Join NCSPE for a virtual panel discussion of the recently published Chinese edition of Education and the Commercial Mindset (Harvard University Press, 2016; paperback, 2018; China Translation & Publishing House, 2022) on Saturday, March 25^th, at 8:00 a.m. EST, 2:00 p.m. EET, and 8:00 p.m. CST. (Simply scan the QR code on the announcement to attend.)

This event is co-sponsored by Columbia Global Centers, Beijing, the Center on Chinese Education at Teachers College, Beijing Normal University, and NCSPE.

On the panel, I will be joined by Henry M. Levin, William Heard Kilpatrick Professor Emeritus of Economics and Education at TC as well as the founder and former director of NCSPE; Mingyuan Gu, President Emeritus of the Chinese Comparative Education Society and Senior Professor of International and Comparative Education at BNU; and Ruichang Ding, assistant professor of International and Comparative Education at BNU. The discussion will be moderated by Henan Cheng, deputy director of TC’s Center on Chinese Education.

Education and the Commercial Mindset is a study of market forces shaping public education in the United States and abroad. It is the fifth book to come out of NCSPE, following Privatizing Education (Westview Press, 2001), edited by Henry M. Levin; School Choice and Diversity (Teachers College Press, 2005), edited by Janelle T. Scott; Privatizing Educational Choice (Routledge, 2005), by Clive R. Belfield and Henry M. Levin; and Between Public and Private (Harvard Education Press, 2010), edited by Katrina E. Bulkley, Jeffrey R. Henig, and Henry M. Levin.

The Chinese edition of this book was translated by Ruichang Ding and Ao Ma. It opens with an introduction by Mingyuan Gu to place the story of educational privatization in the context of Chinese education policy. To that same end, I was asked to write a preface, as well. Below is the English version of the preface.

Samuel E. Abrams
Director, NCSPE
March 23, 2023

Preface to the Chinese edition of Education and the Commercial Mindset

To see this book published in Chinese is a great honor. Since reading the autobiography of the journalist Theodore H. White, In Search of History (1978), as a high school student, I have been fascinated by the political and economic history of China. White’s account as a foreign correspondent in China during the 1930s and 1940s lucidly conveyed the complexity of the nation’s evolution and foretold the steep challenges ahead.

China today would be unrecognizable to White, who died in 1986 at the age of 71. While White lived to see Deng Xiaoping ascend to power in 1978, he did not live to see the transformation Deng would bring about.

Rejecting a centrally planned economy in favor of an economy guided by the market, Deng proved himself a pragmatist. His goal was economic progress. “It does not matter whether a cat is black or white,” Deng famously said, “so long as it catches mice.”

The commune system in China was thus undone, and with its demise many forms of collectivization unraveled. This applied to education as well as industry. The Communist Party had converted all private schools to public institutions soon after taking over the country in 1949. In the 1980s, the government turned the clock back and began decentralizing the school system with the authorization of minban (“operated by the people”) schools. Individuals and social organizations were urged to establish schools; schools themselves gained more autonomy; and parents gained more freedom of choice.

By the mid-1990s, many minban schools had transmuted into conventional private schools charging considerable tuition. Though funded by parents paying such tuition, these schools were subsidized by the state through free or low-fee property leases. The incentive for the government to subsidize private schools in this manner was twofold: to advance academic achievement through competition among schools; and to offload educational expenditures to private citizens who could afford to pay tuition for their children. In 1994, there were 2,358 minban schools enrolling 451,000 students. By 2006, there were 16,527 minban schools enrolling 12,568,000 students. By 2019, there were 17,433 minban schools enrolling 22,163,600 students.

While Education and the Commercial Mindset does not address this dramatic transformation in Chinese education policy, it does tell what I believe is a highly relevant story that should interest Chinese readers: the story of educational privatization in the United States and Sweden set against the path taken by Finland. While policymakers in the United States and Sweden turned to the market, their counterparts in Finland persisted with government action in the form of investment in better teacher preparation and pay as well as curricular enrichment.

As I document, Milton Friedman and his disciples contended for decades that private markets could deliver better schooling than governments. In the 1990s, this belief was put to the test in the United States by Edison Schools, Inc., and other for-profit educational management organizations (EMOs) celebrated by many in government and on Wall Street. Edison grew rapidly, running schools in cities across the country. Yet disappointing academic and financial outcomes soon pushed the company and its competitors to the margins.

The focus of EMOs on standardized testing nevertheless found expression in federal policy with No Child Left Behind in 2002 under President George W. Bush and with Race to the Top in 2009 under President Barack Obama, with the unfortunate consequence of narrowing curricula to those subjects being tested and placing substantial pressure on students, teachers, and administrators. This new emphasis on competition based on test scores also defined non-profit EMOs that surfaced in the wake of the for-profit EMOs. These non-profit EMOs flourished, but they depend on philanthropists, tireless teachers, and students capable of abiding by rigid academic and behavioral expectations. This dependence necessarily limits their reach.

In Sweden, a similar story unfolded. The government in 1991 gave permission to for-profit and non-profit private operators to open their own schools in competition with municipal schools. While this gave families more choice, problems followed: many for-profit school operators cut corners in the name of profits, placed tremendous pressure on teachers to raise student scores on national tests, and implemented admission barriers to underperforming students; grade inflation resulted at many private schools from the pressure on these schools to exhibit success; and growing segregation resulted from native Swedish families sending their children to private schools rather than having them mix with immigrant children in municipal schools. Meanwhile, scores on PISA for Sweden fell in each subject—reading, math, and science—with each administration of the triennial exam from 2000 to 2003, 2006, 2009, and 2012.

In Sweden as well as the United States, the advocates of the free market have not acknowledged its limits. For discrete goods and services—such as textbooks, computers, transportation, and software support—the free market works well. For complex services—such as school management as well as medical and elder care—the free market does not work well because there is insufficient transparency for proper contract enforcement. This is a technical matter, not an ideological one. Complex services are necessarily opaque. In the case of schooling, in particular, the direct consumer is a child, who is in little position to judge whether classes are being properly taught. The parent, taxpayer, and legislator are all at a necessary distance. And standardized testing as a check on quality is rife with problems.

This book, in sum, is a cautionary tale about the seductive power of free-market ideas. What applies to the United States as well as Sweden should also apply to China. As the economist Arthur Okun wrote in Equality and Efficiency (1975) in opposition to Milton Friedman and his followers, “The market needs a place, and the market needs to be kept in place.”

The decision by the Chinese government in July 2021 to limit online after-school tutoring to 30 minutes, to prohibit such tutoring after 9:00 p.m. and during weekends and holidays, to require tutoring companies to transition from for-profit to non-profit entities, and to bar such companies from raising investment capital through public offerings indeed comport with this message about the limits of the market. If unharnessed, such tutoring clearly manufactures need, catalyzes unhealthy competition among students, undermines family time, and puts tremendous pressure on family spending.The impact of these reforms imposed by the Chinese government has already been significant. Within months, several education companies—including three traded on the New York Stock Exchange (New Oriental Education & Technology Group, TAL Education Group, and Gaotu Techedu)—posted substantial losses and had to lay off thousands of employees.

In closing, I want to express my gratitude to Ruichang Ding for suggesting this translation and for taking on the heavy task of doing it. I met Ding when he was a visiting scholar at Teachers College, Columbia University, in 2017. Ding read my book and afterward told me a Chinese translation was needed because of the growing popularity of minban schools. I was pleased to hear Ding’s response and am grateful for his work on my book. I likewise want to express my gratitude to Henry M. Levin, professor emeritus of economics and education at Teachers College, who served as Ruichang’s sponsor as a visiting scholar and who introduced me to Ding. Levin has lectured many times in China as a visiting professor and in that capacity he met Ding. For making countless connections between scholars around the world and for demonstrating the importance of comparative analysis, Levin has been a role model for scholars everywhere and in all fields.