Saturday, February 02, 2008

Reforms that Work

TCS Daily has an article by Johnny Munkhammar, "Reform Lessons for the United States" about the politics of real change. All the candidates for President are presenting themselves as agents of change but cynics like me aren't buying it. Why?

Reforming is usually seen as politically difficult. Luxemburg's then-Prime Minister Jean-Claude Juncker stated frankly that: "We all know what to do, but we don't know how to get re-elected once we have done it." Clearly, there are many opponents to reform - such as populist media, special interests and within the civil service. And reforms usually have a short-term cost, but larger long-term gains.

When your primary goal is to get re-elected and reform is seen as an impediment to this goal, well I think we all know what a politician will do.

Anyway, after reading this article, I thought it might be interesting to investigate some reforms that other countries have made that were successful and see why these reforms are being stifled in the US. My first choice for research is education. I believe in public funding of education. There are obvious benefits to society of having an educated population and while a strict libertarian would probably scoff at the idea that government needs to be involved at all, I think the benefits of public funding outweigh the costs to freedom.

I have for many years been in favor of vouchers for school funding. It seems obvious to me that the problem with our publicly run school system is a lack of competition. If monopolies are bad in the private sector why should we expect them to be any different in the public sector? And make no mistake, publicly run schools are as close to a monopoly as you can find in this country. So the obvious question is, has any other country tried a large scale voucher system? What were the results?

It turns out that there is a country that has a large scale voucher system that has been running since 1992. And the biggest surprise is that it is Sweden, a country not known for its free market approach to government. How has it worked? Apparently, pretty well.

Here are links to several articles about the Sweden experience:

Hoover Institution

Frontier Centre for Public Policy


The Fraser Institute

The Telegraph

The American Spectator

And it turns out there are other countries that use a voucher approach successfully. Denmark and the Netherlands also use a voucher approach. Why is it so hard for the US to follow a reform that has proven popular and successful in other countries? The obvious answer is the opposition by teachers unions. But is their opposition logical? I think not. In countries that have tried voucher schemes the number of schools has increased dramatically and therefore increased the options available to teachers. It seems to me that teachers would benefit as much as students if a voucher system were in place. Teachers would have more freedom to teach how and where they want. Pay would be more based on performance and competition for good teachers would likely increase pay for them while limiting the pay and advancement opportunities for poor ones.

It is time we finally addressed the poor performance of our public schools. The logical and proven method for doing that is a voucher system. Now we just need a politician with the guts to get it done.

Next I'll take a look at privatizing government pensions (such as Social Security).

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