The question frequently arises: Why do so many billionaires support the privatization of public education? Surely, they don’t care about making a profit as they are already billionaires. Here is one possible answer, as reader Randal Hendee posted this comment on the blog about the motives of the billionaires who support “reform”:



There’s a lot of evidence that reducing the cost of public education is one of the main goals of people like Gates, Broad, and the Waltons. They’re playing a long game that they hope will result in lower taxes for big property owners and for the wealthy in general. At the same time, they see profit in “reform” because even with relatively lower tax revenues, a new cohort of children enrolls every year. Once the opportunists tap into that public revenue stream (through privately operated charters, educational technology, data mining, real estate deals, and so on), the cash cow will keep on giving. Or so they hope.


The Walton family fortune is based mainly on cost reduction (that and inventory control via technology and breakneck expansion). The Walton billionaires are billionaires because Walmart learned how to squeeze both suppliers and employees. In the process they put thousands of local merchants out of business. The Waltons are trying to undermine American institutions such as public schools and labor unions. To imagine that these efforts have nothing to do with cost reduction doesn’t square with company history. (If you want to know more about how the family stays so rich, google “Walton tax avoidance.”)


While Eli Broad is said to favor higher taxes for the rich, cost reduction is a big part of the Broad efforts. Broad wants fewer schools, larger class sizes, more charters. Charter expansion is one of his big goals, and of course many charter teachers work in sweatshop conditions for relatively low pay. Some of this cost saving is diverted to marketing and high administrative salaries. But the long term idea is to spend less on schools, not more. Presumably, free market incentives will spur “higher achievement.”*


Here’s what Bill Gates said about education and technology (and cost reduction) at the 2013 Davos Conference:


“Well, we’re taking the Internet revolution and we’re applying it in more areas. So, for example, in education the idea that not only are the best lectures online, but you can interact with people, talk to other students, that we ought to be able to deliver education that’s higher quality but dramatically lower cost. There’s a lot of excitement about that.


“MOOC means Massively Online Open Courseware and a lot of good pioneers that are learning and making that stuff better and better. The [Gates] Foundation is the biggest funder of that activity ’cause we see so much promise and the increasing price of education just doesn’t work. You know, a lot of our unemployment is because kids aren’t well educated enough. If you’re a college graduate, unemployment is very low. We’ve got to increase access to education, but letting the price go up won’t allow that.”


Anytime you hear someone say, “You can’t solve the problem by throwing money at it,” that person wants to reduce the cost of (that is, underfund) public schools, particularly the ones in poor urban neighborhoods and areas of rural poverty. Gates often used to preface his education remarks by stating that we spend way more than we used to but have little to show for it. He never took inflation into account, nor did he mention special education mandates.


Sure, the “reformers” want to “transform” public education by destroying it, but cost reduction is built into their overall scheme.



*Note: Eli Broad publicly supported Governor Jerry Brown’s proposal to raise taxes for education, but he simultaneously funded a “dark money” effort to fight the same proposition.