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Magna Charter?

Friday, September 1, 1995

Two competing paradigms of education reform have emerged in the United States in recent years, and the differences between them are growing sharper. One, commonly termed "systemic reform," assumes that reform efforts should be led by government and imposed from the top down. Its advocates believe that state (or federal) authorities must set standards not only for student learning, but also for teacher training, pupil assessments, textbooks, and school resources. Though undertaken in pursuit of higher standards and better results, systemic reform relies on uniform strategies to ensure that "inputs" everywhere are equal and all schools undertake similar activities. Government resources and bureaucratic regulation are, of course, its preferred mechanism for making this happen. Much of Goals 2000 embodies this approach.

The second reform paradigm, which we call "reinventing education," embraces decentralized control, entrepreneurial management, and grassroots initiatives, all within a framework of publicly defined standards and accountability. Under this approach, public officials establish standards, make assessments, and hold schools accountable for meeting performance goals but do not themselves run the schools. Public officials also retain the power to cancel charters and school-management contracts on grounds of consistently poor performance, but they do not directly supervise or control the means by which schools pursue those ends.

Under this paradigm, education may be delivered through charter schools (licensed by public authorities such as a state, city, or local school district), "opt out" schools that secede from their local education agencies and run themselves with what amounts to a "block grant" of public funds, "contract schools" (in which a performance contract is negotiated between private educational managers and a public agency), and "choice" programs (in which students use scholarships or publicly-funded vouchers to attend the schools of their choice). In all such situations, the continuing responsibility of public authorities is to establish standards for educational and fiscal performance and monitor progress in relation to those standards. (Those who reject this degree of public accountability may, of course, turn to wholly private schools or home schooling.)

The "reinvention" approach welcomes diverse strategies and schools organized and run by various entities such as teacher cooperatives, parent associations, private corporations, religious institutions, and community-based organizations. It assumes that students and families are different and should be free to match themselves to the schools that suit them best. It requires little bureaucracy and few regulations because it rejects the proposition that schools must be centrally managed according to a single formula.

We strongly favor the "reinvention" paradigm, provided that it contains one key element borrowed from the "systemic" approach: standards and accountability. It is our conviction that only clear and high standards for performance will ensure accountability, both to the marketplace (that is, to families making informed choices among schools) and to whatever public body authorizes the schools to operate.

These standards need not be national, they need not be highly detailed, they should not prescribe pedagogy or resource use, and they need not cover the entire curriculum. (Indeed, the ability of schools to add their own features to the "core" described in the standards is part of what will make them different from one another.) But only when such standards are in place -- and accompanied by good tests and a steady flow of performance information -- can parents make informed choices among schools and public authorities determine which schools deserve to retain their "charters," contracts, or accreditations.

These two approaches are now competing with each other, not only in Washington, D.C., but also in the states. Systemic reform remains the favored strategy of the Clinton administration and of some educators (especially in state departments of education and teachers unions), but the "reinvention" alternative is preferred in many other quarters -- including by many elected officials, business leaders, and parents, as well as by teachers and principals who welcome the possibility of breaking free from the stifling grip of bureaucracy.

The reinvention impulse has even reached Capitol Hill, where the past year saw stirrings of the first major push in memory to "devolve" centralized activities to states, communities, and families and to lift restrictions on the use of federal aid. This impulse arises partly from the quest for better education, but also from a reaction against the regulatory burden of federal regulations and unfunded mandates.

This is the motive behind recent congressional activity concerning "block grants" in areas as diverse as welfare, school lunches, and job training, as well as education aid. To be sure, turning categorical programs into block grants and devolving control to states and communities will not automatically foster reinvention. Indeed, recipients may not do much of anything. But doing away with "Washington-knows-best" approaches and removing strings from federal dollars at least permits reform-minded states and communities to experiment with new strategies for education and other public services—and closes the easy route of blaming Uncle Sam for poor results.

The federal government is so hamstrung by special interest groups that getting it out of the way of change-minded states and communities may be the most we can expect from Washington on the "reinvention" front. Certainly, all efforts by Uncle Sam to foster such reforms directly have proven halfhearted at best and fraudulent at worst. The so-called "Improving America's Schools Act" of 1994, for example, banned any use of federal aid for privately managed public schools and created a school "choice" program so laden with preconditions and constraints that it must be termed phony. It enables members of Congress to say they "voted for school choice" while ensuring that there is none.

Even rigorous accountability based on testing was discouraged by explicit prohibitions in the Goals 2000 legislation on the use of federal funds for this purpose. Those who believe that such reforms are the main hope for serious educational improvement are learning that Washington is the wrong place to look. But much is happening elsewhere in the nation under the "reinvention" banner.

Potemkin Charters

The charter school idea has picked up tremendous momentum, as have variants, such as a flock of new, miniature high schools in New York City that are not called charters but share many of their characteristics. Those qualities include a large measure of operational independence from headquarters in return for a promise to achieve certain results over a stated period of time. (New York City's quasi-charters, however, have not agreed to any educational performance goals, and their quasi-independence relies on waivers by the local teachers union, waivers that do not even apply to the schools' many other employees.)

By summer 1995, 19 states had enacted explicit "charter" school laws, including eight during the most recent legislative session (Louisiana, Arkansas, New Hampshire, Texas, Alaska, Wyoming, Delaware, and Rhode Island). Several hundred such schools were scheduled to be open this fall. Charter schools are no panacea -- not in a country with 85,000 public schools -- but this movement is the second-most-exciting development on the educational reform front.

Not all charter laws are created equal, however, and several enacted in recent months are so weak that they are unlikely to do much good. We think of them as "Potemkin" charter programs with an impressive facade but no substance. Some of these laws were supported by people who actually oppose charter schools on principle and had decided to undermine support for them by promoting a bill that pretended to create them. This is currently happening in New Jersey, where the state teachers union is supporting a weak charter bill in the state assembly, although a stronger, competing bill supported by the state education commissioner, the state senate, and Governor Christine Whitman may yet prevail.

Weak charter laws generally suffer from at least one of three serious failings:

  • They require the prior assent of too many "stakeholders," such as a majority of teachers currently teaching in the affected schools, and contain no mechanism for creating new charter schools that do not already possess such stakeholders. Of course, it would be wonderful if existing schools converted to charter status with the support of a majority of teachers and parents working together, and that is sure to happen in some places. But there are also situations in which parents and community leaders want to start a new school, and they should be allowed to do so—with the staff they want to teach in it. (Currently, California's charter law requires the approval of a majority of teachers, as do those in Georgia, Hawaii, and New Mexico.)
  • They place local school boards in sole charge of granting charters. (Wyoming, Louisiana, and Texas have recently enacted such laws.) Though such a limitation is invariably a key political goal of school board lobbyists, it can be fatal for charter schools, because the uniform policies of a benighted local board and risk-averse superintendent are usually what charter-seekers are keenest to escape. That is why strong charter laws either lodge the authority to issue charters with a different entity (such as a state superintendent or state board) or -- better yet -- create multiple windows or appeal mechanisms so that no single entity has the absolute power to deny a charter application. In Michigan and Minnesota, state universities have the authority to issue charters. In Arizona, besides vesting this authority in both local and state school boards, the legislature created a new "charter school" board exclusively for this purpose

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  • They neglect to exempt charter schools from enough of the statutes, regulations, and contractual provisions that burden conventional schools. Thus, the charter school is not truly free to chart its own course. The whole point of such a school, after all, is to gain autonomy of action in return for accountability for results. The only regulations that charter schools should be expected to comply with are those governing health and safety and protections against racial discrimination. But many states leave numerous other rules in place. If a state still requires that U.S. history be taught in the 11th grade, that a school's pupil-teacher ratio cannot exceed 25:1, that 40 minutes a day must be spent on math, that certain textbooks must be purchased, and if there is no respite from seniority rules, salary schedules, or tenure requirements, then we see little point in calling an entity so regulated a "charter school." Such a charter is unlikely to be worth the paper it is printed on -- and few will go to the bother of seeking such a document.

Why have so many states created these Potemkin charter programs? The explanation, of course, has to do with power and politics, catalyzed by the education establishment's fierce resistance to changes that threaten its monopoly. Though many teachers and principals crave opportunities to "opt out" of the system and run their own schools without the incessant oversight, time-wasting regulations, and innumerable mandates of the bureaucracy, their professional organizations seldom see it this way. Thus teachers unions, school-board associations, and superintendents, if they cannot defeat the charter bill altogether, generally do their utmost to weaken it. So do other advocacy groups—for example, special education—whose stock-in-trade is rule-bound uniformity rather than diversity. In fact, the Southwest Regional Laboratory recently leveled a novel criticism: that charter schools—precisely because many of them demand a high degree of parent involvement—are unfair to children with bad parents!

Obtaining a charter does not end the hazards that await these schools. Most also encounter practical problems when they first launch. One perennial challenge is finding a place to operate a charter school. To our knowledge, no state provides charter operators with buildings or capital financing. Though this is no huge burden for existing schools that convert to charter status, it poses a great obstacle to the creation of new charter schools. Another problem is that many charter school founders and managers have little prior experience in matters such as financial management, purchasing, and marketing.

Our hunch, however, is that these are birthing and growing pains associated with a feisty, infant reform strategy that will, in time, turn into a strapping youth. We doubt that opponents will be able to halt its growth. In England, where "grant-maintained" schools have been in place for several years -- and where almost a fifth of all secondary schools have "opted out" into this independent status -- even the Labor Party is having to come to terms with their continued existence. Indeed, party leader Tony Blair now sends his own child to a grant-maintained school.

Gains for School Choice

There was major progress on the choice front in 1994-95, centering on Milwaukee and Cleveland. In Wisconsin, Governor Tommy Thompson succeeded in persuading the legislature to pass his proposal to expand Milwaukee's voucher experiment to include many more children and to permit attendance at church-affiliated schools. As revised, and assuming the courts eventually assent, up to 15,000 low-income Milwaukee children (nearly all of them minority) will be able to attend any school within the city limits.

In Ohio, the legislature agreed to a proposal by Governor George Voinovich to initiate a voucher "pilot" in 1996 for children in Cleveland. That city's catastrophically bad school system was "taken over" by the state under a federal court order in early 1995. Here, too, church-affiliated schools will be eligible recipients of voucher-bearing youngsters -- up to 2,000 of them. And here, too, the primary beneficiaries of this reform will be low-income minority youngsters.

Court battles have already begun, and we do not doubt that choice's foes, having lost two significant political battles, will now throw vast resources into the effort to get vouchers thrown out as a violation of the "Establishment Clause" of the First Amendment. In August, the Wisconsin Supreme Court issued a temporary injunction against the Milwaukee plan. But the governors and legislators of Wisconsin and Ohio deserve hearty applause from those who believe, as we do, that no child should be forced to attend a bad public school against his and his parents' will when a better school -- public, private, or hybrid -- is available close by. Because the families of poor children often lack the wherewithal to exercise such a choice on their own, it is the obligation of elected officials to make it possible for them, as they have historically done in higher education. That this will now happen in two major U.S. cities is a development of immense significance to American education.

A number of other states stepped up to the "choice" plate in 1995 but struck out. In Texas, Pennsylvania, Connecticut, Illinois, and Arizona, variations on the voucher theme failed to pass, and New Jersey delayed consideration of Mayor Bret Schundler's Jersey City plan until at least autumn of this year. The original Ohio choice bill, to encompass a broader area than Cleveland, was chopped down by the legislature. Another setback was the ruling by Puerto Rico's Supreme Court that the voucher program there violated the commonwealth's constitution.

Nothing, of course, elicits tougher opposition from defenders of the public-school status quo than voucher schemes (and similar ventures that go by different names), even when such plans are aimed precisely at those disadvantaged children who are most likely to drop out of public school. But the idea is not going away. Meanwhile, privately-funded voucher projects also continue to multiply, from New York's Student/Sponsor Partnership, to the Golden Rule program launched in Indianapolis in 1991. Today 23 programs reach more than 10,000 students.

We believe that it is just a matter of time before children from needy families in most parts of the country will be able to carry their vouchers (or scholarships or whatever they may be called) to any accredited school. We understand that some private schools fear government regulation, and may decline to participate. We recognize that public aid should be targeted toward those students in greatest need (as is now the case in higher education); and we acknowledge that the Supreme Court will have to sort through the constitutional questions posed by inclusion of parochial schools. (Recent Supreme Court decisions in this domain have encouraged voucher supporters.)

Still, it must be noted that, in the meantime, primary and secondary schooling is becoming increasingly anomalous as vouchers come to prevail in most other domains of U.S. domestic policy. Even President Clinton has endorsed vouchers in job training and in public housing. Moreover, much of the rest of the world -- from Australia to Chile to the Netherlands -- treats publicly-subsidized private-school attendance as routine and normal.

Contract Management

Paul Hill's superb new book Reinventing Public Education sets forth a comprehensive vision of how this approach could work in the future -- and why it is apt to work better than direct operation of all schools by the school system's central office. Meanwhile, Educational Alternatives, Inc. (EAI) continues to manage a number of schools in Baltimore and recently added Hartford, Connecticut, to its portfolio. The superintendent of schools in the District of Columbia has tried to revive his plan to engage EAI to run some of D.C.'s troubled schools. A private management firm is functioning as "superintendent of schools" in Minneapolis.

The Edison Project opened its first four schools in 1995, with others due to follow if these succeed. And at least two other companies are already active in this field in the United States. Sabis is an international group that has been running a school in Minnesota and recently added a second (charter) school in Springfield, Massachusetts. Nashville-based Alternative Public School Strategies has reached an agreement with little Wilkinsburg, Pennsylvania, to run one of three elementary schools in that community -- a school in which 78 percent of students receive free or reduced-price lunches. (The future of this contract, however, is shadowed by ambiguity in the laws of Pennsylvania as to the legality of such an arrangement.) More companies and communities will surely follow, probably including big corporate guns such as Disney, which is creating a school in Florida that many view as a prototype.

Unfortunately, not all the blossoms in this garden are healthy. EAI's relationship with a school in Dade County, Florida, has ended. Baltimore mayor Kurt Schmoke -- whose strong support is the main reason EAI has been able to withstand intense establishment pressure in that city -- has voiced dissatisfaction with student performance in the EAI-run schools after three years and has suggested that the arrangement may need to be rethought. And EAI's bold plan to alter budget priorities in Hartford kicked up such a storm from vested interests -- imagine shifting funds from surplus staff to areas such as technology—that the company and school board have decided to scale back most of the changes, at least for now, from the entire district to six schools that have "volunteered" for the full treatment.

The difficulties of EAI in Baltimore and Hartford suggest that contracting will probably work best with new schools and with existing schools that are receptive. It is difficult to graft a new management program onto a school whose staff is determined to defeat the new managers. Perhaps private management should begin with a single school or manageable number of schools that want to be changed. Otherwise, the new managers will be forced to maintain all the elements of a system that currently does not work for children. And if they do, they will be doomed to fail.

As for Edison, there is incredible pressure on its first four schools to be nearly perfect -- educationally, organizationally, and budgetarily -- from the very outset. The venture's future hinges on how well it meets these immense expectations. Every education journalist and researcher in the Western world is knocking on the Edison schools' door, probing for defects or missteps. No conventionally-run public school in America is likely to be subjected to the same degree of scrutiny or held to the same standards of perfection.

In our view, contract management of public schools holds considerable promise, and these trials should be encouraged. We should also expect bumps along the road as these schools get their bearings; some may even fail. It is well to bear in mind, however, that we currently keep failing public schools open and even reward them when they should be closed down. Therefore, when a poorly run contract school or charter school is terminated, we should see such an action as a victory rather than a setback for the reinvention strategy. If and when that happens, it will prove that school authorities are willing to be held accountable for poor results.

Meanwhile, beware the word "privatization," which is widely used by supporters of the current system to block all movement toward contract management. True "privatization" means selling or otherwise transferring a public asset to private owners who henceforth bear sole responsibility for its existence and are accountable to no one save their shareholders.

That is what is happening to certain big, state-run factories in Eastern Europe, for example, but it is not what firms such as EAI and Edison are doing with the U.S. schools they manage under contract. Those schools remain public in every sense that a student, parent, taxpayer, or voter could think important: They are open to the public, financed by the public, and educationally and fiscally accountable to public authorities for their continued existence (and for the retention or termination of their private managers). Here is a sure test of whether an organization has been privatized: If public authorities can cancel the contract or withdraw the charter, the transaction is not privatization. It is a management contract on behalf of the public, not a transfer of public goods to private ownership.

Governance Changes

The century-old governance structure of American public education is showing signs of change. As a recent Education Week headline put it, "Fervor spreads to overhaul state agencies."

This year, it appears, 30 states carried out or at least considered reorganization or reduction of their education departments, mirroring the popular political trends of reducing government, pushing authority to local officials, and giving power to the elected officials whom the voters are apt to hold responsible at the polls for the effective use of their tax dollars. (Education spending is the largest or second-largest budget item in every state.)

Texas offers a dramatic example. Now the second most populous state, Texas has been long known to have perhaps the most highly regulated school system in the country, with an immensely detailed education code and an all-powerful state education agency. Early this year, the legislature agreed with Governor George W. Bush Jr. that significant changes were needed. In effect, they repealed the entire education code and started afresh.

The authority of the Texas Education Agency has been limited to six basic functions, including recommending education goals, granting campus charters, managing school funds, and administering federal programs. Several new categories of schools and school systems have been authorized, including "home rule" districts that are freed from most state mandates and charter schools that may be organized by individuals or groups outside the existing school system. (Unfortunately, as we noted earlier, almost all Texas charters must be issued by the local school board, and these boards are not likely to welcome dissenting approaches.) Texas also created a new network of alternative schools and made it easier to remove disruptive students from regular classrooms. And it created a powerful new state board for educator certification, to be named by the governor.

Other states have taken different approaches. Minnesota abolished its department of education and merged these functions into a new department of children, families, and learning. Wisconsin took virtually all duties and powers away from its independently-elected state school superintendent, an office that was widely perceived as a captive of the education establishment, and turned them over to a new agency answerable to the governor. New Jersey's governor "froze" the regulatory process and directed the education commissioner and his colleagues to propose a comprehensive overhaul. North Carolina -- another highly centralized, heavily regulated state -- is shrinking its department of education by half and rewriting laws and regulations to give local districts far greater flexibility. The state has established annual performance standards for the state's almost 2,000 public schools based on "reasonable progress" in reading, writing, and math and with various interventions, sanctions (including suspension of principals and teachers), and rewards for success or failure to meet those standards. In other words, the state is moving from a regulatory compliance strategy to one based on standards and results.

Illinois also made a radical change, though it affects only the city of Chicago, whose troubled and deficit-plagued schools have been the object of innumerable reform efforts in recent years. The legislature gave unprecedented control to the mayor, who has appointed (and can remove) all members of a small newly created "board of trustees" and a management team that includes a chief operating officer and fiscal, purchasing, and educational officers. The new law also places school principals in charge of all school employees (previously they had no authority over custodians) and authorizes them to set their own school hours and staff schedules. The Chicago Teachers Union is barred from bargaining over many nonsalary issues such as class size, staff assignments, academic calendar, hours and places of instruction, pupil assessment policies, privatizing services, and decisions over charter schools. It is also forbidden to strike for the next 18 months.

Will Unions Get with the Program?

Chicago is not the only place where teachers unions have run afoul of public authorities. Largely because of their efforts to block state and local reforms, the unions are coming under more intense scrutiny and challenge. School boards, legislatures, and governors are promulgating policies and proposing legislation to abolish tenure, redefine collective bargaining rights, repeal "fair-share" agreements, and otherwise change laws and practices that sustain union interests and undergird their power.

In Indiana, for example, the "fair share" law has been repealed. This law had authorized unions to extract fees from nonunion members in return for "services" performed for them by the unions, regardless of whether the individuals wanted those services. (An obvious example is a wage increase that affects all teachers in the district.) By repealing this law, the legislature made it illegal for unions to negotiate such arrangements with school districts. In another, more localized blow to the Indiana State Teachers Association, the legislature passed a reform bill for the Indianapolis schools that limits collective bargaining to the issue of wages only in that city.

In neighboring Michigan, the state also erased collective bargaining over certain nonsalary issues, empowered school boards to put teachers' health insurance out for competitive bidding (rather than compelling purchase of this benefit from the Michigan Education Association's insurance subsidiary), instituted steep fines against teachers who go on strike, and forbade the union to deduct political contributions from teachers' paychecks without their permission.

Such developments are apt to continue as long as unions throw sand in the reform gears. When education is reshaped around standards and performance rather than inputs and processes, just about every established routine will be affected, including personnel practices. No aspect of a school's management is more crucial to its effectiveness than how it handles staffing, and nothing is more fatal to performance-based innovation than attempts to preserve staffing rules that disregard performance.

In New York City, for example, the contract with the United Federation of Teachers allows a school, if 75 percent of the staff agrees, to be included in the "school-based option transfer plan," which lets it (among other union-rule waivers) select its own teachers rather than having staff assigned on the basis of seniority. Sixty schools, including most of the struggling new, small high schools, have opted to be included in the program.

In the city's 1,000 other public schools, however, which enroll 99 percent of the children in the system, transfers to vacancies continue to be based strictly on seniority. Junior teachers can be "bumped" by more senior teachers from other schools, no matter how much a school may want the junior teacher or how little it wants the more senior teacher. Such practices, of course, make it impossible for a school's staff to develop its own ethos, which is essential to the staff's effectiveness and its ability to work together as a team with shared goals.

The Educational Excellence Network has had a long history of successful association on important projects with the American Federation of Teachers at the national level, and the authors of this report admire AFT head Albert Shanker's defense of high standards and high stakes, his international work on behalf of democracy, and his good sense about curricula issues. His staff has also produced some terrific products, and several AFT locals have pioneered (or at least tolerated) some promising reform strategies.

At the state and local levels, however, far more often than not, the AFT and NEA are the most potent protectors of the status quo. In principle, they could change, abandoning their tired industrial model of unionism and turning to the flexible, responsibility- and accountability-seeking, participatory, professional approach to organizational behavior that modern organizations need, and that many other organizations have. We do not know whether, if only for self-preservation, they will prove willing and able to take such a step. We certainly hope they will.