It’s easy to do business when the customer is forced to buy.
But is it fair, is it just, or does it create a situation where people are coerced into purchases they wouldn’t make if they had a say in the matter?
For example, school children as young as 8-years-old are forced to take a battery of standardized tests in public schools. Would educators prescribe such assessments if it were up to them? Would parents demand children be treated this way if they were consulted? Or is this just a corporate scam perpetrated by our government for the sole benefit of a particular industry that funnels a portion of the profits to our lawmakers as political donations?
Let’s look at it economically.
Say you sold widgets – you know, those hypothetical doodads we use whenever we want to talk about selling something without importing the emotional baggage of a particular product.
You sell widgets. The best widgets. Grade A, primo, first class widgets.
Your goal in life is to sell the most widgets possible and thus generate the highest profit.
Unfortunately, the demand for widgets is fixed. Whatever they are, people only want so many of them. But if you could increase the demand and thus expand the market, you would likewise boost your profits and better meet your goals.
There are many ways you could do this. You could advertise and try to convince consumers that they need more widgets. You could encourage doctors and world health organizations to prescribe widgets as part of a healthy lifestyle. Or you could convince the government to mandate the market.
That’s right – force people to buy your products.
That doesn’t sound very American does it?
In a Democratic society, we generally don’t want the government telling us what to purchase. Recall the hysteria around the Obamacare individual mandate requiring people who could afford to buy healthcare coverage to do so or else face a financial tax penalty. In this case, one might argue that it was justified because everyone wants healthcare. No one wants to let themselves die from a preventable disease or allow free riders to bump up the cost for everyone else.
However, it’s still a captive market though perhaps an innocuous one. Most are far more pernicious.
According to dictionary.com, a captive market is “a group of consumers who are obliged… to buy a particular product, thus giving the supplier a monopoly” or oligopoly. This could be because of lack of competition, shortages, or other factors.
In the case of government mandating consumers to buy a particular product, it’s perhaps the strongest case of a captive market. Consumers have no choice but to comply and thus have little to no protection from abuse. They are at the mercy of the supplier.
It’s a terrible position to be in for consumers, but a powerful one for businesspeople. And it’s exactly the situation for public schools and the standardized testing industry.
Let’s break it down.
These huge corporations don’t sell widgets, they sell tests. In fact, they sell more than just that, but let’s focus right now on just that – the multiple choice, fill-in-the-bubble assessments.
Why do our public schools give these tests? Because peer-reviewed research shows they fairly and accurately demonstrate student learning? Because they’ve been proven by independent observers to be an invaluable part of the learning process and help students continue to learn new things?
No and no.
The reason public schools give these tests is because the government forces them. The Elementary and Secondary Education Act (ESEA) requires that all students in grades 3-8 and once in high school take certain approved standardized assessments. Parents are allowed to refuse the tests for their children, but otherwise they have to take them.
It wasn’t always this way. When the act was first passed in 1965, it focused almost entirely on providing students with equitable resources. That all changed in 2001, with the passage of No Child Left Behind, a reauthorization of this original bill. And ever since, through every subsequent reauthorization and name change, the federal law governing K-12 schools has required the same standardized testing.
The testing corporations don’t have to prove their products. Those products are required by law.
It’s one of the largest captive markets in existence. That’s some 50.4 million children forced to take standardized assessments. The largest such corporation, Pearson, boasts profits of $9 billion annually. It’s largest competitor, CBT/ McGraw-Hill, makes $2 billion annually. Others include Education Testing Services and Riverside Publishing better known through its parent company Houghton Mifflin Harcourt.
If many of these companies sound like book publishers, that’s because they are or their parent companies are. And that’s no coincidence. It’s another way they bolster their own market.
Not only do many of these testing corporations make, provide and score standardized assessments, they make and provide the remedial resources used to help students pass.
So if your students are having difficulty passing the state test, often the same company has a series of workbooks or a software package to help remediate them. It’s a good business model. Cash in before kids take the test. Cash in when they take it. And if kids fail, cash in again to remediate them.
Ever wonder why our test scores are so low? Because it’s profitable! The money is all on the side of failure, not success. In fact, from an economic point of view, there is a disincentive to succeed. Not for teachers and students, but for the people who make and grade the tests.
But that’s not all.
Once you have a system in place, things can become static. Once districts already have the books and resources to pass the tests, the testing corporation has less to sell them, the market stagnates and thus their profits go down or at least stop growing.
The solution once again is to create yet another captive market. That’s why Common Core was created.
These are new academic standards written almost exclusively by the testing corporations and forced on districts by federal and state governments. Under President Barack Obama’s Race to the Top initiative, $500 million in federal education grants were tied to adopting these new standards. States were coerced to push Common Core on their districts or else lose out on much needed funding.
This resulted in the need for districts to buy all new materials – new text books, new workbooks, new software, etc. It also required the states to order brand new standardized tests. So once again the testing industry cashed in at both ends.
And these tests were more needlessly difficult so more children would fail and need costly remediation.
Was there a pressing academic need for these new standards? Was there any evidence that these standards would increase student learning? Were there even any independent studies conducted to attempt to prove a need?
No. This was a total money grab. It was naked greed from one industry completely enabled by our lawmakers at the federal and state levels.
Republicans made noises against it, and some still do. But consider this – the overwhelming majority of state houses are controlled by the GOP. They have the power to repeal Common Core at any time. Yet almost none of them did or do.
Ask yourself why. It has nothing to do with the Democrats. Republicans are owned by the same masters as the so-called liberals – these same test corporations.
You have to understand that our government is no longer ruled by the principle of one person, one vote. Money has become speech so wealthy corporations get a huge say in what our government does.
If an industry gets big enough and makes enough donations to enough lawmakers, they get the legislation they want. In many cases, the corporations write the legislation and then tell lawmakers to pass it. And this is true for lawmakers on both sides of the aisle.
Standardized testing and Common Core are one pernicious example of our new captive market capitalism collapsing into plutocracy.
Our tax dollars are given away to big business and our voices are silenced.
We are all slaves to this new runaway capitalism that has freed itself from the burden of self-rule.
How long will we continue to be hostages to these captive markets?