Saturday, May 2, 2015

Hidden Costs of Choice

I'm going to set aside my several issues with a charter school system (say, the pitting of student educational interests against the charter operator's business interests) and pretend that I have other beefs with charters so I can focus on just one concern-- the extra costs of a charter-choice system.

If you run a restaurant, offering a buffet can be tricky and costly. You have to be prepared to offer a full range of dishes, so that your Beloved Diner can have a full choice-- even though your beloved diner will leave some of those choices unused. Either you will have to absorb the cost of the extra food, or you will have to offer a buffet that doesn't really offer many choices.

A charter must have extra capacity built in. If I'm going to offer Chris a choice of three schools, each one of those schools must have a seat available for Chris-- and Chris will only occupy one of them. But every empty seat represents a cost to the system.

The plan will be that Happychoice Academy can offer fewer seats than would be needed to accommodate every single student who could conceivably choose to attend. Instead of three schools preparing three seats each for Chris, Pat and Taylor, each school will prepare just one seat and hope that Chris, Pat and Taylor distribute themselves evenly between the schools.

But that ideal is unlikely to happen, so charter-choice schools have to manage their excess capacity, which means taking control of how many of which students come to fill those seats. The only way to guarantee a full open free-choice system would be to have multiple schools which all have the capacity to handle all the students-- and that amount of excess capacity would be hugely expensive. The only way such a system can hope to be remotely economically viable is for choice to actually be limited. So, choice controlled by the schools.

Even if the schools become good at predicting the amount of capacity they need, or they use very tight controls, the no-backfill rule creates more unused capacity which creates more excess cost. Success Academies, the extreme example, jettison more than half of their students between 3rd and 8th grade which means either A) they plan to wash out that many students or B) somebody has to pay the overhead costs of all those empty seats. That sloughing off of students also means that somebody somewhere has to maintain the capacity that allows them to absorb the students who return from Happychoice Academy.

Of course, the part of the system that is obligated to maintain much of this excess capacity is the traditional public system, which must take every student that shows up at its doors.

Bottom line-- if we treat a charter-and-public school combo system as one school system, we arrive at one of two options.

A) A system that, for each 1,000 students, must maintain and finance a total 1,400 (ish-- I'm just spitballing here) seats. That is economic wastage of huge proportions.

B) A system that, for each 1,000 students, maintains say, 1,200 seats, with the full 1,000 in public school and the charter-choice capacity all tightly controlled and not really very choicey at all.

This is one of the mysteries of the conservative support of charter-choice systems for me-- the wastage is huge. A charter-choice-public hybrid system is like trying to operate four homes for the same amount of money you spent on having just one. It's wasteful and excessively costly, requiring you to pay for all sorts of capacity that you don't need. There's a reason that school districts strapped for cash are not saying, "Hey, let's save money by opening three more schools in the district."

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