Education “Reform”: Putting Middle Men First

Last summer, I asked this question:

Why are millionaires and billionaires targeting public education? For the same reason banksters pimped mortgage loans. For the same reason Wall Street wanted to privatize Social Security. For the same reason Willie Horton Sutton robbed banks.

Answer this question: What is the largest portion of the budget in all 50 states?

A couple of new columns chronicle further moves by what former Assistant Secretary of Education Diane Ravitch calls “The Billionaire Boys Club” to take their cut of public education tax dollars.

The New York Times  has a Sunday piece on billionaires using the “leveraging effect” of philanthropic advocacy to steer public policy. Efforts by the billionaire-funded Gates and the Broad Foundations to promote charter schools resulted in the Obama $4.3 billion “Race to the Top” program which, says the Times , prohibits states from limiting the number of charter schools. According to Ravitch, Obama appointed someone from the NewSchools Venture Fund that promotes charter schools to run “Race to the Top.”

The philanthropists, “some with roots in the loosely libertarian milieu of Silicon Valley or Wall Street,” might have noble intentions, but also have their critics:

“It’s sort of influence-peddling writ large,” said Richard L. Brodsky, a senior fellow at the liberal-leaning research organization Demos and a former New York State assemblyman. “The notion that the society is better served by the super-rich exercising their charitable instincts is in the end anti-democratic.”

But not anti-capitalist.

The Sunday Washington Post  looks at the growth of “virtual schools.” Ronald J. Packer, CEO and founder of K12 Inc. of Herndon, VA (just outside Washington), controls the country’s largest provider of public virtual schools. The Post  reports that between 2004 and 2010, “K12 gave about $500,000 in direct contributions to state politicians across the country, with three-quarters going to Republicans, according to the National Institute on Money in State Politics.” If K12 were a school district, it would rank 30th largest among the nation’s 1,500 districts.

Packard, 48, took a roundabout route to education. A former Goldman Sachs banker, he was working as a consultant with McKinsey and Co. when he got a call from Michael Milken, the financier who pleaded guilty to securities fraud in 1990 and later became a philanthropist partly focused on education.

Packard joined Milken’s education investment holding firm and ran one of his companies, a chain of preschools. About the same time, Packard was trying to find an online math course for his 6-year-old daughter. Frustrated by the dearth of options, he saw a business opportunity.

He founded K12 in 2000 with a $10 million investment from Milken and Larry Ellison, the chief executive of Oracle Corp., maker of software and hardware systems. William J. Bennett, education secretary under President Ronald Reagan, became the company’s chairman, bringing his conservative bona fides and political connections to a company that originally aimed for the home-schooling market. Bennett resigned from K12 in 2005.

K12 Inc. has the right backers. It has the right location. It bought the right friends. And it had revenues of $522 million in the last year, netting the investors $12.8 million in profits and Packard $2.6 million in total compensation. Says Packard, “For many kids, the local school doesn’t work. And now, technology allows us to give that child a choice. It’s about educational liberty.” [Emphasis mine.]

If that cheese-whiz grifterism doesn’t make the hair stand up on the back of your neck, you haven’t been paying attention.

Aside from investors, how are virtual schools doing for their presumptive clientele, children? How well are they learning in front of a monitor? The Post  reports that there is not yet enough data to be sure, but by standard measures for-profit “virtual schools — often run as charter schools — tend to perform worse” than the traditional public school room.

Page 1 of 3 | Next page