A few years ago, as the charter movement began to grow and get stronger, it became clear that it had attracted the enthusiastic support of a large number of super-wealthy hedge-fund managers.
One of these articles appeared in the “Style” section, as if to suggest that charters had become a really cool hobby for people who normally spend their time racing polo ponies or cruising the Mediterranean on their yacht. There was no suggestion that any of the funders involved had attended a public school or ever sent their own child to one. No, they were investing in good deeds by opening privately managed schools to compete with public schools, get higher scores, then take away the entire building of the public school. Mayor Bloomberg encouraged the co-location of charter schools, creating a scenario that some called “academic apartheid,” in which the charter kids had the best and latest of everything, while the public school kids on the other side of the building had to make do with the remains and enroll the children that the well-endowed charter did not want: those who did not read English, and those with severe disabilities, those who didn’t follow the rules.
Steven Brill wrote about the birth of “Democrats for Education Reform” in 2005 in his book Class Warfare, and he makes clear the sense of noblesse oblige felt by those in attendance. The investment in charter schools was exciting for men (and women) who had gone to the nation’s finest prep schools and best colleges and had accumulated great wealth. He tells the story of DFER’s first organizing meeting, held at a luxurious penthouse; the guest speaker was the rising young Senator from Illinois, Barack Obama. When Obama was elected, DFER sent its list of choices for cabinet positions to the new President; its choice for Secretary of Education: Arne Duncan. The best way to reform schools, they concluded, and to save the lives of minority children, was to create privately managed charter schools with people like themselves on the board of directors.
As I reflected on this bit of background to the role of hedge fund managers in promoting the privatization of public education, I suddenly remembered an email I received in 2010. The writer asked me not to mention his name, for obvious reasons. I never forgot his letter.
I post it here.
I manage money and I’m black. I am distressed by the barrage of mail I’ve been getting from fellow money managers who somehow think there is a fairly easy solution to educating the “underclass” by using charter schools. I’d like to share with you a few points from my experience which may help you contextualize my concern.
1. Hedge fund managers typically don’t add value to society.
2. Hedge fund managers often have very little practical real world experience. Many have not worked for anyone else. Yet activist managers are very comfortable giving advice to operating managers of companies in which they take a stake.
3. Hedge fund managers virtually never hire minorities outside of Asians
4. Hedge fund managers have attended exclusive private schools and almost always send their kids to the same.
5. Hedge fund managers know virtually nothing of incentive systems and largely supported the Wall Street incentives which nearly created the demise of our society as we know it.
6. Hedge fund managers and private equity managers typically don’t pay their share of Federal taxes. (I personally elect to pay my carried interest as regular income)
With my experiences as a backdrop, I’m somewhat concerned that groups such as DFER (Democrats for education reform) are receiving so much positive press.
As I have begun to research education I wonder if you can point me in the right direction?
1. Has there been a study on the effect of educational lotteries (like the kind that are run to select students for some charter schools) on the students who aren’t picked? It seems a bit demoralizing to me…
2. Has there been a study of teachers who would work for incentives? In other words I’m not sure free market incentives work for professionals like all the teachers I know?.
I am a 22 year veteran of [tech company] who left to start a money management business. One of my early management assignments at [tech company] was to manage public sector sales for the Philadelphia area. This job afforded me a great deal of interaction with teachers and students of the Philly school district.
My current business manages money for clients with assets from XXX to several hundred million. It is the intention of my family to pay out all business profits from our internal hedge fund to urban squash and music education in public schools.
Thanks in advance for your consideration