On pp. 25-6 Frank mentions the schools race once again. He must be serious. “Parents who want to send their children to good schools must outbid other parents for houses in good school districts. Their ability to do so depends almost entirely on relative income. Here, too, we see the logic of musical chairs: no matter how much money people earn, only half of all children can attend schools in the top half.”
First of all, this is not necessarily true on its own terms. If all schools were private, then there may be a very large and successful chain of schools, call it Walschool, such that 3/4 of all children would attend it and so be equal in the quality they receive.
Second, why limit this reasoning to schools? Only half of all people can get the top half most expensive tablet computers. Or pianos. Or safari adventures. So what?
Third, Frank is again playing a game with silly assumptions. The consumers’ interest in the quality of the children’s education would, under laissez-faire, cause competitive pressures on schools to improve. Improvement could take a vast variety of forms: novel teaching techniques, stricter certifications for teachers, ingenious incentives for students, adoption of new technologies, better safety and security, customized curricula, individual tutoring, and a hundred others that I lack the imagination to invent.
The situation with schools illustrates precisely the opposite of Frank’s theory. Whatever the relative position of individual schools, consumer incentives cause each set of schools and the company that owns it to seek constantly to create a better and cheaper service. Society straightforwardly benefits from this competition.
Now Frank can argue that schools are government-run enterprises, tax-financed, and so do not improve. Well, some considerably weakened competition does exist, insofar as there are “good” and “bad” school districts, and voters in bad districts may demand changes. But he cannot attack libertarians for affirming individual freedom to travel or move to whatever location one prefers (limited only by his neighbors’ private property rights), including for the sake of better public schools, on the grounds that the school system is statist. Let’s abolish government schooling, and the wasteful “arms race” will go away.
Some libertarians, myself including, recommend free and unrestricted immigration. It may be a somewhat unrealistic ideal due to the welfare state and the billion Chinese half of which may want to move to the US right away causing severe political problems, but economically and morally, that’s what we should aspire to. The world cannot be knitted together — out of many (individuals), one (free market) — as long as nation-states exist.
Finally, to finish off Frank’s argument, even if there is an arms race for better schools, society does benefit when a worker acquires new skills and gets a raise or moves to a better job, because he becomes to that extent more productive. Again, if everyone does that, then no one benefits as a producer, but everyone benefits as consumers. An individual worker’s quest for higher wages blesses, via his accumulation of human capital, those around him.