New Book Defines the Case Against KIPP and Other Charter Management Organizations

Charter schools have been with us now for two decades. Enough evidence and data have been gathered that it ought to be possible to assess their capacity for achieving what many describe as their goal: helping poor children and closing achievement gaps.  Samuel Abrams, the director of the National Center for the Study of Privatization in Education at Teachers College, Columbia University, has just published Education and the Commercial Mindset, a fascinating evaluation of the role of two strategies for privatizing schools—the Education Management Organization (for-profit EMO) and the Charter Management Organization (not-for-profit CMO).

Abrams sets up a case study of Edison Schools to examine the role of for-profit school management and a case study of KIPP (Knowledge is Power Program) to explore the workings of a huge, nonprofit charter network. While Abrams’ story of the ultimate failure of the for-profit EMOs is a fascinating read, the presence of the not-for-profits is of far more urgent interest; these are, after all, the fast-growing form of privatization. According to Abrams, if one removes the huge online, virtual-academy EMOs, the nonprofit CMOs are replacing the for-profit EMOs in terms of market share: “In sum, by 2011-2012, the latest academic year for which cumulative data are available, nearly one-third of students in schools managed by EMOs were online students; the number of CMO schools had far surpassed that of EMO schools; and the number of students in CMO schools had far exceeded the number of students in EMO brick-and-mortar schools.” (p. 193)

In an interview with journalist Valerie Strauss, Abrams clarifies the subject of the privatization of education with an essential definition: “Privatization takes the form of nonprofit as well as for-profit school management, as privatization technically means outsourcing the provision of government services to independent operators, whether nonprofit or for-profit.” In other words, nonprofit charter schools are a form of privatization, despite that their proponents and sponsors persist in calling them “public charter schools.”

While Abrams’ review of KIPP is mostly positive—especially compared with the record of Edison Schools that precedes his profile of KIPP,  he explains the KIPP Schools’ limitations and concludes that on the whole privatization—even the not-for-profit variety—has failed to fulfill the promises of proponents of the school choice marketplace:

  • “Teacher retention has… been a central challenge for KIPP as well as similar CMOs.  The price is not merely time, energy, and money lost to recruitment and training of replacements but also quality of instruction… (T)he explanation for the negative impact of high teacher turnover appears to derive not only from insufficient experience of new teachers but also from inadequate institutional stability, in turn fundamental to fostering cooperation among colleagues, nurturing new faculty, and developing trust with students.” (pp. 222-223)
  • While KIPP and others have emphasized no-excuses programs to build “character” among their students, and while KIPP worked actively with Angela Duckworth, whose academic research has focused on the role of “grit” in academic success, Abrams cautions that other academics have produced ample evidence that,”disadvantaged students did not fail to make it to and through college because of insufficient character… but because of insufficient social and financial resources taken for granted by middle- and upper-class students.” (pp. 243-244)
  • Then there are the selection screens: “(T)hose students ill suited for KIPP’s high demands may not enter KIPP lotteries or may not do so in proportionate numbers… Moreover, attrition and replacement patterns further distinguish KIPP students.  Of those students who do gain admission to KIPP but do not prove a good fit, a significant number drop out after one or two years, return to their neighborhood district schools, and either get replaced by higher performing transfers or do not get replaced at all…. In a subsequent study of nineteen KIPP middle schools across the country from 2001-2009, a third group of scholars concluded that ‘late entrants’ who transfer into KIPP in sixth grade or later (though relatively few students transfer into KIPP middle schools after sixth grade) to replace exiting students tend to comprise fewer male students, fewer students with learning disabilities, and more students with higher baseline scores on fourth-grade reading and math exams.” (pp. 245-246)

Abrams concludes that KIPP and other CMOs cannot exist without a public school system of last resort to serve all of the children the charters refuse to choose in the first place or those the charters push out because the children or their families are not able to adjust to the charter’s demands or school culture: “(T)he very existence of KIPP and other CMOs embracing the philosophy of ‘no excuses’ depends on the presence of a fallback system of schooling, where students can go if KIPP, Mastery, or Achievement First does not prove a good fit… This qualification is critical.” (p. 249) Abrams quotes New York City Mayor Bill de Blasio: “The answer is not to find an escape route that some can follow and others can’t. The answer is to fix the entire system.” (p. 250)

In the interview with Valerie Strauss, Abrams further describes the impact of market reforms on urban public school districts: “(T)his outsourcing generates the atomization of school districts, meaning the diminishment of neighborhood schools and the civic involvement each neighborhood affiliation involves; second this atomization makes for navigational challenges for many parents, who either have a hard time finding the right schools for their children or getting them there day after day when the school is across town; third, this atomization translates into ‘good schools’ and ‘bad schools,’ with students who can’t succeed in the ‘good schools’ concentrated in the ‘bad schools,’ which are often default neighborhood schools, where learning can become far harder given the negative effects struggling students can have on on other students.  In sum, such outsourcing leads to opportunities at high-performing schools for some students but leaves many others behind… Privatization accordingly amounts to a flawed response… not a solution.”

* This blog has been corrected.  Originally, the Abrams interview was credited to Jennifer Berkshire.  Valerie Strauss herself conducted this interview.

Jeb’s Foundation for Excellence in Education Discloses All Major Donors

In a January profile of Jeb Bush, the Republican candidate for President, Lyndsey Layton of the Washington Post described Bush—who launched his own Foundation for Excellence in Education in 2008 after he completed two terms as Florida’s governor from 1999-2007—as a promoter of school “reform,” a disruptor, and a privatizer: “issuing A-to-F report cards for schools, using taxpayer vouchers for tuition at private schools, expanding charter schools, requiring third-graders to pass a reading test… encouraging online and virtual schools.”  Layton quotes Jeb’s goals in his own words: “fighting government-run, unionized, politicized monopolies… that trap good teachers, administrators and struggling students in a system that nobody can escape.”  Jeb resigned from the foundation at the end of 2014 in preparation for his Presidential candidacy.

While the Foundation for Excellence in Education has actively engaged in advocacy, it is a dark-money, not-for-profit, charitable organization that purportedly provides issues education but not lobbying and that, under current election laws, is not required to name its donors.  On Wednesday afternoon of this week, the Foundation for Excellence in Education disclosed to the Associated Press the names of all donors who had given more than $5,000 before the end of 2014. The AP reporters, Ronnie Greene and Steve Peoples, who broke the story, describe the disclosure as “part of a larger effort by Bush’s campaign to highlight transparency.”  Previously the foundation had revealed names of donors only from 2012-2014.

The AP reporters comment: “Big-time donors to a nonprofit educational group founded by Jeb Bush, disclosed for the first time Wednesday, highlight the intersection between Bush’s roles in the worlds of business, policy and politics years before he began running for president…  That donor list shows the circular connections as Bush moved from governor to education advocate to corporate board member.  Supporters in each of those stages of his career contributed to his educational foundation—which, in turn, sometimes supported causes benefiting its donors.  They include Rupert Murdoch’s media giant News Corp., GOP mega-donor Paul Singer’s foundation, energy companies such as Exxon Mobil, even the Florida Lottery.”  Officials at the Florida Lottery explained that, while the Lottery cannot legally make charitable donations, it did underwrite six conferences of the Foundation for Excellence in Education (worth $82,500) “to help raise awareness of the lottery’s contributions to education.”

One of the committees of the Foundation for Excellence in Education, Chiefs for Change—a group of conservative state superintendents of public instruction—has actively promoted on-line education and particular products of education publishing and technology companies in the states where these officials were serving as state chiefs.  In some instances members of Chiefs for Change have served as endorsers for such products among their colleagues in other states.  Ed O’Keefe, a reporter who also picked up this story on Wednesday in the Washington Post,  adds that, “The Foundation for Excellence in Education… has mixed politics and policy by drafting education reform legislation, paying travel expenses for state officials, lobbying lawmakers, and connecting public officials with industry executives seeking government contracts.”  (Chiefs for Change separated from the Foundation for Excellence in Education earlier this year to become an independent organization.)

According to the AP report, Michael Bloomberg, New York City’s former mayor and a leader who has actively promoted such practices as closing so-called failing schools, opening charter schools, and evaluating teachers by their students’ test scores, has been a major contributor: “Four companies and nonprofits that appointed Bush to their boards of directors or advisory boards backed the education foundation.  One, Bloomberg Philanthropies, was among the most frequent supporters, making seven donations worth between $1.2 milliaon to $2.4 million.  Bush served on Bloomberg’s board from 2010-2014.”

The AP reporters explain that the Foundation for Excellence in Education has also made strategic grants that seem to have helped secure contracts for friends of the foundation: “Bush’s education nonprofit provided $1.1 million in public information grants to eight states in 2013…. In recent years, at least nine charter schools and education-related donors to the Foundation for Excellence in Education won contracts in those eight states, revealing the mirrored missions of donors and the foundation.”

The foundation, according to the AP report, received grants from philanthropies and businesses known to be among America’s prominent backers of the privatization of education: the Walton Family Foundation, Wal-Mart Stores, Wal-Mart Foundation, Bill and Melinda Gates Foundation, the News Corp., and the Leona M. and Harry B. Helmsley Charitable Trust.

Corporate support for the foundation seems to have been viewed as a marketing strategy.  O’Keefe at the Washington Post reports: “A large number of contributions came from for-profit education companies, including Apex Learning; Pearson; Charter Schools USA; VSSCHOOLZ; News Corp.; Microsoft; Intel; and K12, Inc.  Of these companies, News Corp.—which has digital education properties—was most generous, giving six-figure sums in at least three years.”

The AP reporters note, perhaps with some humor: “While Hillary Clinton played a leading role in an organization that accepted millions of dollars from foreign entities, Bush’s group accepted money from just one international source: British-based Pearson PLC….”  Pearson is well known as one the three biggest education publishers that sell books, tests and technology to school districts across the United States.  It is the producer, grader, and data processor of the on-line tests being administered by the Common Core PAARC Consortium.  Pearson also competes across the states to provide the standardized tests that states are required to administer annually under the federal No Child Left Behind Act.  It also markets curricula and textbooks aligned with the tests it produces.

This blog has covered the history of Jeb Bush’s involvement with education policy here and here.

Ohio Supreme Court Hears Oral Arguments Today in Case Involving White Hat Management

Today, September 23, 2014, the Ohio Supreme Court will hear oral arguments in a long running case that has pitted Ohio’s notorious White Hat Management Company, which manages charter schools for-profit, against ten of its schools whose boards set out to dissolve ties to the management company and bring in a new manager.  White Hat at first refused to disclose to its schools how it had spent the 96 percent of taxpayer funding for the schools that went directly to the management company without the charter boards’ oversight.  The schools had to go to court to force White Hat to disclose this information to the schools it managed.  Now the question is: Who owns the school buildings, furniture, and all equipment?

The case involves basic and important questions: whether charter school boards are in charge and can cleanly terminate contracts with poorly performing management companies they have hired to run the schools, whether management companies can create subsidiaries with taxpayer funds to amass real estate empires and then rent buildings back to the management companies with whom they are affiliated at rents well over market rates, whether buildings and other assets purchased by the management companies with tax dollars are owned by the charter school boards or the private management companies, and finally whether charter schools themselves—that draw funding from Ohio’s state education fund and the state’s over 600 public school districts—are public or private entities.

Doug Livingston, an Akron Beacon Journal reporter and Ohio’s top education writer, explains the case succinctly: “The case involves Akron-based White Hat Management and 10 charter schools.  The schools’ boards, after paying White Hat millions to run what turned out to be poorly performing schools, fired the company when they were unable to obtain answers as to how the money was spent.  But after the firing, White Hat argued that it owned most of the assets and it would be the boards that would have to move and start up new schools from scratch.  Meanwhile, the buildings that were vacated often became the home for new charter schools run by the for-profit White Hat… The case illustrates a larger issue: Ohio charter schools were created more than 15 years ago as independent public agencies.  But as so many for-profit companies now own the real estate, furniture and computers, the questions are raised: Are charter schools still public?  Are they independent? Or are they now privately run, for-proft businesses?”

Livingston points out that a recent investigation by the Beacon Journal and the News Outlet at Youngstown State University uncovered a number of instances when members of charter boards explained that they had been recruited by management companies to serve on the charter boards that later hired the management companies.  White Hat Management was reported by charter board members to have been one of the management companies that recruited them to serve on a board that was, supposedly, responsible for hiring a management company—despite that federal law requires that not-for-profit boards be independent of any contractors or managers they hire.

Purchase and rental of school buildings is a significant part of this case.  Livingston reports that the “Beacon Journal-News Outlet review of hundreds of property records and business filings across Ohio found multiple connections between management companies and property owners.  The investigation found that 40 percent of Ohio public charter schools pay rent to for-profit or out-of-state landlords.  At least six companies have leased property to charter schools that also hired them to run the schools.  One real estate company charges a rental rate that equals nearly half the property’s market value…. The most active companies are Summit Academy, which owns half its school properties, and White Hat, which has created out-of-state real estate companies to acquire at least 11 of its 29 brick-and-mortar charter schools in Ohio… White Hat and others have related companies that manage real estate portfolios, and while the schools in those portfolios may change names, the education management company doesn’t.”

According to Livingston, “The Ohio Department of Education keeps no records on the private management companies hired by public charter schools… And because the state asks little, determining ownership of assets is complex.”

White Hat claims it owns all the buildings, furniture and equipment as an independent contractor.  According to M. Bettman writing for Legally Speaking Ohio, “White Hat argues that the charter schools are ultimately governed by their individual school boards—no management company takes that role.  Charter schools are allowed to contract with management companies like White Hat to administer the daily functions of the school.  As was perfectly permissible, the management agreements shifted all financial risk from the Schools to White Hat.”

Bettman also presents the schools’ argument, “The Schools argue that public funds do not lose their public function just because a private entity has received them… White Hat did not provide a discrete or remote service, but was entrusted with carrying out a government function on a daily basis, and received public funds for doing this… White Hat acted as a purchasing agent for them in the acquisition of furniture, computers, and other personal property… White Hat became an agent for the Schools, therefore establishing a fiduciary duty for White Hat to act primarily for the benefit of the Schools.”

The Court of Appeals, according to Bettman, found for White Hat: “that the Schools owned only the property that had to be titled in their own names due to the nature of the funding source, and that is the only situation in which White Hat operates as the purchasing agent for the Schools.  Otherwise, the funds received by White Hat… became its private funds, and property it bought with those funds belongs to it.”

The case is complicated by the political power of David Brennan, owner of White Hat Management, former member of  Ohio’s higher education board of regents, long time advocate for Ohio’s school voucher program, proponent of legislation to promote the unregulated growth of charter schools, and campaign-donor extraordinaire to members of the Ohio General Assembly.

Orwellian Language Again: Info-Graphic Answers Your Questions about Democrats for Education Reform

It has perhaps slipped your mind, but beginning Sunday afternoon and ending this morning, a group of New York hedge fund managers and charter school supporters has been meeting at Camp Philos in a retreat center at Lake Placid, in New York’s Adirondack Mountains.  The honorary chair of this event was Andrew Cuomo, the governor of New York.  Governor Cuomo is not only the man who went before an Albany rally this spring to proclaim, “We will save charter schools,” but also the man who, we discovered later, worked behind the scenes with supporters of a well connected New York City charter school network to stage the rally.

Billy Easton is the executive director of New York’s Alliance for Quality Education, a large statewide coalition of organizations that has been working hard for over a decade to help ensure that New York’s public schools are adequately funded.  AQE, as the organization refers to itself, has worked assiduously to ensure that New York lives up to the commitments made in response to a statewide school funding lawsuit, Campaign for Fiscal Equity v. New York, only to be disappointed repeatedly by Governor Andrew Cuomo, who has been more interested in cutting taxes and supporting charter schools.

According to Easton in a recent commentary published at Gotham Gazette, “While backers of the corporate school agenda are proclaiming Cuomo as a conquering hero, public school parents around the state are protesting against him.  His policies have systematically forced classroom cuts every year he has been in office and have promoted a damaging culture of teaching to the test…  The organizers of Camp Philos are literally bathing in money from hedge fund managers and other super-wealthy donors that are ready to continue arming the Governor in his effort to push forward more corporate-style reforms…. Meanwhile, our public schools are barely scraping by.  Year after year, school districts across the state have been through an endless cycle of classroom cuts that have resulted in shrinking opportunities for students.”

In honor of Camp Philos, late last week Easton’s organization, AQE, and its allies put together an info-graphic to help us all connect the dots among Camp Philos’s sponsors, their allies, and the people who spent $1,000 to attend the three day event ($2,500 for VIP attendees).  The info-graphic is helpful because you may have wondered about the involvement of hedge fund managers in the promotion of charter schools.  You may have wondered about Democrats for Education Reform, that has chosen a name that sounds progressive but instead promotes school privatization and works with the Koch Brothers and Rupert Murdoch and Betsy DeVos and her pro-voucher American Federation for Children.  And you may not have been able to figure out that Education Reform Now (the group that just last month spent nearly $5 million for TV ads supporting Success Academy Charter Network’s right to co-locate three charter schools into New York City public school buildings) is the 501(c)(3) arm of Democrats for Education Reform.  And maybe you thought Democrats for Education Reform couldn’t touch public schools in your state because it is only a New York organization, but you didn’t realize that DFER, as it is called for short, has also been spending huge amounts to impact state and local elections across the country.

This info-graphic, Democrats (In Name Only) for Education Reform,  along with the links it provides to background material, will establish DFER clearly in your memory and straighten out any misconceptions you may have about what this organization really stands for.

It Is Spring and Big-Money Conferences on School “Reform” Bloom

I  was educated in the public schools of small town Havre, Montana, and my children were educated in the public schools of inner-ring suburban Cleveland Heights, Ohio.  I am a strong believer in public education—publicly funded, universally available, required to accept all children who present themselves at the door, and accountable to the public. A public system seems to me the optimal way to balance the needs of each particular child and family with the need to create a system that secures the rights and addresses the needs of all children. While public education is not a utopia, I believe it has fewer structural flaws, from the point of view of the common good, than privatized alternatives.

How quaint seem my attitudes this month when the money blooming around privatizing public schools is far more lush than the flowers of spring.   Privatization—privately managed charters, vouchers,  all the private contracting that creates and services all the standardized testing, and the education technology sector—is rapidly expanding.  There is money to be made and power to be wielded.

Two national conferences in the next couple of weeks demonstrate the impact of money in education this spring.  Beginning yesterday, the Arizona State University and Global Silicon Valley Education Innovation Summit is meeting in Scottsdale, Arizona.  Diane Ravitch quotes the sponsors of the conference:  “Our founders have spent the past two decades focused on the Megatrends that are disrupting the $4 trillion global education market along with the innovators who are transforming the industry.”

The long list of speakers includes a who’s who of supporters of “corporate” education reform: Margaret Spellings (George Bush’s Secretary of Education), Penny Pritzker (portfolio school reform supporter in Chicago before she became Secretary of Commerce), Jim Shelton (formerly director of education at the Bill and Melinda Gates Foundation, now Assistant Secretary of Education), Jeb Bush (former Florida Governor and through his Foundation for Excellence in Education a proponent of awarding schools and school districts A-F grades), Christopher Cerf (now with Rupert Murdoch’s Amplify ed tech company, formerly Governor Chris Christie’s New Jersey commissioner of education), and Reed Hastings (CEO of Netflix and vocal supporter of the elimination of elected boards of education).  The 49 sponsors of the conference include publishers, test designers and data processors like Pearson, McGraw Hill Education, and Houghton, Mifflin, Harcourt; for-profit universities like Apollo, DeVry, and Kaplan; tech companies like Microsoft, and philanthropies like the Bill and Melinda Gates Foundation. Over 100 companies are slated to present their wares.

Maggie Severns at Politico describes the reason for the conference: “Capital flows into companies serving the K-12 and higher education markets jumped to $650 million last near—nearly double the $331 million invested in those spheres in 2009.”

Or if you want a different kind of education “reform” experience, you can make your way to an Adirondack Camp at Lake Placid, New York on May 4-6 to “reform, relax, retreat.”  Your host will be the Honorable Andrew Cuomo, New York’s charter-friendly governor.  Hofstra professor Alan Singer describes what is to be called Camp Philos in this fascinating piece at Huffington Post. The fee for normal participants is $1,000, but VIPs can pay $2,500 for the three day event being sponsored by Education Reform Now, which Singer describes as closely but unofficially tied to Democrats for Education Reform, the pro-charter, hedge fund-supported, pro-privatization national PAC.

This event isn’t about making money from education; instead it is about using money to shape education policy.  The sponsors are the people who, for example, used their money to ensure that Governor Cuomo blocked New York City Mayor Bill de Blasio’s attempt to reign in the Success Academy charter school network of powerful Eva Moskowitz.  Singer notes that Education Reform Now has made campaign gifts to Cuomo since 2010 that add up to $65,000.  “The Education Reform Now Board of Directors,” writes Singer, “reads like a list of hedge fund royalty.”  Board members head up Highfields Capital Management, Cornwall Capital, Bain & Company, Sessa Capital, Gotham Capital, Covey Capital, Maverick Capital, Charter Bridge Capital… and the list goes on.

M. Night Shyamalan, the film maker, is also a sponsor.  According to Singer, Shyamalan “attended elite private schools as a youth, decided he is an education expert and wrote a book about saving public schools after filming in a Philadelphia public high school.”  Shyamalan’s preferred genre, however, is not the public education documentary;  Singer lists Shyamalan’s Hollywood horror films: After Earth, Devil, The Happening, The Village, and The Sixth Sense.

Singer concludes: “According to the online agenda, break-out sessions include discussions on ‘The Next Big Thing: Groundbreaking Approaches to Teacher Preparation,’ ‘Up, Down, and Sideways: Building an Effective School Reform Coalition,’ ‘Tight-Lose Options for Ensuring All Kids Have Access to a Great Education,’ and ‘Collaborative Models for Changing State and Local Teacher Policies.’ But really only one topic will be discussed — How to promote and profit from the privatization of public education in the United States.”

Hucksterism In Education Exposed

I was serving on a panel at an evening event last week about the growth of privatization of education here in Ohio, when someone asked, “Why do parents grab at the chance to send their children to these schools?  Most of them don’t do nearly as well academically as public schools.”

People speculated about the lure of the freedom to choose and the conversation wandered a bit.  But finally came a comment that stopped many of us:  “Public schools can’t advertise, but all the voucher and charter schools advertise all the time, especially the cyber charters—Ohio Virtual Academy (K12) and the Electronic Classroom of Tomorrow.”

Hucksterism in education is the subject of a new piece by Ruth Conniff: The Sharks are Circling Our Public Schools.  Ruth Conniff is the editor of The Progressive, a journal that champions the public good including a current project known as Public School ShakedownThe Progressive has recently merged with the Center for Media and Democracy which has persistently exposed the far right attack on the public good, including ALEC Exposed.

Conniff describes robocalls promoting Wisconsin vouchers.  A woman’s voice describes, “free tuition to send your child to a private or religious school.”  “We at School Choice Wisconsin are proud to pay for this call, because we want the very best for you and your child.” The calls, writes Conniff, are coming in the midst of the application process for Wisconsin’s new  statewide voucher program.

Conniff reports that School Choice Wisconsin is an arm of the American Education Reform Council (funded by John Walton) and the far right Bradley Foundation of Milwaukee.  This spring Americans for Prosperity, the Koch brothers’ PAC, has also been sponsoring pro-voucher events across Wisconsin.

Cyber charters are advertising across Wisconsin right now, too.  Conniff describes postcards (with gorgeous photos of adolescents at scho0l) being mailed during Wisconsin’s e-school open enrollment season.  She notes that cyber schools do not, as pictured, educate students with their peers in a brick and mortar building, and, “According to the state’s school report cards for the 2012-2013 academic year, half of the children in virtual schools were attending one that was not meeting performance expectations.”

Conniff concludes: “So as parents are sorting the mail and checking messages and hearing about all these great choices you can make—free tuition! flexible! individualized learning! laptop provided!—keep in mind that you are paying for these businesses with the money that used to sustain our public schools.  They are still performing better than all of these new, alternative options.”

Check out Public School Shakedown and ALEC Exposed and the other great investigative journalism at The Progressive. What is happening in public education in Wisconsin is very likely also relevant in your state.  Vouchers.  Charters.  The impact of the American Legislative Exchange Council on your legislature.  Public School Shakedown even has a new project: Teach for America Truth Squad.

A Peek into How the Education Sector Works

Many of us have the sense that profit has become increasingly involved in the world of education, but while the term “education sector” has come into our lexicon, we have only the vaguest idea about the many ways profit is driving privatization in and around our public schools.  Nor do we really understand how the for-profit education sector is wound together with the operation of laws and policies like No Child Left Behind and Race to the Top.

A new article, For Education Entrepreneurs, Innovation Yields High Returns: Learning from Larry Berger, Jonathan Harber, and Ron Packard, posted on the website of conservative Education Next, helps fill in the gaps about the growing role of venture capital and for-profit corporations in education.

Writer Julie Landry Petersen describes the struggles and frequent failures of many private education companies over the past 25 years, but contends that, “the economics of education investing are changing.  Schools are now wired and have accountability incentives to invest in technology to boost student achievement, while teachers are ready to experiment with new tools.  For start-ups, hardware costs have come down and software is cheaper than ever to develop.  Longtime education banker Michael Moe of GSV Capital says a higher quality of entrepreneurs is entering the space. Consequently, education technology companies raised $1.1 billion in funding from venture capitalists in 2012, more than double the amount raised the prior year and nearly 10 times as much as a decade earlier.”

Peterson profiles education technology entrepreneurs Larry Berger of Wireless Generation, sold in 2010 for $390 million to Rupert Murdoch’s News Corporation as the anchor of its ed-tech division Amplify, headed up by former NYC schools chancellor Joel Klein; and Jonathan Harber, founder of SchoolNet, sold to education publishing giant Pearson in 2011 for $230 million.

Both start-ups initially grew when they scrambled to discern ways to fill a technological niche when new federal laws or policies were enacted.  “Wireless Generation employees poured over the No Child Left Behind Act (NCLB) the night it was signed, looking for potential opportunities, and found that the act’s Reading First component ‘created an unusual amount of liquidity centralized at the state level (about $200 million per year) that did not already have a bureaucracy trained to spend it,’ as Berger has written.  Wireless Generation went on to secure at least 18 state contracts….”

SchoolNet, on the other hand, planned to cash in on Race to the Top as well as the need for data demanded by NCLB.  “In 2009 and 2010, states competing for Race to the Top grants began looking for ‘instructional improvement systems’ that would earn them points against the grant program’s criteria for providing teachers, principals, and administrators ‘with the information and resources they need to inform and improve their instructional practices, decision-making, and overall effectiveness.'”  SchoolNet filled the niche with “systems that could capture, analyze, and report formative data quickly to allow teachers and principals to make instructional changes accordingly, a gap that grew even wider when NCLB began to shine a spotlight on the dismal progress of student subgroups and put pressure on schools to improve their performance.”

Petersen also profiles Ron Packard, the founder and CEO of K12, the huge, for-profit, on-line academy.  Petersen’s profile of Packard and K12 acknowledges the serious criticism of this company that has made enrollment growth its priority, while ensuring neither student achievement by any generally accepted measure nor an acceptable course completion or graduation rate.  She quotes investor Whitney Tilson who advised other investors against K12: “K12’s aggressive student recruitment has led to dismal academic results by students and sky-high dropout rates.”  K12 has succeeded as a for-profit company, however, “with revenues skyrocketing from $141 million in 2007 to $848 last year, drawn mostly from its management contracts with states and districts to operate virtual and blended-learning schools, but also from operation of three private online schools paid for by parents and from direct sales of its courses to schools and districts.”  Packard’s annual salary was $670,000 plus stock options.

Those promoting privatization in education value individualism, competition, efficiency, deregulation, innovation, profits and creative disruption.  These are, of course, the values of the marketplace.

Entirely different core values underpin the public school system that has historically served our children in the United States. We have long valued public schools for civic as well as personal benefit and we have counted on a vast and stable publicly owned system designed to serve the needs and protect the rights of all children.  We would do well to consider the warning of political philosopher Benjamin Barber—who reflects on the loss of public ownership and public oversight—as we contemplate the implications of the growing privatized market for education technology and services:

“Privatization is a kind of reverse social contract: it dissolves the bonds that tie us together into free communities and democratic republics.  It puts us back in the state of nature where we possess a natural right to get whatever we can on our own, but at the same time lose any real ability to secure that to which we have a right. Private choices rest on individual power (brute force), personal skills (randomly distributed), and personal luck.  Public choices rest on civic rights and common responsibilities, and presume equal rights for all.  Public liberty is what the power of common endeavor establishes, and hence presupposes that we have constituted ourselves as public citizens by opting into a social contract.”

On a less philosophical level, there are also several really basic things that the three entrepreneurs profiled in  Petersen’s article never consider as they look for a corporate niche in our public schools. What about the school children and their need for personal connection with teachers who will nurture their learning and development?  And what about the stewardship of our tax dollars?  Should we be spending public funds for services from tech companies, for on-line schools, and for corporate profits, salaries and bonuses when we might instead, for example, hire more classroom teachers and thereby lower class size?

Federal Register Notice Spells Out Arne Duncan’s Priorities

Have you, by chance, found yourself wondering if it can really be true that the Democratic administration of President Barack Obama is actively supporting school privatization through the expansion of charter schools?  Maybe it isn’t true, you thought.

To help you sort out the role that Arne Duncan’s Department of Education is playing in privatization of public education, I’ll share the little blurb that caught my eye in the December 3, 2013 e-news blast on public education from Politico:

TODAY’S FEDERAL REGISTER: PRIORITIES FOR CHARTER SCHOOL GRANTS: The Education Department is pondering whether grants to nonprofit organizations that run charter school projects should be weighted based on whether they improve efficiency through economies of scale, improve accountability, recruit and serve students with disabilities and English-language learners more effectively and combine technology-based instruction with classroom teaching. There are other proposed definitions relating to graduation rate and student achievement. Weigh in during the next 30 days.

Yup.  Right there in the Federal Register it says the Department of Education is making grants to nonprofit organizations that run charter schools.  And then Politico provides a kind of laundry list of possible priorities for the granting: make charters more efficient? more accountable? more inclusive of English language learners and children with disabilities? more technology-based?  Much as the Federal Register is not my favorite periodical for casual reading, I followed the link to try to untangle how the Department of Education plans to spend our tax money and what are the issues on which we all have a chance to weigh in during the next 30 days.

The Department’s notice in the Federal Register makes it very clear that the Department of Education actively supports the expansion of charter schools.  Charter Schools Program (CSP) Grants, says the notice, are designed “to increase national understanding of the charter school model by… providing financial assistance for the planning, program design, and initial implementation of charter schools; evaluating the effects of charter schools… expanding the number of high-quality charter schools available to students across the Nation; and encouraging the States to provide support to charter schools for facilities financing….”  Because the program being described in yesterday’s Federal Register notice is for CSP National Leadership Activities, the blurb describes this particular initiative: “The purpose of the CSP Grants for National Leadership Activities is to support efforts by eligible entities to improve the quality of charter schools by providing technical assistance and other types of support on issues of national significance and scope.”

Yesterday’s Federal Register notice is not a request for proposals, but is instead to announce proposed “priorities, requirements, and definitions” that will apply when the Department of Education actually launches the competition.  “The Department most recently conducted competitions for CSP(Charter School Program) Grants for National Leadership Activities in FYs 2006 and 2010.  In those competitions, we invited applications for projects designed to improve stakeholder capacity to support high-quality charter schools but did not require or give competitive preference to particular types of projects… To ensure that projects funded with CSP Grants for National Leadership Activities in future years address key policy issues facing charter schools on a national scale, the Department proposes the priorities in this notice.”  They are:

Improving Efficiency through Economies of Scale: “Compared to charter schools, traditional public schools tend to have higher student enrollment, which may result in lower average costs per student…” says the notice.  Grant applicants are asked to join in consortia to design “projects of national significance and scope that promote shared systems for acquiring goods or services to achieve efficiencies….”

Improving Accountability: “While there are many high-performing charter schools across the nation, charter school performance varies significantly and too many persistently low-performing charter schools are not held accountable for their results.”  Grant seekers would be expected to create “projects of national significance and scope to improve authorized public chartering agencies’ capacity to conduct rigorous application reviews, monitor and oversee charter schools… close underperforming schools, replicate and expand high-performing schools, maintain a portfolio of high-quality charter schools, and evaluate and communicate the performance of that portfolio…”

Serving Students with Disabilities: “As public schools, it is essential that charter schools provide equitable access and appropriate educational services to all students, regardless of disability, as set forth in the Individuals with Disabilities Education Act (IDEA)…”  Grant seekers would propose “projects of national significance and scope that are designed to increase access to charter schools for students with disabilities…”

Serving English Learners: “From 2001 to 2010 the number of students identified as English Learners increased significantly, growing from approximately 3,700,000 to 4,660,275 nationwide…” “This proposed priority is for projects of national significance and scope that are designed to increase access to charter schools for English Learners….”

Personalized Technology-Enabled Learning: “Learning models that blend traditional, classroom-based teaching and learning with virtual, online, or digital delivery of personalized instructional content offer the potential to transform public education….”  Grant applicants would be proposing “projects of national significance and scope that are designed to improve achievement and attainment outcomes for high-need students through the development and implementation in charter schools  of technology-enabled instructional models….”

As I read all this, of course, my first thought is about what I am not being asked to comment on.  Is investing tax money in charter schools that are privately operated a good idea?  Is the Department’s assumption correct that such schools are more innovative than traditional public schools?  Despite this program’s goal of creating “projects of national significance and scope,” haven’t the larger “national” Charter Management Organizations been unable to demonstrate that they are on the whole better than traditional public schools?

And what might be my response to the five priorities, beginning with the first priority: creating economies of scale? One question comes to mind: instead of creating huge consortia of privatized charter schools, wouldn’t we be better able to realize such economies by returning our focus to improving traditional public schools in which economies of scale are a natural part of the system?  Why create a whole other infrastructure when we have a relatively workable system already?

My experience here in Cleveland makes me wonder about the political feasibility of the second priority—granting money to encourage states and non-profits to regulate charters.  Charters are usually created and operated in state law, and despite that our Cleveland mayor created  just the sort of regulatory capacity the Department is proposing in this priority—a Transformation Alliance to oversee charters and to close those that are failing our children or stealing the state’s money—when it came time for the Ohio legislature to embed the Cleveland mayor’s regulatory plan into law, legislators in the pocket of William Lager (Electronic Classroom of Tomorrow) and David Brennan (White Hat Management Company) ensured that the the statute they passed lacked the teeth that would have enabled the Transformation Alliance to close the bad schools.

The third and fourth priorities are deeply troubling because they suggest that the Department of Education has somehow drifted from its important role as a protector of children’s civil rights.  The federal role in education has historically been to expand opportunity and access to education for children in groups who have been under-served.  Title I has provided federal dollars for schools serving a large number or high concentration of children in poverty.  IDEA guarantees and funds services for children with disabilities.  Other regulations and funding streams support the education of immigrant and migrant children and children learning English.  That the Department of Education is proposing to make grants to develop programs to encourage charters to begin serving these children seems bizarre, when the same Department of Education has an Office of Civil Rights whose function is to enforce that all publicly funded schools will provide appropriate services for these children as their right.  Why is the Department offering grant money to encourage provision of the services that the same Department is legally responsible for ensuring that these schools have already been providing?

This is not a new issue.  In 2011, the Southern Poverty Law Center sued the Recovery School District in New Orleans, because the mass charterization of the schools after Hurricane Katrina left students with disabilities poorly served.  According to SPLC:  “The Individuals with Disabilities Education Improvement Act (IDEA), requires that New Orleans public school students with disabilities receive equal access to educational services and are not unlawfully barred from the classroom. This law applies to both charter schools and publicly operated schools. The law specifically requires that students with disabilities are identified so that they can receive needed services — including an individualized education plan and services to ensure that children with disabilities can transition productively into adulthood. These students have a federal right to receive counseling, social work and other related services that are necessary to ensure that these youth obtain an education…  Despite this federal law, some students with disabilities in New Orleans public schools have been completely denied enrollment as a result of their disability, forced to attend schools lacking the resources necessary to serve them and punished with suspensions in record numbers. Still, other students’ disabilities are being completely overlooked due to a failure to identify them.”

The fifth priority seeks to promote controversial on-line learning.  We know that the virtual, e-charters—K-12 being the largest and most notorious—have the worst academic record of  any kind of school and that they are known to suck millions of dollars out of state public school budgets.  And the idea of blended learning—larger classes, fewer teachers, and more computers—is being questioned as a pedagogical theory, while it is known to cut costs for personnel.

What we can confirm by reading yesterday’s Federal Register is that Arne Duncan’s Department of Education is squarely behind charters.  It is also fully engaged in the practice of competitive grant funding.  I3 money—money for the Office of Innovation and Improvement—is proposed in the President’s 2014 budget at $150 million.  I would personally prefer to see this money put into the long-underfunded, Title I Formula program to improve the public schools in the poorest communities where families struggle and state school funding lags across virtually all the states.  These are the communities now subject to punitive sanctions like school closures.

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.”