In Hedging Education, Justin Miller, for The American Prospect, describes “how hedge funders have over the past decade underwritten a movement to mushroom the number of local school board members who support the rapid expansion of charter schools. “A network of education advocacy groups, heavily backed by hedge fund investors, has turned its political attention to the local level, with aspirations to stock school boards—from Indianapolis and Minneapolis to Denver and Los Angeles—with allies.”
It all began in New York City, where, “Whitney Tilson, straight out of Harvard… deferred a consulting job in Boston to become one of Teach for America’s first employees in 1989. Ten years later, he started his own hedge fund in New York. Soon after that, Teach for America founder Wendy Kopp took him on a visit to a charter school in the South Bronx. It was an electrifying experience for him… The school was one of two original Knowledge Is Power Program schools—better known as KIPP, which has since grown into a prominent charter network with nearly 200 schools in 20 states plus the District of Columbia, serving almost 70,000 students, predominantly low-income and of color… Tilson… started dragging all his friends, most of whom were hedge fund investors, from Wall Street up to the south Bronx to see the KIPP school. ‘KIPP was used as a converter for hedge fund guys,’ Tilson says. ‘It went viral.'” When he became a charter school evangelist, Tilson really didn’t know much about public schools themselves: “I personally never knew what the situation was like for families forced to attend their local school in the South Bronx, or Brooklyn. I didn’t know of anyone who dropped out of high school or college—much less that there were high schools where half the students dropped off.” One wonders whether Tilson also visited public schools in New York City or whether he just accepted that KIPP’s approach is the best strategy for educating children in poor neighborhoods.
Tilson and his friends in the hedge fund world founded a new political organization, Democrats for Education Reform, and, according to Justin Miller, they set out to confront what they considered to be the politically powerful supporters of public schools, the teachers unions. “Basically, if you were anybody who was anybody in hedge funds, you probably chipped in. Tilson called the group Democrats for Education Reform (DFER), and set it with a mission ‘to break the teacher unions’ stranglehold over the Democratic Party.'” Miller adds that DFER also targeted national Democratic leaders: “Early on, DFER identified then-Senator Barack Obama and then-Newark Mayor Cory Booker as promising politicians willing to break with teachers unions.”
Miller corrects the common assumption that hedge funders got into supporting charter schools for the money: “Many critics of the corporate education-reform movement are quick to accuse proponents of seeking to cash in on the privatization of one of the United States’ last public goods. And while there are certainly those in ed-reform circles who stand to benefit from a windfall of new education technology, testing, and curriculum services, hedge funders by and large do not fit that stereotype. Theirs is more of an ideological and philanthropic crusade, rather than a crude profit-seeking venture.”
Miller reports that DFER, which is currently active in 13 states and the District of Columbia has expanded the role of charters across the country by partnering with other Astroturf groups that, like DFER, pretend to be local, but are in fact, well-funded national organizations—StudentsFirst (that just merged with 50CAN), 50CAN (operating in 7 states), Stand for Children (with 11 state affiliates), and Students for Education Reform, described by Miller as an Astroturf offshoot of DFER. Shavar Jeffries, the national president of DFER, denies, of course, that DFER is an Astroturf organization: “Our state chapters are not run by people flying in from Washington. They are staffed by local political organizers and education experts that are overwhelmingly from the communities they work in.” Miller responds: “But the financial influence of the outside charter-boosters is an ill-kept secret. The pushback against outside pro-charter money in local races has been steadily growing as more and more cities are impacted.”
These organizations have, according to Miller, been able to influence local school board races with big financial investments primarily because, “Compared with other political races where a campaign will stretch over the better part of a year… school board races are unique. Filing deadlines are much closer to Election Day, meaning that the field of candidates doesn’t fully materialize until quite late and the actual races don’t heat up until about two months out. That makes it more difficult to vet candidates and learn about connections. Campaign finance reports exposing big money often pop up late….”
These big national groups—DFER, StudentsFirst, Stand for Children, 50Can and Students for Education Reform—have, as profiled by Miller, influenced school board elections in Denver, Minneapolis, and most particularly Indianapolis, where candidate Gayle Cosby eventually raised a total of $80,000 (from several organizations and investors) to support her successful 2012 school board candidacy: “DFER pumped more than $40,000 into Cosby’s campaign, hiring her a campaign manager, orchestrating several direct-mail flyer blasts, and buying up radio spots. This was unheard of in Indianapolis school board races.”
Cosby is described as reflecting that after DFER contributed $40,000, “At that point, I felt a loss of control in certain respects.” Today Cosby has become disillusioned with the cause promoted by her original campaign investors: “Cosby has since taken up the role as the board’s main dissenter. She believes that charter special interests have completely co-opted the desire for change in the schools and have promoted an agenda that sees charter schools and privatization as the only way to fix Indianapolis Public Schools. Four seats will be up in 2016, including Cosby’s, who has decided not to seek re-election….”