Choice - Vouchers and Privatization

The idea that a private for-profit group should compete

with the public schools in educating children and that it

should do so at a profit moved a step closer to reality

over the summer.  Whatever monopoly teachers,

administrators, and school boards hold over publicly

supported education seems destined to be questioned, if not

changed outright.  Surprisingly, the support for that

questioning came not just from the proponents for choice

and/or vouchers but from such people and places as the

board of education in Baltimore and the president of Yale


Benno Schmidt's announcement that he was leaving the

presidency of Yale to become the chief executive officer of

a chain of private for-profit schools being planed by

entrepreneur Christopher Whittle sparked more reaction in

the press than any similar story of a college president

moving to the corporate world.  While Whittle may have been

trying to buy credibility for the Edison Project, the

question of why Schmidt, a highly respected scholar, would

take on a speculative job in K-12 education had many people

looking for a deeper meaning.  Whittle's plan to build a

chain of private schools with anticipated revenues of $10

billion by the year 2010 is attracting people like Schmidt

and others to the Edison Project design team.

All of this seems to indicate that 1) there is hope for

money to be made, 2) there is an expectation that public

opinion will accept the idea of privatization of some of

public education, and 3) there is some indication that

political forces (President Bush, et al.) may succeed in

breaking the public education monopoly.  For people like

Whittle, establishing a market niche before any competitors

even have a foothold could be an astute business move.

Meanwhile, the board of education in Baltimore entered into

an agreement that will allow Education Alternatives, Inc.,

of Minneapolis to operate nine of Baltimore's 158 public

schools.  John Golle, chairman and chief executive officer

of the private for-profit firm, said that it will receive

the same sum (approximately $5,415 per student) that the

city now spends to educate each student.  However,

Education Alternatives plans to spend the money differently

and to use the accounting firm of KPMG Peat Marwick to

recommend efficiencies in the non instructional side of the


Golle will be able to bypass the school district's

procurement process, but, as the opening of the school year

approached, he had not reached cost-cutting agreements with

the unionized custodial or food-service employees. 

Although teachers can transfer out of the contract schools

if they wish, by early July only 15 of 300 teachers had

requested transfers.  Education Alternatives currently

operates one elementary school (South Pointe) in Miami and

had a contract last year to manage the schools in Duluth. 

That contract was not renewed.


Writing for the New York Times, Albert Shanker of the

American Federation of Teachers referred to the potential

of turning an education endeavor into a profit-making

venture as the "threat of an educational industrial

complex."  While steps have been taken and promises made by

those hoping to capture market attention, educators have

been calling for rules to level the playing field on both

sides.  Educators have also raised such issues as local and

state accountability, equal educational opportunity for all

students, and separation of church and state.

Is is vastly appealing to attack Whittle and others for

their profit motives, and much of the popular press took

this line throughout the summer.  Some observers seem to

reason that any profit to an entrepreneur or investor

represents money taken away from students and parents. 

This money could be used to strengthen equal educational

opportunities for the poor or to add new programs, they

reason.  Pushing this criticism to its limit, however, only

tends to spotlight those things that cannot be explained

away.  Don't publishers and all of those selling equipment

and supplies to the schools make a profit?  Can one make a

real distinction between these items and the process of

delivering instructions?

The fear that students will be given an inferior education

- taught by uncaring teachers in substandard facilities and

using poor (no nonexistent) instructional materials in the

name of showing a profit - is somewhat difficult to

justify.  These conditions, some would say, already exist

in a few public schools, and Whittle and others say that

these are the conditions that need to be fixed.

The recent cascade study spotlighting where the money goes

in schooling - by Bruce Cooper and Robert Sarrel of Fordham

University, picked up by the U.S. Chamber of Commerce and

now used in several large school districts may shed useful

light on the question of profit versus quality.  Tracking

the dollars, even when there is not a category labeled

"profit", may be an important way of bringing about

improved instruction through improved efficiency.  If

Whittle's new patterns of efficiency through the use of

technology will save dollars for a profit - making venture,

why can't these ideas be used to save dollars wasted in the

present system?


Meanwhile, across the country choice and voucher proponents

are either touting gains or pushing efforts to make their

ideas an election year issue.  Some of the activity

includes the following:

   *  California's Choice in Education League collected more

      than enough signatures but was ruled off the November

      ballot because state officials wanted a 10% cushion of

      extra signatures.  Backers say they will get a full

      public/private voucher proposal on the ballot for the

      spring of 1993.

   *  Voucher proponents in Colorado have tried several time

      to put the issue on the ballot.  By late July it looked as

      though they would have the signatures needed to get a full

      private/parochial/home schooling voucher plan on the

      November ballot.

   *  Last March the state supreme court in Wisconsin upheld

      the Milwaukee plan allowing low-income parents to send

      their children to private schools.  This effort was limited

      by the legislature to Milwaukee, but the court ruling might

      signal an expansion of the program.

   *  The Institute for Justice - a group based in Washington,

      D.C. - has filed a lawsuit on behalf of low-income parents

      and children in Los Angels and Chicago school districts. 

      The suit asks the courts to order Illinois and California

      to transfer the amount of the state per-pupil expenditure

      from the school districts to the parents.  It further

      charges that the quality of education is so poor in the two

      cities that it violates federal equal educational

      opportunity laws and state constitutional provisions for

      education. ĘThe group has also threatened to files suits in

      other large cities.


   *  The impact on the states of President Bush's G.I. Bill

      for Children (if it gets introduced and passed) could be

      significant.  While the media hype has focused on granting

      parents a $1,00 voucher per child, the fine print in the

      proposal originally called for $500 million in grants to

      state and local governments in 50 cities across the

      country.  These could then distribute the much ballyhooed

      $1,000 vouchers to parents.  This probably means that all

      states that wish to participate would have to enact

      enabling choice legislation, and this would certainly

       trigger a debate in the states where no choice legislation

      now exists.


Somehow it's always easier to believe in a new idea that

involves only a minor change in our present world.  Turning

classroom instructional activities over to a private

for-profit group will probably continue to be viewed - at

least in the short term - as a major change in our public

school system, however.  The opinion of the public and of

educators could be the deciding factor in the acceptance or

rejection of the idea.

When it becomes evident that the current system cannot - or

will not - fix existing problems, the acceptant may come

quietly, even from the ranks of educators.  The Baltimore

contract with Education Alternatives might be an example of

this situation.

If all things remain constant, we might be able to predict

the results of privatization.  But every additional

Baltimore changes the debate and alters long-term

possibilities.  Anticipated momentum for privatization may

also come from such events as the U.S. Chamber of

Commerce's cascade studies, the New American Schools

Development Corporation's funded (and unfunded) projects,

the Edison Project, and the charter school movement.  From

a political standpoint, the events of the next two months

will tell us whether we are ready as a nation to support

state and federal efforts to offer choices, to provider

vouchers, and to privatize education - or whether we still

believe in a publicly funded, publicly operated school


Reference: Pipho, C, (1992, September), Choice - Vouchers and privatization. Phi Delta Kappan, 74(1), 6-7.

Reprinted with permission of Phi Delta Kappa, Inc.
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