The business war on education: corporate America reaches out and we get the common core.
BY NICK SMITH
LETTERS TO CAL-EM
A PERSONAL HISTORY OF HIGHLAND
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Sometimes I wonder whether the world is being run by smart people who are putting us on or by imbeciles who really mean it. [Mark Twain]
Highland is like all the other public schools in the nation when it comes to implementation of the common core. They are required to put the common core in place in order to satisfy the state and federal mandates forcing every school to participate or lose their federal money. I’ll tell you up front, I think the common core sucks. It screws our children out of the education they truly deserve in the name of “reform” and “value-added accountability”—whatever that really means. It is a horrible crime thrust upon the American taxpayer, the educational system and the students in this country. So, Cal-Em, I suppose you want to know how we got to this state of absurdity. I’ll try to tell you how it happened, but, please be patient with me because it is a long and complicated journey, requiring your close attention if you are going to understand the actions and the implications.
As I have outlined before, it all started with the A Nation at Risk report back in 1983, which alarmed the American public with its scare-tactic rhetoric, its distortion of the facts, its manipulation of the data and its out-and-out lies. Alarmed, many states, including Iowa, organized groups to study the state of education and report their findings and recommendations back to the state. These groups were mainly composed of business leaders who assumed that the problem was a people problem and that a business philosophy was the solution to the imaginary problem of failing educational systems. No teachers were involved in the process then, and they are not involved in the process now; thus, people who really know nothing about education or teaching began to set the course for education “reform.” Let’s be honest; the reforms of the last thirty years have been a bust. They tweaked with the system but never changed the system. Look at the results for the last thirty years and you’ll find that all of the reforms and all of the money spent hasn’t changed a thing. What’s worse is that corporate America and billionaires began to view “reform” as an opportunity to take a piece of the 1.7 trillion dollars spent on education every year by the American tax payers. Business and government joined in an effort to “privatize” the system that continues to this very day. We, the American public, have been duped into believing the business model and factory curriculum promoted by both corporate enterprises and government, is the answer to improving education, but this methodology only allows them to be poised for the biggest public money grab in our history.
From 1983 to the present, business leaders have maintained the opinion that the very best possible education reform is one based on the good old market theory. Public education, the proponents of the business model of education reported, is a government monopoly, and teachers, free from the ideas of the free market ideology, have no incentive to control costs or deliver high quality teaching. Without the market forces of competition, teachers were left free to live off the public trough without being accountable. The obvious solution to the problem is to subject public education to the rigors of the free market place. Put the money for schools into the hands of the parents through a voucher system in order to create completion through choice. The choices the parents make will produce high achievement at the lowest possible cost. The public, however, did go for this idea at first, but over time, as the cost of public education began to rise, people started to blame the school bureaucracy and the teachers’ unions for the problem. Eventually, with all the rhetoric from politicians, entrepreneurs and big business funded projects, both those people driven by market theory and those driven by their anger at teachers, embraced the concept of the charter school.
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A partnership of entrepreneurs, mostly from Silicon Valley billionaires and major Wall Street investors, jumped at the chance to put their money behind this reform idea. Choice and markets began to drive the American education reform agenda almost exclusively. The theory smacks of Mom and apple pie—what can be more American than that? What if, however, none of it’s true? What if the whole thing is merely an attempt to get more public money into the hands of the one percent? Parents didn’t follow the theory. They were more concerned about their children’s safety, and they preferred schools close to their own homes. Highland went through the new school building wars, finally passing a bond to build a new school in the town of Riverside and add improvements to the school In Ainsworth. There are still people who won’t speak to each other over that decision. At the secondary level, most parents are more interested in the trophies in the school lobby. How many academic trophies are in those trophy cases? Does this mean that parents don’t care about academics? No way! What it means is that the parents have met their children’s’ teachers at the school, and the teachers seem to care about their children, take a personal interest in them and the teachers seem like decent people who are doing a good job. The parents place more value on those things than they do on performance measurements based on standardized tests of basic skills.
The privatization of public education marches on, and I think it is a very dangerous path that the country has embarked upon. If we lose public education, we lose the only institution left that has a chance to provide equality and equity to our children. At least the goal of public education is to provide learning opportunity for all children regardless of their ethnicity, religion, wealth or social status. Don’t think for a moment that a school run by entrepreneurs will be concerned with the equality of their students; I would sooner think that the bottom line profit would be the major concern. The major inroads to the millions spent on education each year have already been made, and through their money and lobbyists, businesses and special interest groups are expanding their for-profit factory schools across the entire nation. The marriage of billionaire corporations and government leaves the American people out of the process, avoids accountability and siphons millions away from public education. It is unhealthy when one crook attempts to steal your money, but it is horrendous when many crooks get together to steal your very future. That is what I think is happening. Our children’s future is being robbed in the name of reform.
In the appendix, I have reprinted an advertisement for a full day conference to outline how investors may make a profit from the education market. The entire ad turns my stomach because the promoters at Palm Ventures envision numerous for-profit companies taking over education as a market and an investment. The real danger to our freedom and equality, the real danger to our opportunities as Americans and the real danger to our future hinges on whether or not we keep public schools for everyone or whether we allow business interests to take over the educational system and privatizes education for profit. Charter schools, which do not have to follow government rules or standards are making huge inroads in parts of the country. They are often backed by huge for-profit enterprises that care little for the students but greatly for the bottom line profit taking of their business concern.
This “conference” sported a one-day price tag of $1,495.00. I think that’s a huge price to pay unless you’re looking for big returns on your money. Of course, the American people will ultimately decide if they want to keep their public schools or if they want education run by business enterprises and Wall Street entrepreneurs. For me, the choice deals with equity and opportunity for all children. I have seen the reports from charter schools and for-profit schools where their successes seem remarkable; however, once you realize that they are not educating everyone, but only the chosen ones, you see that they produce no better results than public schools, except they also take a profit. I, for one, do not wish to see education fall into the hands of Microsoft or Walmart because I don’t believe the interests of all children will last long in their profit making hands. Education needs to be for everyone, not just for the rich or the wealthy or the well positioned politically. The longer we let business interests dictate the operation, measurement, accountability and actions of our schools, the easier it will be for them to take over the entire education system, tapping into the trillions of dollars spent on education each year. Maybe the public wants Wall Street to run their schools, but, as for me, I say fight. Fight to the last teacher standing, not for your jobs, but for the children.
Cal-Em, you must prepare yourself for a long fight to regain the freedom public education offers.
By Valerie Strauss January 9, 2013
Education reform as a business
The Washington Post
Attention – Middle-Market Private Equity
& Mezzanine Investors & Lenders
Private Equity Investing in
For-Profit Education Companies
How Breakdowns in Traditional Models
& Applications of New Technologies
Are Driving Change
Harold Levy, Managing Director
Tuesday, January 15, 2013
8:00 am – 5:00 pm
New York City
Designed to Meet the Needs of GPs, LPs, & Managers of Buyout, Growth Equity, Mezzanine, & Lending Funds, as Well as Independent Sponsors, Operating Partners, Portfolio Company Managers, and the Bankers, Lawyers, Accountants, & Other Advisors Who Support Them
Private equity investing in for-profit education is soaring, and for good reason — the public and non-profit models are profoundly broken.
This is why for-profit education is one of the largest U.S. investment markets, currently topping $1.3 trillion in value.
Look at the current state of K-12 public education. School districts across the U.S. are underfunded, underperforming, and well behind the curve when it comes to adopting quality technologies.
Many simply lack the expertise to treat today’s applied technologies as not just gadgets or strategic opportunities, but as real solutions for expanding their capacity to teach students.
And in the post-secondary world, non-profit institutions are finding that very few enticements are bringing in money. Not sports. Not research. Not classrooms.
Public funding and private endowments are both down, and neither will be particularly reliable in the future.
So 2013, and beyond, will see numerous for-profit companies making inroads into public and non-profit education by taking over large swaths of the market. What’s more, they’ll prosper in the corporate training and continuing education marketplace as well.
- The entire education sector now represents nearly 9 percent of the U.S. GDP.
- Merger and acquisition activity in for-profit education last year surpassed activity at the peak of the Internet boom.
- More and more non-profit colleges are hitting the wall and seeking investors to help them transform into for-profit institutions.
You’ll learn how to achieve investment success in this education revolution when you attend The Capital Roundtable’s ENCORE conference — “Private Equity Investing in For-Profit Education Companies,” being held in New York City on Tuesday, January 15.
Here are 6 important reasons you should attend this conference:
- Understand which technologies are the engines of change for the entire for-profit education industry.
- Hear how online services go well beyond coursework solutions to include engagement, assessment, and other critical needs.
- Realize what new regulations can be expected during the next presidential term.
- Find out which technologies are poised to take off, such as massive open online courses (MOOCs), adaptive learning platforms, and virtual laboratories.
- Recognize the growing demand for training tools to assess performance and measure effectiveness.
- Gain insight on the strongest opportunities to lower costs and improve learning.
Serving as chair of this ENCORE conference on Tuesday, January 15, in New York, is Harold Levy, former Chancellor of the New York City School System and now managing director at Palm Ventures in Greenwich, Conn.
Palm is a family office that invests in for-profit education and other capital investments with a positive and transformative effect on society.
Harold leads the education practice, capitalizing on his vast experience in education and finance. He is also former executive vice president and general counsel of Kaplan Inc., director of Global Compliance of Citigroup, and head of litigation at Salomon Brothers.
He has served on the boards of a number of academic institutions and for-profit education companies. Harold is presently treasurer of the Roosevelt Institute and a member of the Presidential Advisory Committee of Teachers College, Columbia University. He holds a B.S. and J.D. from Cornell University and a M.A. (PPE) from Oxford University.
20 Education Experts Bring You A Day Of Rewarding Lessons
Our Roundtable features 4 expert panel discussions led by our chair and with the shared insight of 20 of the top private equity experts in the for-profit education marketplace.
When you attend our January 15th Roundtable you will listen and learn from GPs, operating executives, investment bankers, lenders, consultants, and more — offering real-world perspectives, lessons learned and industry outlooks, plus insights on managing current portfolio companies.
By attending this Capital Roundtable conference, you’ll be wise to the winning strategies and tactics of successful investors in for-profit education companies. You’ll also hear how they are adding value to their current portfolio companies. We’ll be answering such questions as:
- What are some of the main challenges that PE investors are facing in the education sector?
- How are lenders approaching education deals, and what factors are behind their decisions?
- How can new investors in for-profit education avoid common traps and pitfalls?
- What specific sectors within the for-profit education marketplace may hold the greatest promise for investors?
- What specific criteria should you use in evaluating potential deals?
- What are current sector valuations — reasonable, high, or somewhere in between – and how may they change in 2013?
Our Excellent Networking Opportunities May Be Reason Enough To Attend
We’ve built ample time into the day’s agenda so you can –
- Meet fellow attendees and featured speakers
- Enhance your personal database with valuable connections
- Share both ideas and business cards
- If you’re a lender, hedge fund manager or investment banker – identify potential partners
- If you’re an attorney or advisor – meet new potential clients
- If you work as an executive search professional – meet potential prospects
Register Now and Receive Our Early Bird Discount
Early registration for this encore conference is not just a wise idea, but also saves you money. To receive a generous discount of $400 off our regular price, simply sign up before November 20, 2012.
Keep in mind this conference is certain to fill up quickly, so you’ll want to register as soon as possible to assure yourself a seat. To avoid disappointment, please contact Mara Kane today to confirm your attendance at 212-832-7300 ext. 0 or firstname.lastname@example.org
We look forward to having you join us on January 15th.
This conference is being produced by The Capital Roundtable, America’s leading conference organization focusing on “need-to-know” information for professionals in the middle-market private equity community. For more information about The Capital Roundtable’s 30 annual conferences and other events and programs, please visit www.capitalroundtable.com.
- Harold Levy, Managing Director, Palm Ventures
- Burt Alimansky, Chairman & CEO, The Capital Roundtable
- David F. Bainbridge, Managing Director, Veronis Suhler Stevenson LLC
- James A. Bland, Principal, HCP & Co.
- George Cigale, Chairman & CEO, Tutor.com Inc.
- David Hoverman, Senior Principal, Parthenon Group LLC
- Jeffrey Keith, Operating Partner, Sterling Partners
- Victor Klatt, Principal, Penn Hill Group
- Timothy B. Loomer, President & CEO, Campus Management Corp.
- Robert Lytle, Partner Parthenon, Group LLC
- Michael P. McQueeney, Managing Partner, Summer Street Capital Partners LLC
- H. John Michel, Partner, Drinker Biddle & Reath LLP
- Jason Palmer, Chief Product Officer, Straighterline
- Ralph Protsik, Managing Director, BSG Team Ventures
- John R. Przypyszny, Partner, Drinker Biddle & Reath LLP
- Robert T. Puopolo, Partner, Epic Partners
- Adarsh K. Sarma, Managing Director, Warburg Pincus LLC
- Joshua N. Schwartz, Managing Director, East Wind Advisors LLC
- Stuart J. Udell, President & CEO, Catapult Learning LLC
- Carol Vallone, Chief Executive Officer, Educate Online Inc.
- David L. Warnock, Managing Member, Camden Partners Holdings LLC
Ralph A. Wolff, President, Western Association of Schools & Colleges
Additional speakers to be announced