Dan Ariely has a provocative but mostly wrong-headed article in today's Washington Post roundtable on the Atlanta testing scandal. He claims that it's inevitable that teachers will respond to high-stakes tests by cheating just as corporate executives act in ethically challenged ways to please their bosses and investors.?But business people all behave differently, some ethically and some not. What drives the difference?
Take Johnson & Johnson during the 1980s Tylenol scare as an example. For decades, J&J has operated based on a credo that permeates the organization. These values have real relevance in the company, and personnel are promoted and developed based on their adherence to the credo. Business school students read cases on Johnson & Johnson's success at developing this corporate culture. When tragedy struck with the Tylenol murders, J&J acted responsibly, even though they weren't responsible for the deaths. Given the culture there at the time, it's hard to imagine them doing otherwise. Yet J&J also measures its profitability and expects employees to contribute to that bottom line.
Ariely glides over this in his "history lesson," suggesting that measuring and evaluating using a specific criterion necessarily causes people to focus only on what's being measured. That's nonsense, and the proof is in the innovative products and services American corporations have developed on the way to creating trillions of dollars of wealth. There are undoubtedly bad actors in the business world, but there are also a lot of
Markets are a tool with many uses, and we employ them broadly in our society because on balance they create a lot of good. Kevin Welner doesn't see it that way, however, especially in education (PDF):
This points to what should be the fundamental progressive response?the critique that many progressives seem hesitant to seize: that educational opportunities should be among the most precious public goods. While public education does provide an important private benefit to children and their families, it also lies at the center of our societal well-being. Educational opportunities should therefore never be distributed by market forces, because markets exist to create inequalities?they thrive by creating ?winners? and? ?losers.?
Progressives may be hesitant to seize this critique because it's wrong and misunderstands markets. First, Welner ignores consumers. If Wal-Mart and another retailer compete, in a well-functioning market the consumer wins by paying lower prices, enjoying higher quality, or both, regardless of whether Wal-Mart or its competitor wins a given customer's business. Markets don't exist for the sake of competition, or to provide wealth for "winning" competitors. Competition is intended to serve end users.
Second, education markets, unlike the ones in business, are not usually tasked with allocating profits. Even in places where for-profit charter operators are permitted, profits for those operators should not be a primary or even secondary concern of the education system. Instead, markets provide a mechanism for empowering parents, decentralizing decision-making, and fostering a variety of educational
- Stretching the School Dollar
- Common Core Watch
- Ohio Gadfly Daily
- Board's Eye View
- Choice Words
About the Editor
Bernard Lee Schwartz Policy Fellow
Chris Tessone was a Bernard Lee Schwartz Policy Fellow and the Director of Finance of the Thomas B. Fordham Institute. He has strong interests in governance and education finance, especially teacher compensation and school facilities finance.
June 13, 2013