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Just Say No to School Vouchers . . . Again

Gary North
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June 30, 2011

The debate within the conservative movement over school vouchers keeps coming back. This reminds me of the sequels to the Frankenstein and Dracula movies in the 1930s and 1940s. No matter how many times the mob from the town destroyed a monster, it came back. The reason was clear: money. There were still ticket-buyers ready to see him return. Finally, it ended with Abbott and Costello Meet Frankenstein in 1948. When Bud and Lou got the screen rights, the franchises were over.

The latest revival of the school vouchers issue has come as a result of a Tea Party group in Pennsylvania, which is promoting vouchers for economically poor students. The idea is being challenged by libertarian Tea Party members. The New York Times describes the proposed law.

The bill would give vouchers to students in failing schools who are poor enough to qualify for the federal free lunch program. The amount would vary according to how much money the state contributes to each district and would be expanded to a limited number of additional students in the second and third years of the program. It would cost an estimated $50 million in the first year, $100 million in the second and $1 billion in the third.

The Times recounts tales of splits on other issues within the Tea Party movement in other states. According to the article, the Tea Party is a negative political movement: united on what it opposes, but fractious on what should be done. I think this overestimates the Tea Party's agreement on what it opposes.

That the movement could divide over school vouchers indicates that there is a recurring disagreement within the Right over what the civil government should fund and why, as well as what it should not fund and why not.

This debate has gone on for my all of adult life. It goes back to Hamilton and Jefferson in 1790: the debates over whether the U.S. government should assume the debts of the states, and whether the government should create a central bank, privately owned. Hamilton won the votes, but he did not win the arguments. He favored centralization. Jefferson did not, at least not in 1790. When he was President, it was a different matter. Think "export embargo" and "The Louisiana purchase."


Thirty-five years ago, my article against school vouchers was published in The Freeman: "Vouchers: The Double Tax." I began with a quotation from a book by the grandson of John Quincy Adams, The Education of Henry Adams. He wrote it in 1907, but it was not published until immediately after his death in 1918.

All State education is a sort of dynamo machine for polarizing the popular mind; for turning and holding its lines of force in the direction supposed to be most effective for State purposes.

I argued that the crisis in education, which was becoming visible in 1976, is in fact a crisis of the government-run schools. It cannot be fixed, because the principle of education run by the government is wrong. It is not the State's responsibility to educate children. It is the parents' responsibility. I offered this assessment:

Like the sinking ship which finally takes on too much water, the government education system is irretrievable. It will be useful in the future only as scrap. But what about those millions of students who will go through the system before it finally sinks? Will they too become useful only as scrap?

I argued the following.

First, the tax-funded educational system is inherently contradictory. The justification for tax-funded schools is that it brings the benefits of education to the poor. But education involves concepts of truth and falsehood. It involves the selection of facts and topics. The state has certain standards of truth and falsehood. It uses state funding to promote the truth and inhibit falsehood. I add today: think "Darwininan evolution." Think "central banking."

There are taxpayers who have reverse views of what constitutes of truth and falsehood. Inevitably, tax money is extracted from one group of voters to promote the causes and beliefs of another group. The big winners are the educational bureaucrats, who promote their views at taxpayer expense.

So, education cannot be free under tax funding. There are no free lunches. There is also no free inquiry inside government schools. There are always badges and guns in tax-funded, government-licensed education. There are also wallets -- less full after the local school tax assessment has been paid.

Americans have long understood this with respect to the tax-funding of churches. They have not understood this with respect to tax-funding of schools. Back in 1963, two Protestant scholars, one liberal (Sidney E. Mead) and one conservative (R. J. Rushdoony), identified the public school system as America's only established church. They were correct.

It is worth noting that Massachusetts was the last state to abandon tax-supported churches, in 1832. Within five years, the legislature had created a department of education to supervise its newly created system of tax-funded schools.

Second, I raised the issue of the failure of the tax-funded schools. The schools were regarded by voters as declining, which in 1976 had become clear. Yet they were also regarded as agencies of public salvation -- messianic, as Rushdoony called them. I wrote:

Education today occupies an equivocal position in contemporary life, functioning both as a scapegoat for every failure and as a catch-all for every hope and expectation of society. The schools and colleges are berated for extending their authority beyond the fundamentals of learning into a program which envelopes the whole child or the whole man, and, at the same time, are given additional responsibilities which can only extend their scope even further. Fundamental to this unhappy and contradictory approach is a messianic expectation of education coupled with a messianic attitude on the part of educators. The attitude of people towards education is that it is a god that has failed and yet a god who can perhaps still be whipped into fulfilling his mission.

This has not changed.

Third, I argued that the supposed pluralism of American life is denied by the nature of school funding.

The pluralism of American life is now, and always has been, in direct opposition to a philosophy of public education. Yet the irreconcilable conflict between these two principles has never been faced by the vast bulk of our citizens and virtually any of its educational theorists. The financing of a pluralistic culture must be voluntary, springing from the deeply felt needs of the various religious, intellectual, and cultural groups.

Three centuries of conflict over the control, content, and financing of public education serve as a testimony to the futility of combining a system of tax-financed schools with a pluralistic culture financed by free men. The system of education is elitist, as all professional systems must be, but with taxation as its base, the system is in conflict with democratic principles. It leads to a system of minority rule.

Fourth, I argued that the philosophical foundation of tax-funded education is the doctrine of neutrality. Only because education supposedly can be neutral and is in operation neutral can educators make a moral case for extracting wealth from voters and also passing compulsory attendance laws. If neutrality is a myth, then such coercion is inherently unjust, according to the presumptions of democracy.

An implicit schizophrenia undermines every system of public education. On the one hand, a primary justification for the existence of government-financed education is that the nation needs citizens who are educated for the responsibilities of democratic participation in the political processes. The schools are to educate men in terms of the "ethics of democracy" or "democratic values" or just plain "patriotism." Schools must inculcate "values," although the more vague these are, the better for the administrators.

On the other hand, in order to ward off criticism from various religious and ideological groups, public education is simultaneously defended as a system which inculcates no religious or ideological values whatsoever. Public education is simply technical, making possible a better, more productive, and more profitable life for all of its students. The stated goals of democratic education and strictly vocational or technical training are in absolute opposition to each other. The first absolutely affirms the value-laden nature of public education, while the second absolutely denies it.

Fifth, and by far the most important, is the debate regarding the locus of sovereignty over education. Is it the State or is it the family? To identify this locus sovereignty operationally, follow the money. Who funds the schools?

Any system of education must ultimately be the reflection of and product of the philosophical principles of those who finance the system. The decision about the financing of any institution inescapably determines the shape and content of that institution. Modern men, being secular, now recognize this fact when applied to the institution of the church. They see that a state-supported church is antithetical to the principle of freedom of conscience. They see, and religious zealots like Roger Williams see, that state-financed churches become the tools of the state which supplies the funds. But modern men do not see that this strict relationship between financing and operations applies equally well to government school systems. Somehow, the relationship is ad hoc; it works when churches are involved, but it is irrelevant in the field of public education. Like the established churchmen of two centuries ago, today's priests and parishioners of the public schools refuse to recognize the nature of their relationship to the state.

This led me to a conclusion:

The crisis of education is therefore a crisis in the realm of values, with the values of the parents coming into conflict with the values, philosophies, and incompetence of those in control of the tax-supported educational system. If the parents continue to capitulate to the philosophy of public education, then they will continue to be defeated in their attempts to gain the kind of education they want for their children. There is only one way that all parents can gain such satisfaction: they must pay for the education of their children. They can earn the money or they can convince some third party to give them or their children the necessary funds on a voluntary basis, but the parents must pay. If they want to get what they pay for, they must pay directly, rather than paying through the coercive means of state taxation.

Sixth, I introduced the idea of school vouchers. I argued that they are a pseudo-market scheme. The element of coercion is basic. This is the bedrock fact of tax-funded schools. Follow the money, and we come to the state: badges and guns.

The state cannot legally hand over billions of dollars to parents unless parents are limited in what kind of education they are allowed to buy with the State's money. So, the State will set up licensing agencies that will determine which schools are eligible. The moment there is government funding, there is government licensing.

To strengthen my case, I referred to chapter 9 of Milton Friedman's 1962 book, Capitalism and Freedom, on occupational licensing. I argued that Friedman's support of school vouchers in chapter 6 is inconsistent with chapter 9.

A school voucher is given to parents. They can send their children to any school they choose, or so the promoters say. The receiving school then turns over the voucher to the government for reimbursement.

This looks good on the surface. Schools must compete. Parental authority is maintained: greater freedom to choose. This defends educational pluralism.

It is all fake. How do we know? Follow the money.

The voucher program violates the most important principle of education: parents are responsible for the financing of their children's education. He who is responsible is also legally sovereign, and vice versa. Operationally, the source of the funding determines the locus of sovereignty. The goal of all those who would defend market arrangements must be to determine the moral locus of sovereignty in any particular circumstance, and then see to it that the sovereign agent be made legally and economically responsible for the exercise of his power. By failing to demand that parents be the source of funding for their own children's education, the promoters of the voucher scheme have abdicated their responsibility in extending the principle of voluntarism and its concomitant, personal responsibility.

In the voucher system, the source of the funding is still the taxation system. The financing is based on the principle that it is legitimate to use political power in order to grant benefits to one group at the expense of the other. The principle of coercion is still dominant. The dominant principle, over time, will thwart the elements of voluntarism in any pseudo-market scheme. The state is still the operational sovereign over education, simply because the threat of violence, which is the state's legal monopoly, is the source of the funds for education.

Friedman in 1962 logically had to add these qualifying words:

Governments could require a minimum level of schooling financed by giving parents vouchers redeemable for a specified maximum sum per child per year if spent on "approved" educational services. Parents would then be free to spend this sum and any additional sum they themselves provided on purchasing educational services from an "approved" institution of their own choice.

Notice the quotation marks around "approved." Why are they there? I wrote:

The key word, of course, is "approved." Why Prof. Friedman has chosen to put the word in quotes is not altogether clear. Does he mean "kind of approved"? Certainly, he is wise enough to know that when the state bureaucrats approve or disapprove, they do not hide their actions in quotation marks. They simply decide. They decide in terms of criteria appropriate to the continued functioning of the statist educational bureaucracy. As Prof. Friedman writes: "Any subsidy should be granted to individuals to be spent at institutions of their own choosing, provided only that the schooling is of a kind that it is desired to subsidize." Desired by whom to subsidize? The parents? Hardly; they are the ones to be dictated to, not dictated by. The parents will be told where they can freely spend their vouchers, and they have to that degree lost their sovereignty. The state provides the funds through its monopoly of coercion; the state shall determine, coercively, how and where those funds are to be spent.

Seventh, I came to the article's title: "The Double Tax." When the State takes money from voters to fund government-run schools, parents must pay twice: taxes and private schools. It is one tax, two payments. But if tax money is used to fund approved private schools, the parents who oppose the outlook of the regulators are forced to pay another round of taxes: a second set of taxes for a second set of schools.

How many schools will come into existence that refuse to accept vouchers because they recognize that with the vouchers also come controls? Hardly any. This will lead to a takeover of most private schools by the state.

If parents continue to send their children to uncertified schools, then the state must find a way to convince private school administrators that they must register with the state and conform their programs to state educational standards. The voucher system is the most logical means of achieving this goal. Vouchers will create a second, pseudo-free market school system, using "free" in both senses: independent and without cost to the users. The state-operated schools will then compete with the state-licensed schools. Almost no third alternative will be economically possible.

I concluded with this warning:

If vouchers are to be stopped, they will have to be stopped by parents who recognize the double taxation nature of the voucher scheme. Those who truly want independent schools and are willing to pay for them must not seek after vouchers, for vouchers are the very seal of doom for the independent school system. Pseudo-market schemes generally lead to anti-market results. The opposition to vouchers must be made on principle and in opposition to the superficial logic of the pseudo-market. He who is morally responsible must pay. Abandon this principle, and you abandon your sovereignty as a free man. Good results stem from good principles. Vouchers are an intellectual, moral, and educational disaster. They will not work to expand the realm of freedom.

That was my case in 1976. It still is.

Murray Rothbard was persuaded, as he wrote.

Well, once in a blue moon, I change my mind on a political issue, and this is one case. I have now abandoned support for tax credits. I have been convinced by an argument relayed to me from an old friend, paleoconservative Dr. Gary North, and seconded by other leading paleos. My God, have I abandoned liberty at last, under the terrible influence of these "horrible fascists," as one Modal has called them? Not quite. North's argument is as follows, and it will be instructive for all Modals out there to parse it carefully: whether it be vouchers or tax credits, the State will decide which private schools are worthy to receive them. If those schools are not deemed worthy, that is, if they are not Politically Correct in all sorts of ways, they will be stricken from the approved list. The result, then, of vouchers or tax credits will be, in the name of expanding parental choice, to destroy the current private school system and to bring it under total governmental control. Parents who want to send their kids to really private schools, schools which may be Politically Incorrect in many ways, will then have to pay tuition to a third set of genuinely private schools, after paying taxes to support two sets of schools, the public and the Officially Approved Private.

I had only to hear this argument to be converted. It's not that I never thought of the problem of approved private schools before, it's just that I had not given it sufficient weight.

I did not persuade Friedman.


Because the Bush Administration floated a trial balloon in 1992 for vouchers, I wrote a new introduction for the 1976 article. That was great: I got paid twice. The Freeman printed it with the same title.

Bush proposed a $1,000 Federal voucher, but only for middle-class families and poor families. So, from the beginning, this was a wealth-redistribution scheme. The Secretary of Education, Lamar Alexander, announced: "Specifically, the president's proposal would give a $1,000 scholarship to every child of a middle- or low-income family in a participating school district. Parents must be permitted to use the scholarship at any lawfully operated school."

The words "lawfully operated" were crucial. I commented.

There is a rule in all things associated with state funding. Anyone who ignores this rule is either naive or suicidal. Here is the rule: If you take the state's nickel, you accept the state's noose. You may prefer an older version: "If you take the queen's shilling, you do the queen's bidding." In short, you do not get something for nothing.

The overriding economic question regarding educational vouchers is this one: "At what price will parents sell their birthright, namely, control over their children's education?" A subordinate question is this one: "At what price will private school administrators sell their ability to deal with parents?" Sadly, we can be fairly sure of the answer: a low price.

Given the recent flare-up of this ancient political battle within the Tea Party, consider my assessment.

The amazing fact is that the education voucher issue has changed very little since The Freeman published an earlier version of this essay in May 1976. The political conservatives are still trying to "clean up the public schools" by introducing competition through vouchers. The Christian school movement is still confident that vouchers will help them financially but without any negative side effects, such as the introduction of controls by the state. The public school teacher unions are still totally opposed to vouchers because vouchers will create "elite schools"--supposedly a very undemocratic thing to allow, at least until it is time to choose a college for your children.

The more things change, the more they stay the same.

This time, Friedman read my essay. He responded in a letter to The Freeman.

This plan [the voucher plan we propose] would relieve no one of the burden of taxation to pay for schooling. It would simply give parents a wider choice as to the form in which their children get the schooling that the community has obligated itself to provide. The plan would also not affect the present standards imposed on private schools in order for attendance at them to satisfy the compulsory attendance laws.

Read this again: "The plan would also not affect the present standards imposed on private schools in order for attendance at them to satisfy the compulsory attendance laws." Almost two decades later, I still find it hard to believe that he wrote this.

In the next paragraph, he wrote: "The compulsory attendance laws are the justification for government control over the standards of private schools." He shifted the argument from tax funding to compulsory attendance. He refused to follow the money. This was so obviously at odds with what he had written everywhere else that we can regard it as a desperation reply. He shifted the argument from the issue of the locus of sovereignty, which was my central argument.

The danger North raises that a parental choice scheme that made vouchers available for both government and private schools would lead to efforts to control the curriculum of private schools is very real, but it is present now because of compulsory attendance laws. Moreover, in a well- drawn voucher initiative, such as the one that will be on the California ballot at the next general election, provision can be made for avoiding that outcome.

I called him on this in my reply.

Here is the crucial question: Who is responsible before God for the education of children, their parents or the state? I contend that it is the parents. I therefore reject educational vouchers on principle. But more to the point, I reject them even as a transitional tactic, for vouchers will reduce the freedom of sectarian parents to choose by reducing the supply of sellers who will supply sectarian education.

Then I added this in response to his argument about the proposed law in California.

Thus, it is irrelevant that the language of a California voucher proposal appears to protect the authority of parents to choose any school they desire for their children. The U.S. Supreme Court has determined what curriculum standard must apply in state-funded education: a compelling secular purpose (see Lemon v. Kurtzman and Hunt v. McNair, 1971). Parents will be free to choose when they use the state's money, but their choices will be limited to state-approved schools. They will be free to choose only what the state approves.

I learned all this from Capitalism and Freedom--excluding chapter 6.

Chapter 6 is the chapter on school vouchers.


The debate has risen from the grave, just like Dracula in the movie sequels. The promoters refuse to argue either the morality of tax-funded education or the question of its economics: follow the money. They dismiss the economic arguments and moral arguments of their opponents.

According to the New York Times, one of the promoters of vouchers dismisses the critics as "bed-wetters." I guess his point was that we worry too much about handing over to the State the authority to educate future voters. For him, ideas have no consequences, and economic analysis has no consequences. The historical record of over 170 years of State-deifying school curricula has no consequences. He thinks he can get votes by promising conservatives one more reform, one more raid on the public treasury. He thinks he will lose votes if he stands for the principle of parental sovereignty. This is why the schools continue to get worse. This is why the educational bureaucrats still are in complete control. Conservatives believe in the legitimacy and efficacy of guns and badges as the joint foundations of education.

If they thought there were votes in it, a lot of conservatives would call for a return to tax-fundred churches . . . with vouchers, of course, to maintain freedom of choice.

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