‘Back To-School’ Teaches Us a Lesson About Government

Back-to-school shopping has long been a parent-child rite of Americans’ experience. In years past, we saw sale signs and store displays before the end of July. Sunday papers thickened with advertising inserts. Trips to the mall ensued. Parents and their children came into conflict over it.

Much of that has changed. Internet sales have been strangling newspapers and advertising has moved to the web. Malls, along with other brick and mortar stores, have been declining. And COVID often changed whether kids would be going back to school, much less what to wear (other than masks, of course). Whatever shopping conflict may have arisen took place at home while shopping online, largely hiding it from public view.

2022 is showing itself to be, at least so far, a bit more “normal,” if that word has meaning anymore. Back-to-school issues seem to be regaining importance, exacerbated by the stress current sharply inflated prices are putting on family budgets. According to The National Retail Federation, school supplies are expected to cost $864 this year, almost 20 percent more than in 2019. But the underlying issues have not really changed. 

At heart, economics is the proposition that incentives matter. Larger benefits or lower costs cause decision-makers to want more of something, even when they are your children, whose rationality you may question. As a result, when there are sharp differences in the costs or benefits faced by parties who must jointly decide on purchases, disagreements arise. That is back-to-school shopping. 

Parents and children often value back-to-school items from different perspectives. Children approach such choices more from the “where will this put me on the social pecking order at school?” viewpoint. In my day, it may have been phrased more in terms of “is this cool?” but cool is no longer “cool” vernacular. Parents’ considerations are often more practical. “How long will the clothes last?” “How easy are they to wash and dry?” “Do they meet a dress code?” and similar other issues loom larger in their desires for what goes in the shopping cart, whether it is physical or online. That can leave parents and their children far apart in what they want.

Perhaps even more important is the difference in costs facing parents and children. Parents footing the back-to-school bill weigh the value they perceive against each item’s price, because they must pay it. But children need not pay the bill (beyond whining, guilt-tripping, extorting, or arguing with their parents). The gap between what to get at a zero price and what they get at the actual price can be massive.

At this point, it is worth remembering that back-to-school shopping conflicts are larger in scale, but not in kind, from many other conflicts that arise from the differing incentives facing parents and children.

Why are young children more likely to misbehave in a store checkout line than at home? Because their benefits (e.g., easily accessible candy or gum) are higher, and their costs are lower (they are less likely to be punished in public). Why are older children so eager to borrow Dad’s car? Because they get the benefits without the costs.

Why do kids always want to eat out, despite its added expense? Because it is not their money. Why do some want their favorite clothes washed almost daily? Because it is not their time and effort being expended. In contrast, why are they so resistant to doing chores, cleaning their rooms or washing dishes? And why do they want to study less than their parents want them to? Because it is their time and effort.

A mechanism similar to that of back-to-school shopping underlies why modern politics heightens Americans’ disunity. Americans’ preferences for what they want government to do are very different, and various groups are always lobbying the government to expand their to-do lists out of others’ pockets. Many desires are also mutually inconsistent, so that we cannot all get what we want, in areas ranging from taxation and regulation to healthcare, education, and the environment. Further, different people face vastly different tax and regulatory price tags for what government chooses to do, as when some pay disproportionately high shares of the burden for government expenditures, including future taxes, when deficits or unfunded liabilities are created by current programs..

Conflict over what we want the government to do is even greater than in back-to-school shopping. The government also decides who will be treated as “children,” including what and how much they will be given, and who it will force to bear the “parent’s” tab. One consequence is that every added government “something for nothing” promise—of which there has been a cornucopia recently–expands American discord. 

Further raising the temperature of such disagreements is that there is a big difference between spending your own resources to better your circumstances and government’s deciding how to spend your resources “for you.” You know yourself better than government, you care about yourself more than government, and unlike government you are not allowed to steal. And that remains true even when functionaries promise they care more and can do it better than you can yourself. Fortunately, most of us are sensible enough not to think that government should dictate how we clothe our children, but many are unfortunately gullible enough to think the same is not true in the vast range of other areas government wants the biggest footprint in. As Milton Friedman put it, “Nobody uses somebody else’s resources as carefully as he uses his own.” Being forced to shop through the government “store” raises the costs to society via the distortions introduced by taxes, mandates, regulations, sundry protectionist policies, poor incentives for bureaucrats, and the like.

One common means of reducing back-to-school disagreements also illustrates a problem with our current redistributionist state. That is to give children back-to-school budgets for clothing, then let them choose what to buy with that budget. Such a shift forces them to compare the value they see represented by each dollar spent on each item with the value offered by alternatives they could pick instead. That raises their price tag from zero or near-zero to what something really costs. That can dramatically reduce conflicts.

Applying such an approach to government more generally would increase Americans’ freedom to make their own choices with their own resources, by reducing government dictation in areas our preferences and circumstances differ widely (i.e., almost everywhere). The disunity caused by those who claim to be unifiers would be reduced. 

To see this, simply reflect on how many back-to-school items aren’t worth their cost to parents, but are worth more than zero to children. In every case, children want to spend more than their parents do for them. Parents trying to teach their child “the value of a dollar” have little luck convincing them otherwise, because it is the parents’ money, not the child’s, on the line. Then multiply that level of conflict by all the things government wants to “give” us.

Unfortunately, American politics has trended in the wrong direction, with an ever-expanding array of redistributive programs, backed by what we recognize as theft unless government is involved and we are on the receiving rather than the “being taken from” end. That is a major reason we now stand so divided, and why all the new something-for-nothing promises (reflecting Thomas Sowell’s observation that “The first lesson of economics is scarcity: there is never enough of anything to fully satisfy all those who want it. The first lesson of politics is to disregard the first lesson of economics”) being made will worsen things rather than provide solutions. The effort to “produce” a host of free lunches, despite economists’ often repeated assurance “There ain’t no such thing as a free lunch,” gives us higher costs and fewer benefits instead.