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Business-Managed Democracy

“Business-managed democracies are those in which the political and cultural arrangements are managed in the interests of business”

Sharon Beder

Business-Managed Education

School Choice Ideology

Think Tanks


Corporate-funded think tanks around the world argue that the best way to improve schools is to introduce competition, through giving parents choice of schools and making schools accountable through student testing. This is based on management theories that claim competition will give schools “both the tools and the incentive to behave in more cost-effective, flexible, competitive, consumer-satisfying and innovative ways. In other words, schools would behave more like ‘commercial enterprises’”.

These think tanks claim that other factors, such as how well funded and resourced a school is and the socio-economic background of students, are not significant. They therefore oppose additional government funding of poor inner city schools but favour voucher systems and open enrolment.


In Canada the Fraser Institute has being promoting the marketisation of school for a number of years. In 1999 it published The Case for School Choice and in 2006 Why Canadian Education Isn’t Improving, which argued that “Political control [ie democratic control] of public education is preventing good people and good intentions from yielding tangible improvement”. It argued that government control gives special-interest groups, particularly teachers, too much say in decisions; favours collective choice over individual choice; requires too much compliance with regulations; and “schools become excessively uniform”. In contrast, the Institute claims, a market system would provide incentives to ensure schools were performance driven. The report cites think tank writers from the US.

In the US the Cato Institute has published a number of studies promoting markets in education and school choice (see here). Similarly the Heritage Foundation provides a web page School Choice in America, which gives state by state information on school choice as well as having a number of projects promoting school choice (see here).

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Supposed Superiority of the Private Sector


Think tanks and the businesses that fund them promote the “belief that the private sector approach is superior to that traditionally adopted in the public sector” and that if public organisations cannot be privatised the next best thing is to force them to operate like private for-profit companies and compete with each other in a market.


Australian economist, Mark Harrison, typifies this ideological argument:


But imagine if we ran our supermarkets the way we run our schools… we have government provided supermarkets, financed by taxes, at which shoppers can get a basket of groceries for free. 
Customers are forced to shop at the supermarket in their suburb, and can only change to another government supermarket with permission, and subject to room at that supermarket….
Managers find it difficult to order supplies on time, experiment with new suppliers, fix windows, get supermarkets painted or build new facilities. All these decisions are overseen by central office and involve much bureaucracy. Most spending goes on salaries. Cuts in the equipment budget mean that shopping trolleys are very old, most with three or four wobbly wheels. Home delivery has been abandoned as a cost-cutting measure. Many ideas introduced in the private sector, such as express checkouts, and checkout scanning devices have not been adopted in the public sector due to union opposition.

This is a demonstration of very shallow thinking about education and the analogy could be easily ridiculed by turning it on its head and asking: “Imagine if we ran our schools the way corporations run their supermarkets. Nevertheless Harrison and others use the lack of government funding necessitated by tax cuts demanded by business and their think tanks, to damn public schools for not providing a quality education. They also characterise public education as a public school “monopoly”. Fortune magazine writer, Peter Brimelow, wrote:


the problems of education are immediately seen as the problems typical of any socialized monopoly. The public school system is the American version of Soviet agriculture, beyond help as currently organized because its incentive structure is all wrong… The cure for the problems of a socialized monopoly is a good dose of competition. One way to accomplish this is the voucher system… Public education has been a curious and anomalous experiment with socialism.

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Contributers' Updates and Examples

If you have any examples or updates you would like to contribute please email them to me and I will add them here. Please give references for where you sourced the information.