History of the Voucher Idea

It is often thought—in fact it has even been said by contributors to The Freeman—that education vouchers were first proposed by Milton Friedman in his Capitalism and Freedom (University of Chicago Press, 1962). But this is not true. Milton Friedman may have been the first person to introduce and apply the label “education voucher,” and he has certainly popularized such proposals both in that book and in later publications. But similar proposals were in fact made much, much earlier. (For more information on vouchers, see "School Vouchers Give Parents More Choice in Education.")

Thomas Paine and Education Allowances

What were, apparently, the very first such proposals are to be found in Chapter 5 of Part II of Thomas Paine’s Rights of Man: Being an Answer to Mr. Burke’s Attack on the French Revolution, a work first published in 1791 and dedicated to President George Washington. This chapter is entitled “Ways and Means of Improving the Condition of Europe, Interspersed with Miscellaneous Observations.” These ways and means embrace several different but complementary proposals. They are all carefully costed on the assumptions that England would be the first country in which they were adopted, and that the necessary funding could be found by cutting out a total of four million pounds of expenditure on the monarchy and on the armed forces. The first claims on this sum, which Paine estimated would consume just under three and three quarter million pounds, were for the payment of pensions to the old and relief to the poor. He then contends that most of the remainder should be applied as follows:

After all the above cases are provided for, there will still be a number of families, who though not properly of the class of poor, yet find it difficult to give education to their children; and such children, under such a case, would be in a worse condition than if their parents were actually poor…. Suppose then four hundred thousand children to be in this condition, which is a greater number than ought to be supposed, after the provisions already made. The method will be to allow for each of these children ten shillings a year [half a pound] for the expense of schooling, for six years each, which will give them six months schooling each year and half a crown [two and half shillings] for paper and spelling books.

Paine calculates that the cost of providing these education allowances would amount to a quarter of a million pounds a year. The final task is to dispose of the comparatively modest residue of the original four million pounds in a series of miscellaneous benefactions. But before proceeding to that task Paine adds a footnote insisting that the education could and ought to be privately provided, and that its provision would benefit both the teachers and the children taught. For “There are always persons of both sexes to be found in every village, especially when growing into years, capable of such an undertaking,” while “Twenty children at ten shillings each amounts to ten pounds a year for not more than six months work” and “there are often distressed clergymen’s widows to whom such an income would be acceptable.” So”Whatever is given on this account to children answers two purposes, to them it is education, and to those who educate them it is a livelihood.”

John Stuart Mill versus State Education

In 1859, in a much too rarely noticed and quoted passage of his classic essay On Liberty, John Stuart Mill repudiated not just public school monopolies but any state involvement at all in education: “. . . that the whole or any part of the education of the people should be in State hands, I go as far as anyone in deprecating. . . . A general State education is a mere contrivance for molding people to be exactly like one another. . . .” It was in this context that Mill–without, it would seem, any awareness that he had been anticipated by Thomas Paine—offered his own education voucher proposal:

Were the duty of enforcing universal education once admitted…. If the government would make up its mind to require for every child a good education, it might save itself the trouble of providing one. It might leave to parents to obtain the education where and how they pleased, and content itself with helping to pay the school fees of the poorer classes of children, and defraying the entire school expenses of those who have no one else to pay for them.

Writing On Liberty in 1859—well before the first establishment by the Forster Act of 1870 of a state-maintained system of primary education in Britain—Mill understandably had nothing to say about the economic costs as opposed to the ideological dangers of a state monopoly in the supply of educational services. But earlier, in his 1848 Principles of Political Economy, he was as wholehearted as could be wished in his assault on monopoly in general. Mill argued there against socialists: “I utterly dissent from the most conspicuous and vehement part of their teaching, their declamations against competition…. They forget that wherever competition is not, monopoly is; and that monopoly, in all its forms, is the taxation of the industrious for the support of indolence, if not of plunder.”

Indolence and plunder are strong and scarcely appropriate charges to level against the teachers and the officials in the monopolistic public school systems of either the United States or the United Kingdom. But the fact that both systems have in recent years been consuming ever more taxpayer funding with no corresponding increases, and in some directions actual declines, in education quality does reveal the motivation for the united and implacable opposition within those systems to the introduction of any measure of competition. For competition supplies customers with better value for their money. In 1861, two years after Mill wrote the passages just quoted, a witness with long and wide experience of British schools, which were still at that time all private, testified before a Royal Commission on Popular Education that:

It is subject of wonder how people so destitute of education as labouring parents commonly are, can be such just judges as they also commonly are of the effective qualifications of a teacher. Good school buildings and the apparatus of education are found for years to be practically useless and deserted, when if a master chance to be appointed who understands his work, a few weeks suffice to make the fact known, and his school is soon filled, and perhaps found to be inadequate to the demand of the neighbourhood.

State education in Britain was first established by the Forster Act of 1870. But William Edward Forster, who gave his name to that Act of Parliament, was himself a classical Gladstonian liberal. (In the United States today the liberal media would denounce him as an extreme conservative!) Certainly the system established by that Act eventually developed into one catering for over 90 percent of the relevant age groups, and one from which parents can withdraw their children only if they are able and willing to pay twice, once through taxation and then again through school fees. But that was not how it was in the beginning, or how Forster himself ever wanted it to become. He insisted–against some (then) Conservative opposition–that poor parents unable to pay school fees for their children should be enabled to choose an independent denominational school if they so wished instead of having to use the state system. The Forster Act therefore included the following Section 25:

The school board may, if they think fit, from time to time, for a renewable period not exceeding six months, pay the whole or any part of the school fees … [for] … any child resident in their district whose parent is in their opinion unable from poverty to pay the same; but no such payment shall be made or refused on condition of the child attending any public elementary school other than such as may be selected by the parent; and such payment shall not be deemed to be parochial relief given to such parent.

Unfortunately the embryo contained in this Section 25 was killed in infancy by the growing bureaucracy established under the Act as a whole and the foundation was laid for national compulsory education in England.