Issue 2, the Business Model, and Ohio Schools



Pedal across Nevada
and you have plenty of time to think.

 This summer I took a solo bicycle trip across the United States to raise money for research on juvenile diabetes. 

When you pedal 4,615 miles alone, you have plenty of time to think about all kinds of political issues.  This is especially true when you're crossing the barren stretches in Nevada.

At one point, after I reached Reno, I passed a billboard advertisement for some private school.  And that got me thinking about Issue 2, here in Ohio. 

By now, you probably know that our Republican governor and our Republican-controlled legislature want to introduce "business efficiency" to Ohio schools.

Well, really, how can opponents of Issue 2 argue against that?  Efficiency!  That's always good.  And business is all about profit, right?  You can't make a case against "profit," can you?  That's capitalism at it's finest.  Right?

Look at the record of for-profit colleges, however, and you may start to wonder.  If Issue 2 passes, is the key word, at the K-12 level in Ohio, going to be "profit" or "education?"

If you haven't been following the news, you may not realize that in recent years enrollment at for-profit colleges, in Ohio and elsewhere, has ballooned to 2,000,000, with much of that growth fueled by $25 billion in federal student loans. 

So:  with all that money dangling in front of your for-profit nose, what's a for-profit school to do?  Well, advertise, of course.  Make it look like going to the University of Phoenix, for example, is a sure-fire path to success.

Only--in too many cases--it's not.  For-profit colleges, which account for 12% of U. S. students in "higher education," rake in more than a quarter of federal student aid money, and end up with an abysmal record when it comes to preparing "graduates" for gainful employment.  As a result, for-profit colleges account for half of all student loan defaults. 

Consider the "business efficiencies" introduced by the Education Management Company (EDMC), based in Pittsburgh and 41% owned by Goldman Sachs.  (With his Lehman Brothers background, Mr. Kasich must salivate when he sees the piles of dollar businesses can make running the state schools.)  The company, which made 89% of its net revenue on student loans, runs Argosy University and Brown Mackie College, among others.

If you want to educate the young--and turn a tidy profit--well, you have to rely on "business efficiencies."  So EDMC developed a system to reward the most successful recruiters, creating what is know in the bowels of  Wall Street as a "boiler-room culture."  Really, it was a telemarketing scheme:  recruiters, and phone banks, and the hard sell, no matter what.  Get those students IN THE DOOR--and bonus pay for solictors who bring in the most business every day.  Take that student loan check, cash it, and put the money in the EDMC account. 

It doesn't matter if EDMC employees enroll students who can't write simple essays.  It doesn't matter if they prey on the desperate unemployed during hard times.  It doesn't matter if they promise to turn marginal students into doctors, lawyers, teachers, computer programmers and nurses.  Students who were clearly on drugs were encouraged to sign up--even students without computers--to take online classes.

So what, if you "hijack the American Dream," as one observer put it?  Sign up those poor suckers, with no chance of graduating, and stick them with hefty federal loans.

Capitalism is about profit--first, second and last. 

Governor Kasich knows that.  He, better than any public sector worker, knows that in the end the free enterprise system has a cash register for a heart and a bank balance where a conscience should go.

I understand if someone wants to vote for Issue 2, if all they care about is keeping their taxes low. 

But don't be fooled by the rhetoric.  There are several provisions buried deep inside Senate Bill 5, that spell disaster for our schools.

Governor Kasich and the Business Model in Education Perfected

      
IF YOU LISTEN TO THE EXPERTS TALK (people who almost never actually teach) about how to “fix” America’s “failing” schools, you notice certain terms are accepted without question. Inner-city schools, where graduation rates are low, are “dropout factories.” 

CNN does a series on education and repeats the phrase “school crisis” so often you think the End Times are coming. 

And if you turn in to Fox News you hear Hannity and O’Reilly and Beck (when he’s not busy weeping) talking sagely about saving public education by following the “business model.”

If we’re going to go in this direction, as Governor Kasich here in Ohio and Scott Walker in Wisconsin and Chris Christie in New Jersey seem to want, it might be important to know what this means. Are we talking business-like efficiency? Or profit above all? Or do you mean that schools should copy business morality?  

Do we copy, for example, British Petroleum?  

True: it would take effort to blow up an entire school and sink it in the Gulf of Mexico, killing eleven teachers in the process, but cutting corners on safety and spreading toxic waste would be an interesting “business model” in education. 

The possibilities are endless. You might copy the tobacco companies, which insisted for decades that their products weren’t harming anyone. Teachers could pitch product like companies selling male-enhancement pills. School districts could start paying $473 million to lobbyists to get laws and breaks they want from the legislature, just like the finance, insurance and real estate industries did in 2010. 

Oh, wait:  White Hat Management, the largest for-profit charter school operator in Ohio has already been accused of bribing public officials and corrupt financial practices. Probably makes Governor Kasich, an old Lehman Brothers hand, get misty-eyed for the “good old days” when he and his friends were derailing the U. S. economy. 

Cincinnati Bengals Business Model?

If nothing else, there’s always the National Football League, one of the most successful business models in America today. It might be wise to study their play book. Why not, for example, charge students “seat licenses” before they sit down in our classes? Is that what we mean? Why not stop students from bringing their own food into the cafeteria and sell hot dogs in the lunch-room for $4.50. Meanwhile, shut off the water fountains and charge kids for bottled water.

 

That way you can be like Mike Brown and the Cincinnati Bengals and put out a crappy product and still make a fortune.  

IF SCHOOLS ARE GOING TO FOLLOW THIS PATHWAY how will it work in the end? Schools don’t have a chance of making a profit on handicapped kids. So, do we deny entry based on pre-existing conditions, like health insurance giants? Do we follow the tactics of the banking industry? You issue students debit cards to buy paper, pens, and pencils. Say:  the child needs a mechanical pencil to complete a math exam. His account is short on funds. He uses his debit card, pays 49¢ for the pencil, and the school charges $38 for an overdraft fee.

The airlines are another source of inspiration. We tell kids:  “You want to bring that book bag on this bus? It’s going to cost you $25 extra.” And that’s only one way! Oh: and you want to change your class schedule? We’re going to have to charge a $150 booking fee. 

We want schools to cut administrative costs. Let’s use HMO’s as a guide. We start routing phone calls from parents through press 1, press 7, press 6, press 4, press 1, press 5, get put on hold, get disconnected, and start all over again. Finally, mom or dad reaches someone with a foreign accent. 

Consider the case of Pennsylvania Judge Mark A. Ciaverella, Jr., if you want to know what might go wrong as we privatize schools and run them for profit. Judge Ciavarella was found guilty in February, 2011, on a dozen charges, including money laundering and racketeering in a $2.8 million dollar scheme to funnel juveniles into two privately-owned prisons.  

In what prosecutors labeled a “cash for kids” scam, each young defendant was seen as a unit of profit and the more prisoners the judge “produced” the more prison owners profited.  

Ciavarella received $1 million in kickbacks, and sentenced thousands of youths to jail, including one high school girl who earned three months behind bars after creating a Web page spoofing an assistant principal. Another teen went to jail for stealing a jar of nutmeg. 

A second judge involved took a plea deal, as did the builder of one of the detention facilities, and 6,000 juvenile records had to be expunged. 

In the end, the best example might be for-profit colleges like the University of Phoenix—where we can actually study how the business-as-education model works. These kinds of schools enroll 12% of higher education students in the United States. Those students receive nearly a quarter of all federal student aid, which accounts for more than 80% of revenue at for-profit colleges. Unfortunately, many students who attend for-profit colleges graduate with no marketable skills and make up nearly half of all federal student loan defaults.  

If Republicans law makers have their way, perhaps we can go back in time to the good old days. Let companies that run schools make teachers live in company-owned homes in company-run towns. (There won’t be any teachers unions to stand in the way.) When companies perfect the system they can pay teachers in scrip, like coal mining companies used to pay workers in the 20s, and that scrip would only be good at the company store.  

You total up the bill at the end of the month—groceries, rent, utilities—and what do you know? The teacher owes the company money or ends up with only a few pennies. 

IF YOU ASK GOVERNOR KASICH or the shills at Fox News the system at that point is perfected.