If I may
go off from one of the comments Friedman made in this interview, I am trying to
be open minded about what direction public education can go in order to better
serve a diverse student population.
I refuse to use the words “body” or “client base” to describe (young)
children in learning institutions, because this only plays into the business
mind set that has invaded public education.
One of the
best, if not the strongest, arguments in my view for traditional public schools
is their geographic center in the neighborhood where children live. Young children especially do not need
to become little commuters in Kindergarten, but indeed that is what we are
doing. Their geographic worlds are small and going not too far away from home
for the day with children they recognize from nearby is healthy and nurturing.
There are
some innovative ideas and existing programs out there that should be explored
and developed more fully before being forced onto national scale. But especially in K-6 I think we should
be reinforcing not dismantling public schools. Vouchers are being sold as a miracle cure and the evidence
so far refutes any such thing.
People care about community.
They respond when their neighborhoods are under threat or when the
people they know become involved.
Vouchers to promote privatized education sounds just like another
enterprise building scheme, not improving the educational process.
We should
be reinforcing all systems at the local level that improve local community
sustainability, not as an antidote to globalization, but as a natural healthy
network linked to the whole.
This is
just one area where theorists apply a concept as an overlay over people’s lives
to make it fit into their proposals.
It is simply contrary to basic common sense. If Milton Friedman can admit to changing his mind about monetary
supply and ruminate about the application of policy by current politicians,
then surely we can wonder why all of a sudden the NeoCons are pushing so hard
to privatize education. Ask.
Challenge. Resist. Let’s take the
best of the old traditions and modify it with the best of what we discern from
the new ideas. Economic theory, education policy, government reform.
KWC
Some FWers
will be interested in the following interview with Milton Friedman in this FT
Weekend Magazine:
<<<<
FT LUNCH WITH MILTON FRIEDMAN
Simon London
Hold on to your hats and prepare to be amazed: Milton Friedman has changed his
mind.
"The use of quantity of money as a target has not been a success,"
concedes the grand old man of conservative economics. "I'm not sure I
would as of today push it as hard as I once did." Granted, this is hardly
a conversion of Damascene significance. But, heck, it's a start. It also shows
that, at the age of 91, Friedman still has his critical faculties intact. The
man once described as "the most consequential public intellectual of the
post-war era" is still engaged -- and engaging.
We are at the North Beach Restaurant in San Francisco. While he will be forever
linked with the "Chicago school" of economics, Friedman and Rose, his
wife and sometime co-author, moved to the area in the late 1970s when he
retired from teaching.
The restaurant is only a couple of blocks from Friedman's home and, it
transpires, is a regular haunt. He receives a voluble welcome.
Those under the age of 40 are probably unaware how consequential Milton
Friedman has been. His mild recantation on monetary targeting would have caused
a sensation - and perhaps saved a lot of grief -- had it been uttered 20 years
ago. In the early 1980s, both the US and the UK set interest rates according to
Friedman-style targets for money-supply growth. The common aim was to bring
down inflation without the pain of recession.
The common outcome, however, was partial success. Inflation fell, but at
enormous cost in terms of unemployment.
The fact that central banks the world over have given up trying to
"fine-tune" economies to an imaginary perfect pitch is a measure of
his wider influence. Money-supply targets may have been replaced by inflation
targets - but the Friedman influence remains strong.
If this was not enough for one lifetime, Milton Friedman the polemicist has
been at least as influential as Milton Friedman the economist. His championing
of small government, low taxes and market forces helped set the terms of public
policy debate through the 1980s and beyond.
It comes as no surprise to find he has strong views about the menu, too. On
Friedman's recommendation, I order sand dabs, a flatfish said to be something
of a house speciality. The professor opts for eggplant and we agree on two
green salads to start, with iced water all round.
Free To Choose, the "personal statement" published with Rose in 1979,
closed with the observation that the intellectual climate was shifting away
from collectivism in favour of free market ideology. What has happened in the
20 years since, I wonder? "The fall of the Berlin Wall, which occurred 10
years after Free to Choose was completed, means that support for socialist,
collectivist forms of social organisation has all but disappeared...
"On the other hand, anti-collectivism has not meant anti-big government.
In terms of the attitude towards big government, it is very hard to say that
there has been any improvement. There may have been backsliding." I point
out that government spending fell as a proportion of national income during the
1990s, reversing a long upward trend. Surely this was a sign of big government
in retreat? More a sign of political gridlock in Washington, he responds, with
President Clinton's Democrat White House pitched against a
Republican-controlled Congress.
He adds, with an air of disappointment, that spending under George W Bush is
back on an upward trend. "The second President Bush appears to have
inherited the free-spending tendencies of the first," he says
dismissively. What, then, of the tax cuts that the president recently signed
into law? "His insistence on tax cuts is good," he concedes.
"That is the only real way of bringing pressure on Congress to hold down
spending. In my view, the size of government is determined much more by how
much they can raise in taxes than by any ideological theory." The entrees
arrive very, very hot.
"To go back to your original question, the tide of public opinion has
continued to go against government. People are as suspicious as ever of
government - big or small. Unfortunately, the slowness with which public
opinion affects policy has not changed."
His favourite example of the mismatch between public opinion and public policy
is school vouchers. Such a scheme, he says, would unleash market forces in the
education sector by giving parents the right to choose which school their child
attends. Funding would be granted in the first instance to the child, not the
school. Schools would then have to compete for business by raising standards or
pleasing parents in other ways.
"There is no doubt about public opinion," he says, tucking in to his
eggplant. "Everyone knows that the public school system is lousy. The
solutions proposed are all ineffective with one exception: a greater degree of
parental choice - more competition. The majority of the American public is in
favour of child-centred financing. But the teachers unions exercise such strong
political control that it is very, very difficult to make any progress."
Listening to him it is easy to understand why his formula appealed to political
leaders -- think Margaret Thatcher and Ronald Reagan -- who craved
black-and-white answers to complex questions. As well as turning out academic
papers and polemics, Friedman in his prime was also a prolific producer of
newspaper articles. One of his most influential appeared in The New York Times
Magazine circa 1970, arguing that business should keep its nose out of social
affairs and concentrate on maximising returns to shareholders.
"The only responsibility of companies is to make a profit," he wrote
-- providing thousands of future MBA students with an easy starting point for
essays on the topic of corporate purpose.
This is one area, I suggest, in which the tide of opinion has surely turned
against him. Recent scandals involving Enron, WorldCom and others have added to
the interest in "business ethics" started in the late 1990s amid
growing concern about environmental degradation and globalisation.
Nonetheless, Friedman's passion for shareholder primacy remains undiminished.
The fashionable idea that companies should balance the needs of shareholders,
employees, customers, communities and other "stakeholders" strikes
him as wrong-headed.
"The stakeholder notion is a very dangerous notion. It is a socialist
notion. It says that employees are major stakeholders. It is really a movement
towards employee-run enterprises." But what about the claim that human
capital is as important to businesses as financial capital? Surely employees --
the providers of human capital - should have some say in the way businesses are
run?
His answer is twofold. First, human capital is not new. The share of wages and
earnings in national income has been remarkably stable through the decades.
Second, the best system of corporate governance is one that provides the best
incentives to use capital efficiently. The self-interest of employees in
retaining their jobs will often conflict with this overriding objective. Besides,
shareholders enjoy none of the contractual protection enjoyed by employees.
Thus, they bear the residual risk when a company fails.
"You want control... in the hands of those who are the residual recipients
because they are the ones with the direct interest in using the capital of the
firm efficiently. How do you like the sand dabs?" Sand dabs, it turns
outs, are a favourite in the Friedman household. Rose's sand dabs are unmatched
even by the North Beach Restaurant.
I ask whether he has changed his famously sceptical views about European
monetary union. After all, the euro has been around for a couple of years and
is, as we speak, kicking sand in the face of a weak dollar. Surely this
suggests that the European single currency could be a long-term success.
"I've been wrong so far, so I don't have too much confidence in my view.
But I think within the next 10 to 15 years the eurozone will split apart. The
British government, on balance, should stay out of it." I remark that
Friedman the economist seems less sure of himself these days than his
polemicist alter ego.
After a long pause, he agrees: "You form a philosophy at a certain stage
and for the rest of your life it dominates. On the big issues of policy I don't
think there is anything I've changed my mind about."
>>>>
Financial Times 6/7 June, 2003
