Mandating Betamax

I just returned from the Association for Education Finance and Policy annual conference in Seattle, which was a really fantastic meeting.  At the conference I saw Dartmouth economic historian, William Fischel, present a paper on Amish education, extending the work from his great book, Making the Grade, which I have reviewed in Education Next.

Fischel’s basic argument is that our educational institutions have largely evolved in response to consumer demands.  That is, the consolidation of one-room schoolhouses into larger districts, the development of schools with separate grades, the September to June calendar, and the relatively common curriculum across the country all came into being because families wanted those measures.  And in a highly mobile society, even more than a century ago, people often preferred to move to areas with schools that had these desired features.  In the competitive market between communities, school districts had to cater to this consumer demand.  All of this resulted in a remarkable amount of standardization and uniformity across the country on basic features of K-12 education.

Hearing Fischel’s argument made me think about how ill-conceived the nationalization effort led by Gates, Fordham, the AFT, and the US Department of Education really is.  Most of the important elements of American education are already standardized.  No central government authority had to tell school districts to divide their schools into grades or start in the Fall and end in the Spring. Even details of the curriculum, like teaching long division in 4th grade or Romeo and Juliet in 9th grade, are remarkably consistent from place to place without the national government ordering schools to do so.

Schools arrived at these arrangements through a gradual process of market competition and adaptation.  Parents didn’t want to move from one district to another only to discover that their children would be repeating what they had already been taught or were  inadequately prepared for what was going to be taught.  To attract mobile families, districts informally and naturally began to coordinate what they taught in each grade.  Of course, not everything is synced, but the items that are most important to consumers often are.

That’s how standardization in market settings works and we have a lot of positive experience with this in industry.  VHS became the standard medium for home entertainment because the market gravitated to it, not because some government authority mandated it.  If we followed the logic of Gates-Fordham-AFT-USDOE we would want some government-backed committee to decide on the best format and provide government subsidies only to those companies that complied.

Instead of ending up with VHS, they may well have imposed Betamax on the country, even though market competition would have shown that approach to be inferior.  Sony was the industry leader and if a government-backed committee were in charge they almost certainly would have had the most influence.  The Fordham folks might want to keep this in mind.  A government-backed committee is almost certain to prefer what the AFT wants over what Fordham may envision since the teacher unions are like Sony except only 100 times more powerful.

Even worse, once government-enforced standardization occurs it becomes extremely difficult to change.  If we had a government-backed panel decide on Betamax, we may have been stuck with that format for decades.  We almost certainly would have stifled the innovation that led to DVDs and now Blue-Ray.  Once Sony had entrenched their format, what incentive would they have had to change it?

Similarly, once the Gates-Fordham-AFT-USDOE coalition settles on the details of nationalizing standards, curriculum, and testing, it will become extremely difficult to change anything about education.  Terry Moe and Paul Peterson’s dreams of technology-based instruction may never leave the dream stage because it may fail to comply with certain provisions of the national regime.  If I were the AFT, I’d almost certainly insert those details into the regime to prevent the reductions that technology may bring to the need for teaching labor.  No one should be naive enough to think the Edublob won’t figure out how to use nationalization to block that and other threatening innovations.

I’m also sure that Bill Gates would have preferred being able to get a government-backed committee to enshrine Microsoft-DOS or Windows forever.  But thanks to market competition we have Google innovating with cloud computing.  And I’d bet that Google would love to get government backing for their approach if they could.  Dominant companies almost always favor government regulation.

So I understand why the AFT, USDOE, and Gates favor the current effort to nationalize education.  The mystery to me is why Fordham is protecting the right-flank of this movement or why some conservative governors have gone along.  Don’t they realize that it will enshrine arrangements that favor the teacher unions and are bad for kids?

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8 Responses to Mandating Betamax

  1. Greg Forster says:

    Fun fact of the day: In his memoir, David Brinkley reports that when color television was introduced, the federal government almost mandated the adoption of a hideously inefficient technology that would have kept prices extremely high and the physical sets very large.

    (Fascinating book, by the way. In the 1940s he filmed a story on the first computer small enough to fit inside a single room. But because TV cameras were big and bulky and the computer took up almost the entire room, he couldn’t get a visual of the computer. The network axed the story because they weren’t interested in running it if it didn’t have a visual! Free marketers will also enjoy his story of being offered membership in West Virginia’s state-sponsored mineral extraction cartel. At the time he had no idea they were trying to bribe him – he didn’t realize that membership was worth millions of dollars in contracting rights!)

  2. Betamax was the technologically superior design, according to Silicon Valley folks I know.

  3. Hi Joanne,

    My understanding (and memory) is that Betamax had a higher quality image but many movies couldn’t fit onto a single tape. People found getting up to switch tapes in the middle of a movie to be a pain that was worth the lower picture quality of VHS.

    That’s the thing about market standardization — a committee of experts might think that picture quality is most important but consumers might decide they care more about tape length. The market allows consumers to prioritize among competing values.

  4. allen says:

    Another important consideration in the victory of VHS over Betamax was that JVC, the developer of VHS, was willing to cut deals all over the place for the right to produce decks, tape and pretty much everything else that might be covered by their patents. By contrast Sony wanted to maintain tight control over every aspect of Betamax.

    The result was that volume and competition quickly dropped the price of VHS to levels that the makers of Betamax couldn’t match.

    So the question is, are we better off with a VHS public education system or a Betamax public education system?

  5. tim-10-ber says:

    If the Betamax school system included Sony’s higher standards, higher quality, etc. even if it cost more? Seems like the Betamax version wins hands down for the kids (higher quality education with better teachers, curriculum, etc) and for society (better educated kids, higher graduation rates means fewer dollars spent on prisons, etc). Just a thought…

    Unfortunately…education is designed in the US to be nothing more than mediocre…I restate…government education…

  6. Daniel Earley says:

    In my opinion, the key to evaluating the triumph of VHS over Betamax for purposes of analogy are precisely as Jay underscores; nimble marketplace priorities vs monopolized priorities. Indeed, even later generations of VHS overcame the original quality deficit by simply multiplying the number of tape heads — and still at a lower cost. Then both became obsolete, which seems to sum up the essential point.

    Of course, even Blu-Ray and all physical media are now threatened by streaming HD video and online data storage. Alas, being nimble even trumps being temporarily “right.” Hence, the value of the one true “prime directive” — preserving the vibrant, competitive, organic nature of free choice at all costs.

    In other words, Jay nailed it.

  7. concerned says:

    If we followed the logic of Gates-Fordham-AFT-USDOE we would want some government-backed committee to decide on the best format and provide government subsidies only to those companies that complied.


    Last week, President Obama proposed making Race to the Top a permanent program, largely because of the important reforms already triggered at the state and local level even before we have issued any awards.

  8. Larry Berger says:

    The VHS/BETA metaphor is useful in that what ends up being important in all such battles over technical standards is that a standard needs to emerge. Then the marketplace of innovative content, services, and distribution models built atop the standard can get started. Sometimes the market can support two standards (CDMA and TDMA), but rarely three and never fifty.

    The issue of which standards win, if the choices are comparable, has often been arbitrary and it certainly isn’t entirely driven by consumers – it is usually driven by big industry consortia that agree to the common standards so that the market can get going. Other times it is driven by federal largesse, as when the ARPANET was opened up to become the internet, or the GPS Satellites were turned over to civilian use. Still other times it happens via by the commercial dominance of one provider (e.g. Microsoft).

    We don’t have any commercially dominant player in K-12, and federal largesse would not be welcome in this case. So the notion that an industry consortium has lined up behind common core standards is actually the way it should happen. The reasons for it are to make markets happen where they matter instead of having diverse choices in a commodity layer where (Jay is right in saying) different state offerings are largely similar anyway, but not sufficiently the same that it saves any money or hassle, or creates opportunities for quality differences, in building products and services.

    Collective action isn’t always a sign of anti-market behavior – in the case of technical standards it is usually a market enabler. Having a different railroad gauge in every state would not have been a sign of consumer choice or innovation in the laboratory of the states.

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