Rahm's Infrastructure Trust, a failed privatization scam.

Rahm Emanuel flew in Randi Weingarten  to support the Infrastructure Trust. 

The BGA's Alejandra Cancino writes in Crain's, that Rahm Emanuel's grand PR stunt, known as the Infrastructure Trust, has done nothing to rebuild Chicago's infrastructure nor to build any trust. In short, it was a sham and a humbug, a facade under which to carry out even more failed privatization deals.

Writes Cancino:

...the infrastructure trust that Mayor Rahm Emanuel once hailed as a model of out-of-the-box thinking to jumpstart public works has proved anything but.

 Launched five years ago this month, the Chicago Infrastructure Trust has accomplished little and done so at a snail's pace. None of the $800 million in financing that Emanuel claimed he had lined up from institutional investors to bankroll city projects ever materialized, with resources so tight that the trust on several occasions has been late by more than a month in paying staff and once by several months.

What's more, city records reviewed by the Better Government Association show trust operations and projects have been largely dependent on public financing even though Emanuel sold the idea as an innovative financing scheme to free taxpayers from cost and risk.

As of October, the trust still owed money to some former employees, consultants and contractors, according to its most recent audit report.

Sounds like one of Trump's deals. Doesn't it? And there were more. Like the the failed privatization of Midway Airport.

I warned about the Trust back in 2012 when Rahm first touted it as a model for other cities to follow and claimed that it would bring thousands of jobs to Chicago. And I wasn't alone.

Ald. Scott Waguespack, 32nd, (yes, there are a few honest ones on the council) opposed the trust's creation pushed for more transparency and City Council oversight.

Ben Joravsky, writing in the Reader, called Rahm the "trust fund mayor" and warned of the lack of transparency around IT.

But warnings fell on deaf ears. Why? Because there were the big banks, like Citibank and big Democratic Party backers singing the Trust's praises. Namely, Bill Clinton who stood shoulder to shoulder with Rahm when IT was rolled out. .

And then there was AFT Pres. Randi Weingarten who Rahm flew to Chicago so she could offer her union's support of the Infrastructure Trust at Bill Clinton's Global Initiative Conference.

“People want to work,” Weingarten said. “And what we’re seeing, whether it’s the mayor’s infrastructure program here in Chicago or everything else we’re doing around the country, is that when labor and business start working good together on trying to put people back to work with good jobs, when we start building things again, it builds huge hope around the country.”

To her credit, Randi had been in town a few weeks earlier to support and march with thousands of rallying union teachers. If you followed my blog at the time, you know that I gave her props for that.  But now, here she was rallying support for Rahm's great privatization scheme, cheering it on with the very forces that were attacking the CTU in a massive media campaign.

She wasn't alone among union leaders either. The Mayor had put Jorge Ramirez, president of the Chicago Federation of Labor, on the board of the Trust. The promise of jobs, no matter how illusory, is pretty enticing. Just ask the sell-out union leaders who have drunk Donald Trump's "Make America Great Again" kool-aid.

Pritzker gives Hillary a pat on the head and wants her to move into ed philanthropy.

Chicago Billionaire J.B. Pritzker was the chair and chief money bungler bundler for the Clinton campaign. He's the heir to the Hyatt Hotel fortune and hotel union-buster supreme. He told Crain's that his aim, "isn't ego gratification; it's all about making money". I suspect it's both.

Last month I called him out on his special-ed hustle with Goldman Sachs. It allows private firms to foot the initial bill for public education services and then be repaid with interest if those services reduce the number of kids in special ed. They call it "social impact" investing. I call it a plot to reduce services for needy kids -- or public education meets the Ownership Society.

Chicago Mag calls him, "the other mayor of Chicago" even though he's lost every political election in which he's run (I think it's one). He's even got a Chicago charter school named after him.

In this morning's Sun Times, Pritzker hands out the party line on the election postmortem. Like the rest of the Democratic leadership, Pritzker takes no responsibility for the defeat and puts all the blame on Comey, the pollsters, and men. He forgot about the Russians and the electoral college for some reason.

So the story goes,

 He praised Clinton for running “a campaign of substance” and made up of “the best statisticians and data analytics people in the world.”

If any of that were true, H.C. would have won by a landslide. What were the substantive issues of her campaign? Basically, "I'm not as bad as Trump and the Russians are rigging the election." Certainly nothing young potential voters or much of anyone else could get excited about. She barely mentioned the education.

And if her statisticians and data analysts were so great, couldn't they at least have told her to visit Wisconsin at once during the entire campaign, instead of spending silly time in Arizona a week before doomsday? Or maybe they did and she just wanted to hang out with her pal, McCain.

“She ran the campaign while Republican bullets were flying and with a media that gave him (Donald Trump) more airtime and enjoyed following his antics more than they did talking about the qualifications and experience of what it would take to be president,” Pritzker says.

Republican bullets flying? Really? Well yeah, it's an election campaign. Unless of course, he's not being metaphorical and mean real bullets, like the kind supposedly fired at her in that cockamamie story about her landing "under sniper fire" in Bosnia.

But the thing that really got me in the Pritzker interview was this...

Looking ahead, Pritzker expects Clinton, now “a statesperson of historic importance,” to advise leaders. And he hopes she’ll become a force in philanthropy — ideally in early childhood education. That issue is especially important to Pritzker, who was co-chair of Clinton’s Education Policy Working Group. Clinton’s view of education is a “big reason” Pritzker supported her.

No mas, please. Hands off public ed. We've been philanthro-peed enough. No more school-closers and privatizers needed. Just pay your damn taxes Mr. Pritzker and leave the schools alone.

Charter patron, union basher Whitman buys into the Clinton campaign

An actress dressed as union basher, "Queen Meg" greets members of the California Nurses Association (CNA) during a rally at the CNA offices in Oakland.

I may live to regret these words, but I will unabashedly be voting for Hillary Clinton in November. Having said that, let me point out that many fellow Clinton supporters give me the creeps. Oh well. Strange bedfellows and all that.

If Hillary loses to neo-fascist Trump in November, it won't be because she ran out of cash. Lately, in a backlash against Trump's continued spewing of disgusting anti-immigrant and anti-woman garbage, there's a growing group of conservative Republican Wall Streeters throwing their money behind Clinton.

The latest GOP billionaire to endorse HC is former eBay and Hewlett Packard CEO Meg Whitman who revealed that Clinton, had reached out to her in a phone call about a month ago, one of the first indications that HC was aggressively courting Republican leaders.

Whitman has called Trump a "fascist", a "demagogue" and "a threat to American democracy" (she's obviously been paying attention) and tells NYT:

“I will vote for Hillary, I will talk to my Republican friends about helping her, and I will donate to her campaign and try to raise money for her.” 

Hillary getting millions in Wall St. cash comes as no surprise to anyone. Bernie Sanders made it a central issue in his primary run. But for Californians, who overwhelming voted against her in her own run for governor, and for educators in particular, any Whitman influence in the Clinton campaign or a position in a Clinton regime, would especially odorous. 

Whitman, who backed Romney in 2012, has spent millions and much of the past decade pushing for expansion of privately-run charter schools and other privatization initiatives. In her losing run (paid for with $144M of her own money) for governor against Jerry Brown, she made lifting the cap on charter school expansion a centerpiece of her campaign. 

In 2011, she bankrolled Silicon Valley charter schools to the tune of $5 million through her Whitman-Harsh Family Foundation. One of those schools, Summit Preparatory Charter High School, was featured in the anti-public-school 2010 documentary “Waiting for Superman.” 

Whitman also sits on the board of Teach for America (TFA). 

She is virulently anti-union. Her position on immigration is more closely aligned with Trump than with Clinton. And Whitman has been a leading voice for abolishing the state's capital-gains tax which accounts for more than $11 billion in state revenue. 

Now $11B may not sound much these days, but to put it in context, the estimated cost to CA taxpayers for free UC tuition for every in-state student (Bernie's much maligned campaign centerpiece) is $3B. 

Should this make Clinton supporters uncomfortable and vigilant? Yes indeed. Should it keep us from voting against Trump in November. Absolutely not.

Privatization has become the standard conservative response

Privatization guru Milton Friedman

Donald Cohen at TPM gives us a good history of privatization and the current attack on public space and public decision making.

Today, after 50 years of attack on government, privatization is a standard conservative response to tight public budgets, a key pillar of attacks on government, and a lucrative market opportunity for domestic and global corporations. Large corporations operate virtually every type of public service including prisons, welfare systems, infrastructure, water and sewer, trash, and schools. For example:

In 1988 AFT president Al Shanker proposed a new idea: To create charter schools where teachers could experiment and innovate and bring new ideas to the nation’s public schools. Today, nearly 3 million children attend charters, and large corporate chains and billionaires are funding the rapid growth of privatized, publicly funded charters.

“Cities have been discovering that public services do not necessarily have to be reduced by government or paid for by taxes,” the Privatization Council’s David Seader told the Milwaukee Journal in 1986. Individuals can pay for what they use and private companies are ready to take their money.

Cohen on Bill Clinton

Perhaps Clinton’s most significant contribution to privatization was ideological. The NPR reports redefined government services in market terms – “citizens” became “customers” of public services and competition became a guiding management principle.

A new pro-public movement, with this history in mind, is growing quickly, says Cohen.

It has become clear that the 40-year conservative assault on government is enriching some and leaving more and more Americans behind. Groups across the country are organizing and starting to see success. Water systems are being remunicipalized, private prison companies are losing contracts (and both Democratic presidential candidates have pledged to end for-profit incarceration), and a growing movement is focused on rebuilding our national commitment to public education.

Elizabeth Warren calls SEC's approval of Cohen's firm 'a mockery'. Corrupt hedge-funder, charter supporter.

Hedge-funder Steve Cohen

“The commission has permitted a recidivist hedge fund manager, well-known for his former company’s willingness to evade and ignore federal law, to once again profit from – and potentially exploit – investors.” -- Sen. Elizabeth Warren

Whenever I read about some crooked hedge-fund billionaire mired in scandal, I always check to see if and how they're involved with charter schools. I rarely come up empty. 

Billionaire hedge-funder Steve Cohen is one of the major underwriters of privately-run charter schools. The couple's Steven and Alexandra Cohen Foundation is a top donor to the Connecticut Coalition for Achievement Now (ConnCAN), Achievement First, Families for Excellent Schools Cohen, whose SAC Capital paid $1.2 billion in a security fraud case last year. 

The Guardian reports:

On Thursday, [Sen. Elizabeth Warren] sent a missive to Mary Jo White, SEC chair, telling her she was making “a mockery” of the regulator’s core mission.

Warren, a scourge of Wall Street, is disappointed with the agency’s decision to approve Stamford Harbor Capital to act as investment adviser to outside clients. The reason? The firm is associated with Steven Cohen, former manager of SAC Capital Advisors, who pleaded guilty to insider trading in 2013 and paid a record $1.8bn fine.

Turns out, Cohen indirectly owns Stamford Harbor Capital. He is to receive as much as 50% of client profits, but won’t have any supervisory role, according to Bloomberg.
“Steve Cohen owns the entity, but consistent with his January agreement with the SEC he will not supervise the activities of anyone working on its behalf,” Jonathan Gasthalter, a Stamford Harbor spokesman, told Bloomberg.

 “The commission has permitted a recidivist hedge fund manager, well-known for his former company’s willingness to evade and ignore federal law, to once again profit from – and potentially exploit – investors,” Warren wrote in her letter on Thursday. “This is an unacceptable outcome from the nation’s primary enforcer of securities laws, and it is the latest example of an SEC action that fails to appropriately punish guilty parties, deter future wrongdoings and protect investors.”

Why is the White House covering for Cohen? While he has been a big contributor to conservative super PACs like Chris Christie's America Leads, he's also a big backer of Dem. candidates, including Connecticut Gov. Malloy.

The Hartford Courant's Jenny Wilson reports:

Wall Street billionaires who have invested heavily in the expansion of charter schools contributed more than $200,000 to Democrats in the 2013-14 election cycle, helping Gov. Dannel P. Malloy secure re-election.

The campaign contributors earned their fortunes as hedge fund managers and private equity investors before earning reputations as "education philanthropists." They have helped bankroll charter school movements throughout the country, spending to influence elections and to support advocacy movements.

Major U.S. hedge fund managers are on pace this year to more than double the amount they gave in the 2012 election campaign, with independent fundraising groups backing Democratic presidential front-runner Hillary Clinton and Republican rival Ted Cruz receiving the most so far.

Bernie Sanders has eschewed donations from Wall Street. He has racked up a string of wins in early state nominating contests with attacks on Wall Street and calls for a more equitable distribution of the country's wealth.

Byrd-Bennett, 'a foot soldier in the march towards privatization'

Ian Belknap is a writer and performer living in Chicago. He hits the nail on the head with this opinion piece in Crain's, "Framing education as a business attracts the wrong people".

While the leading candidates in both parties spend their valuable debate time extolling the virtues of capitalism (...what built the greatest middle class in the history of the world.” -- Hillary Clinton), Belknap points out what should be obvious by now. The push towards privatization of public education has been a disaster.

What got him going was the indictment of Chicago schools CEO Barbara Byrd-Bennett.

Byrd-Bennett's woes are rooted in her greed, yes (and her tone deafness to irony—"tuition to pay and casinos to visit?"... But she has also acted as a foot soldier in the decades-long march toward privatization and misapplying the precepts of business to the complex (and in many cases generations-long) problems facing our schools.

Her downfall, writes Belknap,  "may be read as the logical extension, and, one hopes, the last gasp, of a badly flawed and shortsighted approach: namely the fallacy that business principles are well suited for every aspect of society".

It is past time we abandon the demonstrated failings of such an approach. It is past time we reconceive of jobs like Byrd-Bennett's as "CEO"—doing so focuses wrongly on the "outputs" of the system they're meant to preside over, rather than the contribution they may make to it during the time it is entrusted to them. In short, it is past time we as a society stop misapplying a business-style conception of risk and reward to education.

Wall St. public school strategy: Loot, pillage, burn...

Sen. Mark Warner (D-Va). - Reuters

The Senate has passed an amendment to new proposed federal legislation, which would steer hundreds of millions of dollars intended for impoverished school districts and classrooms, into the pockets of Wall Street consultants. The legislation, authored by Sen. Mark Warner (D-VA) was tucked into the Senate version of a massive K-12 education funding bill currently up for congressional reauthorization.

Among the chief proponents of the congressional bill was the Center for American Progress (CAP), a Washington, D.C., think tank that is closely associated with Bill and Hillary Clinton.

Bank of America, which made fees off of school district swap deals made in Chicago and Denver, has donated at least $50,000 to the Center for American Progress. Other major donors to the Center for American Progress include the Bill and Melinda Gates Foundation, which has given at least $500,000, and the Walton Family Foundation (of the Walmart fortune), which has also given at least $500,000 to the think tank. Both the Walton and Gates foundations have partnered with the Boston Consulting Group.

David Sirota at IBT is hot on the trail. He writes;

As budget-strapped Chicago follows a mass school closure with a new plan to layoff more than 1,400 teachers, one set of transactions sticks out: the city’s moves to refinance $1 billion in debt through complex financial instruments called swaps. The deals were spearheaded over the last few years by financial advisory firms brought in by the city to help find money saving efficiencies. Instead of saving money, though, the Windy City took a big hit: The school system has lost more than $100 million on the transactions and has paid millions in fees to its financial consultants.

 Chicago is not alone. School districts across the country have been increasingly relying on high-priced consultants and Wall Street firms for financial and management advice. While proponents say many of the ensuing consultant-driven initiatives have resulted in cost savings, critics note that other initiatives have resulted in investment losses, layoffs and school closures. What is clear is that school districts’ reliance on outside advisers has created business opportunities for the financial industry. And now, thanks to an amendment to federal education legislation moving through Congress, that lucrative market for financial and consulting could become even more flush with cash -- specifically, with federal money meant for impoverished school districts.

The amounts that consulting firms can earn for work on public school policy can be eye-popping. In Philadelphia, the Boston Consulting Group was reportedly paid $230,000 per week for its work pushing for privatized education services and closures of up to 88 schools in the city.