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The Letter From: Market Critic or Critical Friend?


Looking through my “to do” list, I see the last segment of my series on the social keiretsu and a review of the Teacher Equity Project charter school’s proposed multi-year budget. Looking at my postings over February and March, I see a debate with Kevin Carey over NCLB’s Section 9401, another with Andrew Rotherham over the blur of advocacy and analysis in education policy, and critiques of Supplemental Educational Services, social entrepreneurship, education reform think tanks, the Administration’s implementation of the Reading First program and NCLB’s Scientifically Based Research provisions, and industry trade associations' approach to NCLB reauthorization.

Although I every week I post at least one RFP school improvement organizations should pursue, I do my best to link readers to the rest of my writing, and this blog’s “About the author” section explains that I am both pro-market and remain very much in support of NCLB as written in 2001, it is no surprise to me that the casual edbizbuzz reader often thinks I oppose the law and privatization.

I was prompted to think about all this by Education Week reporter Scott Cech's online article of March 27 on the newly announced evaluation of Charter Management Organizations (CMO), to be published in print on April 2. To summarize, the Gates Foundation is funding a study through New Schools Venture Fund (a financial intermediary for the new philanthropy) on the effectiveness of the latter's portfolio of nonprofit CMOs, many of which were funded by Gates directly or through New Schools.

New Schools issued an RFP for the evaluation, which was won by a joint venture of two well-respected organizations. For-profit evaluation house Mathematica will do the quantitative analysis of educational efficacy, led by former RAND analyst Brian Gill, one of the nation's most experienced evaluators of large-scale educational programs. The non-profit Center on Reinventing Public Education (CRPE), led by Paul Hill, another RAND alum with impeccable credentials, will try to explain how those results have been produced. (Those interested what such a combination might yield should consider reading some of RAND's studies on New American Schools, which employed a similar division of labor.)

My part in the article consisted of two quotes, from a telephone interview in which I walked Cech through the Gates' and New Schools' press releases. I commented generally about such large-scale evaluations based on my own experience, rather than specifically about this particular study – the approach not being a matter of public record at the time.

The comments:

First, that if I were doing such a study, I would compare charter schools operated by CMOs to similarly-situated public schools managed by school districts, as well as independent charters.

Second, that - based on my own direct experience with New American Schools' grants and investment in Comprehensive School Reform, and my subsequent observation of such evaluation as an afterthought with most other approaches to school improvement – Gates and New Schools should have been doing this kind of comparative evaluation from the start.

I stand by both statements. It’s hardly news that public schools operated by CMOs are alternatives to both district-managed schools and independent charters, operated differently, or based on very different financial assumptions. Consequently, other things being equal, researchers would want to compare all three. I should have added public schools run by EMO's.

As for the need to do comprehensive evaluation across a portfolio of investees from the start, that concept is foreign to neither venture capitalists nor school reform. Gates and New Schools had plenty of resources to draw upon in considering that option. They decided to put all their money into investment. I think that was a mistake given the high-risk nature of the activity.

What bothered me about the article was not my content, but its presentation. I think the average reader was quite likely to conclude that I oppose CMOs and charters. (Consider this average reader.) I do doubt that centrally managed nonprofit CMOs will prove to be a more cost-effective means of achieving public school quality at scale than centrally-managed for-profit Education Management Organizations or centrally-managed school districts. I do oppose the decision of venture philanthropy to bet the charter movement’s future on the CMO strategy. I think more funding should have been left for independent new starts and their collective support.

But my concerns are not ideological or political. They are based on direct experience with scale in fee-driven public school reform activities, and years of analysis of such financial and educational data and operational information as the CMOs and their grantors have been willing to release. I hope the CMO can work, but I don’t see it as my job to “protect” CMO’s or charter advocates from criticism based on facts, analysis or even reasonable theories. I don’t consider the simplistic defense of problematic models – or even declining to air dirty linen - as a defense of market-based school reforms. I’d prefer to see ineffective models and providers tossed from the market early by grantors, investors and market advocates, rather than at the behest of opponents when large numbers of providers have failed after becoming synonymous with the market concept to citizens and policymakers. My intent is to be true to market principles.

The New American Schools Development Corporation (NAS) employed RAND to provide independent program evaluation of its grantees from its formation in 1990. Evaluation was used to identify initial grantees, to winnow the portfolio, and to determine how much money to put into what teams for what purpose. Every single RAND evaluation was made available to the public. Not all of it was flattering, but it forced NAS and its teams to get real about results from the start.

In the mid 1990's, Design Teams moved to a dissemination strategy based on fees. Having moved out of the R&D phase, NAS shifted its funding from grants to equity, loans and joint ventures. Program evaluation became central to the investment decisions made by its Education Entrepreneurs Fund.

Immediately after passage of the federal Comprehensive School Reform Demonstration Program (CSRDP) in 1997, each Design Team pursued the independent evaluation of its program. The collective recognized the need to separate itself from the crowd of providers with no real interest in demonstrating quality who would crowd the new funding stream.

NAS Teams thrived under CSRDP. More important, when the program ended, they continued to grow. Long after Comprehensive School Reform faded into the short memory of today's school reformers, every NAS Design Team of the CSRDP era remains in business in one form or another.

New American School's decision to fund only what could be demonstrated to work through rigorous evaluation was a painful rejection of leaders it admired, people NAS staff new well and considered friends, models it found intriguing, and practices it thought should and maybe even could work - and it hurt rejected organizations' reputations and bottom lines. But, above all, the decision was an affirmation of market-based school reform. Ever since, that kind of tough love has been sadly lacking in each successive trend in market based school reform. Although better late than never, that was the point behind my comment on the late timing of the CMO evaluation. It is an approach that extends throughout my writing and podcasting.

In June of 1996, Paul Hill, Robin Lake and I co-wrote “Charter Schools, Escape or Reform,” an Education Week opinion piece selected for inclusion in that publication’s celebration of its best Commentary after 25 years of operation, The Last Word. As charter advocates, we distinguished those who supported charters as a way to reform public education from others who simply sought escape from any accountability to the taxpayer through its government. We argued that a system of public education based on independent charters still needed government oversight to assure basic educational quality, fiscal responsibility, and civil rights. We received a good deal of grief from many in the charter movement. Today, our points are conventional wisdom. We weren’t charter opponents, we simply looked a few steps further than our colleagues and suggested strategies that might have mitigated a crisis of quality that has slowed the movement's political momentum since the turn of the century.

I have the same attitude today. Many advocates of market-based reform are quite clear about the system they want to escape, but are far less transparent about the accountability they should accept. I’m trying to identify the unanticipated consequences of this short-sightedness and suggest approaches that will deal with the problems well before they become crises.

And so today…

I’m not “opposed to” social keiretsu – I just think that those engaged in public education and public school reform need to know about them and filter what their members say and do based on that knowledge.

I don’t think Keven Carey is wrong stating that waivers granted by Secretary Spellings under NCLB Section 9401 have been based on something akin to a political consensus, only that they are neither contrary to law, nor will they necessarily be based on consensus in the future.

I give Andrew Rotherham a great deal of credit for his willingness to engage in debate on the line between advocacy and analysis. It would be much easier for him to join most of his colleagues and ignore the criticism.

I want Supplemental Educational Services to work, but I’m having a hard time with programs that cost so much and yield so little in achieving their sole objective under NCLB - helping students demonstrate proficiency on state math and literacy tests. More generally, I have been very disappointed with most k-12 firms and trade groups’ late interest in evaluation.

I think “social entrepreneurship” has great promise as a concept in education reform. And for that reason, I despise it as social spin.

Similarly, policy ideas require marketing no less than any other service offering. But there’s a crying need for organizations that work beside their clients on public school reform, and that need is not being met by policy marketing shops simply because they’d prefer to be called “think tanks”.

I love NCLB’s AP, Reading First and SBR provisions as written law, but loathe the Administration’s implementation of both.

My cause is a market. A place where schools can select from a broad array of teaching and learning products services and programs with a clear understanding of their costs and value added to student performance. Where parents - and teachers, can select from many high quality schools. Where schools, programs, services and materials meet some kind of a floor of demonstrated efficacy. Where for- and nonprofit providers are engaged in a healthy competition based on what works. Where for-profit firms can make an attractive profit on offerings that truly improve student learning. Where investors are not only encouraged but rewarded to capitalize innovation in teaching and learning. Where government regulation is based on what’s best for the market, rather than any one of its stakeholders. Indeed, where all stakeholders play an active yet transparent role the development of regulation.

I’d like to be seen as a critical friend of all market-based reforms. There are so many defenders of specific providers, policies, programs. Adding my voice to the chorus adds little to the cause. In real life, it's your best friends who can tell you what you’d like to hear least but need to hear most. I’d like to be seen as that kind of a friend to those involved in market based school reform. I don’t blame EdWeek’s Cech for setting me up as the antagonist. The article only prompted me to think about a typecast I’d like to avoid and, to be honest, don't think I deserve.

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The foundations haven't bet the whole ranch on CMOs - Walton in particular is still funding one-offs. Gates et al have sunk some money into CMOs, but it's hardly the only funding out there.

Your statement that CMOs aren't a good way to scale charters is curious to me. What's the rationale? As long as they maintain the small schools and some sort of quality control, I'd rather have 10 Achievement First schools in my city than 10 random charter schools. You know that with Achievement First they'll all be good, with minimal quality variance, whereas the mom-and-pops will have some great schools and some that are terrible. Of course, best-case scenario is 10 AF schools and 10 mom-and-pops...


Is it appropriate for Gates to fund evaluation of Gates' programs? How independent will that evaluation be?


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