Via the SchoolsAndState.org site mentioned below, I found a very interesting article about the economic implications of abolishing public schools and going with all private or home schools. It is a very interesting read. It points out that public schools generally cost twice as much as private schools. People don't notice this because they pay for it through taxes instead of out right. Anyway, I encourage everyone to read it.
In short, if we could abolish public schools and compulsory schooling laws, and replace it all with market-provided education, we would have better schools at half the price, and be freer too. We would also be a more just society, with only the customers of education bearing the costs.