Archives for category: For-Profit

The National Education Policy Center in Boulder, Colorado, released a report today about the performance of the for-profit online corporation K12. This is the biggest of the online operators, which has been criticized repeatedly for poor academic performance yet continues to expand. Just recently, Ohio and Pennsylvania added more for-profit virtual charters, as North Carolina rejected them and New Jersey deferred making a decision.

The new NEPC report found that students who enroll in these virtual schools do worse in academics than those who attend a brick-and-mortar school.

The authors of the report urged states to slow down in their headlong rush to open more such “schools.”

Here are the major findings, as reported in the press release:

New Report Shows Students Who Attend K12 Inc. Cyber Schools Falling Behind

Students at K12 Inc., Nation’s Largest Virtual School Company,
Are Lagging in Reading, Math and Graduation Rates; Researchers Say Evidence of Success Needed BEFORE Further Expansion

Few Dollars Dedicated to Instructional Salaries and Special Ed, Despite Lower Overhead Costs

WASHINGTON — A new report released today by the National Education Policy Center (NEPC) at the University of Colorado shows that students at K12 Inc., the nation’s largest virtual school company, are falling further behind in reading and math scores than students in brick-and- mortar schools. These virtual schools students are also less likely to remain at their schools for the full year, and the schools have low graduation rates. “Our in-depth look into K12 Inc. raises enormous red flags,” said NEPC Director Kevin Welner.

The report’s findings will be presented in Washington today to a national meeting of the American Association of School Administrators (AASA), where the report’s lead author, Dr. Gary Miron, is scheduled to debate Dr. Susan Patrick, president and CEO of the International Association for K–12 Online Learning. The report is titled, Understanding and Improving Full- Time Virtual Schools.

“Our findings are clear,” said Miron, an NEPC fellow, “Children who enroll in a K12 Inc. cyberschool, who receive full-time instruction in front of a computer instead of in a classroom with a live teacher and other students, are more likely to fall behind in reading and math. These children are also more likely to move between schools or leave school altogether – and the cyberschool is less likely to meet federal education standards.”

K12 Inc. schools generally operate on less public revenue, but they have considerable cost savings, says Miron. They devote minimal or no resources to facilities, operations, and transportation. These schools also have more students per teacher and pay less for teacher salaries and benefits than brick-and-mortar schools.

“Computer-assisted learning has tremendous potential,” said Miron. “But at present, our research shows that virtual schools such as those operated by K12 Inc. are not working effectively. States should not grow full-time virtual schools until they have evidence of success. Most immediately, we need to better understand why the performance of these schools suffers and how it can be improved.”

Earliier this week, New Jersey education officials postponed granting approval to a K12 Inc. full- time virtual schools for one year. In many states, however, policy is headed in exactly the opposite direction. In Michigan, for example, legislators decided earlier this year to lift the cap on full-time virtual schools, even though the state was in the second year of a pilot study to see whether these schools work and what could be done to ensure they work better. That pilot study had provided no findings to support such a scale-up.

Student performance results from the current study are clearly in line with the existing body of evidence, which includes state evaluations and audits of virtual schools in five states as well as a more rigorous study of student learning in Pennsylvania virtual charter schools conducted by the Center for Research on Education Outcomes (CREDO) at Stanford University. CREDO’s study found virtual-school students ended up with learning gains that were “significantly worse” than students in traditional charters and public schools.

New Report Shows K12 Inc. Cyber School Students Falling Behind/ 3

Miron and co-author Jessica L. Urschel, a doctoral student at Western Michigan University, analyzed federal and state data sets for revenue, expenditures, and student performance. In terms of student demographics and school performance data, the researchers studied all of K12’s 48 full-time virtual schools. In terms of revenues and expenditures, they used a federal data set that includes seven K12 Inc. schools from five different states (Arizona, Arkansas, Idaho, Ohio and Pennsylvania), although these seven schools accounted for almost 60 percent of all of K12 Inc.’s enrollment from 2008-09, which is the most recent year of available finance data.

In terms of the number of students enrolled, K12 Inc. is the largest private education management organization (EMO) and the largest private operator of virtual schools in the United States. It had contracts to operate 48 full-time virtual schools in 2011-12. In addition to these contracts, K12 Inc. provides services and support to dozens of other schools that have more limited online offerings.

Key findings include:

  •   Math scores for K12 Inc.’s students are 14 to 36 percent lower than scores for other students in the states in which the company operates schools. Across grades 3- 11, the scores were between 2 and 11 percentage points below the state average in reading.
  •   The on-time graduation rate for students the K12 Inc. schools is 49.1 percent, compared with a rate of 79.4 percent for the states in which the company operates schools.
  •   Only 27.7 percent of K12 Inc.’s schools reported meeting Adequate Yearly Progress (AYP) standards in 2010-11, compared to 52% for brick-and-mortar schools in the nation as a whole.
  •   Student attrition is exceptionally high in K12 Inc. and other virtual schools. Many families appear to approach the virtual schools as a temporary service: Data in K12 Inc.’s own school performance report indicate that 31% of parents intend to keep their students enrolled for a year or less, and more than half intend to keep their students enrolled for two years or less. K12 Inc. also noted in this report that 23% of its current students were enrolled for less than a year and 67% had been enrolled for fewer than two years.

• K12 Inc.’s schools spend more on overall instructional costs than comparison schools – including the cost of computer hardware and software, but noticeably less on teachers’ salaries and benefits.

New Report Shows K12 Inc. Cyber School Students Falling Behind/ 4

  • K12 Inc. spends little or nothing on facilities and maintenance, transportation, and food service.
  • K12 Inc. enrolls students with disabilities at rates moderately below public school averages, although this enrollment has been increasing, but the company spends half as much per pupil as charter schools overall spend on special education instruction and a third of what districts spend on special education instruction.Among the take-aways from all this is that K12 Inc.’s cyberschools reduce costs by having more students per teacher and by reducing overall spending on teachers’ salaries and benefits, particularly for special education instruction. “Part of K12’s problem seems to be that it skimps on special education spending and employs few instructors, despite having lower overhead than brick-and-mortar schools,” said the NEPC’s Welner, who is a professor of education policy at the University of Colorado. 

A recent article in the Guardian explores how the publishing giant Pearson commands the education world in Britain.

Pearson not only sells textbooks and testing, but also owns Britain’s biggest national examination system, which is operated for profit.

But that’s not all.

Pearson is now promoting itself as a policy studies outfit and think tank, studying the problems of British education and offering solutions. In whose interest, one wonders.

And of course it is developing a model school with a computer-based curriculum called the “Always Learning Gateway,” covering 11 subject areas. It is being tried out for free but will eventually be offered for profit.

Pearson is preparing a report on which the English examination system is promoting high standards and positioning Britain to be a global leader.

“Alasdair Smith, national secretary of the Anti Academies Alliance, which is critical of corporate influence in education, says: “This stuff frightens the life out of me. My concern is that business dictates the nature of education, and especially the aims of education, when it should be one voice among others.”

“Ball says private influence does not stop at Pearson. He mentions McKinsey, the management consultant that has published two widely cited international reports on successful education systems, as evidence of companies’ incursion into policymaking. Sir Michael Barber, Tony Blair’s former education standards guru, was an author of both McKinsey reports. He now works for Pearson.

“Last month, it was reported that ministers want to “outsource” some policymaking to companies, consultants and thinktanks in a bid to scale down the civil service.”

The British government, it seems, is outsourcing education policy to the nation’s largest vendor of education products and services.

I try to be careful in terms of what I write and what I repost from readers. If readers express their personal experiences and strong views, I have no problem with that, and I never repost anything that uses epithets or goes beyond the bounds of civility or fair disagreement. If I err, it is not knowingly.

I just received a comment about Tennessee’s evaluation system and its provenance. This was in response to my post today about “legal fraud.” I would appreciate readers’ responses, not opinions, but citations and facts:

TN bought TEAM/TAP, a teacher evaluation system from a Milken owned company called NIET. http://www.tapsystem.org/about/about.taf?page=nietbio_lmilken
The 1-5 scoring rubric met the requirement in Race to the Top to evaluate teachers with “objective” measures.The Milkens have been marketing TEAM/TAP since the mid 1990’s. If it is so effective, shouldn’t there be dozens of studies replicating its success? There are none. Peer-review constrains bad science and practices, and protects those from harm who are subjected to its application. It’s not an overstatement to say that, absent critical review, the TEAM evaluation can identify teaching quality about as well as rolling dice.

That the Milken family foundation has bypassed peer review and critical analysis and sold its “product” to the taxpayers is very curious. This use of our public funds deserves further scrutiny. Recall that co-founder Michael Milken is a convicted felon. Rudy Giuliani successfully prosecuted him for a massive fraud in 1989 that destroyed his company and cost the taxpayers millions in the ensuing cascade of savings and loan failures. Milken’s crimes were so egregious, president G.W. Bush refused to give him a presidential pardon. Caution and study here would seem wise. http://articles.latimes.com/2009/feb/03/business/fi-milken3

Outsourcing to contractors with a history of fraud has the potential to be a spectacular boondoggle. Our students will be the victims. Who will be held accountable?

Maureen Reedy, a teacher in Ohio for 29 years, was Ohio teacher of the year in 2002. Now she is running for the Ohio House of Representatives.

She deserves the support of every taxpayer, parent, and citizen in Ohio.

She is angry at the waste of taxpayer dollars for bad, deregulated charter schools. Forget what you read in The Economist about the miracle of privately managed charters. As she points out below, half the charter schools in the state are in academic emergency or academic watch, compared with only one in 11 public schools.

She is especially outraged by the rapacious cyber charters. As she points out in this article, two of Ohio’s major charter sponsors have collected nearly a billion dollars of Ohio taxpayer dollars since 1999:

Charter schools are a poor investment of Ohio’s education dollars and have a worse track record than public schools in our state; there are twice as many failing charter schools as successful ones, and one in two charter schools is either in academic emergency or academic watch, compared with only one in 11 traditional public-school buildings. Five of seven of Ohio’s largest electronic-charter-school districts’ graduation rates are lower than the state’s worst public-school system’s graduation rate, and six of seven of the electronic charter schools districts are rated less than effective.

And finally, the Electronic Classroom of Tomorrow has failed in every identified state category for eight years, a worse track record than the Cleveland City School system, which is under threat of being shut down by the state. The Electronic Classroom of Tomorrow is run by unlicensed administrators. Lager, in addition to his $3 million salary, earned an additional $12 million funneled through his software company, which sells products to his charter-school corporation. Just how much does the average teacher in the Electronic Classroom of Tomorrow earn you may ask? Approximately $34,000 per year.

Why do the Governor and the Legislature look the other way? Why are they quadrupling the number of vouchers and reducing oversight of the state’s troubled charter schools?

That’s easy:

I am appalled at the direct pipeline funneling vital state dollars for our children’s education directly into the pockets of millionaires like David L. Brennan, chief executive officer of White Hat Management ($6 million yearly salary) and William Lager, CEO of the state’s ninth-largest school district, the Electronic Classroom of Tomorrow ($3 million yearly salary).

Let’s follow the money trail of political contributions by these two for-profit charter-school CEOs to high-ranking GOP legislators. In the past decade, Brennan and Lager have donated a combined $5 million to high-ranking GOP legislators, including Gov. John Kasich, Lt. Gov. Mary Taylor, House Speaker William G. Batchelder and Sen. Kevin Bacon, chairman of the Senate Committee on Insurance, Commerce and Labor.

Why isn’t the U.S. Department of Education blowing the whistle on these scandals?

Is education reform about improving education or about lining the pockets of campaign contributors?

Not a hard question in Ohio.

A reader asks a reasonable question, perhaps wondering why states like Ohio and Pennsylvania continue to authorize cyber charters despite their abysmal results.

He brings up Michael Milken, who was convicted on charges of securities fraud and tax violation and sent to jail in 1990. According to his bio on Wikipedia, Milken made $1 billion a year and was paid out about $1.1 billion in fines and settlements of claims. One way to understand what is happening in education today is to read Connie Bruck’s book about Milken, the junk bond king, in Predator’s Ball. Junk bonds and leveraged buyouts led to lots of “creative destruction” of familiar brand names.

Today, Milken is a leading figure in the education reform movement.

He is one of the founders of the nation’s biggest cyber charter chain, K12. His foundation invests in merit pay (which as I have previously observed, never works); it gives awards annually to outstanding teachers. One does wonder if it is appropriate for an ex-felon to run schools that receive public funding. I don’t think he could work in a school because schools–at least, public schools– usually fingerprint future employees and don’t hire ex-cons. Cyber charters make a lot of money for their sponsors, but they provide a low-quality education, if you judge it by academic results.

I don’t understand the concept of “legal fraud”. Is that just reserved for corporations and some politicians?Re: CorporationsMilken owns K12 Inc and they are operating in 32 states + DC:http://www.k12.com/schools-programs/online-public-schoolsMilken is a convicted felon who admitted to and was imprisoned for fraud related to fiscal managment. Today, he typically says he’s just an investor in his companies and I believe he tries to conceal his real involvement in them by playing a kind of corporate musical chairs. At the very least, state government officials should be able to track and identify his true involvement in his companies and prevent those companies from receiving public funds on the basis of his felony convictions over money matters. I think it’s possible to do, because the feds prevented him from obtaining financial aid for a university he owned, since his felony convictions were related to violating US securities laws. Perhaps it’s because they were violations of federal laws and not state laws, but one would think the issue is more about fraud involving money, rather than jurisdiction.Re: Certain PoliticiansMy city’s former mayor of 22 years got our city into some truly terrible long-term contracts that privatized some public services, in order to cover fiscal deficits, including a 75 year parking-meter contract and a 99 year parking garage contract. Parking rates immediately skyrocketed and that is going to be lasting our ENTIRE lifetimes. This former mayor now works for the very law firm that negotiated that parking-meter deal:

http://blogs.chicagotribune.com/news_columnists_ezorn/2012/05/daley-a-year-later-no-thanks-for-the-memories.html

I just don’t get why these kinds of things look like fraud and yet might be legal. Are there that many loopholes?

It’s particularly disconcerting when the politicians who do such things are attorneys who are familiar with the law –and the loopholes, too, I guess. This mayor was previously a State’s Attorney. Our last two governors, who were also lawyers, are currently serving time in prison for crimes they commited while in office.

One has to wonder why some people manage to avoid prosecution or sanctions while others don’t. Admittedly, I’m sometimes glad when little people, with little money and little crimes that don’t have victims are not targeted, but when we’re talking about big people, with big money and big crimes that impact millions of folks, not so much.

A reader sent this comment in response to an earlier post. I jumped when I read it because he was absolutely prescient. Consider this: We hear on all sides that the public schools are failing, declining, etc., that test scores are falling, etc., but NONE OF IT IS TRUE. Test scores on NAEP, the only no-stakes national test with forty years of data, are at their highest point in history. And yet, the spin masters keep spinning their tales of failure. It’s time to ask why. I have often imagined the scenario that this reader describes but have been fearful of saying it out loud. Suppose a group of powerful people decided that they wanted to privatize public education. Where would they start? How would they create a “message” to sell something that no one would accept if it was candidly described?

In June , 1992, I wrote the following letter to the editor. Based on today’s posting, I think this letter is as relevant today as it was in 1992.“Try to picture this. A large national corporation, until recently grazing contentedly on federal military contracts, finds its annual earnings reflecting a shocking drop. It is decided that new access to federal dollars must be found, or the corporation may go out of business. Someone suggests a product which could tap into ever increasing federal education dollars. Another suggestion leads to looking into the possibility of crafting that product so that state and local education dollars can also be tapped.”

“The marketing department points out that the product will not sell, unless the buyers, the American public, can be convinced that the current product is substandard. Marketing is assigned the task of creating the need for these new products by convincing the American public that its public education institutions are utter failures. Once that had been accomplished, a program will be undertaken to separate public education dollars from public education institution. Those dollars would become the mainstay of corporation earnings. The product is private education.”

Recently, the FBI raided the offices of the Pennsylvania Cyber Charter School, because of concerns about the intermingling of various for-profit businesses that were created by the school. The school has revenues of about $100 million or more and has spun off a number of other businesses. Apparently, the former governor Ed Rendell made some moves to seek greater accountability and transparency in the school’s booming business, but the current Corbett administration relaxed that effort.

This makes for fascinating reading, if you have any interest in how privatization works and how it is possible to become rich beyond your wildest dreams by running an online charter school for profit. The web of interlocking businesses is dazzling. For some reason, this line caught my eye: “The other person most involved in demanding more transparency from PA Cyber, former Department of Education Chief Counsel Judy Shopp, could not be reached. She left the state’s employ and is now PA Cyber’s compliance officer, also getting income from Avanti, according to financial disclosures she filed.”

One of the nice things about having your own blog is that you can do things like recommend an article that appeared last November.

I recommend this article by Lee Fang that was published in The Nation.

It is a stunning piece of investigative journalism about the corporate reform movement, its leaders, its methods, its goals.

The article centers on events in Florida but the context is national.

It is a shocking story, well documented, and very important.

When I read it, I tweeted it.

It deserves to be read and widely circulated.

This reader scrutinized the website of the Capital Roundtable. This is what he learned:

Although I am not a middle-market investor, I sure did learn a whole bunch over at the Capital Roundtable website. You see, I did not know this:

“Education is now the second largest market in the U.S., valued at $1.3 trillion.  So while an industry of this size will always be scrutinized by regulators, the most onerous recent changes are likely over, and investors should face an easier climate down the road.  And while eventual passage is not guaranteed, several pieces of legislation favoring the for-profit industry have been proposed in Congress.”

And I have been following Arne Duncan and the Race to the Top but it was nice to see the following in black and white.

“In the K-12 space, the federal “Race To The Top” initiative has enabled a growing level of privatization in the K-12 segment, and rewarding districts for embracing alternative models, technological advances, and locally-based criteria.”

So in this new “space” public education is a market not a public good. RTTT enabled privatization. OK, now I get it.

Whether the Common Core standards are good or bad, one thing that is clear is that they have opened up multiple opportunities for entrepreneurs.

The textbook industry is retooling, at least adding stickers that say their products are aligned with the Common Core.

Pearson is developing a complete curriculum package in mathematics and reading, for almost every grade, assisted by the Gates Foundation. Children in some district will be able to take their lessons from Pearson products from the isearliest years right through to high school graduation.

Consultants are standing by, ready to sell products and services to school districts.

Here is one interesting list of what is available. There are many more.

What is happening now was not unexpected. Indeed, it is the intended result, it was planned for, hoped for, envisioned.

Joanne Weiss, who helped design Race to the Top and is now chief of staff to Secretary of Education Arne Duncan, described the plan:

The development of common standards and shared assessments radically alters the market for innovation in curriculum development, professional development, and formative assessments. Previously, these markets operated on a state-by-state basis, and often on a district-by-district basis. But the adoption of common standards and shared assessments means that education entrepreneurs will enjoy national markets where the best products can be taken to scale.

Weiss spent many years as an edu-entrpreneur, engaged in the design, development and marketing of products for the education industry.

We don’t know yet whether Common Core standards will improve the education of America’s children. But of this we can be sure: They will be good for the education industry.

Diane