Michigan Rep. Melton quits to become a lobbyist for Rhee

Rep. Tim Melton, a Michigan Democrat (in name only) is resigning to take a lobbying job with StudentsFirst, an organization founded by fired D.C., schools chancellor, Michelle Rhee.  Melton has received campaign money from the corporate, anti-union "reform" group, DFER. He actually brought the group to Michigan and was then made their "Reformer of the Month" in July.

Public schools shouldn't depend on handouts from billionaires

From the New York Times:

Although praiseworthy as a matter of personal philanthropy, the donation by the mayor and the others, whose names were not disclosed, is highly distressing as a matter of public policy. It is disgraceful that essential components of our public education system now depend on the charitable impulses of wealthy citizens.

A number of judges have begun to respond to the devastation in state education financing: in May, the New Jersey Supreme Court ordered Gov. Chris Christie and the Legislature to reinstate $500 million in funds for poor urban districts, and last month, a North Carolina judge blocked cuts that would have decimated financing for a statewide preschool program. -- When schools depend on handouts

Related: NYT, 8/3/11, Private Donors, Including Mayor, Save January Regents 

Over the last several weeks, Mayor Michael R. Bloomberg made a series of unusual fund-raising calls to a handful of wealthy New Yorkers. Would they be willing, he asked, to chip in $250,000 each to save some standardized tests?

Where did that Zuckerberg money go?

Remember Mark Zuckerberg's $100M gift to Newark Public Schools. Hey Mayor Booker, Gov. Christie -- Where'd the money go?  Public wants to know. ACLU files suit. But Booker acts outraged that anyone would dare to ask. He claims, "there are no documents."

Excuse me!

"As parents, as taxpayers and as citizens, we have a need and right to know how the money pledged to Newark’s public schools will ultimately serve Newark’s public school students," said Laura Baker, the grandmother of a Newark public school student who filed the initial OPRA request on behalf of the Secondary Parents Council, a 30-year-old group of Newark parents and grandparents. -- Star Ledger

As school opens in L.A....

Supt. John Deasy's back-to-school speech gets cool reception. 

Administrators also have expressed worries about Deasy's strong ties to Los Angeles Mayor Antonio Villaraigosa — a staunch critic of some district labor groups — and to charter-school supporters as well as to philanthropists and donors critical of public school performance. --   Howard Blume, L.A. Times

Is the Man from Gates looking over his shoulder at the imported-teacher scandal he helped create before he bailed from P.G. County? Deasy and school officials there, turned to hiring from abroad. Since 2005, Prince George’s County Public Schools actively recruited more than 1,000 of the school district’s 9,000 teachers from other countries, mainly the Philippines.

When one teacher blew the whistle on the school district, the Department of Labor in 2007 launched an investigation. In a ruling last month, the Labor Department said Prince George’s schools are a “willful violator” of labor laws and sentenced the district to pay the teachers $4 million in back wages. However, the district also was barred from sponsoring new visas or even renewing visas for the existing international teachers. -- AFL-CIO Now Blog

At the SOS March in D.C., the international teachers of Prince George’s marched in solidarity with all the other teachers, students and parents from across the county

Boehner says, "guess who's coming to dinner?" It's Mike Madigan

Madigan (L) & Boehner

“The press never picked up on it,” Edelman said about how his group had endorsed twice as many Democratic candidates as Republicans. Those endorsements were a strong indication to Madigan, however, that they were clearly favoring him. “Luckily, it never got covered that way,” Edelman explained. “That wouldn’t work well in Illinois. Madigan’s not particularly well liked.” -- Illinois Times

Now this from today's  Sun-Times (8/24/11)

Talk about strange bedfellows.

Two weeks ago, U.S. House Speaker John Boehner (R-Ohio) came to Hinsdale to raise money for Republicans to fight the congressional map drawn under the direction of state Democratic Party chief and Illinois House Speaker Michael Madigan. The very next night, the congressman broke bread with Madigan (D-Chicago) at a fund-raiser for Boehner’s leadership fund at the Lemont home of Chicago Mercantile Exchange Chairman Terry Duffy. Madigan’s little-known appearance has left partisans in both political camps in a state of disbelief.

Remember, it was Madigan who helped Stand For Children and Jonah Edelman engineer the passage of anti-union bill, SB7 in Illinois. He's also currently leading the grab of the teachers pension fund.  So these bedfellows are not as strange and they seem. 

CPS board chair Vitale out as head of AUSL

Vitale

Banker, real-estate mogul and former Board of Trade president, David Vitale chairs Rahm Emanuel's hand-picked Chicago school board. At the same time, he chairs the board of the Academy for Urban School Leadership (AUSL), the "turnaround" company that contracts with the board to operate 19 schools around the city. Emanuel recently announced plans to double the number of teacher residency training academies run by AUSL.

This obvious conflict of interest (or is it?) has forced Vitale to leave AUSL. It's a pain in the ass for AUSL patron, venture capitalist Mike Koldyke, but that's life in the big city.

So he's appointed John Cook to take Vitale's place. Cook is a board member of AUSL and director emeritus of McKinsey & Co. Cook also serves on the boards of Brown-Forman, Winona Capital Management and the dean's advisory board of the Ross School of Business at the University of Michigan. Perfect!

Koch responds to Buffett: "Take your shared sacrifice and ..."

Charles Koch, head of the massive petrochemical, manufacturing, and commodity speculating Koch Industries corporation, has responded to Warren Buffett's call for shared sacrifice:

“No Thanks.” In a statement to right-wing media, Koch says: "I believe my business and non-profit investments are much more beneficial to societal well-being than sending more money to Washington." -- Think Progress

Koch brothers have seen their wealth rise $11 billion in recent years, making the Koch brother among the richest in the country by being worth around $22.5 billion each. Much of those profits, however, are due to soaring gas prices and the fact Koch Industries has avoided compensating the public for one hundred million tons of carbon pollution the company produces each year. Other Koch companies also receive significant taxpayer subsidies, despite Koch’s supposed opposition to government spending. This company is among the country’s top sources of carcinogenic chemicals and air pollutants.

Koch has given money to educational initiatives, but in exchange for control over academic freedom that simply furthered Koch’s political beliefs. These “investments” at best advance Koch’s political ideology and at worst misinform American voters. Either way, they are hardly a replacement for “government spend[ing]” on things like food assistance and basic medical service.

Wisconsin school districts lose millions in shaky investments

With public school districts facing massive state budget cuts, school boards and financial managers are under pressure to get greater and more rapid returns when they invest dwindling reserves, health care funds, and borrowed operating dollars. School districts in Wisconsin, facing an assault from Republican anti-taxers, recently lost millions when they bought into fraudulent packages put together by Wall Street firms like Goldman Sachs and short-selling hedge-fund operators.

The S.E.C. has sued the investment firm that advised the school districts to buy the three ill-fated securities, which the regulator said were unsuitably risky for unsophisticated investors. The five Wisconsin school districts lost tens of millions of dollars on a $200 million investment, most of which was borrowed.

According to NYT's Gretchen Morgenson:

"Once again, we see the same toxic ingredients that have appeared repeatedly in the aftermath of the crisis: collateralized debt obligations, credit default swaps, ruinous leverage, an overreliance on credit ratings, greed and extreme naïveté."

Koch Bros. fund school re-segregation in Wake County, N.C.

In reality, there are deep connections between the Kochs and Wake County, and it's all about the money. The latest installment in the left-leaning Brave New Foundation's "Koch Brothers Exposed" video series reveals how a Koch-founded and -funded outfit, Americans for Prosperity, fueled a campaign to "re-segregate" the schools of Wake County, a prosperous area in North Carolina that's home to the cities of Raleigh and Wake Forest, among others. -- Mother Jones

N.Y. Chancellor Tisch spends millions on Race-To-Top 'advisers"

Chancellor Tisch

Power philanthropy rules the schools

“Private people give money to support things they’re interested in.” -- Roger Tilles, member of the Board of Regents.

Chancellor of the New York State Board of Regents, Merryl Tisch, is contracting 13 research fellows  to advise the education commissioner and the 17-member board on how to spend its $700 million Race To The Top grant. The fellows will  be paid as much as $189,000 each, in private money; to date, $4.5 million has been raised, including $1 million donated Tisch herself. She is a member of one of New York’s multi-billionaire families.

Donors to the program will include Bill Gates ($892,000), who is leading the charge to evaluate teachers, principals and schools using students’ test scores; the National Association of Charter School Administrators ($50,000) and the Robbins Foundation ($500,000), which finance charter expansion; and the Tortora Sillcox Family Foundation ($500,000), whose mission statement includes advancing “Mayor Bloomberg’s school reform agenda.”

Tisch's bankrolling of the program is another indication of a new trend in ownership society schooling where representatives of the billionaire class directly run public institutions themselves and use tax-exempt private investment, either directly, or thorough their private foundations) to do an end run about the democratic process.  Earlier this month, Mayor Bloomberg announced that he would be running a city youth program with $30 million of his own foundation money.

NYT's Michael Winerip writes:

Public education has never been so divided, between those like Dr. Tisch, Commissioner John B. King Jr. and Mayor Michael R. Bloomberg who support the Obama administration’s signature Race to the Top initiative and its emphasis on standardized tests and charter schools; and dissenters on the board, who call it a Race to the Bottom and put their faith in teachers as well as traditional public schools. The Race to the Bottom folks warn that the supposedly free fellows come at a stiff political price.

Race to the Top requires states to develop student-data collection systems. Recently the Education Department awarded a $27 million no-bid contract to Wireless Generation, a company owned by Rupert Murdoch and overseen by a former New York City chancellor, Joel I. Klein. Mr. Klein is a good friend of Dr. Tisch. The state comptroller’s office is investigating whether it was proper to award the contract without bidding.

Hedge fund billionaires hedge bets on 2012 elections

David Koch, Jimmy Lee and Henry Kravis are among the most sought-after donors. | AP Photos

Many are longtime Republicans who count themselves among the hundreds of politically-active donors still dissatisfied with the field—as proof, the majority of the hundreds of attendees at a recent conference hosted by industrialists David and Charles Koch were uncommitted to a candidate, sources said). -- Politico

Ohio seems to be home to the most charter school scammers

Brennan

"The market works in supplying a quality product in the delivery of services because failure is not tolerated by the market. If you fail, you go out of business." -- David Brennan

To get a charter in Ohio, all you need it seems, is lots of money for local Republican campaigns and a white hat.

One of the nation’s largest charter-school operators, White Hat runs more than 30 charter schools across Ohio. The schools are funded by the state like traditional public schools but are privately operated. White Hat is run by David Brennan, the second-biggest Republican campaign donor over the past decade. He founded White Hat in 1998. His lobbyists wrote many of the proposals governing charter schools in the House’s proposed state budget this year, although most were removed by the Senate. No other state has for-profit charters like the ones authorized in Ohio. But Ohio's House Republicans acted as if they owed Brennan a return on his investment. The state of Ohio pays Brennan's White Hat Management Company $74 million a year.

In May,

Brennan's minions in the Republican-run Ohio House moved brazenly to reward their benefactor at the expense of Ohio's taxpayers. Ignoring a torrent of criticism, Thursday night the House passed a two-year budget bill that contained the unthinkable: It authorized creation of taxpayer-financed schools whose primary purpose is to turn a profit for their owners. And it reduced the oversight authority of the government entity that serves as sponsor of those schools. -- Cleveland.com

Now,

A Franklin County judge ordered major GOP donor and charter-school operator David L. Brennan to turn over a detailed accounting of how his for-profit management company spends the millions of tax dollars it receives each year. For years, the company has refused to open its books, claiming such information was secret. The decision is good news for the nine schools suing White Hat and others who for years have tried unsuccessfully to learn what portion of the tax dollars the company receives is spent on teacher salaries, school supplies and other expenses, and how much it pocketed. -- Columbus Dispatch

 A study released this year by a nonpartisan research organization at the University of Colorado-Boulder concluded that no large for-profit charter school management firm in the United States has a performance record worse than White Hat. Of the country's 51 White Hat-managed schools, one met a standard called "adequate yearly progress." That's a success rate of under 2 percent.

Brennan has been a  darling of the power philanthropists has been a featured speaker at the Philanthropy Roundtable.  Former Ohio Gov. Voinoivich had his son working at Brennan's law firm.

But even Checker Finn's  right-wing Fordham Institute, themselves a sponsor of several Ohio charter schools, admits that the state's support for for-profit charters like White Hat has turned it into a "laughing stock."

But according to Progress Ohio, 

 "Brennan was helped along by the intellectuals of the Buckeye Institute and Fordham Institute. They provided valuable cover for free-market "education" plans, and eventually these institutions proliferated in Ohio more than in any other state in the union."

Following the Charter Dollars

A report from the Louisiana School Boards Assoc. reveals many of the hedge-funders and ownership society forces behind the current charter school movement. 

Following the Dollars

The DeVos are joined in the outspoken group of billionaires who proclaim publicly that they favor ending government involvement in education. Among the biggest contributors are Richard Mellon Scaife (owner of the Pittsburg Tribune Review), and the Koch family foundations. Other foundations include Olin, Bradley, Smith Richardson and the Walton family who join in the drive to eliminate public education.

The DeVos family also helps finance Family Research Council, and Focus on Family. Betsy DeVos is sister to the founder (Erik Prince) of Blackwater (now Xe Corp.) the private security firm that has become one of the largest supplier of mercenary soldiers in the world.

Also see, Where Hedge Funds Meets Charter Schools by Ricardo Kaulessar at HedgeFund.Net
Published:August 10, 2011

"This is how things are done in Illinois."

That's what Joseph Cari, former finance chairman for the Democratic National Committee, told a Virginia investment firm seeking millions in business with the Illinois State Pension Fund. Cari told them that they could get a piece of the state's teacher retirement money if they would only kick back $850,000 his way.

Cari's downfall came after he assisted Stuart Levine, a corrupt trustee of the Illinois Teachers' Retirement System who was also convicted in the scandal, in an attempted extortion. Levine made a series of calls in 2004 to  executives of JER Inc. demanding $850,000 — equal to 1 percent of the $85 million the Virginia investment firm was seeking from the teachers retirement board to invest. The firm, however, refused to pay. -- Chicago Tribune.

So with teachers desperately trying to hang on to their meager pensions, as state politicians circle around like vultures, Cari  and other Democratic Party rainmakers were using the fund as their own private profit center.

Cari, threw himself on the mercy of the court, pleading severe mental anguish and promising never to do it again. U.S District Judge Amy St. Eve bought Cari's story and spared him from prison, sentencing him to three years of probation, a small fine, and nine months of home confinement. Of course in Cari's case, "home confinement" means that he will be able to leave to go to work every day and even travel abroad on business.

After all, that's how things are done in Illinois.

Will the Rahm/Rauner axis pave billionaire's path to the governor's mansion?

Billionaire Republican charter school patron, Bruce Rauner brought Josh Edelman and Stand For Children to Chicago. He bankrolled many of the Democratic Party politicians who in turn, voted for and passed anti-union legislation in Illinois. He also made Mayor Rahm Emanuel a multi-millionaire and poured millions into Rahm's campaign war chest. Now it's time for the Chicago machine to reciprocate and help make Rauner the next governor of Illinois.

Jonah Edelman, chair of Oregon-based Stand for Children, gave a very frank blow-by-blow of how he got the education reform legislation passed in Springfield this year and he said he was recruited to Illinois by Rauner

When Emanuel left the Clinton White House to become an investment banker in the ’90s, one of the big deals he helped put together was Rauner’s firm’s purchase of SecurityLink from SBC Ameritech, where Emanuel’s successor as White House chief of staff, William Daley, would later become company president. -- Sun-Times

More on Murdoch's $27M no-bid contract from NY Dept. of Ed

Leveraged with Duncan's Race To The Top $$$

The Daily News reports:

More than a dozen private firms wanted to work on a project like the one the state Education Department is set to award to a Rupert Murdoch-owned company in a $27 million no-bid contract.  Critics say, state officials had ample time to competitively bid out the contract and still meet a fall 2012 deadline for a federal Race to the Top grant.

"It raises all kinds of questions," said Susan Lerner, executive director of good government group Common Cause New York. "There appears to be time in this process to go through a much more open-bidding process to ensure that the public is getting the best vendor at the best price."

Wireless Generation paid as much as $5,000 a month to lobbying firms to advocate for the contract and Race to the Top funds with state officials.

In December 2010, the state Education Department began work with Wireless Generation on preparing the no-bid contract, A month earlier, Joel Klein had announced he was stepping down as the city schools chancellor to join News Corp., overseeing its budding education division.

Autocrat Bloomberg's Golden Rule: He who's got the gold makes the rules

According to a story in today's New York Times, Mayor Bloomberg "cajoled" five of his impossibly wealthy peers to help him foot the cost of the midyear Regents examination.

The mayor put $30 million of his own philanthropic stash — along with $30 million more from that liberal Croesus George Soros to fund a program which will supposedly keep minority students from leaving school. Times writer Michael Powell adds: "This same mayor runs a police department that stops and frisks record numbers of black and Latino men — half a million each year, sometimes at gunpoint."

HERE is, too, the question of Mr. Bloomberg’s billions and the thin membrane between philanthropy and mayoral advantage. Patricia E. Harris, for instance, wears a broad hat as chairwoman and chief executive of the mayor’s $1.75 billion charity. And she dons a perhaps more modest chapeau as his first deputy mayor.

New ed fiefdom: The Murdoch/Gates alliance

Bill Gates & Rupert Murdoch at the 2009 Microsoft CEO Summit

The Obama/Boehner Debt Ceiling deal could weaken and even destroy large areas of public space and public sector educational initiatives. At the same time, it will expand the power of new private fiefdoms built on alliances between giant philanthropies and corporate "reformers."

The latest fiefdom is being constructed as an alliance between the Gates Foundation and corrupt media mogul Rupert Murdoch. Vicki Phillips of the Gates Foundation announced the "amazing" new alliance:
 Wireless Generation is a subset of Murdoch's News Corp which is cutting multi-million-dollar deals with large urban schools districts like NYC. Former NYC schools chancellor Joel Klein heads up the initiative for Murcoch.

But the Gates Foundation admits it is having a tough time getting grant recipients to be straight with them about the success or lack thereof, when reporting on how they spent $2,5 billion in Gates money last year.

"We have some work to do to build more productive grantee relationships," CEO Jeff Raikes wrote in a letter released with the foundation's annual report.

Among the findings, said Greg Shaw, senior adviser for strategic partnerships, were "reports of senior grantee people who worry about whether they can attract the right staff to work on a Gates Foundation grant or even keep people on a Gates Foundation grant because they sense that the quality of the interaction, the clarity of communications, the openness to feedback isn't always there." -- Seattle Times

As part of our contribution, the foundation took an important first step a few weeks ago and selected a vendor to build the open software that will allow states to access a shared, performance-driven marketplace of free and premium tools and content. That vendor, Wireless Generation, will create the software, but it will be owned by an independent nonprofit, so that any school, school district, curriculum developer, or tool builder can contribute to the collaborative.” -- Parents Across America

Mitchell interview with Finland Ed Minister Sahlberg

In case you missed Andrea Mitchell's  wonderful interview with Finland's Education Minister Pasi Sahlberg on MSNBC (Video + script):

Was Sec. Duncan playing ball with the hedge-funders?

Eisman

Sen. Grassley's investigation of the DOE

Iowa Republican Sen. Charles Grassley is investigating whether Education Department officials, including Arne Ducan himself, disclosed confidential government information to hedge fund managers. Whether or not the investigation is in part an attempt by Grassley to  protect friends in the notorious  for-profit student loan industry, remains to be seen. But there are indications that someone in the top-levels of the DOE was leaking info to hedge-fund short-sellers like Steve Eisman about which of the student-loan profiteers was going to be targeteEid by Duncan's agency.

NYT Deal B%k writer Ben Protess says:

Expecting tough new rules in the wake of the controversy, Mr. Eisman and other hedge fund traders placed huge bets against the industry. In a letter this week, Mr. Grassley questioned the education secretary, Arne Duncan, about the agency’s ties to the hedge fund world and the lack of policies restricting contact with Wall Street players

I'm amazed that Whitney Tilson's name hasn't popped up yet. Tilson, who operates the T2 hedge fund, bankrolls the corporate school reform group DFER and has a direct pipeline to Duncan.