The Case for For-Profit Education

By Carrie Lukas, Independent Women’s Forum (Policy Focus)

For-profit entities should be among those providers competing for education dollars. Defenders of the status quo recoil from the idea of for-profit education companies, but there is no reason why the profit-motive will be any less effective in encouraging innovation in education than it has been in improving other aspects of life. Allowing businesses to compete for education dollars will lead to better educational outcomes and give our economy a boost. Americans should want the best and brightest minds competing to find innovative ways to educate students, and for entrepreneurs to know that they’ll be financially rewarded for developing effective programs.

This is a must-read analysis on how the private-sector can play an important role in addressing our country's educational needs.  To read the complete study in pdf, click here.   Here's an excerpt:

We all know our education system isn’t working as it should. During the last forty years, per pupil spending on public K-12 education has tripled, after accounting for inflation. Yet test scores have stagnated. Too many students leave U.S. schools without needed skills.

Our education system simply fails to encourage innovation or reward success. We need to fundamentally change incentives to encourage real progress and better outcomes. Putting education consumers—parents and students—in control of the resources we already spend on education would encourage real dynamism, as providers compete to provide the best service at the best price.

For-profit entities should be among those providers competing for education dollars. Defenders of the status quo recoil from the idea of for-profit education companies, but there is no reason why the profit-motive will be any less effective in encouraging innovation in education than it has been in improving other aspects of life.

Why you should care
A good education helps individuals reach their potential and creates a more productive, engaged society. Here’s why you should support education reform, including allowing for-profit education providers to compete for education funds:

• The Status Quo Isn’t Working: We’ve poured money into education, and the results remain disappointing.
• Our Poor Education System Is A Drag on the Economy: The management consulting firm McKinsey and Company analyzed the effects of our substandard K-12 education system and concluded it was the equivalent of a “permanent national recession” that made our country hundreds of billions of dollars poorer each year.
• A Private-Sector Solution: Allowing businesses to compete for education dollars will lead to better educational outcomes and give our economy a boost.
• Reform Without New Costs: Improving our education system doesn’t require more tax dollars—it requires  unlocking the resources already being spent on education to encourage real innovation and reward success.