Human capital theory originally justified free public education as collective investment

Evidence

When Friedman, commenting on one of Schultz’s drafts, asked him the critical question of whether returns to investment in education accrued primarily to the individual or the collective, Schultz replied that such investment raised national income and was therefore in the interests of the public as a whole. The public provision of free education, moreover, enabled rich and poor to attend college, independently of family wealth; the corresponding increase in wages for poor students could be justified in the same way as progressive taxation. — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 250

Categorization

• XREF: This complicates the caricature that all Chicago-school economists opposed public subsidy — connects to the broader fracturing of neoliberalism that this book’s project is doing. The Friedman-Schultz exchange is a genealogy of how ‘human capital’ got split between private and public framings. — connects to: The human-capital concept entails that education is a consumer good, not transformative experience — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 168; Human capital theory originated with a neo-Keynesian, not Chicago neoliberals — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 248; The Friedmans traced education underinvestment to capital market imperfections, not inadequate public funding — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 252 (+2 more)
• DEEPTHINKING: The original human-capital rationale for public subsidy is the exact opposite of the later privatized student-loan regime; the same intellectual lineage was repurposed against itself. This is a dense inversion worth sitting with.