Fascinating! This is one of those posts that I skimmed...then read properly...then read again. I'm all over Illich, and agree with most of his philosophy, but applying a critical eye to the quote makes me wonder if he was painting with too broad a brush here.

I certainly agree that institutional dependence (including institutional rankings) is a key pillar of the hidden curriculum, and that has cascading effects through peoples' choices about their lives. However, I'm not sure I would blame school for the complete laundry list of societal failings. I think that much of what we encounter in society subtly pushes us toward the treadmill of consumption and the myths surrounding benevolent government and the unquestioned supremacy of markets.

School may be part of that, but the influence is nothing compared to advertising, mainstream media, shopping culture, corporate power, etc, that we're all confronted with every day. One might even argue that school is somewhat of a refuge from the barrage, although that might have been less true when Illich was writing this.