, probably larger, market value with numerous competing schools (Merrifield, 1999), rather than with the status quo (a small number of only semi-competitive school districts, plus a few resource poor private schools). 100% child-centered public funding would help many teachers through a more competitive labor market and more school diversity.

Competition: Current non-federal education revenues would yield taxpayer support of about $5000 per mainstream student. Means testing the level of support is an option, but that would complicate education policymaking by introducing income distribution issues. Since most current private schools run on much less than $5000 per child, parents would have access to nearly all of them, and child-based funding would increase parents' leverage with educators. The high stakes would also increase educators’ interest in cost cutting and innovation. The difference between profit and loss could hinge on relatively few students, so educators' incentives to excel would be strong even if only a few parents are capable, careful buyers of instruction.

The profit-making opportunities created by that level of public support would cause many entrepreneurs to enter the market, and existing private schools would expand. Entrepreneurs can probably top current 'public' schools for less than $5000 per pupil, so major over-investment in K-12 education is a possibility. That might prompt legislators to gradually reduce public support. The political determination of the public support level is the major shortcoming of 100% child-centered public funding.

Again, the right to 'add-on' is a critical issue. Market determination of prices (tuition) is a cornerstone of competitive conditions. That means schools must have the freedom to set whatever price they want. Denying the right to add on could also have important political ramifications. The increase in parental choice could get the blame for a reduction in the availability and quality of education services.

There is a good argument for going beyond that and requiring an add-on. Lieberman (1993), West (1994), and Coulson (1999) argue that parental sharing of education costs would significantly increase parental attention to education issues and school differences.

Access: Perhaps tax dollars should not fully cover fees, but it is important from an access standpoint to have enough taxpayer support, so that with competitive forces, many schools would accept it as nearly full payment. $5000 per child or 90% (say) of the total private school cost, whichever is less, in public support would give even low income families access to most schools. Significant incentives to specialize would greatly increase the diversity of services available to most children. That would spur parents to more carefully examine the options; another reason why parents would become more involved in their child’s education. The better match between parents’ preferences and educators’ practices would also reduce litigation, political polarization, tensions between teachers and parents, and it would increase students’ incentive to stay in school and work hard.

100% child-based funding would not eliminate the threat of a significant increase in the regulation of private schools, but it would lower the probability of it. Competitive pressures would weaken the likely proponents of regulation: primarily today's choice opponents. The additional costs attributed to private school choice (Levin, 1991) can't result from administratively simpler 100% child-centered public funding. Equal support of mainstream children also yields regional funding equity at any scale (multi-county, state, etc) desired. According to Fernandez and Rogerson (1997), the equalization of public funding would increase the future aggregate income of society.

Socialization: More children would transfer to private schools. Otherwise, 100% child-based funding yields the same socialization issues as private school choice. Greatly increased specialization - compared to private school choice - would further reduce the relevance of bias as a choicemaking factor. When school practices differ significantly, student body composition would effect the school choices of only the most ardent racists.

Stability: Every family would have genuine, steadily improving choices, so there is no danger that improvements in some schools would harm children stuck in other schools. Competition by schools for students and personnel would significantly weaken the constituencies that prefer accountability to politicians to accountability to customers. The equalization of public support for similarly situated children would weaken the equity arguments against child-centered funding that some would still make because wealthier families would buy more education through add-ons.

Formalization: More children would attend schools that make their own policies. That would eventually include the surviving government-owned schools. They'd have to significantly increase site-based control to specialize and stay flexible, and thereby remain competitive. Competition among teachers, opportunities to specialize, and competition for the best teachers would give teachers the autonomy of true professionals.

Outright privatization eliminates school taxes. Legislators would reallocate or refund the general revenues formerly spent on K-12 education. Parents would buy instruction for their children the way they buy other things.

There are four key differences between 100% child-centered public funding and outright privatization. 1.) With the former, the political process has a major role in deciding K-12 spending. With outright privatization, it’s only markets. 2.) Outright privatization makes access to education more dependent on family income and how families prioritize education spending. 3.) School regulation is less likely when tax revenues are not involved. 4.) 100% child-centered public funding could be fully implemented very quickly. Outright privatization would have to be phased in slowly. Even if all former public school funding was refunded to taxpayers, rather than re-allocated to other government functions, much of the tax relief would go to families without school-age children. Many families could not bear the large, sudden increase in household expenses. In addition, the market probably cannot absorb all of the government-owned facilities at once.

Competition: Compared to 100% child-based public funding, outright privatization reduces the entrepreneurial stakes by cutting K-12 spending, and by possibly removing some low income families from the market. Outright privatization would create much more competition than public or private school choice.

However, the absence of government funding reduces the regulation threat, the over-investment threat, and the price control threat that exists because add-ons might be banned.

Access: Outright privatization maximizes product differentiation, but the stronger link between income and access to instruction is a big concern. If education services produce spillover benefits (West [1994] discusses that controversial issue), strictly private education funding would mean under-consumption even by families with adequate incomes. Children of low income, or uncaring, parents might not have access to any formal education. Blumenfeld (1981), Coulson (1999), Friedman (1990), and West (1994) found that high quality, charity-funded schools produced high literacy rates among low income children during the periods of history when there was no government funding of K-12 instruction, but there is no guarantee that such philanthropic arrangements would re-emerge. The extent of re-emergence, and its form (charity-operated schools vs low income vouchers) is the key uncertainty preventing more definitive discussion of the comparison factors.

Socialization: Outright privatization would increase the family income homogeneity of student bodies. Since income and minority membership are correlated, outright privatization would produce less student body diversity than 100% child-based funding.

Stability: Many families would have genuine, steadily improving choices, but some children could be stuck in low quality schools resistant to change because of their captive, low income clientele. Disparities in access to instruction, including the possibility of no access for some children, could energize political pressure to re-introduce public support.

Formalization: Outright privatization would minimize it.

Competition: 100% child-centered public funding (CCPF) maximizes the dollars at the discretion of parents (the taxpayer support, maybe supplemented by their money), so it creates stronger incentives to compete (the stakes) and more competitors. Depending upon the regulations that accompany the former, CCPF or outright privatization will maximize competitors’ independence and their ability to compete (comparable resource access and freedom from constraints).

Access: Funded at current state and local K-12 education spending rates, 100% CCPF would yield the most access. CCPF would produce more product differentiation than private school choice or public school choice, because with CCPF more schools would be independent, and they'd be funded at current levels or better. CCPF would make more of the available offerings affordable than outright privatization or private school choice.

Socialization: Increased separation by economic class, race, religion, ethnic background, or other grouping criteria, is an unlikely, but possible outcome of only outright privatization, public school choice, and highly restrictive versions of private school choice. The latter two lower the cost of exercising parental choice within a largely unchanged school system in which similarities in schools' teaching practices can make student body composition the most significant difference between schools. Outright privatization would increase the school choice relevance of income. Increased specialization is the key to diversity because it will sort people by their academic interests.

The other key aspect of socialization is an appropriate common body of knowledge. Curriculum uniformity is more likely among 'public' schools, but a politically-chosen curriculum may not create the appropriate common body of knowledge. Lieberman’s (1993) review of public schools’ policy making process, illustrated in Sykes (1995) through the textbook production and selection process, demonstrates why the political process so often produces bland and bizarre results. Also, as the current education debate illustrates, theoretical benefits of a politically-chosen common body of knowledge are worthless if 'public' schools cannot effectively teach it to children. Judgments about the political process, and the improvement that would result from public school choice, will determine whether CCPF or public school choice are best on the socialization factor.

Stability: 100% child-centered public funding is the most likely to be a stable reform, especially if initiated with existing taxpayer support of K-12 education. Then parents, not competition in the political arena, would determine the allocation of public support. Outright privatization is not stable unless philanthropy generously supports children from low income families. Probable continued ineffectiveness of 'public' schools could make private school choice and public school choice unstable reforms.

Formalization: Outright privatization minimizes formalization. Private school choice, or 100% child-centered public funding (CCPF), could increase formalization if either were to lead to greater regulation of private schools.

Private school choice is not at one extreme, with the status quo at the other. Just taking some money away from 'public' schools to make private schools more affordable creates little incentive or authority for 'public' school administrators to overcome major obstacles to improve their schools. It could actually make 'public' schools’ worse. CCPF and outright privatization are at the other extreme from the status quo. School reformers should include them in their reform options.

The primary finding of the informal analysis is that the dominant form of additional parental choice lacks a separately funded system of 'public' schools. Since choice advocates seek more competition, access, stability, and less formalization, they should prefer CCPF or outright privatization. CCPF or outright privatization are superior to public school choice and private school choice on each comparison factor. Private school choice may out-perform the status quo, but it is inferior to CCPF. Many of the frequently-heard arguments against parental choice only apply to choice within a dual system of 'public' and private schools. Therefore, CCPF has fewer political disadvantages than 'private school choice'. In addition, CCPF has every advantage of private school choice to a greater extent, and some extra ones. CCPF produces more taxpayer support of choice from existing education funds. That increases parents’ choices and competitive pressures with a lower probability of debilitating regulation and higher taxpayer costs. CCPF is more stable than 'private school choice', so it is less likely to produce unpleasant surprises. Political instability could cause 'private school choice' to evolve into CCPF with the gradual defunding of 'public' schools even while the least fortunate students remained dependent on them until the system shutdown completely. The public might not tolerate the wrenching, highly visible demise of the 'public' schools that could accompany an unintentional transition from private school choice to CCPF. Voters might demand the abandonment of such a painful transition, and give up on choice, or severely restrict it.

The choice between outright privatization and CCPF is not as clear-cut. The advantages of outright privatization - market-set resource allocations and school fees, and minimum government intrusion - are significant. The disadvantages are also potentially significant. Much would depend on whether enough philanthropy emerges to educate the children of low income families. With outright privatization, education could become unavailable to low income families, and middle income families could under-consume it. That would be inefficient, as well as inequitable.

Political pragmatism is the reason why I believe that the proponents of extra parental choice should support CCPF. It lacks some of the serious political liabilities of private school choice and outright privatization. Private school choice was soundly defeated in several statewide elections, primarily through criticisms that do not apply to CCPF. The political instability and more limited choices of private school choice could prevent a genuine application of market forces. The assertion that outright privatization will leave children from low income families uneducated will cost choice advocates many votes. Proponents of outright privatization are much more likely to achieve their objective with CCPF as a starting point. The decay of private school choice into CCPF could be quite messy, and might cause voters to abandon the reform, but a transition from CCPF to outright privatization could be quite smooth and painless. It would only take a decrease in the real (inflation-corrected) value of taxpayer support over time for parents to gradually assume a growing share of educational expenses, and to determine if charities will materialize to help fund the education of children from low income families.

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