Tuesday, July 5, 2016

For HRC: Profit Vs. Non-Profit Charters

So this is how we're going to play it.

As all the interwebs now know, Hillary Clinton got herself booed at the NEA conference today by mentioning charter schools (she also drew jeers for GOP dumpster-fire/candidate Donald Trump). But in language mimicked by the many folks who read Politico, Politico said

The presidential hopeful won back the crowd by making a distinction between charter schools in general, and those schools run by for-profit companies. Clinton said people on the outside are pushing “for-profit charter schools on our kids.”

This mirrors a plank in the Democratic Platform Draft, which also directs its disapproval fully and only at those nasty For Profit charters. The theory here is that it's just those for-profits that are trying to make a bundle by privatizing education and redirecting public tax dollars into private pockets. This is a distinction without a difference.

Let's consider all the ways that private companies and individuals profit from non-profit charter schools.

Management companies.

In this scenario, I set up my non-profit school-- and then I hire a profitable management company to run the school for me. The examples of this dodge are nearly endless, but let's consider a classic. There's the White Hat management company that was being dragged into court way back in 2011. This particular type of arrangement was known as a "sweeps contract,' in which the school turns over close to all of its public tax dollars and the company operates the school with that money-- and keeps whatever they don't spend. The White Hat story is particularly impressive, because the court decided that White Hat got to keep all of the materials and resources that it bought with the public tax dollars.

Or consider North Carolina businessman Baker Mitchell, who set up some non-profit charter schools and promptly had them buy and lease everything-- from desks to computers to teacher training to the buildisng and the land-- from companies belonging to Baker Mitchell. From Marian Wang's 2014 profile:

To Mitchell, his schools are simply an example of the triumph of the free market. "People here think it's unholy if you make a profit" from schools, he said in July, while attending a country-club luncheon to celebrate the legacy of free-market sage Milton Friedman.

Real estate grabs

All charter schools-- even the non-profits-- can get into the real estate business as a tasty sideline for providing a school-like product. Charter producers can find money to fund a building and then-- voila-- they own a tasty piece of real estate. Remember-- thanks to some Clinton-era tax breaks, an investor in a charter school can double the original investment in just seven years!

In fact, there are real estate companies in the charter school business. And this can be a particularly terrible deal for the taxpayers. Bruce Baker lays out here how the public can pay for the same building twice-- and end up not owning it. Read the whole thing-- it's absolutely astonishing.

Write a big fat check 

If you have the giant cojones for it, you can just write yourself a big fat check with all those public taxpayer dollars. To use one of everyone's favorite data points-- Carmen Farina is paid $200,000 to oversee 135,000 employees and 1.1 million students. Eva Moskowitz's Success Academy chain handles 9,000 students, for which Moskowitz is paid almost half a million dollars. And while Moskowitz gets plenty of attention, she is by no means unique. 

And that's just the legit stuff

Depending on the state you're in, all of the above may be perfectly legal. Right now in Pennsylvania, we're considering a law to make it illegal to hire family members to work in your charter school, because apparently that has been perfectly okay for as long as we've had (non-profit) charter schools.

But because all charter schools are largely unsupervised and remain accountable to nobody, all manner of shenanigans have occurred. We've got the Gulen charter schools, which appear to exist mainly to raise money for an out-of-favor political movement in Turkey.

Search for charter fraud, and the reports just roll in. Here's just one that includes classics such as charter operator using charter funds to finance their other businesses, or not feeding students, or faking enrollment.

The fraud and misbehavior are bad enough that even some charter fans will say, quietly, that regulators need to clamp down on the bad actors, because their acting is really, really bad.

And that's just the profit issue

This is before we talk about every anti-democratic, school-destroying, segregation-spreading, education-failing, community-disrupting, and achievement-gap-increasing aspect of charter schools. As readers of this blog know, while charters can (and once were) a good thing, the modern charter movement has turned them into one of the most destructive forces in education today.

But we're going to maintain focus

We're going to stick to one point, and the point is this-- to pretend that there is a substantive difference between profit and non-profit charter schools is either willfully ignorant or deliberately misleading. I've said it many times-- a modern non-profit charter school is just a for-profit school with a good money-laundering plan.

Clinton clearly intends to use this distinction-without-a-difference to keep both her anti-charter constituents and her pro-charter financiers happy, but what she's attempting to do is just weaseling around an important issue. It is impossible for someone as savvy as Clinton not to know the truth behind her hair-splitting. It's disingenuous and dishonest. There's no news or surprises here-- Clinton is a BFF of the financial interests and privatizers behind the modern charter movement, and she has always been a fan and supporter of charters. Her charter school boos at the NEA convention were earned; her endorsement by NEA was not.

I don't know if Clinton and the Democratic Party are kidding themselves, but they're definitely trying to kid the rest of us. Does that make her a worse choice than a ignorant racist squawking hairball-encrusted cheeto?  Maybe not-- but let's not kid ourselves that HRC is on our side. The odds are 100% that public education is going to get screwed in November; there's no reason to needlessly volunteer to have our hearts broken again, too.


  1. Even when the candidate said all the right things before he was elected, he ended up implementing all the wrong things. Be prepared for more disingenuous hair splitting.

    And then prepared for her to do whatever the heck she wants, regardless of what she said or meant to say or implied or thinks is best or doesn't think is best.

    The amount of time it would take to ramp up and be truly knowledgeable is time she doesn't have, or won't give, and being deeply informed certainly isn't a priority, regardless of the rhetoric.

  2. Does anyone really think that Gates, the Waltons, Broad, the Koch brothers and assorted hedge fund investors really care about the test scores of black and brown children?

  3. Diane Ravitch on her blog said that she has asked for a meeting with HRC, but hasn't had a response. So I started a petition for anyone wishing to demand that HRC meet with Ms. Ravitch: https://www.change.org/p/hillary-clinton-a-meeting-between-hillary-clinton-and-diane-ravitch?recruiter=174540454&utm_source=share_for_starters&utm_medium=copyLink

  4. I just saw two party operatives explain to the sleepy-eyed Chuck Todd that one week before the first debate, they will tally up polling results to see if anyone should be added to Hillary and Trump. It it looks like 15%, Gary Johnson will be allowed to be in debate number 2. He has already been barred from debate number one. (I am a fan of fairness, not Gary Johnson). Anyone with enough prestige to attract media coverage and candidates can state a debate. I believe Diane Ravitch should round up some talented people to moderate a debate devoted solely to education. There is a chance Johnson and Stein might show up, but probably not Hillary and Trump. But you never know---if Trump thinks he could embarrass Hillary...I think the effort should be made, in the middle of August, to establish the reality that the media and the major candidates want no part of discussing an issue that is hugely important to a lot of ordinaty people...the education of their children. I am a nobody, but my niece in law is Sarah Reckhow---I bet she would help moderate and compose questions if Diane could be talked into offering such an event.

  5. This fight is bipartisan.. and even though we may not be happy with the candidate we ended up with, your name calling is appalling. And what if the "ignorant racist squawking hairball-encrusted cheeto?", as you call him, becomes the President? Then all of you have wasted reform efforts only on the Democrats? Shame on you. Diane Ravitch should be asking for the same meeting with Trump as she is for HRC.

    1. If Diane Ravitch does not know what Peter and everyone else knows who is not asleep about Clinton's long-time embrace of corporate charter schools, then she is the dumbest ed historian on record. Of course, she does know, and for Ravitch to pretend that Hill might be turned by a meeting with Diane, is pure self-serving fiction. If the resistance is to be led by the duplicitous Diane Ravitch, who has helped to assure another generation of corp ed reforms with ESSA, then we are truly screwed. Who is SavePublicEd, anyway? Can't use your own name?

      As I noted this morning in a FB comment about Ravitch's goals,

      Her goal is to have her cake and eat it, too. In recent years, she has shifted her allegiance from the neoliberal Republicans to the neoliberal Dems. For all intents and purposes regarding education, there is no difference, however. Both embrace corporate ed reform, which has been for a quarter century (when does it corporate ed antiquarianism?) focused on expanding privatization, segregation, and standardized learning. Ravitch has become the mouthpiece of the corporate teachers' [sic] unions, whose existence is tied to Wall Street and the Clintons. Her goal, then, is to invoke the rhetoric of resistance in her lucrative speaking and writing, while supporting the policies that keep public education under control of the corporate bosses. No better example than ESSA. That is how history will judge her, I suspect.