Monday, September 1, 2014

Squeezing Labor For $$$

If your goal is to get rich in business, labor is a problem you must solve.

I mean, there's that big stream of money. You can see it, right there, fat and full and flowing right toward you and then BAM-- it suddenly gets diverted because you have to pay workers their wages.

Early in human history, rulers established the ideal base level for wages-- $0.00/lifetime. But most countries (even the US-- though not first as we like to believe) eventually recognized slavery as a Bad Thing, and so the scramble was on to see what creative ways could be discovered to drive wages as low as possible.

Unions emerged as a way to exert counter-pressure, and while it will be repeated many times today (Labor Day), it can never be stated too many times-- everything that American workers take for granted from minimum wage to a defined work week to safe work conditions was fought for by unions and not given freely and voluntarily by management. And that most definitely includes the workers' share of that big stream of money.

In education, the financial pressures were traditionally different. There were certainly plenty of pressures to keep costs down, and I get that. As a taxpayer, I'm not inclined to write the school district a blank check, either. Those fights could get plenty ugly. I remember when Cleveland City Schools would shut down in October or November because they were out of money and the taxpayers had voted down the levy. And once upon a time, I was a local union president during contract negotiations and a subsequent strike. Believe me-- I know exactly how angry taxpayers when they think their taxes are going to go up.

But these we're seeing something new. Folks in the financial sector have noticed that the river of money running through education is huge. Huge! And they want a piece of it.

That can only mean one thing. Because that river flows mostly toward personnel. In fact, in runs toward personnel in a way that business people can find absolutely shocking. I remember a local board member who operated a concrete business and who was absolutely stunned by the percentage of the school budget that went to personnel costs. In his whole tenure, he never stopped talking about it, and always in tones that suggested he saw it as proof that the district was completely screwed up from a business standpoint.

But schools are a service sector, and personnel have to be a huge portion of the budget. Yes, there's money to be made in infrastructure and supplies, but that's easy-- you just insert your own business in that particular pipeline.You can't easily bring more money in by, say, raising prices. No, if you want to squeeze real money out of schools, you'll have to squeeze the personnel.

So when you hear reformsters talking about restructuring teacher pay, they're really talking about one thing-- "how do we divert some of that river of money from teachers to us?"

Proposals that follow the same template as TNTP's bogus plan talk about increasing pay for teachers, but they are really about the overall costs of a teaching staff. The basic principle here is pretty simple-- schools can afford to pay beginning teachers a bit more if they can convince them not to stick around. There will be some savings in not having to pay them a top career-level master teacher salary, but the big savings will come from not having to provide them with a pension, ever.

Merit systems are even easier to stack in favor of the school operators; the technique is already well-known in the private sector. You budget a set amount of money for merit bonuses, and that's it. It doesn't matter how many merit bonuses you award-- they are all going to be a slice of that pre-determined pie.

The tier system that some propose is a matter of PR and recruitment. You get one or two Master Teachers per building making a hefty salary. Those allow you to say, "Look at the huge salary our Master Teachers make!" (It also helps with the average salary numbers for your building.) You budget for the number of high-paid Master Teachers you can afford, and never exceed it. For extra savings, promote teachers to the Master slot after six or seven years, wash them out before a decade, and still avoid pension costs.

None of these plans are about making teacher compensation better for teachers. No reformsters are out there proposing to attract teachers with offers of better lifetime career earnings, nor are reformsters talking about how to keep the best teachers around for thirty-five or forty years. The idea is simply to reduce labor costs as much as possible, so that the river of sweet, sweet money can roll on, unimpeded.

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