The balanced development of compulsory education, with a focus on the goal of educational equality, is both a matter of policy orientation and a practical educational issue. At present, people are mostly concerned with the unbalanced state of development of compulsory education, its causes, and issues regarding its administration. Various modes of production, policy choices, and institutional arrangements during different periods have been the practical, historical causes of differences in regional compulsory education, differences between urban and rural areas, and differences between schools. A direct consequence of the unbalanced development of compulsory education has been the emergence of irregularities in school selection. During the process of school selection, the strength of family and school social capital is increasingly influential, and it has increasingly negative effects: circumventing the policy of going to school near home, aggravating differences between families because of family and school social capital, and therefore damaging the prospect of educational equality. On this account, we present a constructive proposal for government policy to reduce the detrimental effects of social capital by means of reasonable policy choices and institutional arrangements. With prerequisite balanced allocation of school resources for compulsory education, the government reduces the role that family and social capital play in school selection and constructs a benignly competitive environment wherein school social capital works to placate social issues aroused by the intervention of the social capital of families and schools in school selection.