How Clinton Democrats Joined Philanthrocapitalists to Create Corporate School Reform

I remember my gratitude when, back in 2010, I sat down to read Diane Ravitch’s The Death and Life of the Great American School System, which connected the dots across what I had been watching for nearly a decade: the standards movement, annual standardized testing, the operation of No Child Left Behind’s test-and-punish, Mayor Bloomberg’s promotion of charter schools in New York City, and the role of venture philanthropy in all this.

Now over a decade later, many of us have spent the past couple of months worried about pushback from the charter school sector as the the U.S. Department of Education has proposed strengthening sensible regulation of the federal Charter Schools Program. We have been reminded that this program was launched in 1994, and we may have been puzzled that a federal program paying for the startup of privately operated charter schools originated during a Democratic administration.

Lily Geismer, a historian at Claremont McKenna College, has just published a wonderful book which explains how the New Democrats—Bill Clinton, Al Gore, and the Democratic Leadership Council—brought a political and economic philosophy that sought to end welfare with a 1996 bill called the “Personal Responsibility and Work Opportunity Reconciliation Act” and envisioned privately operated charter schools to expand competition and innovation in the public schools as a way to close school achievement gaps. Geismer’s book is Left Behind: The Democrats’ Failed Attempt to Solve Inequality. The book is a great read, and it fills in the public policy landscape of the 1990s, a decade we may never have fully understood.

In the introduction, Geismer explains where she is headed: “Since the New Deal, liberals had advocated for doing well and doing good. However, the form of political economy enacted during the new Deal and, later, the New Frontier and Great Society understood these as distinct goals. The architects of mid-twentieth century liberalism believed that stimulating capital markets was the best path to creating economic growth and security (doing well). The job of the federal government, as they saw it, was to fill in the holes left by capitalism with compensatory programs to help the poor, like cash assistance and Head Start, and to enact laws that ended racial and gender discrimination (doing good). In contrast, the New Democrats sought to merge those functions and thus do well by doing good. This vision contended that the forces of banking, entrepreneurialism, trade, and technology… could substitute for traditional forms of welfare and aid and better address structural problems of racial and economic segregation. In this vision, government did not recede but served as a bridge connecting the public and private sectors.” (p. 8)

Geismer devotes an entire chapter, “Public Schools Are Our Most Important Business,” to the Clinton administration’s new education policy.  She begins by telling us about Vice President Al Gore’s meetings with “leading executives and entrepreneurs from Silicon Valley. The so-called Gore-Tech sessions often took place over pizza and beer, and Gore hoped for them to be a chance for the administration to learn from innovators of the New Economy…. One of these meetings focused on the problems of public education and the growing achievement gap between affluent white suburbanites and students of color in the inner city…. The challenge gave venture capitalist John Doerr, who had become Gore’s closest tech advisor, an idea…  The tools of venture capital, Doerr thought, might offer a way to build new and better schools based on Silicon Valley’s principles of accountability, choice, and competition… Doerr decided to pool money from several other Silicon valley icons to start the NewSchools Venture Fund. NewSchools sat at the forefront of the concepts of venture philanthropy. Often known by the neologism philanthrocapitalism, venture or strategic philanthropy focused on taking tools from the private sector, especially entrepreneurialism, venture capitalism, and management consulting—the key ingredients in the 1990s tech boom—and applying them to philanthropic work… Doerr and the NewSchools Fund became especially focused on charter schools, which the Clinton administration and the Democratic Leadership Council were similarly encouraging in the 1990s.” (pp. 233-234)

Quoting John Doerr, who founded the NewSchool Venture Fund in 1997, Geismer gives us a taste of the kind of rhetoric we heard so often from the corporate school reformers: “‘The New Economy isn’t just about high-tech products,’ Doerr liked to say. ‘It’s about the politics of education, constant innovation and unlimited growth’ and a nonhierarchical meritocracy where ‘the best ideas win.'” (p. 238)

We learn about Al From, who founded and led the Democratic Leadership Council (DLC), and From’s commitment to charter schools: “Privately, From stressed to the president that charter schools, along with welfare reform, were the most important ways to show his willingness to challenge ‘the old liberal Democratic Party orthodoxy’ and special interest groups like organized labor. Charters could appeal to the white moderate suburbanites whom the DLC believed to be critical to Clinton’s (1996) reelection effort.”  And Clinton bought the new strategy: “The 1996 State of the Union was most notable for Clinton’s declaration that the ‘era of big government is over.’ Elaborating on that theme, he also dared ‘every state to give all parents the right to choose which public school their children will attend; and to let teachers form new schools with a charter they can keep only if they do a good job.'” (p. 244)

When, in 1997, Clinton held an event to celebrate charter schools at the San Carlos Charter Learning Center in California, the school’s founder, Don Shalvey, met another entrepreneur, a guy who had already sold a software company for $750 million, Reed Hastings, who later founded Netflix.  The two raised millions of dollars to sponsor a ballot issue that would raise the state’s cap on the number of charter schools. Eventually, without ever mounting the ballot referendum, they reached a compromise with California’s legislature to pass a bill to “increase the number of charters in the state from 250 immediately and add an additional 100 each year after that.” (p. 251)

Beyond Shalvey and Hastings’ efforts in California there were various strategies to grow the scale of the charter movement. In 1994, Clinton’s Department of Education launched the Charter Schools Program, “which provided new seed capital for opening charter schools.” (p. 243)  And there was the ongoing work of the NewSchools Venture Fund: “The NewSchools board and staff especially concentrated on ways to accelerate the scale and impact of the charter school model… NewSchools developed a model of creating a charter network called a charter management organization (CMO), which would be nonprofit but draw on market-based ideas and practices. NewSchools worked closely on this idea with Hastings and Don Shalvey… Shalvey did most of the legwork in developing University Public Schools (it would later change to Aspire), which he envisioned as a ‘scalable model’ that would bring ‘the customer focus and sense of responsibility of a top-notch service organization or consulting firm to public education.’ The name derived from its goal that all the low-income students who enrolled would go on to college or at least ‘aspire’ to do so… NewSchools provided the initial funding but tied the money to student performance and achievement.” (p. 256)

As the movement grew, so did problems for the public school districts where the charter chains located: “For most of the 1990s, charters represented a small portion of the total schools in most urban districts. The growth of CMOs and the new philanthropic investment changed that in the next decade as NewSchools helped to launch or expand twenty CMOs… For the first time, public schools in struggling urban neighborhoods found charter schools making a significant dent in their enrollments and funding. With the perpetual scarcity of funding and resources allocated for public education, it would have particularly deleterious consequences for many urban schools.” (p. 259)

Geismer summarizes the impact of the educational experiment Clinton launched: “Whether successful or not, charters remain effective symbols of the control that wealthy private forces have come to wield over public policy and the ways that the ethos of the New Democrats had a direct impact on the public sector. The Gates Foundation and the tech entrepreneurs of the NewSchools Venture Fund did not just get a seat at the decision-making table but wielded the financial power to control educational policy at the local, state, and federal level.” (p. 260)

More broadly Geismer examines the tragic limitations of Clinton’s experiment in using “the resources and techniques of the market to make government more efficient and better able to serve the people. Clinton and his allies routinely referred to microenterprise, community development banking, Empowerment Zones, mixed-income housing, and charter schools as revolutionary ideas that had the power to create large-scale change. These programs, nevertheless, uniformly provided small or micro solutions to large structural or macro problems. The New Democrats time and again overpromised just how much good these programs could do. Suggesting market-based programs were a ‘win-win’ obscured the fact that market capitalism generally reproduces and enhances inequality. Ultimately, the relentless selling of such market-based programs prevented Democrats from developing policies that addressed the structural forces that produced segregation and inequality and fulfilled the government’s obligations to provide for its people, especially its most vulnerable.” (pp. 9-10)

I definitely encourage you to read Lily Geismer’s Left Behind: The Democrats’ Failed Attempt to Solve Inequality.

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3 thoughts on “How Clinton Democrats Joined Philanthrocapitalists to Create Corporate School Reform

  1. excellent elucidation of the New Democrats’ role in the counter-productive and harmful gold rush to market-based/edtech solutions to intractable social problems. Where does Democrats for Education Reform (DFER) fit into this picture?

  2. Pingback: Jan Resseger: How the Clinton Administration Joined Philanthrocapitalists to Create Corporate Education Reform | Diane Ravitch's blog

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