Abstract
In this article the author contends that capitalism is not only an economic system, but is also an attitude, a disposition, an active, living spirit whose principles easily endear themselves to seekers of progress and harmony, as well as to those who suffer from its failings. The practice of capitalism arouses the human propensities of desire, self-interest, and greed that often results in the co-opting and corruption of higher ideals, in this case the noble aims of education.
Introduction
Virtually every primordial narrative and most sociological theories that seek to explain the origins and purpose of human existence contain some notion of paradise—a place of origin where existence is productive, positive, and harmonious, unblemished by evil. Only a cursory reading of human history, and a glimpse at current events, are necessary to conclude that paradise, as depicted in the primordial narratives, was lost a good while ago. There is indeed a great chasm between what is described in the opening narratives and what is now. Persistent poverty and the vast inequality of income and wealth among the earth’s people are perhaps the most damning evidence that our current world sits well east of Eden. Rightly, then, matters of poverty and inequality are the focus of major efforts across the globe to get us back to where we belong.
Throughout the years various political, religious, social, and economic systems have been presented as the way to move forward toward a just and sustainable world, like the one depicted in the beginning. Among these systems is free market capitalism, defined as “a system of economic and social relations marked by private property, the exchange of goods and services by free individuals and the use of market mechanisms to control the production and distribution of those goods and services.” 1
Alternatives to capitalism, namely communism, socialism, and authoritarianism, have been tried in an effort to bring about the ideal conditions in which individuals might be able to successfully pursue life, liberty, and happiness. None have fared quite well in that regard.
Capitalism is the offspring of the combined exercise of human freedom, creativity, and perseverance that has advanced the quality of life and extended the horizon of human possibility. At the moment capitalism presents itself as the only viable system with even a reasonable chance to tame poverty, abate inequality, and create the semblance of a world in which people can reach human fulfillment.
Even so, capitalism is also cursed and blamed for a myriad of social, economic, environmental, and moral ills that have produced misery and marginalization for millions. In most recent times, the sustainability, worth, and even desirability of capitalism have come into sharp question. There is, in fact, a growing legion of adherents around the world who claim that education and philanthropy, not capitalism, are the keys to overcoming poverty and inequality in our present age. These two are becoming equivalent in status to capitalism as the preferred escorts to today’s Eden.
Whatever capitalism may or may not be at various times, one must admit that, over time, capitalism has shown itself to be expedient, resilient, indeed feisty—determined to survive at all costs and totally unwilling to be upstaged by well-meaning neophytes or seasoned veterans. Much like the wicked Queen in Snow White and the red dragon in John’s apocalypse, capitalism fancies itself as “the fairest in the land” and will take steps to ensure that no rival shall survive: A great sign appeared in heaven; a woman clothed with the sun, with the moon under her feet and a crown of twelve stars on her head. She was pregnant and cried out in pain as she was about to give birth. Then another sign appeared in heaven; an enormous red dragon with seven heads and ten horns and seven crowns on its heads. Its tail swept a third of the stars out of the sky and flung them to earth. The dragon stood in front of the woman who was about to give birth, so that it might devour her child the moment he was born. (Rev 12:1−4; NIV)
In this article I contend that capitalism is not only an economic system, but is also an attitude, a disposition, an active, living spirit the principles of which easily endear themselves to seekers of progress and harmony, as well as to those who suffer from its failings. But the practice of capitalism arouses the human propensities of desire, self-interest, and greed that often results in the co-opting and corruption of higher ideals, in this case the noble aims of education. The great expectations of the free market become gross exploitation, and the pernicious vanity of capitalism readily devours the common good.
Great expectations
The evolution of education
The desire to know is fundamental to humanity. From the beginning, humans have sought and gained knowledge. The process and purpose of acquiring and applying knowledge have evolved along with the human societies.
In ancient times, humans received knowledge though exploration and experience. Children learned almost exclusively through self-directed free play. As humans progressed from nomadic hunter-gatherers to land-owning settlers with the need to plow, plant, cultivate, and harvest crops, while also tending animals, the purpose and process of knowledge collection changed also. What had been an informal practice of inquiry and observation became a more intentional, structured routine of applying knowledge for specific uses and outputs. In that same progression, children came to be valued as laborers. Time previously spent in carefree play and exploration was diverted into the tedious, repetitive tasks of farming and of household chores, such as caring for younger siblings and aging elders.
Sharp distinctions in economic status and social class came to be as well. Landowners and their children enjoyed the privilege of private education for the purposes of personal enrichment, cultural refinement, and leadership. Non-landowners and the poor, along with their children, were largely taught to perform menial, physically demanding tasks, to obey rules, to show respect for wealth and authority, and to subdue their own curiosity and aspirations. The contours of a system of education in service to market needs were being formed.
In colonial America, upper class children were taught reading, writing, simple math, poems, and prayers. As children grew older their schooling prepared them for their eventual roles in plantation life. Boys studied more advanced, academic subjects, while girls learned to assume the duties of the mistress of a plantation. Education was provided for white students only; it was taught in private homes and funded privately. When they did get education, children of poor families did not receive lessons in literacy and religion like their upper class peers. Instead, they took on apprenticeships that lasted (on average) from three to ten years. Even though they were administered under the guise of “education,” they were de facto free labor. Toward the end of the Colonial period, school districts were established in the New England colonies in order to extend education to more people.
In 1787, the Confederation Congress passed the Northwest Ordinance. The ordinance “encouraged” education but did not require it. Specifically, it divided the Michigan territory into townships of six square miles each. The townships were then subdivided into 36 sections with a minimum size of 640 acres. Each section was then sold at a public auction with the starting bid of one dollar per acre. The funds raised by the sale of section 16 in each township were then set aside for the purpose of funding schools. 2
Because the US Constitution (adopted in 1789) and the Bill of Rights (ratified in 1791) are silent on education (the words “education” and “school” are not used at all), the power and responsibility of education resides with the individual states, because of the provision in the 10th Amendment that reverts any power to the states not explicitly assigned to the federal government. The principles of the Northwest Ordinance became the practice of the new nation. Slowly, the process of education had begun to move from a completely private affair done at home to an organized system intended to educate the broader public.
The automated machinery that enabled mass production during the Industrial Revolution in the 1800s lessened the demand for child labor. In parallel, the notion of childhood as a time for learning and personal development re-emerged. This thinking was promoted and funded largely by religious groups that believed that education for all children should be compulsory and free. The idea gained support from many quarters, each having its own self-serving inspiration.
The church wanted literate members who could read the Bible and spread the faith; industrial employers wanted workers to read, but more so to follow directions; government leaders wanted good citizens and soldiers. Nonetheless, the input and influence of religious individuals and institutions into and upon the development of education in America was immense.
In 1833, Rev. William Holmes McGuffey was invited to write a school textbook for the Truman and Smith Publishing company to sell. McGuffey had already published his first reader in 1841 to introduce children to his ethical code. The child in his book was portrayed as prompt, good, kind, honest, and truthful. The book had a very moralistic tone and presented the white, Anglo-Saxon, and Protestant as the model American. The “McGuffey Readers” were highly regarded literary works. They are said to have exerted a greater influence upon literary tastes in the United States than any other book except the Bible. 3
By the 1840s an organized education system was at full term. The work of education reformers such as Horace Mann in Massachusetts and Henry Barnard in Connecticut helped create statewide “common-school” networks that sought to increase opportunities for all children and to create common bonds among an increasingly diverse population. They also argued that education could preserve social stability and prevent crime and poverty. 4 Common-school advocates worked to establish free elementary education financed by public funds and accessible to everyone. They also advocated that public schools should be accountable to local school boards and state governments. As a result of their efforts, government-compelled reforms such as the establishment of school districts, taxation for public schools, and mandated curriculum and structure proliferated during the late 1800s. 5 By 1918, compulsory school attendance laws for elementary-age children existed in all states. 6
The notion that such government mandates and laws related to education were beneficial to individual families and to the common good was taken as fact. The philosophical balance gauging the purpose, value, and process of education was tipping slightly toward paradise and away from the market.
Education tips toward the free market
In his 1955 essay The Role of Government in Education, economist Milton Friedman reclaimed education as a functionary of free market capitalism by challenging what he termed “an indiscriminate extension of government responsibility.”
7
In so doing, Friedman put a crack in the door welcoming the implementation (decades later) of market-driven consumerist strategies such as school vouchers, charter schools, and various for-profit educational enterprises and schemes. Friedman stated: Education is today largely paid for and almost entirely administered by governmental bodies or non-profit institutions. This situation has developed gradually and is now taken so much for granted that little explicit attention is any longer directed to the reasons for the special treatment of education even in countries that are predominantly free enterprise in organization and philosophy. The result has been an indiscriminate extension of governmental responsibility.
8
Friedman asserted that American society does, and should, take the freedom of the individual as its ultimate objective and that the role of government should be limited to keeping things in order so that the market can work freely: In such a free private enterprise exchange economy, government’s primary role is to preserve the rules of the game by enforcing contracts, preventing coercion, and keeping markets free. Beyond this, there are only three major grounds on which government intervention is to be justified.
9
According to Friedman, the justifiable grounds for government intervention in the marketplace are as follows: first, to cure a natural monopoly and ensure competition; second, to mitigate so-called “neighborhood effects,” circumstances through which the actions of one person (or small group of people) either substantially costs or substantially benefits others and there is no seemingly fair or feasible way to calculate or to even out the imbalanced exchange; third, to exercise a “paternalistic concern for children and other irresponsible individuals. The belief in freedom is for “responsible” units, among whom we include neither children nor insane people …” 10
It shall not be my attempt here to analyze fully or to refute the thinking of Friedman (that would be a foolish exercise since I am not an economist), but rather simply to highlight the elements of his argument that I believe have given mettle to today’s limited government, free market advocates to forge boldly ahead toward more privatization and for-profit education on pathways clearly lain by Friedman’s claims (though perhaps inadvertently).
Friedman has acknowledged that: A stable and democratic society is impossible without widespread acceptance of some common set of values and without a minimum degree of literacy and knowledge on the part of most citizens. Education contributes to both. In consequence, the gain from the education of a child accrues not only to the child or to his parents but to other members of the society; the education of my child contributes to other people’s welfare by promoting a stable and democratic society.
11
Therefore, Friedman has conceded that government financing of schools may be warranted, but insists that government operation of schools absolutely is not. Further, he admitted the value and necessity of government backed education for citizenship purposes, but was very reluctant to grant public financing or operation of school for professional or technical education. In the conclusion to his essay Friedman stated: The alternative arrangements … distinguish sharply between the financing of education and the operation of educational institutions … they center attention on the person rather than the institution. Government, preferably local governmental units, would give each child, through his parents, a specified sum to be used solely in paying for his general education; the parents would be free to spend this sum at a school of their own choice, provided it met certain minimum standards laid down by the appropriate governmental unit.
For vocational education, the government—this time, however, the central government—might likewise deal directly with the individual seeking such education. If it did so, it would make funds available to him to finance his education, not as a subsidy but as “equity” capital. In return, he would obligate himself to pay the state a specified fraction of his earnings above some minimum … assuring that the costs are borne by those who benefit most directly rather than by the population at large. 12
And finally, An alternative … is to stimulate private arrangements directed toward the same end. The result of these measures would be a sizable reduction in the direct activities of government, yet a great widening in the educational opportunities open to our children.
13
Friedman’s essay repositions the scales that weigh the subject of education back in the direction of the turf and terms of the free market. His position was adopted by scores of free-market and libertarian defenders who rallied for legislation to limit government regulation of education, to expand school choice, and to resolve the economic dilemma of paying twice for their child’s education—once for public schools that they prefer not to use and a second time for private or alternative education sources that they do prefer.
In response, the states of Iowa, Arizona, Minnesota, Florida, Illinois, Indiana, New Hampshire, and Pennsylvania have enacted several forms of tax credit laws to address the “double taxation” matter. These tax credits allow for either a reduction in the amount of tax owed, or a reduction of the gross income on which tax is calculated. In each circumstance the amount of the reduction is usually equal to the amount of annual education expense. Opponents of these laws say that vital funds are being diverted from essential school programs. Initial court challenges in each of these states have resulted in decisions to uphold the laws. Over time several such laws have been overturned. Even now, some decisions are pending.
According to the National Conference of State Legislators thirteen states and the District of Columbia funded school vouchers to qualifying students. 14 The vouchers provide a direct cash payment to a private school of choice on behalf of students who qualify, based on different criteria in each state. The value of the voucher is usually all or a portion of what the school district would have received in state funding for each participating student.
Choice and competition are key drivers of free market theory, and they are appealing principles to parents who are weary of the educational status quo that delivers lackluster learning results to children and bureaucratic indifference to adults. The tax credit and voucher programs seem to offer promising alternatives. The embrace of tax credit and voucher programs in the education system is a tacit embrace of capitalism generally, and an implicit invitation for the for-profit model to be widely implemented for K-12 education.
The growing interest in and clamor for school reform came to its zenith in the early 1990s. Market-based approaches to the operation of schools stood out as a consistent theme among the myriad proposals offered as solutions. The general notion of market-centered activity is that the motive for profit demands and inspires efficiency, creativity, and innovation in order to deliver the goods that the market desires.
As applied to education this means that the desire for financial gain would motivate education providers to develop cost-effective ways to create and deliver educational products that yield high educational outcomes for as many students as possible, alongside ample profits to them.
Education management organizations (EMOs)
The education management industry came into being during the early 1990s. An EMO is a private entity that manages and operates public schools—both charter schools and district schools—through a contract with the governing bodies of the schools. These contracts generally call for the EMO to produce targeted, measurable results within a specified time. EMOs can be for-profit or nonprofit. Only for-profit EMOs are being discussed here, since capitalism is the focus of our concern, not school reform in general.
Advocates of the approach claim that business savvy operators, in the form of education management organizations (EMOs), would introduce entrepreneurial energy and competition into the public school arena. This would force public schools to improve or to be closed. Skeptics raise concern that outsourcing actually tends to be more costly (by way of service fees and profit margins) while adding another layer of administration into the process.
According to Profiles of For-Profit and Nonprofit Education Management Organizations 2011−2012 (released November 2013 by the National Education Policy Center [NEPC], School of Education, University of Colorado Boulder):
15
Charter schools have been a catalyst for the creation of new EMOs and they have been a vehicle for the expansion and growth of already established EMOs. In 2011−2012, 36% of all public charter schools in the US were operated by private EMOs (this includes both for-profit and nonprofit EMOs), and these schools accounted for almost 44% of all students enrolled in charter schools.
Since the 1995−1996 school year, the number of for-profit EMOs has increased from five to ninety-seven, and the number of schools operating has increased from six to 840. We estimate that enrollment has grown from approximately one thousand students in 1995−1996 to 462,926 in 2011−2012.
The cost of operating high schools is substantially more per pupil than the costs for primary and middle schools. Approximately 16% of the EMO-operated schools are classified as high schools and 44.2% as primary schools. The remaining schools are either middle schools or are classified as “Other,” since they have irregular grade configurations.
The question to be answered from all of this is whether the market-centered approach to K-12 education has delivered on its promises of student outcomes. What are the stakes and who wins when market mentality enters the schoolhouse? The winning formula from the consumer side comes from having a variety of choices that offer advantages in availability, quality, and price.
Even though we are operating from a very small amount of information from the NEPC report, there are still a few things to say. First of all, there is no price advantage to be gained from a market-centered EMO. The price of admission is the same for a seat in the EMO school as it is for a seat in the school run by the district (most likely they are one and the very same seat). The cost is free to the student’s family by way of taxes imposed on the general public.
In terms of availability, for whatever other advantages the market model may offer, there is limited choice and availability of them since there are only a few EMO schools at the high school level. Given the crisis of low high school graduation rates in the US, 16 this lack of availability may turn out to be a disadvantage and call into question the validity of the market approach altogether.
But what of quality? Can the market deliver on the most significant claim that capitalism seeks to make, i.e., that the potential for profit provides significant incentive and capacity to produce superior outcomes?
Charter schools
The 2013 National Charter School Study (Center for Research on Educational Outcomes/CREDO at Stanford University) is the most comprehensive and reliable source of information on the impact of charter schools on student performance. Its study of charter schools in 26 states does not separate data based on their organizational structure (i.e., both EMOs and non-EMOs are included); the influence of market principles is not clear and can only be surmised.
The 2013 Study demonstrates that charter school students now have greater learning gains in reading than have their peers in traditional public schools. Traditional public schools and charter schools have equivalent learning gains in mathematics. In the aggregate, charter school students in the 26 states gained an additional eight days of learning in reading each year beyond their local peers in traditional public schools. 17
In addition, the 26-state study reports:
Students in poverty, black students, and those who are English language learners (ELL) gain significantly more days of learning each year in both reading and math compared to their traditional public school peers. Performance differences between charter school students and their traditional public school peers were especially strong among black and Hispanic students in poverty and Hispanic students who are ELL in both reading and math.
Charter school enrollment has grown among students who are in poverty, black students, and Hispanic students.
The learning gains for black students who are not in poverty do not differ significantly between traditional public schools (TPS) and charter schools. There are stronger results for black students in poverty. Black students in poverty who attend charter schools gain an additional 29 days of learning in reading and 36 days in math over their TPS counterparts. This shows that the impact of charter schooling is especially beneficial for black students in poverty. 18
These statistics indicate that there may be some merit to the application of free-market principles to the education arena. Freedom from government regulation is also a key ingredient of market thought, as Milton Friedman’s essay noted above. Since the report does not provide specific data for the charter schools operated by for-profit EMOs, it is impossible to give credit to, or to decry, the influence of the profit motive in the positive results in the K-12 education arena. On the other hand, the idea of education as an effective means to tame poverty gains steam. A more detailed picture can be gleaned from a look at the for-profit model in higher education.
College: the path to the American Dream
College has always been touted as the sure ticket to the American Dream: “Get your education!” “With a good education you can do whatever you want to do;” “It’s something no one can take away from you.” These familiar lines have been repeated to children and youth for decades.
Some time ago, a “good” education was considered a high school diploma, but no longer. A survey conducted in 2000 by Public Agenda found that Americans believed that a college education had replaced the high school diploma as the key to the middle class. In that survey 76% of respondents said that there could not be too many people with a college education. Sixty-two percent of the group said that a college education was absolutely necessary for their children. 19
The value placed on a college education, however, is highest among those who have the lowest rates of college participation; African American and Hispanic parents are more likely to emphasize higher education than either white parents or the population as a whole. When asked to choose a single factor that a young person most needs to succeed in the world today, 65% of Hispanic parents and 47% of African American parents select a college education. In contrast, only 33% of white parents choose a college education as the top choice, though this percentage still outranks the other choices, such as knowing how to get along with people and a good work ethic. 20
“Providing people with opportunities for higher education is the way American society promotes social and economic mobility,” 21 said Deborah Wadsworth, President of Public Agenda. “For now, most Americans are generally satisfied with the availability of higher education. However, tougher economic times or changes that violate the public’s values might cloud this rosy outlook.” 22
A December 2013 Gallup poll found that seven out of ten American adults believe that a college education is “very important.” The vast majority of every major subgroup in the survey agreed that college education is very important:
Americans who have college degrees are significantly more likely than those who do not to say that a college education is “very important.”
The perceived value of a college education is slightly higher among 18 to 29-year-old Americans (74%) than it is among those who are 65 years and older (67%).
The value of a college education is significantly higher among nonwhites—a group that includes blacks, Hispanics, and Asians—than it is among whites.
Women are more likely than men to value a college degree, which may reflect that higher percentages of women are now enrolled in higher education compared with years past. 23
The fact that 70% of Americans agree that a college education is very valuable makes it appear that, in many ways, a college degree has become synonymous with the American Dream. At the same time, since Americans value earning a college degree so highly, they may also be more focused on what they expect from a degree. It is not just the degree that matters, but what comes as a result: a good job and a better life. As the cost of higher education skyrockets, consumers will naturally demand more and have higher expectations, presenting a host of new challenges for those who run colleges and universities in the years to come. 24 Once again, education as the means toward the best world is strongly promoted.
For-profit schools
For-profit schools have been a part of the post-secondary education landscape for quite a while. Historically these private institutions have been relegated to the realms of vocational and trade education, viewed more as high-level apprenticeship training academies than as traditional colleges, universities, or even community colleges. In 1986, enrollment at such schools was around 300,000. Attending students were largely lower income, black, Hispanic, Asian and female. Many were the first generation in their family to be college students. These schools offered mostly two-year programs (sometimes also granting Associate degrees).
Nearly 20 million Americans attend college each year. Of these about 12% (2.4 million) attend for-profit colleges and universities that are managed and governed by private organizations and corporations. During the past two decades, enrollment at for-profit institutions increased 225%. The sector experienced this dramatic growth, which was owing in large part to:
An influx of private and venture capital accompanied by the adoption of a mass market mentality to compete with state and private non-profit schools;
increased availability of federal financial aid (as well the Great Recession) that boosted the demand for higher education;
overcrowding at state and private institutions. 25
True to the market principles of innovation and adaptability, many for-profit institutions provide flexible scheduling with year-round enrollment, online options, small class sizes, and multiple convenient locations. These characteristics are attracting a large and growing population of students entering the education market, particularly working adults, part-time students, and students with children.
The rapid growth of this sector has raised eyebrows in many quarters. There are disturbing reports about the tactics many of the for-profit schools use to attract students and the profile of the students they appear to target. There are also unsettling questions about the quality of education some of these institutions offer. There is great alarm regarding the amount of money in scholarships and loans they receive. Criticism has also been leveled concerning the success of their graduates in finding jobs. In their defense, bleak job prospects due to a bad economy and a glut of graduates in certain fields (those with MBAs and lawyers, for example) is a problem for graduates from most schools.
Gross exploitation
The matter of money
The information surrounding the concerns just mentioned illustrate how the practice of capitalism can turn great expectations into gross exploitation. For example, let us examine the matter of the money. Consider these numbers in the big picture:
Twenty million students attend college each year. Sixty percent of them (12 million) must borrow annually to help cover costs. 2.4 million students (12%) attend for-profit schools each year. Eighty percent of for-profit college students borrow. 26
In 2010−2011, roughly 57% of public, four-year college students graduated with an average debt of $24,300; two-thirds of private nonprofit four-year college students graduated with an average debt of $30,000. 27
There are 37 million student loan borrowers with outstanding loans; almost half of this group is under thirty years of age. The next largest group (about 10.6 million people) is in the 30−39 year age range. 28
National student loan debt is greater than all credit card debt in the US. The total has passed the $1 trillion mark. Of this amount $864 billion is federal student loan debt. 29
As numbers alone, the amounts of people and money are astonishing, but when the social implications and personal circumstances are added they expose a horrifying narrative. Clearly, the cost of college, at just about any college, has become excessive and something must be done to curb it. But in spite of the price tag, graduating from college has value. A four-year college graduate earns considerably more than a two-year college or high school graduate. But, once the tassel has been moved from the right to the left and the loan debt is factored in, the income advantage for the bachelor’s degree diminishes and will not be realized until much later. In the meantime, young college graduates have limited economic and social mobility because of the debt, sometimes delaying the start of a family or making major purchases like a home or car, which has a sluggish effect on the economy.
The student loan debt is high, partially owing to the fact that students and families often borrow more than they need since the money is relatively easy to get from the government. The government makes available favorable loans with no collateral or credit requirements. This is done to maintain high college enrollments to achieve better global competitiveness and economic stimulus. The favorable conditions entice students and their families to take the highest amount of loan available, often much more than is required.
The liberal availability of federal student loan funds, combined with the minimal admission requirements at for-profit institutions, presents a ready-made marketing and profit opportunity for these colleges.
During a two-year study of thirty for-profit universities by the Health, Education, Labor and Pensions Committee of the US Senate it was noted that:
76 percent of students attending for-profit colleges were enrolled in a college owned by either a company traded on a major stock exchange or owned by a private equity firm. The financial performance of these companies is closely tracked by analysts and by investors.
Many for-profit colleges make minimal investments in student support services that have been shown to help students succeed in school and afterwards.
In 2010, the for-profit colleges examined employed 35,202 recruiters—more than two and a half recruiters for each support services employee, and one recruiter for every 53 students attending.
During the same period, the companies spent $4.2 billion on marketing and recruiting (22.7% of all revenue). Publicly traded companies operating for-profit colleges had an average profit margin of 19.7%, generated a total of $3.2 billion in pre-tax profit, and paid an average of $7.3 million to their chief executive officers in 2009.
For-profit colleges rely heavily on government revenue. In 2009−2010, the sector received $32 billion, which equals 79.2% of their total revenue and 25% of the total Department of Education student aid program funds. Pell grants totaled $7.5 billion in 2009−2010. 30
It is clear that for-profit colleges obey the principles of free market capitalism: contain costs; cultivate reliable streams of revenue; identify market segment; and pursue sales. Adherence to these principles yields unbelievable financial results. The results for the students, however, are miserable.
Two surveys, noted above, indicated that the American belief that a college education is important is a hardy conviction. Both surveys disclose that this belief about college is held most fervently among people who have participated in the college experience the least, namely African Americans and Hispanics. For these two groups, the American Dream has constantly lured and eluded them as well as their forebears. Yet, they still believe. For these groups, college has held great expectations. By way of the predatory marketing model practiced by some for-profit colleges the great expectations became gross exploitation.
It’s expensive to be poor and ambitious
Kai Wright, Reporting Fellow at the Investigative Fund at the Nation Institute, writes with sharp precision and objective passion about this issue. In a June 2013 article he reports that the collapse of the middle class in America is especially acute for African Americans who returned to college in great number, seeking shelter from or an advantage in a ruthless job market. He notes that the place of educational refuge for blacks in these times was the for-profit college, in which black enrollment grew 264% over a six-year period starting in 2004. 31 Wright goes on to say, “Few have understood the for-profit education boom as part of the larger economic challenge black America faces today. The black jobs crisis stretches way back to the 2001 recession, from which too many black neighborhoods never recovered. Workers and families have been scrambling ever since, trying to fix themselves such that they fit inside a broken economy.” 32
As he continues, Wright brings to the fore in confident, efficient language both the great expectation and gross exploitation that capitalism truly can be, all at the same time: “And it is that very effort at self-improvement, that same American spirit of personal re-creation and against-all-odds ambition that has so often led black people into the jaws of the 21st century’s most predatory capitalists. From subprime credit cards through to subprime home loans and now on into subprime education, we’ve reached again and again for the trappings of middle-class life, only to find ourselves slipping further into debt and poverty.” 33 That the pursuit of education, the sturdy stairway up to the middle class, becomes a pathway to poverty is the cruelest of ironies.
Poverty is not what it used to be
Poverty is the absence of reliable sources for the basic necessities to maintain life. Poverty is a cruel and complex condition, with varying degrees and dimensions. Worldwide, poverty is pervasive and it hits children especially hard. Of the estimated 2.2 billion children in the world, one billion live in poverty. One in three children lives without shelter; one in five is without access to safe water; one in seven has no access to health services. As many as 1.4 million children die each year from lack of safe water and sanitation. 34 Poverty ranges from absolute (where basic human needs like food, clothing, and shelter are deprived) to relative, a situation in which one’s resources are scarce and unstable relative to others in the same environment.
President Lyndon Johnson announced an all-out War on Poverty in America in January 1964. Since that time, the official poverty rate has changed only slightly, from 19% fifty years ago to 15% today (roughly 45 million people). However, the child poverty rate in the US remains stubborn at about 22%. 35 Census figures use numerical data to show who makes up the poor, but the portrait is incomplete. The typical image of the poor as uneducated, racial, and ethnic minorities is no longer true. As many as 41 percent (19 million) of the poor in the US are white by census standards ($23,492 annual income for a family of four). Researchers are beginning to capture a more accurate and meaningful sketch of poverty by using new economic gauges and measurements. 36
The percentage of the population that directly encounters poverty is exceedingly high. New research indicates that nearly 40% of Americans between the ages of 25 and 60 will experience at least one year below the official poverty line during that period, and 54% will spend a year in poverty or near poverty (below 150% of the poverty line). 37 When “the nearly poor and the new poor” are counted (those who temporarily use welfare or charitable assistance, or who experience repeat or long-term unemployment), four out of five Americans (a full 80%) are economically insecure and at substantial risk of falling into statistical poverty. 38 “Put simply,” Professor Mark Rank asserts, “poverty is a mainstream event experienced by a majority of Americans. For most of us, the question is not whether we will experience poverty, but when.” 39
Poverty involves physical depravation, to be sure. Hunger and homelessness are the most visible, but the social and psychological consequences of poverty are devastating to the individual as well as the larger society. Poverty robs its victims of their dignity and a sense of basic security and hope.
One member of a new group of poor people, the college-educated, middle-aged working poor, recently said it all: “When you make what I now make … forget about saving any money; every cent will be spent. That means you’re always running out of things you previously took for granted, from toilet paper to shaving cream. Things like an iPad are unthinkable luxuries. Going to a movie is a splurge.” He continues, “We are mostly either invisible or held in contempt by the public at large. There is a callous indifference to our plight. People just don’t give a —! So, when you become poor in America, it comes complete with shame, isolation, and detachment. It’s tough to maintain any kind of existing relationship, romantic or platonic, with your non-poor friends … Life goes downhill fast, from rich and colorful to a drab, lonely ordeal.” 40 “Poverty,” said Ghandi, “is the worst form of violence.” 41
Education: one place capitalism should not go
Attempts at pinpointing the causes of poverty in America are complicated, if not impossible. There remain underlying assumptions about poverty that suggest that somehow, it is their [the poor] fault; they must be lazy slackers, degenerate gamblers, or drug addicts, or perhaps they are just not trying hard enough.
Capitalism itself is never far away from the center of the debate. Some say: Capitalism creates wealth for a tiny minority. For the majority it creates poverty. Capitalism by definition exploits a large amount of people; in America this group is the low-income working class. The people who own major corporations pay workers low wages in order to make more money for themselves. Corporations such as Gap and Nike have sweatshops in Third World countries and pay the workers less than two dollars a day; however the workers make these corporations hundreds of dollars in product sales. By not paying the workers enough money the system continues.
42
Others say: Now, one might believe that capitalism
We have come to a point at which everything is for sale. We have moved from a market economy (where capitalism is a tool for organizing productive activity) to a market society in which capitalist ideas and values consume, govern, and permeate every activity and relationship. What is undeniable, however, is that markets, especially free capital markets, have moral limits. Inarguably education is an irreplaceable ingredient in combating poverty. Poverty is the ugly and indelible stain of humanity’s fingerprint upon history. Capitalism, despite its imperfections, has the capacity to inspire, to offer hope. But capitalism is a system made by humans. As Immanuel Kant reminds us, “Out of timber so crooked as that from which man is made, nothing entirely straight can be carved.” 44
Consequently, there are some places to which capitalism ought not go. Some places need to be plumb-line straight. The realm of education is one of the places in which capitalism should not go. Capitalism is an active and persuasive advocate that touts its virtues and flaunts its promises of bigger, better efficiency and opportunity. Free market principles applied to education can seem to make great sense and to be the answer, but it must be remembered that capitalism by its nature is exploitative. Marx was right in saying that “the will of the capitalist is certainly to take as much as possible. What we have to do is not to talk about his will, but to enquire about his power, the limits of that power, and the character of those limits.” 45
Conclusion
Pope Francis cautions that “some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by facts, expresses a crude and naïve trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system. Meanwhile, the excluded are still waiting.” 46 In other words, the free markets of capitalism have moral limits.
Education, especially as a primary means of helping the poor, should not be treated as a commodity of exchange subject to the dictates of profit and loss. When certain things, like nature, patriotism, spirituality, education, etc., are turned into commodities, they may more readily become corrupted, degraded, and diminished. Helping the poor is a moral proposition and an imperative for the faithful people of God—a commitment that is, unfortunately, not always shared by the merchants in the marketplace.
In the book of the Revelation, John seeks to “unveil” the subliminal ways and practices of the Roman Empire so that the early Christians might see and resist the seductive aspects of its operation. In the twelfth chapter, John of Patmos brings to the fore the confrontation between good and evil and the persistent efforts of evil to devour good through the images of the woman clothed with the sun about to give birth, and the seven headed red dragon lying in wait to devour her child. Similarly, education may be viewed as the child about to be born. Education opens the mind with knowledge about the world; it helps build character, and leads to enlightenment and understanding of one’s own self.
Because education has the ability to lift the poor up and to level the playing field, capitalism makes special and direct efforts to impose its sinister will upon her and thereby render itself the dominant force in the universe. Just as the evil dragon, with its many crowns and even more horns, poses as royalty, so capitalism is also an imposter. Capitalism attached to education has placed many people into poverty, possibly more than it has brought out. Capitalism does its best work with tangible commodities that are specific and measurable. Education is an immeasurable and priceless component of a sacred social compact. Everything is not, and should not be, commoditized and made for sale. Education, a definite and essential ingredient in the fight against poverty, holds covenant status; it should be owned by no one and treasured by all.
As Christians we need not try to destroy capitalism, the great Babylon of today. We have an alternative: faithfully resist the selfish tendencies of the marketplace as we make our way to paradise, the New Jerusalem of great expectation where there is no gross exploitation.
Footnotes
1.
4.
US-Education.net, accessed 3 February, 2014, http://us-education.net/210-henry-barnard-18111900.html; Britannica, accessed 3 February, 2014, 
.
5.
Ibid.
8.
Ibid.
9.
Ibid.
10.
Ibid.
11.
Ibid.
12.
Ibid.
13.
Ibid.
16.
Ehow.com, accessed 3 February, 2014, .
18.
Ibid.
20.
Ibid.
21.
Ibid.
22.
Ibid.
24.
Ibid.
27.
Ibid.
29.
Credit.com. accessed 4 February, 2014, .
31.
Ibid.
32.
Ibid.
33.
Ibid.
37.
The New York Times, accessed 4 February, 2014, http://opinionator.blogs.nytimes.com/2013/11/02/poverty-in-america-is-mainstream/?_php=true&_type=blogs&_r=0.
38.
Ibid.
39.
Ibid.
43.
Ibid.