There’s a great book out by Harvard’s Michael Sandel on the moral limits of markets (I wrote a long piece about it and its implications for school choice here). But Sandel’s book also contains a lot of interesting information about incentives, and the ways our use of them has both grown and revised the traditional economic thinking that began with Adam Smith’s original 1776 notion of an “invisible hand.”
As Sandel explains, we’ve substantially revised our definition of economics itself — from the 1958 textbook notion of “the world of prices, wages, interest rates, stocks and bonds, banks and credit, taxes and expenditure,” to the modern notion of “a group of people interacting with one another as they go about their lives.”
Because of that tectonic shift, incentives have become the primary weapon in modern social-science policymaking. As Freakonomics author Steven Levitt has written, incentives are now “the cornerstone of modern life.” And economics, he continues, “is, at root, the study of incentives.”
For all of us who care deeply about American public education – and who worry about its future – that shift in understanding should say EVERYTHING to us about what is happening in modern society in general, and modern school reform in particular. Indeed, from No Child Left Behind to Race to the Top, our increasing use of incentives to drive behavior change is the central factor reshaping American schools. Anya Kamenetz made this point in her review of Diane Ravitch’s new book, when she said:
I know there are hard-core right-wing Republican Tea Party/Grover Norquist/ALEC privatizers within the education-reform complex. I agree with Ravitch that the governor of my hometown state, Bobby Jindal, is probably one of them. I also agree that there are always plenty of people out to make a buck who need to be reined in.
But I think the big tent, the big umbrella, the unifying force here is a fascination with technology and innovation, not privatization per se. . . Technophilia explains why the ed-reform complex loves tests so much. It’s all that data, the number crunching that really gets them going. That is why they love charter schools: to pilot new ways of doing things. That is why they love to give tax money to private business owners; they believe that innovation thrives among private entrepreneurs and not in the public sector. That is why they love software and computers in classrooms and online teaching and learning.
I think Kamenetz is onto something there. In fact, according to the Oxford English Dictionary, the use of the word “incentivize” has risen by more than 1,400% since 1990, and whereas Bill Clinton only used the word once in his eight years in office, Barack Obama used it twenty-nine different times in his first three years.
The logic behind this changing worldview was captured well by Obama’s former Treasury Secretary, Larry Summers, who actually said the following in public, apparently without embarrassment or shame:
We all have only so much altruism in us. Economists like me think of altruism as a valuable and rare good that needs conserving. Far better to conserve it by designing a system in which people’s wants will be satisfied by individuals being selfish, and saving that altruism for our families, our friends, and the many social problems in this world that markets cannot solve.
Did he really say that? Does he really believe that?
Yes, yes he does. So fellow advocates for a more humanistic sort of K-12 landscape, take note: when we describe Neoliberal school reformers as two-dimensional greedy privatizers, we obfuscate the real emotional center of their movement, and their primary motivations. As Anya Kamenetz put it, “Bill Gates was a ruthless CEO, but first he was a brilliant software engineer. Is it so hard to believe that in his third act, spending his personal wealth to try to tackle the world’s biggest problems, he’s influenced as much by the latter experience as by the former?”