Do You Feel Exploited by Apple?

…Why Freedom Shouldn’t Stop at the Classroom Door

Many areas of our lives are being revolutionized by technology. Those changing the fastest are the ones subject primarily to market forces. Those changing the least are the ones controlled primarily by government.

How many of us communicate with others at a distance today the same way that we did twenty years ago? In 1992 we all had telephones at home, but very few of us had mobile or cell phones. In 1992 a few of us had personal computers, but very few communicated through email, and the first public web browser was still a year or so away.

The cell phone and personal computer revolutions came very fast, propelled by advancing technology and a capitalist market that promised great wealth to those who successfully met our seemingly unlimited consumer demand for such offerings. No one was forced to pay for any of this; no one was exploited by any of it, either. We gladly paid hundreds of dollars for the communications tools of the future. The collective value we gained likely outweighed the billions of dollars that entrepreneurs like Bill Gates and Steve Jobs earned for themselves.

Now, how many of our children still get their formal education the same way they did in 1992? Virtually all of them. The public school system is owned and run by governments and paid for by tax dollars. The adults who receive those tax dollars have a huge financial interest in making sure that competition and innovation are kept to a minimum. The revolution in personal communications that has taken place over the last twenty years is barely a blip on the K-12 education scene―so far.

One man who foresaw an online education revolution was Lewis J. Perelman. In his 1992 book, School’s Out, he predicted that our brick school buildings eventually would be replaced by what he called “hyperlearning.” Remember, this was written before most of us had even seen the World Wide Web. One aspect of “hyperlearning” is today’s online charter schools―you know, the ones the teachers’ unions are so desperate to shut down.

Another aspect of “hyperleaning” is the recent advent of the non-profit Khan Academy, which now features literally thousands of online lessons about everything from basic math to physics to economics and government. All at no cost to the learners. Online. 24/7. From any computer or smart phone, anywhere in the world. Classroom teachers who aren’t fearful of such progress are embracing this new tool to help their students. But if it rises to the level of actually competing with, rather than complimenting, traditional classrooms, look for politically powerful teachers’ unions to do what they do best: act as the status quo lobby to restrict or even outlaw such competition with their dues-paying members.

Exploited by Apple?

One secret weapon in the online education revolution may be the kids themselves. Thanks to compulsory attendance laws, most of them must attend the brick school buildings closest to their homes. Last month I was invited to talk with a class of public high school juniors about the relationship between politics and economics. After laying out my case for capitalism, including how it can enhance learning through online schools, the teacher explained that he believed more in democracy and government than in the power of the marketplace. One example he used was his feeling of being exploited by Apple because until recently it only allowed him to place proprietary applications on his iPhone, thus increasing Apple’s profits. I pointed out that he was not forced to buy anything from Apple, even its phone, if he didn’t want to. There were, and are, plenty of competitors.

I explained that in a free market, when someone sells a product and another voluntarily buys it, both sides gain value. In the Apple case, for example, if he paid $200 for his iPhone, then he wanted it more than he wanted to keep his $200. Apple, on the other hand, would rather earn his $200 than keep that phone on its shelves. Both sides won. I told the students that when Steve Jobs died last year, he was worth some $7 billion, but he didn’t exploit any of his customers to earn that money. They freely bought what he had to sell.

I then asked the 30 or so students how many of them owned any Apple products, from iPods, to iPads, to iPhones. About 25 raised their hands. I asked how many of them felt exploited by Apple. Not one hand went up, and they laughed when the teacher again said that he felt exploited. That teacher has a monopoly on those students’ time every school day this year. But in an hour and a half, I was able to give them a lesson that hopefully will stay with them when they think about the benefits of capitalism versus government control of our economy―and of our education system.

Perhaps I should have suggested the students read Capitalism and Freedom, Milton Friedman’s classic book in which he argued that economic freedom is a necessary condition for political freedom. If I am invited back I will make that suggestion, but if not, my real-world example of how they have personally benefited from capitalism may be enough to start them thinking about what is wrong with their teacher’s pro-government view, and what is right with the free market.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

  • Justsaying

    But don’t you see? The teacher WAS exploited by Apple. He was just to stupid to avoid it.

  • Bob Clark

    Good article, Steve.  I think we need a easier-to-read-book than Milton Friedman’s Capitalism and Freedom.  I believe it is college level, theoretical type reading.

    Did you notice the U.S federal government is now suing Apple over its e-book relation with publishers.  Seems like many new enterprises when they reach a certain size attract the attention of Uncle Sam.  IBM got held back for a decade or so by the federal government, and Microsoft has paid billions to governments across the planet as these governments try their best to shake down the successful.  Many times you’ll find competitors succesfully lobbying the government for such shakedowns of those succeeding.

    Another big problem with current public education institutions as PSU and Portland Public Schools is they don’t teach a balanced perspective concerning individual versus community; but rather one that places government at the center of the “universe” and as though government is totally to be trusted and nothing can not be solved but with government.  These institutions dis-empower individualism, making their students heavily dependent on others.

  • scatcatpdx

     Yes I feel exploited by Apple proprietary technology, but unlike the proprietary Government rand  compulsive attended and funded education system, I have choice and freedom  to use competitor products.  I hope Microsoft will come out with a pad or smart phone using windows so I can downland Microsoft’s freed visual development tools and develop any app I want, counter to those who claim Microsoft is a monopoly.

    Back to the original point you miss an opportunity to point out the reason the Teacher thinks he is being exploited is how government ran schools and the unions can dictate what technology, books and methodology, and policy  the teach must use.

    Another book (design for students) you can suggest is
    The Morality of Capitalism, What Your Professors Won’t Tell You
    they can download it for free.

  • Rupert in Springfield

    I think its great the students hopefully learned a long term lesson from your talk Steve. It sounds like they did learn, I only hope it stays with them.

    With regard to the teacher feeling exploited, I think this is less a case of the teacher having issues with capitalism, and more a case of the general tendency to use hyperbolic language.

    Exploited, in this case, is a ridiculous, and incorrect, use of the word.

    The correct word would be frustrated.

    The Teacher was frustrated by the fact Apple made the best product, but one of the downsides of it was that you had to go through iTunes.

    That is frustration, not exploitation.

    If the teacher did not know Apple forces you to go through iTunes, then that is a case of being a poor consumer, because that is quite a well known aspect of Apple products.

    He could jailbreak his phone, or iPad and then do what he wanted.

    This again makes obvious the fact that he is not being exploited. A person being exploited takes steps, especially easy ones, to remedy the situation. Jailbreaking would be one of those steps. Since he does not do so, again evidence he is not being exploited, just frustrated.

    • Steve Buckstein

      Great point, Rupert. Of course he was frustrated; we can all relate to being frustrated at times when we don’t get everything we want – and for free, no less.

      But,I fear that even if presented with your analysis he would repeat his claim of being exploited. He seems to think that all capitalists exploit him because he thinks capitalism itself is the manifestation of exploitation.

      • Rupert in Springfield

        >he thinks capitalism itself is the manifestation of exploitation.

        Probably so. I realize you don’t want to get into a big deal with a teacher in front of his class, but do you think the students got the point that the teacher had an issue with capitalism itself, and not apple in particular?

        • Steve Buckstein

          Yes, Rupert, the teacher made it very clear to the entire class that his problem is with capitalism, not just Apple.  Near the beginning of the class to told the students that he preferred that more things in our society would be dealt with through democracy and government, and fewer dealt with through markets. I assume he’s told them that well before I was invited to speak to the class. He made it clear that he’s involved with Occupy Portland, and he wore a T shirt to class.

  • valley person

    ” One secret weapon in the online education revolution may be the kids
    themselves. Thanks to compulsory attendance laws, most of them must
    attend the brick school buildings closest to their homes.”

    This is a completely false statement Steve. Parents can home school, or they can send their kids to a private school, and most large public school districts have some measure of options.

    Yes,  we are all free to buy or not buy an Apple I-phone. But the teacher was also right. Apple exploits its dominant market position to limit what you can have on that phone. Your “lesson” was like your economic philosophy. 1/2 of a loaf.

    • Steve Buckstein

       “Completely false”? 

      Are saying that “most”, meaning something over half of all students, do not attend the public school closest to their homes?

      Without spending much time looking, you can find a Portland Public Schools document year that shows the average “capture rate” for all of its schools in October 2005 was 62.9%. And yes, they use the term “capture rate” implying they proud of how many children the “capture” in the school buildings the district wants them to attend.*

      Of course there are other choices, but they are often hard to exercise and “most” students stay “captured” where the public school system wants them to be.


      • valley person

         Yes, completely false for reasons stated. You said most of them MUST attend the school buildings closest to their homes. For reasons stated, NONE of them HAVE to attend school in those buildings. The fact that nearly half don’t proves my point.  The fact that more than half do may mean those local schools are quite decent. People often move to a particular neighborhood BECAUSE of the school,as any realtor can tell you.

        Neighborhood schools are a bedrock of society.

        My kid went to Portland public schools. He went to his neighborhood elementary 4 blocks from our home, and it was a great school with dedicated teachers. He went to a magnet middle school in a nearby neighborhood. And he went to a high school in a different neighborhood yet. So your characterization is false based on personal experience.

        You have a “fetish” about choice Steve. You want to make every experience of life an extension of shopping. It isn’t healthy. Research has shown that having many choices does not improve happiness, and can diminish it.

        • Steve Buckstein

          Ah, now it comes out.  Having many choices can diminish happiness. I’ve seen some of that research. It may even be true in some circumstances. But that doesn’t justify government artificially limiting our choices. Does that mean you now think that I have a fetish about government control?  If so, we’re getting a little far afield of the theme of this post.

          • valley person

             Well, I think your fetish over choice feeds your angst over government control, yes. And no, I don’t think we have drifted from the original theme here. I would say we managed to probe that theme a bit more deeply.

            Your choice fetish leads you to view public services, like K-12 education, through the lens of shopping at Wallmart. You see education as just another consumer good, so why not have more options?

            Society could make choosing a school  akin to shopping. But going down that road has a lot of social implications that I don’t think you bother to consider. One of those implications is the role of schools in neighborhoods. Another is the angst you would transfer to parents tasked with making a choice that can affect their kids entire lives. A third is the likely segregation of students into good and bad schools, as wealthier parents are able to choose schools farther from their homes while poor parents would not be able to, and neighborhood schools deteriorate.

            The US and other advanced nations maintain  our high living standards largely through having a well educated populace. People advance from lower to middle and upper income levels primarily through access to public education.

            I just don’t think you spend any time at all thinking through all this in you advocacy for choice. Do you?

          • Steve Buckstein

             I agree, the points you raise are very important; but I have thought about them for decades.  I’ll deal with just one here and I’m sure we’ll get to the others some other time.

            “The angst you would transfer to parents tasked with making a choice that can affect their kids entire lives.”

            I believe that this may be a major, if subconscious, reason that many parents, even affluent ones, oppose school choice. Yes, they may be scared to death that they’ll make a decision that could ruin their kids future. So, not willing to take that responsibility, they leave it in the hands of politicians and school bureaucrats. People who don’t know their kids at all. People who may have the best of intentions, but have lots of other things to worry about than Jonny’s future. 

            If “officials” make the wrong decisions for your child, you can blame them, not yourself.

            If you argue that those “officials” know better what your child needs for an education, that may even be correct; but in most areas of life you listen to the experts but you have the final say. Taking the parents choice away in education may make them feel better, but won’t necessarily be best for their child.  Sorry, but I’m still pro-choice.

          • valley person

             Given that most parents lack higher education, it is  an objective fact that professional educators know more about how their kids can best learn.

            The larger question is what sort of society we want to live in. Do we want to put the responsibility for each child’s education in the hands of their parents, regardless of their capabilites and interest, or do we want the responsibility to primarily rest with society, with the parents playing as much or as little of a role as they decide.

            We (the western world) are going through a difficult change brought largely by technological advances and a huge shift in the industrial part of the economy. A 1/2 generation ago people (mostly men) with limited education could make a decent living at blue collar trades and support a family. Our schools were designed to serve this need. Those days are over and we have not found a new strategy that better prepares more students for a new economy.

            Our public school system has gotten the blame for not filling this huge skill gap.

            Some of this criticism is fair, but a lot isn’t. A movement towards expanding “choice” would probably help those who don’t need help the most, and leave those who need help further behind.

            I suspect that as a well educated intellectual libertarian, you see the upside from the perspective of those who would benefit, and you fail to account for the downside.

          • Steve Buckstein

            Since 1999 Cascade has run a totally privately funded partial scholarship program for low-income K-12 kids in the Portland area. Most of their parents are not college educated, but they knew enough to know that they wanted something better for their kids than the local public school offered. They have sacrificed to pay part of the tuition in private schools so their kids could have a better chance in life. 

            When this program started there were some 40,000 slots available nationwide. Over one million low income families applied.

            Therefore I reject your assumption that more choice would leave those who need help farther behind. Just because they’re poor and relatively uneducated doesn’t mean that they don’t care about their kids futures as much as the rest of us.

          • valley person

             What were the private schools in the game?

          • Steve Buckstein

            You want a list? Initially there were some 99 schools for the 550 some kids we gave four year partial scholarships to.  They were all K-8 schools at that time.

            I don’t have the exact tuition costs if that’s what you’re getting at, but most if not all cost much less than local public schools. We’re not talking the Jesuit’s or OES’s, we’re generally talking small to medium size private school, some religious, some not.

            And, for these 500-plus low-income kids, it was no game, it was their education.

          • Ramalama


            VP nailed you on your false claim that most kids “must” attend their neighborhood school, so then you attempt to deflect to a different issue.

            I’d have more respect for you if you would just admit that you were dead wrong on that.

            As for “choice,” it’s actually a complex issue. Yes, having choices is a good thing. At some point, too many choices becomes a bad thing, as people’s brains shut down (I’ve seen it happen many times, and have experienced that myself).

            Also, it seems as though you’re selective in your promotion of choice. Monopolies and oligopolies also restrict choice, but I haven’t seen you call for breaking up monopolies and oligopolies.

          • Steve Buckstein

            I stand by my statement that most kids must attend their neighborhood public school. Sure, there are some options, but many parents aren’t adept enough or have the time to “work the system” to get the choices they prefer.

            I do support breaking up monopolies and oligopolies that hold those positions because of some form of government protection. I don’t believe monopolies last over time in the marketplace without government help, and I see no moral justification for breaking up by force a company that holds a monopoly by virtue of providing the best goods or services to the customers that voluntarily buy from it. As soon as that is not the case, their monopoly is gone; again, unless they can use the force of government against their potential competitors.

          • valley person

             “most kids must attend”

            Hate to nitpick you Steve, but its the word “must” that gets you in trouble. ZERO kids MUST attend their local public school. As a practical matter, factoring in cost , time value, and transportation issues, MOST parents will CHOOSE to send their kids to local public schools.

            Increasing their CHOICES will still probably result in MOST parents CHOOSING to send their kids to the local public school, unless that school is really bad or dangerous.

          • Steve Buckstein

             I do agree that even with more choices many parents (perhaps most, who knows) will still want to send their kids to the local public school.

            But, it’s the potential that they can send their kids elsewhere that I believe will put pressure on those local schools to improve. 

            I know you probably think teachers and administrators are altruists, but I believe they respond to economic incentives much like everyone else.

            Either way, if “most” will stay where they are, then the system has nothing to fear from allowing more choices, or does it?

          • valley person

             “I know you probably think teachers and administrators are altruists”

            Syntax aside, I think teachers and school administrators are professionals doing a job, and their motivations vary from enjoyment of teaching to doing it for the money & benefits to a sense of duty (altruism).

            Money as an incentive is generally useful, but only up to a point. I’m a good example of someone who’s prime motivation is not more money. I value time and experience more highly. I suspect many teachers are in it for something other than how much they can earn.

            “More choices” is not what you are after. The choices are already there. What you want is public money (my money) paying for choices other than the available already funded public schools.

  • Willy

    Apple makes way too much money for my sake. I feel ripped off by them. Plus, they hurt many people in China and other 3rd world countries where they hurt people and make them work hard.
    I buy a lot of Apple stuff because it is the best, but I hurt inside each time I do for the people who make this stuff. They are hurting.

  • Windows

    I hate Apple. I love Microsoft.
    End of discussion.

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