Forbes Article Deplores Private Profits at Expense of Public Good

Writing for Forbes Magazine, Addison Wiggin writes ostensibly to advise potential investors about charter schools as an opportunity for profit.  But his research for Charter School Gravy Train Runs Express to Fat City seems to have led Wiggin in a very different direction.

Maybe Wiggin once took a class in the philosophy of education or maybe he just remembers his high school civics class. Somewhere he learned the importance of public ownership and public oversight of public schools.

The article begins: “On Thursday, July 25, dozens of bankers, hedge fund types and private equity investors gathered in New York to hear about the latest and greatest opportunities to collect a cut of your property taxes.”

The rest of the article is the composite of all sorts of research about charter schools and for-profit education providers across several states.  Here are some examples:

  • “In Ohio, two firms…  are collecting 38% of the state’s charter school funding increase this year.  The operators of both firms donate generously to elected Republicans.”
  • “The Arizona Republic found that charters ‘bought a variety of goods and services from the companies of board members or administrators, including textbooks, air conditioning repairs and transportation services,’ Most charters were exempt from a requirement to seek competitive bids on contracts over $5,000.”
  • “In Florida, the for-profit school industry flooded legislative candidates with $1.8 million in donations last year.”
  • “Researchers from Michigan State and the University of Utah studied charters in Michigan, finding they spent $774 more per student on administration, and $1,140 less on instruction,” than traditional public schools.

Wiggin’s conclusion is for the potential investor: “The history of publicly traded charter school firms is limited and ugly…  For now, the big money in charter schools is confined to those on the inside.  In late 2010, Goldman Sachs announced it would lend $25 million to develop 16 charter schools in New York and New Jersey.  The news release said the loans would be ‘credit-enhanced by funds awarded by the U.S. Department of Education.’ Of course.”


One thought on “Forbes Article Deplores Private Profits at Expense of Public Good

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