Well, the US has gotten a lot of things wrong and a log of states (like Texas) seem to be actively working to thwart education, not encourage it. It's no surprise that the discipline that's suffering the most according to the graphic is Science. It's not just about the DOE, it's about the whole anti-science, anti-knowledge and anti-fact movement that you see.

Additionally, looking at SAT scores has it's own clear caveats, most importantly, the difficulty of the SATs each year is not 100% consistent and it gets slightly adjusted with time, so the described trends might be both in part or in full caused by change in the difficulty of some exams instead of a change in the actual abilities of the students. To determine if that's the case, one should look at the specific methodology used by this specific study. Additionally, is the Cato Institute a non-partial establishment? Seems to me that they have a very clear political agenda, so I'd look at other studies as well. Still, I don't think that it's unlikely that the data or at least the trends portrayed in the graph correspond to reality to a certain extent.

But this is just the US which is not the end all and be all of education. If things are not working, you don't need reinvent the wheel, you can start by looking at other countries that are doing better. Look at Finland, Estonia, The Netherlands and Switzerland, look at Japan, Singapore and South Korea or look at New Zealand. None of them left education to the free market and their educational systems are moping the floor with the US one. One should always try to look at reality and what is happening outside their own backyard and not let their own political beliefs inform everything. The world's current experience seems to show that you get the best educational results with a strong government supported public school system.

Of course, it goes without saying that a lot of the current educational models, a lot of them implemented in the countries mentioned above are archaic as pointed out by the original post we are commenting under. All education needs to improve drastically and a lot of the current concepts and dogma need to be uprooted. But government has to be forced to be a part of it, or change will simply not be expansive enough. Some places are moving in the right direction, but we are by no means there yet and there is a very long way to go.

I'm a fan of the idea of trying to create model schools that are a grass-roots testbed for new methods and approaches and I guess homeschooling can also be viewed as part of the same equation. With time a better model is expected to arise and keeping that perspective in mind, I surely understand the merits of your deregulation argument. The problem with absolute deregulation is that there will be schools that teach just nonsense, just religion or just hippie bs and students there would certainly be at a disadvantage taking the SATs that you mentioned as an example.