Dope farming, a new source of revenue for charter schools?

John Loevy

Let me begin by saying that I have long favored the total and complete legalization of marijuana. I see it as a a potentially huge source of public revenue and a way to radically decrease the prison population. Sales revenues could help restore state dollars to the pension fund which has been badly depleted through years of the state neglect. All this, not to mention removing a part of the market fueling international drug wars which have killed hundreds of thousands.

But as legalization becomes a reality in several states, as always, the devil's in the details. In Illinois, the prospect of even partial legalization for medicinal purposes has opened up a new gold rush of venture capitalists, political cronies, profiteers and other assorted quick-buck hustlers.

Today's Sun-Times reports that attorney Jon Loevy hopes to get his plan approved to open a marijuana farm downstate. Loevy pitch is that he's different that the other dope privateers in that he's getting into the business, not to make a buck, but to support education.... Sorry, it took me a minute to stop laughing and climb back onto my chair.

“Illinois has created a real opportunity for profits, and a lot of the groups chasing this are hedge funds and private equity firms trying to get rich,” Loevy said. “We see this as an opportunity to reroute millions of dollars to education in Illinois when it’s really needed.”

By supporting education, Loevy means that instead of paying taxes, he may funnel a chunk of his tax-exempt profits into the state's networks of privately-run charter schools which he claims will,  "improve educational quality.”

Loevy’s partners include Michael Kanovitz, Loevy’s partner at the Loevy & Loevy law firm, and Rich Silverstein, a real estate developer. Following the lead of the privatized prison industry, they plan to open a $5 million to $7 million, 20,000-square-foot medical marijuana farm in Edgewood, a town of just over 400 people in Effingham County.

A trustee in Edgewood, Ervin Yocum, said the town is looking at the proposal as if it were a regular business. “We need the jobs down here,” said Yocum, who owns the plot of land the cultivation center would be on and would sell it to the group if they get the state license. “It’s a medicine.”

Yes, it's a medicine and will ultimately be part of big pharma. But the thought of public schools, or even  privately-run charters, being dependent for funding on the good will and political orientation of drug privateers is antithetical to democratic education.

If Loevy and his investors are allowed to grow marijuana in Edgewood, there needs to be strict control over conditions and pay for labor on their farm and their profits should be taxed appropriately with funding for education and other public needs being directed by public decision making.

Howard Fuller's flight from the civil rights movement to darling of the racist conservatives

In 2012, Rachel Tabachnick, a researcher and writer on issues pertaining to the Religious Right, put together a comprehensive analysis of the current school privatization movement, "The Right's "School Choice" Scheme" on Publiceye.org.  It began with Milton Friedman's 1995 treatise, "Public Schools: Make Them Private," and continues with the right's attempt to re-frame it's attack on public education as a "civil-rights reform".

This re-framing was left to the likes of power philanthropists and right-wing think tanks like Milwaukee's Bradley Foundation, the Walton (Walmart) Family, ALEC, and the Koch Bros. They in turn, enlisted former civil-rights activist turned George Bush conservative, Howard Fuller and his Black Alliance for Educational Options (BAEO), a group which  tries to portray school vouchers as an effort to help low-income kids and children of color "escape" public schools to the freedom of private and religious schools. Fuller has become a vanguard "warrior" in the right-wing attack on unions and teachers' right to collectively bargain.

Long-time Milwaukee schools activist, teacher, school board member and Rethinking Schools editor, Larry Miller offers a critical perspective on Fuller in his review of Fuller's autobiography,  No Struggle No Progress.

Miller writes:

In the book Fuller uses a variety of arguments to rationalize his alliances. He works closely with the Bradley Foundation and in the past bragged of his close friendship with its deceased president and major architect of the modern conservative movement, Michael Joyce. This is the same Milwaukee-based Bradley Foundation that funds conservative policies throughout the US, has been a major supporter of the Republican Tea Party movement and of ALEC, a group behind Stand Your Ground laws and voter restriction laws, among other reactionary policies. The foundation underwrote the blatantly racist study by Charles Murray resulting in the publication of The Bell Curve, which claims that Black people are intellectually inferior to other races. In his book Fuller describes a group of young people criticizing him for accepting money from the Bradley Foundation. He responded that it is “poetic justice” that they fund his work which he says stands in opposition to Murray’s claims. Fuller has been publicly silent on The Bell Curve.

While Howard Fuller may try to rest on his past militant laurels, in life’s journey where we end up is more important than where we started. An alliance today with the Waltons, the Bradley Foundation, and Tea Party Republicans is an insult to those who have fought in the past and an affront to those fighting today for social justice and who continue to speak truth to power.

As someone who has known Fuller and followed his work for the past 40 years, I couldn't agree more.

Update on Fuller
EdWeek ran a Q&A with Fuller last week in which he eulogizes the late African-American community activist and state legislator Polly Williams, often called, "the mother of school choice" (vouchers). It was Williams who led the way for passage of the nations first district-wide school voucher program, one which by most accounts has been a dismal failure.

Williams herself, later became a critic of voucher expansion and of the direction her movement had taken under the leadership of the right-wing think-tankers.

In the interview, Fuller tries to dance around Williams' and other conservatives' disaffection with the voucher movement and it's turn towards privately-run charters instead. He goes on to deny that he  "ever supported universal vouchers."

What a tangled web we weave...

Polly Williams

Milwaukee columnist Bruce Murphy had this to say about Williams' shift:

Back in 2001, Williams told me she opposed how school choice was expanding. Williams said she supported school choice as an experiment. “Our intent was never to destroy the public schools.” She complained that choice supporters like the Bradley Foundation wanted to expand the program beyond low-income families and she opposed this. More recently she was quoted in a Journal Sentinel story opposing the plans of Gov. Scott Walker and the Republicans to expand the program to middle class families. “They have hijacked the program,” Williams complained.

Murphy documents how Williams was paid handsomely and used by white conservatives until she was supplanted by Fuller. 

From 1990 through 1997, Williams earned some $163,000 in honorariums and expenses, far more than any other legislator in Wisconsin. But after that, Williams saw her extra income drop to almost nothing, as Howard Fuller supplanted her as the moral spokesperson for school choice. “She… could have been the leader of school choice,” Joyce told me. “But she stepped aside and Fuller became the leader.”

Most importantly, writes Murphy, 

...for Williams the goal of choice was to achieve a better education. But in the wake of many studies showing choice students do no better than their public school counterparts, many Republicans now sell vouchers not as a better way, but as a cheaper way to educate children.

In short, the mother of school choice had great misgivings about the program she helped birth. As frank and combative as Williams was, I suspect she would want those reservations to be included in any celebration of her life.

Letters: Ritsch says, Wendy Kopp quote is Duncan's, not his.

In yesterday's post I attributed the quote below, regarding TFA leader Wendy Kopp, to Acting Assistant Secretary for Communications and Outreach Massie Ritsch.

In an email I received this morning, Ritsch says the quote should have been attributed, both by me and WaPo's Valerie Strauss, to Ritsch's current boss, Arne Duncan. Since I got the quote from Valerie's Answer Sheet column,  I will gladly set the record straight on that.

Yes, it was Duncan who made that ridiculous statement about Kopp -- not Ritsch.

Ritsch also denies that in his new position he will, as I claim, “help TFA keep the cash pipeline open and flowing.” That's hard for me to believe, but I will take him at his word on that as well.

Here's Ritsch's email in full:

Mike,

In your post about my new position at Teach For America, you misattribute a quote from Secretary Duncan re: Wendy Kopp as having come from me. Please correct the attribution to reflect that, in fact, Secretary Duncan made the statement below:

“I don’t think anyone in the country has done more over the past 15 to 20 years than Wendy Kopp to identify the talents and characteristics that lead to great teaching”
(Source: http://www.ed.gov/news/speeches/new-approach-teacher-education-reform-and-improvement)

I have asked Valerie Strauss to clarify the quote’s source in her post.

As part of my responsibilities at Teach For America, I will be overseeing the organization’s research and evaluation work, which includes many partnerships with academics who take an interest in TFA’s corps members and the thousands of alumni who continue to work in education long after their initial service. Under Wendy Kopp’s leadership, and now under the leadership of Elisa Villanueva Beard and Matt Kramer, TFA has worked over the last two decades to understand the personal qualities, skills and supports that contribute to great teaching. TFA has made an important contribution to everyone’s understanding of an essential question in education.

My responsibilities at Teach For America will not include managing the grants that the organization has competed successfully for or TFA’s relationship with the Department of Education, so the implication in your post that I will “help TFA keep the cash pipeline open and flowing” is not accurate.

Thanks for correcting your post accordingly.

Massie Ritsch
Acting Assistant Secretary for Communications and Outreach
U.S. Department of Education
(202) 260-2671
massie.ritsch@ed.gov
Twitter: @ED_Outreach

Ritsch leaves Dept. of Ed for TFA after serving as Duncan's clean-up man

“I don’t think anyone in the country has done more over the past 15 to 20 years than Wendy Kopp to identify the talents and characteristics that lead to great teaching” -- Arne Duncan on Ritsch's new boss.

Massie Ritsch

The revolving door between Arne Duncan's D.O.E. the corporate-reform industry keeps turning. Now Duncan is sending his second communications chief in two years, out to work for the school privateers. Massie Ritsch, the acting assistant secretary for communications and outreach, is leaving his job to take a new position Executive Vice President of Public Affairs and Engagement for Teach For America.

Valerie Strauss at the Washington Post reports that TFA has been popular with the Obama administration for years, evidenced by the the millions of dollars it has won from the Education Department in recent years and by the praise heaped on it by the secretary himself.

Ritsch's D.O.E. connection should help TFA keep the cash pipeline open and flowing.

.@ED_Outreach news: I will join @TeachForAmerica as civilian @MassieRitsch in January. Similar job. New challenges. Vital work. Long title.
— Massie Ritsch (@ED_Outreach) November 21, 2014

Ritsch had served as deputy assistant secretary for external affairs and outreach at the department until late 2012, when he took over for Peter Cunningham, who had been assistant secretary for communications and outreach from the start of the Obama administration.

Writes Strauss:

A mark of just how effective Cunningham had been from the start of his tenure was his success in persuading Rolling Stone magazine to put Arne Duncan on the 2009 list of the 100 top “Agents of Change.” Duncan was No. 98, but still ahead of Taylor Swift, who was No. 100.

I do have to tip my cap to Ritsch for one thing. He was the scrubber at the D.O.E. who had to clean up after many of Duncan's mouth poops. Like when Arne claimed that criticism of Common Core was coming from, "White suburban moms upset that Common Core shows their kids aren’t ‘brilliant’".

Bank on Taylor Swift to surge ahead of Duncan without Ritsch and Cunningham there to spin things. And look for TFA's Wendy Kopp to possibly decorate the next cover of Rolling Stone.

Handing all York, PA schools over to right-wing charter privateer

KYLE STOKES / STATEIMPACT INDIANA

Charter Schools USA president and CEO Jon Hage 

Florida-based for-profit, Charter Schools USA is moving on poverty-stricken York, PA and now threatens a takeover that would turn the entire school district into privately-run charters.

The York School Board vote on charterizing all district schools was tabled yesterday until December 17th in the face of parent and community protests. Many have threatened to boycott the district if the vote passed.

According to ABC27 News,

While many students who spoke at the meeting focused on losing the programs they love, the harsh reality of the situation exists in its own back story . Struggling test scores and dwindling finances forced the district into state receivership more than two years ago. Back then the state agreed to an internal recovery plan and standards that were not met since then. 

Without improvement and lacking a contract agreement with the state teacher's union, becoming the first city in Pennsylvania without traditional public schools has become a real possibility in the past several months. 

Charter Schools USA is based in Ft. Lauderdale and is one of the biggest for-profit operators. It's founder and CEO, Jon Hage comes out of the Heritage Foundation, a right-wing think tank funded by the Koch Bros., as well as the  Foundation for Florida Future, another conservative group founded by former Florida Gov. Jeb Bush. Charter Schools USA currently generates revenue of $285 million, operating 70 schools across the country and is also affiliated with Chicago charter operators Chicago International Charter Schools.

Everywhere CSUSA has gone, the company has left a trail of conflict and law suits. More here.

The Indy Star reported in July that troubles are emerging just two years after the Indiana State Board of Education — spurred on by then-Superintendent Tony Bennett — turned four persistently low-achieving Indianapolis Public Schools and one in Gary over to independent operators including Hage's CSUSA's,

Hage’s Charter School USA adventure into Indiana hasn’t gone well from the start, according to Florida-based blogger, Scathing Purple Musings.

York, PA parents protest charter takeover. 

The three schools received an “F” in their first year of operation,  prompting Sherry Hage to outrageously claim that “while we may have received an ‘F,’ our schools are most definitely not failing any longer.” Moreover, a December 2012 story reported that the Hage’s received $6 million more than they should have from then Superintendent of Public Education Tony Bennett. Just six month after the Hage’s deal with Bennett for Charter Schools USA was revealed to have no profit limits nor minimum classroom expenditure levels, Red Apple Development, the real estate development arm of Charter Schools USA donated $5000 to Bennett’s campaign.

Hage's company was sued by Principal Katherine Murphy of the Aventura City of Excellence School and awarded $155 million in damages by a jury for wrongful termination, only to have Judge Rosa Rodriguez reversed the Jury's verdict, finding in favor of Aventura and CSUSA.

Arne's Army Goes Undercover

See the kid with the backpack and the 5 o'clock shadow? He could be D.O.E.?

You've heard about Ferguson, MO's militarized police department. But what about Arne Duncan's militarized D.O.E. army complete with underground agents and paid spies and infiltrators. A Le Carre novel? No, it's real.

Back in 2010, I reported the Dept.'s purchase of dozens of new military-order, Remington Model, 870 police 12/14P Mod GRWC XS4 KXCS SF. RAMAC #24587 GAUGE: 12 BARREL: 14" - Parkerized choke: modified sights: Ghost ring rear, WILSON COMBAT shotguns.They were to replace worn-out shotguns used by the Inspector General's office, said Arne's people.

I asked at the time, but got no answer --- Exactly how did those previous 27 shotguns get worn out?

For context, it was V.P. Joe Biden, laughingly referred to as "Obama's point person on gun control", who advised all of us to go out and "buy a shotgun."

"...just walk out on the balcony here ... put that double-barreled shotgun and fire two blasts outside the house."

"I promise you whoever's coming in is not gonna," Biden said. "You don't need an AR-15 (assault rifle). It's harder to aim. It's harder to use and in fact you don't need 30 rounds to protect yourself."

Then, a year later, I wrote about Arne's militarized army of D.O.E. thugs kicking in parents' doors in the early morning hours to collect on overdue student loans.

Fast forward -- Sunday's NYT reports that dozens of agencies (besides the FBI) now have hired a few thousand secret undercover operatives in order to infiltrate community groups, protests, and catch evil-doers in the act, posing as business people, welfare recipients, political protesters and even doctors or ministers to ferret out wrongdoing. The Times reports that there's so many that, “People are always tripping and falling over each other’s cases.” 

The agents, often youthful looking, will typically “dress down” and wear backpacks to blend inconspicuously into the crowd, says one official.

At the Supreme Court, small teams of undercover officers dress as students at large demonstrations outside the courthouse and join the protests to look for suspicious activity, according to officials familiar with the practice. At the Internal Revenue Service, dozens of undercover agents chase suspected tax evaders worldwide, by posing as tax preparers, accountants drug dealers or yacht buyers and more, court records show. At the Agriculture Department, more than 100 undercover agents pose as food stamp recipients at thousands of neighborhood stores to spot suspicious vendors and fraud, officials said.

Among those government agencies -- you guessed it -- Arne Duncan's D.O.E.

 At the Education Department, undercover agents of the Office of Inspector General infiltrate federally funded education programs looking for financial fraud. 

Lesson in all this? Next time you're on a picket line or at a protest against school closings, ask the kid marching next to you -- the one with the five-o'clock shadow, carrying a back pack -- to say hi to Arne for you.

K12 Inc. stock sinking like a stone

The Tucson Weekly reports:

Things aren't looking good for the publicly traded K12 Inc., which runs online charter schools in states around the country (Its Arizona Virtual Academy has more than 4,000 students). The schools are funded by taxpayer dollars, like all charter schools, so the corporation's profits and its CEO's $5 million salary come from taxpayer money it doesn't spend on its students' educations. K12 Inc.'s stock value has plummeted from $38 in September, 2013, to its current $12.60. The downward slide over the past few months has taken it into dangerous territory. Most stock analysts have revised their recommendations downward from Buy to Hold or Sell.

The notoriously poor education K12 Inc.'s schools provide isn't the issue, at least not directly. The problem is, the customer base hasn't grown sufficiently, stores are closing and new stores haven't opened as expected — I mean, the schools haven't picked up enough new students, some of K12 Inc.'s charters have severed ties with the corporation, and some states are balking at allowing schools to open. When you're running a for-profit school, students are customers and schools are stores, so it's really the same thing, which is the problem with for-profit education.

The Destabilizing Affect of Charter School Closings

"A lot of people in the school choice movement like the idea of accountability, but when accountability hits home, it's really hard to maintain your focus on results," said Brandon S. Brown, the director of charter schools for the Indianapolis mayor's office. "It's the authorizer's responsibility to hold an absolute bar for performance, which means that, sometimes, low-performing schools will not continue to operate." -- EdWeek

Privately-run charter school networks try and operate on a corporate business model, even though they are supposedly public entities, supported with public funds and accountable to public oversight. While their original charge was one of collaborating with their public school cousins to drive innovation and school improvement, their business model is one that puts competition ahead of collaboration and market measures ahead of public good.

In order to attract both public and private investment, charter operators need to manipulate competitive market measures, such as test scores and other comparative indicators of school success to show that they are supposedly outperforming, not only public schools, but competing charter chains as well. This high-stakes competitive drive has often led to a lack of transparency, test cheatingas well as cooking the books and other forms of financial mismanagement.

Such market competition requires a continuous process of weeding out "low performers" in order to boost average measurable outcomes, gathered in various research studies and performed by willing academic or private research organizations. In the process, overseen by so-called authorizers,  thousands of children's and families' lives are disrupted as schools are closed and teachers fired (without due process) and new ones open. These children and families are often the ones most in need of stability. Teachers and students (overwhelmingly poor and students of color) become the flotsam and jetsam of charter school failure.

In 2011, conservative pro-charter Center for Education Reform reported: " Of the approximately 6,700 charter schools that have ever opened across the United States, 1,036 have closed since 1992."

It's a system that operates much like giant retailers Wal Mart, Target and Starbucks, which turn over their entire work force on average, nearly every six months. 

Edweek reports that in cities like Indianapolis, "failing charters closing abruptly, blindsiding parents and sending them scrambling to find new schools" has become a major problem.

The charter sector has long stood by the premise that if the independently run public schools fail to perform, they are shut down—an idea often referred to as the "charter bargain." But as the movement matures, it increasingly faces the messy reality of closing schools—a situation that could become more common.

In Ohio, according to the report, when the time between the announcement of a charter closing and the actual shutdown stretches the full academic year, it is referred to as a "zombie year." Teachers and administrators learn as early as September that their school—as well as their jobs—will cease to exist come May or June. That situation is generally a product of Ohio's closure law, which mandates the automatic shutdown of the state's poorest-performing charter schools, as well as the timing for when student-assessment data gets released.

The most telling piece in the charter school-closing puzzle is, that despite all the intentional disruption and churn, the great majority of privately-run charters fail to out-perform traditional public schools on every important measure.

A similar version of this commentary is cross-posted at Mike Klonsky's Small Talk blog. http://michaelklonsky.blogspot.com/2014/11/charter-school-churn-leaves-students.html

CPS' Great Interest Rate Swap. Running schools "like a business".

"I have 30 years in the business," said Vitale, a former bank executive and former president and CEO of the Chicago Board of Trade. "I'm not a neophyte." -- David Vitale

Today's Trib blows the lid off of the Great CPS Interest-Rate-Swap in which the mayor and his hand-picked school board traded the future of the public school system for cash. If this sounds a lot like former Mayor Daley's parking meter deal -- it should.

It was Daley's $1/yr. man David Vitale, who engineered the dirty deals which also had support from a bill run through the state legislature by Sen. Pres. John Cullerton. Cullerton defended the bill, calling it part of "an effort to run government [schools-m.k.] more like a business."

The CEO at the time was none other than Arne Duncan (although for some reason, the Trib report spares him any mention). From 2003 through 2007, the district issued $1 billion worth of high-risk auction-rate securities, nearly all of it paired with complex derivative contracts called interest-rate swaps, in a bid to lower borrowing costs. But lower costs they didn't. Over the life of the deals, the district stands to pay an estimated $100 million more in today's dollars than it would have on traditional fixed-rate bonds.

The banks benefited, of course. Derivative contracts created new profit opportunities, and fees on auction-rate securities were higher than for other types of bonds.

The Tribune reports:

No other school district in the country came close to CPS in relying so heavily on this exotic financial product. In fact, market data show the district issued more auction-rate bonds than most cities, more than the state of California.

Even though this latest scandal preceded Rahm Emanuel, the current mayor is still tied to it. It was Rahm who brought Vitale over from turn-around company, AUSL and made him Board President. Vitale is still Rahm's go-to financial guy and the district continues to pay through the nose for his dealings.

 Vitale is now president of the Chicago school board. Since Mayor Rahm Emanuel named him to the post in May 2011, he has presided over slashed budgets, teacher layoffs and the closing of more than 40 schools. As the Tribune reported last year in its "Broken Bonds" series, tens of millions of dollars in borrowed money went into schools that are now closed.

Rahm's way of paying for pre-school puts millions into pockets of his investor friends.

If there’s one thing we know about Wall Street, it’s that most Wall Street firms are not in the business of philanthropy.

Yet the city is about to enter into a $30 million agreement with several Wall Street lenders to finance an early education program that from all appearances will allow banks to profit off the educational success of children with almost no risk to their own bottom lines. -- Mark Anderson at the Ward Room 

 Instead of simply finding the money in the city budget to expand the program and keep the benefits for itself, however, the city has turned to lenders such as Goldman Sachs, Northern Trust and the Pritzker Family Foundation to provide the upfront money, with promises of substantial profits for the lenders down the road if the program goes as planned.

Fran Spielman at S-T writes:

Rahm' plan for funding early childhood education is being compared to former Mayor Daley's parking meter plan.

“This is basically privatizing Head Start — giving these banking companies a very high rate of return — higher than even what we saw in the Infrastructure Trust,” said Ald. Scott Waguespack (32nd), one of a handful of aldermen who voted no.

“Head Start has been proven to work for decades…. It reminds me of the parking meter deal. The same type of people came in and said it was a high-risk asset [when] it was a low-risk asset...We lost billions of dollars. We’re not gonna lose billions here. But, taxpayers under this scheme are gonna pay a lot more than if we just went out and re-allocated resources we already have.”