“Don’t It Always Seem to Go that You Don’t Know What You’ve Got Till It’s Gone?”

“You don’t know what you’ve got till its gone.”  Joni Mitchell was prophetic when she sang those words back in 1970.

Back then, for example, if you drove across the Indiana Turnpike, you’d stop at the James Whitcomb Riley, Booth Tarkington, or Ernie Pyle rest stop. Plain, basic concrete buildings, but also racks of maps, clean restrooms, something to eat and some sense of the heritage of Indiana. All gone today: Indiana’s turnpike—under Governors Mitch Daniels and Mike Pence—has been turned over to an Australian investment consortium that pledged improvements at low cost. Now you can stop at gas station-style convenience stores with 47 kinds of potato chips and some beef jerky. Someone flips hamburgers at a tiny grill and there are five or six tables crowded together where you can sit if there’s room. Dirty, minimal restrooms. Although the old places had fallen into disrepair, today’s version is a reduction, a diminishment.

The late political philosopher Benjamin Barber reflects on the implications for all of us of the reduction of government’s role and the kind of privatization of public services represented by the Indiana Turnpike: “There is today a disastrous confusion between the moderate and mostly well-founded claim that flexibly regulated markets remain the most efficient instruments of economic productivity and wealth accumulation, and the zany, overblown claim that naked, wholly unregulated markets are the sole means by which we can produce and fairly distribute everything human beings care about, from durable goods to spiritual values, from capital investment to social justice, from profitability to sustainable environments, from private wealth to the essential commonweal. This second claim has moved profit-mongering privateers to insist that goods as diverse and obviously public as education, culture, penology, full employment, social welfare, and ecological equilibrium be handed over to the profit sector for arbitration and disposal. It has also persuaded them to see in privatization not merely a paring knife to trim the fat from overindulgent state bureaucracies but a cleaver with which democracy can be chopped into pieces and then pulverized.” (Jihad vs. McWorld, p. 239)

What is the appropriate role of government—the role the libertarians seek to erase?  Here are political scientists Jacob Hacker and Paul Pierson: “Why does it take a lot of government to get and keep prosperity?… Effective government makes prosperity possible. It can do so because government has unique capacities—to enforce compliance, to constrain or encourage action, to protect citizens from private predation—that allow it to overcome problems that markets can’t solve on their own… Economists use the term ‘market failure’ to describe many of these problems….  Many important goods in a society are ‘public goods’: They must be provided to everyone or no one… The second big case of failure—and it is really big—involves markets that produce large effects on people who are neither buyers nor sellers. Economists call these external effects, well, ‘externalities.’… When externalities are present, market prices will not reflect the true social costs (or benefits) associated with private transactions.” (American Amnesia, pp.73)

Today with 25 all-conservative, all-Republican statehouses—House, Senate and Governor, all-Republican—along with a Congress seriously considering the budgetary and health care proposals of the libertarian, Tea-Party, House Freedom Caucus—it is becoming clear what reducing government will mean and evident that the consequences will be far more serious than the lack of aesthetics, literary history, and comfort at the new convenience store, rest-stops on the Indiana Turnpike.

The Flint water crisis, which began in 2014—and nobody told Flint’s residents about until 2016—was America’s wake-up alarm. For a long time Michigan has been governing its poorest municipalities and school districts with austerity budget management instead of addressing the needs of the citizens. Michigan’s governor has the right to appoint a fiscal manager who can override elected officials and even abrogate union contracts; there are no checks and balances.  In Flint, Michigan’s appointed emergency fiscal manager, Darnell Earley, approved a plan to save money by taking water out of the Flint River instead of buying already treated water from Detroit. Chemicals to prevent release of lead from old, corroded pipes were not added to the water when Flint began taking water from the river; the pipes corroded all over town; and the children in Flint tested positive for lead poisoning on an epidemic scale. Emergency fiscal managers were first authorized by state law in Michigan in 1988. After voters overturned the emergency manager law by referendum in the November 2012 election, the lame-duck, all-Republican legislature came back in the middle of the night with a tougher law that was referendum-proof. The 2012 law supposedly limits the tenure of austerity-budget emergency managers, but Governor Rick Snyder has found a way to extend austerity management long-term. Curt Guyette, an investigative reporter for the ACLU of Michigan explains: “(T)he managers were given extreme unchecked authority… (T)hey were given the ability to come in, clean up the problems and get out. And so there was an 18-month time limit put on their terms. Except that this governor is exploiting what amounts to a loophole in that law… (T)hese emergency managers serve for 17 months and 29 days, and the day before their term expires, they resign. A new emergency manager is put in place, and the clock starts ticking all over again. And they just shuffle them from one place to another.”  Hands-off, no-regulation-government let down the children of Flint.

Then just a month ago, on June 14, another alarm went off in Britain, which has also been experimenting since the Thatcher era with austerity along with libertarian thinking.  NY Times reporters explain: “Residents of Grenfell Tower had complained for years that the 24-story public housing block invited catastrophe. It lacked fire alarms, sprinklers and a fire escape. It had only a single staircase. And there were concerns about a new aluminum facade that was supposed to improve the building—but was now whisking the flames skyward… The facade, installed last year at Grenfell Tower, in panels known as cladding and sold as Reynobond PE, consisted of two sheets of aluminum that sandwich a combustible core of polyethylene… (B)y 1998, regulators in the United States… began requiring real-world simulations to test any materials to be used in buildings taller than a firefighter’s two-story ladder… Business-friendly governments in Britain—first under Labor and then under the Conservatives—campaigned to pare back regulations. A 2005 law known as the Regulatory Reform (Fire Safety) Order ended a requirement for government inspectors to certify that buildings had met fire codes, and shifted instead to a system of self-policing. Governments adopted slogans calling for the elimination of at least one regulation for each new one that was imposed, and the authorities in charge of fire safety took this to heart.”

The third example, of course, is Kansas Governor Sam Brownback’s experiment to prove that tax slashing will grow the state economy. It didn’t, and last month outraged constituents finally forced their elected representatives to raise taxes.  But the damage can’t be overcome so easily.  Here is Justin Miller in a fine analysis for The American Prospect: “What Brownback’s tax cuts have accomplished is to have created a crisis of catastrophic proportions for state residents. The tax cuts blew an immediate hole in the $6 billion state budget, as revenue levels fell an astounding $713 million from fiscal year 2013 to 2014…. Brownback has also allowed a long-standing public school shortage to metastasize into a full-blown constitutional crisis… More than half the state’s general fund is dedicated to funding K-12 public education… In 2006, Kansas settled a lawsuit with school districts and committed to significant increases in funding over a three-year period. The state did increase funding, but when the Great Recession hit, then-Governor Mark Parkinson, a Democrat, made deep cuts to the education budget.  The cuts were supposed to be temporary, but upon taking office in 2011, Brownback opted for his tax cuts rather than restoring the schools’ funding.  Between 2008 and 2013, state school funding fell by 16.5 percent when adjusted for inflation. In 2015, Brownback cut $28 million more from the state K-12 education budget. A month later, he signed legislation that scrapped the state’s long-held school financing formula, substituting a block-grant system that essentially locked in those cuts for the following two years… The failure to restore pre-recession funding has disproportionately impacted urban school districts like Kansas City’s and Wichita’s.”

In a recent short analysis for the Economic Policy Institute, Does Corporate America See a Future in the United States?, economist Gordon Lafer explains that the new fiscal austerity and removal of government regulation in the U.S. is the result of a lobbying assault that promotes intentional reduction of government as a check and balance on business: “President Trump’s budget proposal follows the playbook that corporate lobbyists have long pushed in state legislatures: tax cuts for companies and the rich, coupled with dramatic cuts to services that benefit everyone… In recent years, states and localities across the country have made drastic cuts to essential public services…  Budget cuts were particularly devastating in the country’s school systems. In 2010, the national student-teacher ratio increased for the first time since the Great Depression; and seven years after the onset of the Great Recession, most states had still not restored per-pupil spending to pre-recession levels. Most striking about these cuts: the legislators who enacted them and the business lobbies that championed them treated them not as temporary tragedies to be repaired when revenues bounced back, but as long-desired permanent cuts to public services. Indeed, many legislatures locked in poorer tax bases by enacting new tax giveaways to corporations and the rich while slashing funding for schools, libraries, and health care. In the same year that Ohio ended full-day kindergarten, legislators phased out the state’s inheritance tax—which had only ever affected the wealthiest seven percent of families.”

Lafer continues: “This agenda was driven by the country’s premier corporate lobbies: chambers of commerce, manufacturers associations, the Koch brothers’ Americans for Prosperity, and the Fortune 500 companies that have participated in the American Legislative Exchange Council (ALEC)… Given this reality, we take this corporate-backed push for disinvestment of America’s public sector as a big, loud early warning signal. ALEC’s agenda is not that of employers committed to their surrounding communities. It more resembles that of a company planning to cut and run. For the rest of us who seek good jobs and future opportunity for ourselves and our children, what’s good for GM is good for GM, period.”

For years and years, Betsy DeVos, the new Secretary of Education, has been directly implicated in this agenda in her home state of Michigan. She and her family founded, funded, and have worked actively with the Great Lakes Education Project, a libertarian lobbying outfit that has led the effort to block increased oversight of the out of control, for-profit charter school sector that has threatened the Detroit Public Schools. When, now that she is the U.S. Secretary of Education, Betsy DeVos demands that school accountability be defined as a parent’s right to choose a different school if things are not going well, she is promoting her libertarian bias for lack of government regulation, lack of democratic oversight, and lack of public transparency.  Her mantra is the expansion of vouchers to drive public tax dollars away from the public system that is required to serve all children and protect their rights.

Most of us take our local public schools—overseen and carefully regulated by government to protect the investment of tax dollars and the rights of our children—so much for granted that it is difficult for us to imagine that Betsy DeVos and her libertarian friends at ALEC, the Great Lakes Education Project and Americans for Prosperity can invest enough billions of lobbying dollars to destroy public education. But we ought to pay attention. “You don’t know what you’ve got till it’s gone!”

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What’s the Matter with School Finance in Kansas is What’s the Matter in Many States

Yesterday the Kansas Supreme Court heard oral arguments to see if changes made by the legislature and signed by Governor Sam Brownback in early April go far enough to remedy underfunding of public education and unequal distribution of state funds to support public schools.  The Court will decide, based on documents submitted and yesterday’s arguments from the plaintiffs and the state defendants, whether to shut down Kansas’ public schools for the upcoming school year, as threatened, or whether school funding in the state now passes constitutional muster. In its February decision, the Kansas Supreme Court said it would order the state’s schools shut down on June 30, if the legislature and governor neglected to find enough money by June 30 to fund schools adequately and to distribute the funding equitably.

It is very hard to be bored by a school funding lawsuit in your own state, particularly if you have children in school and you know the school librarian and school nurse will be shared by several schools or your high school will lose its orchestra if the case goes the wrong way.  When a contested school finance case moves through your own state’s courts, you are even likely to find people arguing about it in bars, because its resolution will affect two things people really care about—their children and their taxes.  If it’s somebody else’s state, however, particularly if its way out in Kansas, well that might seem like their problem—their taxes—their children.

But here’s the thing: what’s the matter with Kansas school funding is likely also the matter in your state.  So it’s very much worth paying at least a little attention. While it used to be pretty widely accepted that paying taxes for government services is a civic responsibility of individuals and businesses and that the tax code ought to be progressive, with the heaviest burden on those with the greatest financial means, these days such principles are being widely questioned.  Like Alabama, Arizona, Arkansas, Florida, Georgia, Idaho, Indiana, Michigan, Mississippi, Nevada, North Carolina, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Wisconsin, and Wyoming, Kansas has all-Republican government without bipartisan checks and balances—a Republican governor and both houses of the legislature dominated by Republican majorities. And just as what’s happened in a lot of these states, Governor Sam Brownback led his legislature to slash taxes—a $1.1 billion tax cut enacted in 2012 and even more in 2013.  The economy, according to trickle-down orthodoxy, was supposed to grow as a result and yield more revenue to the state, but the plan didn’t work.  States like Kansas are broke and can’t see how to afford to fix public education. Not all the states have pending lawsuits, but school funding is a problem not only in the one party states that have embraced austerity budgeting; it is also a long running problem in other places including Louisiana, Illinois, Pennsylvania and New York.

Here is what has been happening this year in Kansas. In February the Kansas Supreme Court affirmed an earlier trial court decision in Gannon v. State of Kansas, and found the state’s school funding system unconstitutional.  The Education Law Center explains the February decision: “In its decision, the Court explained that Article 6 of the Kansas Constitution requires the legislature to ‘make suitable provision for finance of the educational interests of the state…’ Article 6 contains both adequacy and equity requirements.  It necessitates that the legislature provide enough funds to ensure public school students receive a constitutionally adequate education and that the funds’ distribution does not result in unreasonable wealth-based disparities among districts.”  The Education Law Center continues: “The Court had found an earlier funding system inequitable, and the legislature revised the system and brought it into compliance with the Constitution during its 2014 session.  However, in its 2015 session the legislature reversed itself, and the Gannon plaintiffs returned to the Kansas courts, arguing that the funding system had become unfair (inequitable) and therefore unconstitutional again.” Although in 2014, the legislature had made school funding adequate and equitable and satisfied the Court, in 2015, according to the editorial board of the Kansas City Star, the state gave up the formula it had recently devised and switched to school district block grants.

In March of this year, to satisfy the Court, the legislature devised a new plan, and Governor Brownback signed it into law in early April.  Press coverage of the new plan indicates that it cuts funding to some school districts but then awards it back without returning as much funding as the poorest districts desperately need.  It also includes a hold-harmless guarantee that ensures that no district will fall below the current funding level.  According to an April report in the Kansas City Star, a central problem is that because not enough total funds are available in this state that has drastically reduced taxes, it would be impossible to help the poorest districts without taking money from wealthier districts, and that, of course, is politically unpopular: “Fully funding equalization would have required spending an additional $38 million….”  The plan also allows school districts to raise local property taxes, likely to be an easier undertaking in the wealthier school districts.

A recent analysis by John Hanna for the Associated Press explains the political dilemma legislators faced in March as they developed the new plan required by the court: “It was necessary for legislators to prevent any school district from losing money even as they sought to improve funding for poorer ones, the state’s attorneys argue in court filings… Legislative committees considered proposals to boost total money to poor districts by taking funds away from as many as 100 districts.  But those measures garnered little support—partly because districts in Johnson County, the state’s most populous, faced big losses.”  Johnson County is home to the school districts of some of Kansas City’s well-off suburbs.

Alan Rupe, the attorney for the plaintiff school districts, Kansas City, Wichita, Hutchinson and Dodge City, is quoted as condemning the plan for its inherent inequity: ‘The state did not eliminate the distance between the districts caused by naturally occurring wealth disparities… It worsened the disparities and put the districts even further apart. They’ve done the worst possible thing.  They have left the valleys where they are and they have increased the mountaintops… I don’t think for a minute that creating greater disparity is going to satisfy the court. It’s sure not going to satisfy the plaintiffs.”  Yesterday Rupe told the justices that they have the power, “to restrict other spending in state government until or unless the schools receive other funds.”  Schools must be funded as essential public services, he said, according to the state constitution.

Whatever the outcome of the case currently before the Kansas Supreme Court, the Kansas City Star rates as zero the chance that the decision will solve the school funding problems across Kansas: “Another legal battle is under way over whether the state must spend an extra $550 million a year to fund K-12 schools.”

The decision expected by early June from the supreme court of Kansas will be important—whether legislative tinkering earlier this spring makes Kansas school funding satisfy the state constitution or whether the court will shut down public education in Kansas as of June 30 as a motive for the legislature to make more effort.

Will Flint’s Lead Poisoning Wake Us Up to Disaster of State Takeovers and Austerity Budgets?

State takeovers of various sorts have been a favorite policy response of governors and state legislatures who seek an efficient solution to the problems of America’s poorest cities and school districts.  The question today is whether the lead poisoning of Flint, Michigan’s water supply and the attempt for months to hide the seriousness of this situation, all under Emergency Manager Darnell Earley—now serving as Emergency Manager of the Detroit Public Schools—will sufficiently awaken the public to the widespread neglect by state governments of so many of our poorest cities and school districts.

Last August, the Alliance to Reclaim Our Schools released a major report, Out of Control: The Systematic Disenfranchisement of African American and Latino Communities Through School Takeovers, that traces the state takeovers of school districts and the abrogation of democracy as appointed state overseers commence to manage operations without the usual checks and balances imposed by elected boards of education.  That report describes the long-running New Jersey takeovers of Jersey City (since 1989), Paterson (since 1991), and Newark (since 1995); the Louisiana Recovery District that has fully charterized the New Orleans schools since Hurricane Katrina in 2005; the Tennessee Achievement School District that operates schools in Memphis and now in Nashville; the Michigan Education Achievement Authority by which Governor Rick Snyder has taken over 15 schools in Detroit since 2013; and two new state takeovers in 2015—the takeover of Milwaukee Schools that was logrolled last summer into the Wisconsin state budget, and Arkansas’ takeover of the schools in Little Rock.  The 2015 legislation to enable Ohio to take over Youngstown’s schools was too recent to have been covered in the report, and Nathan Deal’s proposal for a Georgia “Opportunity School District” has passed the legislature but must be affirmed by voters in a referendum in November, 2016.

Additionally, Michigan Governor Rick Snyder has the power to appoint emergency fiscal managers for municipalities and school districts deemed to be in financial emergency.  Emergency fiscal managers were first authorized by state law in Michigan in 1988.  In a referendum in November of 2012, the voters overturned the right of the governor to take over local municipal and school district juristictions deemed to be in financial emergency, but the all-Republican legislature came back with a tougher law that was passed before the end of that year. The 2012 law supposedly limits the tenure of austerity-budget emergency managers, but Governor Snyder has found a way to extend emergency management long-term.  Curt Guyette, an investigative reporter for the ACLU of Michigan explains: “(T)he managers were given extreme unchecked authority… (T)hey were given the ability to come in, clean up the problems and get out.  And so there was an 18-month time limit put on their terms.  Except that this governor is exploiting what amounts to a loophole in that law… (T)hese emergency managers serve for 17 months and 29 days, and the day before their term expires, they resign.  A new emergency manager is put in place, and the clock starts ticking all over again.  And they just shuffle them from one place to another.”

We now know that a couple of years ago, Michigan’s appointed emergency fiscal manager, Darnell Earley, approved a plan for Flint to save money by creating its own water system instead of buying already treated water from Detroit.  Chemicals to prevent release of lead from old, corroded pipes were not added to the water when Flint began taking water from the Flint River; the pipes corroded all over town; and the children of Flint began to experience epidemic lead poisoning.

Earley left Flint and was appointed Emergency Manager of the Detroit City Schools a year ago, not enough time for him to be blamed for all of the school district’s fiscal problems.  The state’s previous appointed emergency managers had already failed to correct a long-running financial crisis for Detroit’s schools, a crisis that has now culminated in the failure to pay required contributions into the state teachers’ pension fund and a practice of restructuring short term debt instead of making the needed payments.  Detroit City Schools currently have an accrued deficit of $3.5 billion.

Here is the conclusion of the new report from the Citizens Research Council of Michigan: “Detroit Public Schools has $3.5 billion in outstanding debt.  Nearly half of this amount, $1.67 billion, is capital liabilities payable with a dedicated millage… The balance of DPS’s liabilities are related to legacy costs and repaying short-term borrowings converted to long-term debt by state-appointed emergency managers.  This includes $1.3 billion that represents DPS’s estimated share of the unfunded actuarial accrued liabilities for retiree pension and health care costs…. A plan that solves the district’s money problems without addressing what is taking place in the classroom will not set the district up for future success.  Similarly, any financial plan that only deals with the district’s near-term fiscal woes (cash flow for example) will not prove lasting and will not support student learning over the long haul if current financial problems are shifted to future students.”  Neither has the state legislature invested in public education, nor has the state devised a workable plan for equitable distribution of funding to help the school districts with the least capacity to generate local revenue. A new report from the Center on Budget and Policy Priorities documents that Michigan’s general state funding per student remains 7.5 percent lower than it was prior to the 2008 recession.

It is not only the emergency fiscal managers whose performance is in question in Michigan, but critics have also been raising very troubling questions about the other form of state takeover in that state, the Education Achievement Authority, that manages 15 of Detroit’s struggling schools. Michigan’s Education Achievement Authority was intended to have been expanded beyond Detroit, but low achievement and other problems have prevented its growth. Here is some troubling data released in mid-December: “Just one fourth-grader in schools run by the Education Achievement Authority—a state district created to turn around the worst performing schools in the state—passed the math portion of the exam…. Overall, only 1.2% of the students in the district passed in math and 5.6% passed in English language arts.  In some grades and subjects, not one student passed.”  Last spring, even Governor Snyder admitted to the failure of the Education Achievement Authority, when he issued an executive order to transfer the Education Achievement Authority from the Department of Education to the Department of Technology, Management and Budget, a department directly under Snyder’s control.  In his executive order, he declared, “Despite not achieving satisfactory outcomes, the current structure has neither implemented the rigorous supports and processes needed to create positive academic outcomes….”  In these words last March, Snyder condemns the results of the state takeover initiative he had himself created, though the test scores just released show no improvement under the new management plan he instituted last spring.

And there is more, this time about the implications of the state-imposed emergency fiscal manager on the Detroit Public Schools—news about cutting back on building maintenance under current Emergency Fiscal Manager Darnell Earley.  Here is Michigan’s Eclectablog: “Darnell Earley has been the Emergency Manager for DPS for a year now.  While the obscene state of many DPS schools is not solely on his shoulders, it’s clear that that he’s done nothing to solve the problems.  Once again, he has used the Emergency Managers’ toolkit of cutting, reductions, and other austerity measures to solve a problem that can only be resolved through investment and renewal… For months, labor unions and residents have been sounding the alarm that a plan by DPS to cut the number of certified, licensed boiler operators and switch to an untested, unmanned system of monitoring commercial boilers in schools is too dangerous.  Boilers are more likely to explode when not maintained and watched by licensed, certified operators… DPS is decreasing the number of operators from one per school to a one per every five schools… Getting to a school in time to avert an equipment failure that can cause an explosion will become almost impossible.”

Here is the analysis of Curt Guyette,  speaking in an interview with Democracy Now: “(O)ne of the things about the emergency manager law is that these managers were given extreme unchecked authority.  And the thinking was… they were given the ability to come in, clean up the problems and get out…  And the other thing is… the imposition of austerity.  This is what austerity looks like… So you have all the problems in these schools that you just reported on, because they’re treating it like a managerial problem rather than a structural problem.”  Guyette is asked to comment on the type of communities and school districts on which Michigan has imposed emergency fiscal managers: “With the exception of one, they are all majority African American.  And they’re also all very poor cities.  So this is a racial issue, and it’s a class issue.”

This blog recently covered the fiscal problems of Detroit Public Schools here.