The charter school movement has become an industry, attracting massive private funding, with the goal of leveraging billions of dollars in public subsidies. Although technically charter school financing schemes are non-profit, they generate a phenomenal number of for-profit contracts for companies marketing curriculum and textbooks, computers, software and administrative, clerical and security services

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(this is Part II -- my second article on the school privatization movement)

"Charter schools were a movement, but now charter schools are an industry. They have lobbyists -- they walk around in thousand-dollar suits, some of them." -  Dan Gaetz, Florida freshman senator (R) and former Okaloosa school superintendent (see http://dissidentvoice.org/2009/11/neo-liberalism-the-leveraging-of-charter-schools-with-public-and-private-funds/)

No Child Left Behind

George W. Bush was the first to authorize federal funding to stimulate charter school development in the No Child Left Behind Act. NCLB also strengthened requirements that states implement minimum standards testing to be eligible for federal education funds. Unbeknown to most Americans, this policy was actually initiated by Clinton, although not stringently enforced. As attorney and progressive education reformer Danny Weil (*see below) points out, the true purpose of NCLB wasn't really to improve the performance of low income minority students -- or it would have made some effort to guarantee their school districts more equitable funding. Its main purpose was to use standardized tests to massively highly the poor performance of these schools -- to further bolster support for the burgeoning school privatization movement.

Bush junior wisely left responsibility for school voucher programs to the states. Uptake of school vouchers by low income minority parents has been spotty. This is really no surprise, given that vouchers (limited to the "per pupil equivalent") cover only a fraction of the tuition charged by private schools.

"Throwing Money" at Charter Schools

The low per pupil equivalent -- which ironically highlights progressives' claims of serious underfunding -- has also been a major problem for the charter school movement. According to the Education Policy Studies Laboratory (http://www.lwvny.org/advocacy/education/charter_sch_bib032307.pdf), no charter school is likely to succeed without substantial for-profit or non-profit funding to supplement meager per pupil funding limits. What I find even more ironic, in view of the conservative rallying cry of not "throwing money" at public schools, is the vast amounts of private sector money being invested in publicly subsidized schools.

Make no mistake, charter schools are big business. Large charter school chains like Green Dot, KIPP, Alliance Schools and YES Prep Public Schools are squeezing out many of their community-based competitors. Moreover, owing to generous support from the US Department of Education, the non-governmental financing sector for charter schools has grown leaps and bonds. Presently 25 private, non-profit organizations collectively provide over $600 million in direct financial support to charter schools. In addition, Standard and Poor and Moody's list over 70 rated charter school bonds totaling over $1 billion.

These private funding sources leverage a variety of federal monies to supplement low state and local "per pupil equivalents." In addition to Title I funding, the US Department of Education has awarded $50 million of grants through two programs administered by the Office of Innovation and Improvement: the Credit Enhancement for Charter School Facilities Program and the State Charter School Facilities Incentive Grants Program. This supplements four federal programs administered by other federal agencies that charter schools can access for their facilities needs: the Public Assistance Grant Program (administered by FEMA), the New Markets Tax Credit Program and the Qualified Zone Academy Bond Program (both administered by the US Treasury), and Community Programs (administered by the Department of Agriculture).

Should We Allow Conservative Philanthropists to Run Our Schools?

A final source of charter school funding is the New Schools Venture Fund created in 1998, which hosts funding by conservative-leaning mega charities, such as the Bill and Melinda Gates Foundation and the Walmart family foundation.

Why do millionaires and billionaires donate hundreds of millions of dollars to charter schools? Danny Weil calls it priming the pump. Neoliberals have strong ideological reasons for seeking to dismantle traditional public education. They know that the charter school movement has the potential to capture billions of public education dollars for profit-oriented ventures. However owing to the low per pupil equivalents for disadvantaged students, new privately run charter schools are unlikely to succeed without outside support. And despite claims to the contrary, corporate donors know that "throwing money at schools" allows them to attract and retain the best teachers -- and in the long run, improve student achievement.

Moreover in a number of cases, these donors have been invited to serve as board members on charter school chains with major governing responsibilities -- offering them an extraordinary amount of control over curriculum, textbooks and potentially the ideological bent of the schools they oversee (e.g. whether they teach evolution or its fundamentalist Christian alternative Creative Design).

For-profit Companies: Circling Like Sharks

The massive growth in charter schools and the funding to support them has also led to a burgeoning industry that applies for and distributes grants, in addition to hundreds of companies that sell "educational products and services." And although technically all charter school financing schemes are non-profit -- they generate a phenomenal number of for-profit contracts for companies marketing curriculum and textbooks, computers, software and administrative, clerical and security services.

One example is Ignite, an educational software company founded and run by the former president's brother Neil Bush. It sells its wares to Florida charter schools, thanks to another brother, ex-governor Jeb Bush. (See http://progreso-weekly.com/2/index.php?option=com_content&view=article&id=1592:evidence-that-bush-family-profits-from-florida-education&catid=43:this-aint-disneyland&Itemid=62)

Obama's Neoliberal Stance on School Privatization

Yet of the last five presidents, Obama has clearly been the staunchest ally of the school privatization movement. In addition to pushing generous increases to charter school funding, the Obama administration also included a provision in the 2009 stimulus package forcing states to liberalize and/or expand their charter school programs or miss out on $100 billion in public school stimulus funding. Many states, which are already closing schools and laying off teachers, have a cap on charter school formation because they can't afford further decreases in their public school budget. Due to the failure of charter schools to improve achievement scores (see previous article "The War on Public Education"), they can't make the case to voters for establishing more of them, given the additional cuts this would impose on public schools. Others, in Ohio, for example, have had serious problems (owing to lack of public oversight) with fraud and corruption in privately run charter schools. However, at present all states without legislation authorizing the formation of charter schools will have to approve it -- and all those with funding caps will have to remove them -- or miss out on badly needed stimulus funding.

Arne Duncan's Record in Chicago

Obama's appointment of Arne Duncan, former CEO of Chicago Public Schools to head the Department of Education, suggests states will continue to be under enormous pressure to de-fund public schools -- and that many more will close. While running Chicago schools, Duncan -- in collaboration with Mayor Daley's office and Chicago's corporate elite -- pursued an aggressive school privatization agenda. In 2004, this included an attempt to close 20 out of 22 schools in a low income minority community. The effort was clearly linked to the mayor's and property developers' efforts to "gentrify" the neighborhood -- to force out minority residents and glam up their properties for re-sale to white upper middle class professionals. With all their neighborhood schools closing, low income residents would have no choice but to leave.

Fortunately militant protests by residents stopped the arbitrary school closures. However Duncan then preceded to implement a draconian decree under No Child Left Behind ordering immediate closure (with no probationary period) of schools where students failed to pass standardized tests. Duncan also made it clear that these schools would immediately be turned over to private charter school operators funded by grants from the Bill and Melinda Gates and WalMart family foundation).

The Role of the Corporate Media

It should also be no surprise that the corporate controlled media is beating the drums for the neoliberal agenda to privatize schools. As Danny Weil outlines in "Corporate School Hype and How It's Managed," NPR, CNN, PBS, 20/20 and Oprah Winfrey are all guilty of staging "informercials" promoting charter schools and school privatization as a solution to the "crisis" in public education. No pro-public school advocates are invited to challenge the assertions presented, and there is no disclosure of ideological or financial (as in the case of controversial civil rights leader Al Sharpton) ties to right wing think tanks and school privatization proponents (see http://www.counterpunch.org/weil08262009.html).

*Danny Weil is the author of the groundbreaking 2009 expose The Charter School Movement: a Reference Manual. He has published several eye opening chapters from the book in Counterpunch http://www.counterpunch.org/weil08262009.html and Dissident Voice http://dissidentvoice.org/2009/11/neo-liberalism-the-leveraging-of-charter-schools-with-public-and-private-funds/

Authors Website: http://www.stuartbramhall.com

Authors Bio:
I am a 63 year old American child and adolescent psychiatrist and political refugee in New Zealand. I have just published a young adult novel THE BATTLE FOR TOMORROW (which won a NABE Pinnacle Achievement Award) about a 16 year old girl who participates in the blockade and occupation of the US Capitol. I also have a new non-fiction ebook REVOLUTIONARY CHANGE and a 2010 memoir, THE MOST REVOLUTIONARY ACT: MEMOIR OF AN AMERICAN REFUGEE describing the circumstances that led me to leave the US in 2002 to start a new life in New Zealand. My memoir won an Allbooks Review Editor's Choice Award. I have a political commentary blog at my website.