ABSTRACT

The market policies in higher education, institutionalized in the 1970s with federal need-based, portable grants, were developed based on arguments that free markets improve quality, increase innovation, and reduce costs. The chapter suggests that the combination of market approaches and educational accountability schemes implemented by many states, often in disjointed and contradictory ways, undermine states' achievement of these goals. It summarizes the shifts in political ideologies. The chapter describes that during the global period there has been a break in the implicit social contract framed by human capital theory, which guided higher education finance for nearly a half-century from the end of the Great Depression through the end of the Cold War. The classic liberal and conservative arguments are placed in a historical perspective and used to describe the current ideological clash about education and educational finance and the post progressive stance. The chapter recognizes and encourages advocacy within education systems and also encourages openness about strategies and outcomes.