K-12 Incorporated – Where For-Profit Schools Mean Millions

K-12 Incorporated - Where For-Profit Schools Mean Millions

Senator Lamar Alexander comes up with another plan to save American education. This one means shoveling money into the hands of for-profit schools.

Suppose we could say to the young: “You should go into teaching. Someday, you can be a millionaire! The next Nathaniel A. Davis!”

For-profit schools! That’s the ticket!

New plan involves funneling money to for-profit schools.

Before we turn to Mr. Davis, however, we need some background. This week Senator Lamar Alexander of Tennessee offered up the latest in a long string of schemes to fix the nation’s public schools. Teachers, I imagine, are wondering, “Shouldn’t education in this country be fixed by now? How many of these plans have politicians already put forward?”

Ignore that conundrum.

Here’s the bold new plan—not to be confused with previous bold new plans. Such as ‘No Child Left Behind.’ Mr. Alexander wants Congress to free up federal funds for 11,000,000 students from low-income families. Not new funds. No, Alexander is a fiscal hawk. His idea is to take away money that the public schools already receive. Then he wants to give it to parents to spend so they can enroll their children in schools of their choice. Choice! That’s what makes America great. Well, not counting parents who are gay or lesbian and might want to choose whom they marry.

Cash and carry:  for-profit schools love profits!

What Senator Alexander wants is to divert $24 billion in funding. That’s 41% of federal dollars spent on K-12 education. Or:  $2,100 per child.

Under his plan states might use the money to:

  1. Help low-income students attend public schools outside their neighborhoods.
  2. Fund individual scholarships to help pay private school tuition.
  3. Attend charters, including for-profit schools. 

Really! Choice is cool! Like:  would a member of Congress rather go to a fine restaurant with a lobbyist and eat a $150 meal? Or—since the GOP savaged the food stamp program—would a low-income person rather eat stale donuts scrounged from a dumpster?

Anyway, how would this plan work? Suppose a low-income family hopes to send a daughter to Summit Country Day High School here in Cincinnati. Let’s do the math:

Cost of attending Summit Country Day (9th grade):            $19,050

Federal money available:                                                                       2,100

Shortfall:                                                                                                 $16,950

Oh, so close! Sadly, the aspiring low-income student still can’t get into the élite school and rub elbows with upper crust children. And by the way, could we not raise the minimum wage, which would be communism or something. And damn! Who thinks low-income families should be covered by health insurance!

Sure. The GOP loves to help low-income children.

Or could it be that Republicans secretly hope to privatize all the schools—and break up teachers’ unions as a bonus? For-profit schools! That’s the right-wingers’ dream fix for education! Perhaps Republican hearts don’t pump red. Perhaps they pump green.

Here in Ohio, we know the answer. Meet David Brennan, operator of White Hat, a charter school chain with almost fifty franchises.

No, I mean schools.

Brennan cares about dollars. No, no, I mean kids. That’s why he has a $6 million mansion down in Naples, Florida. Because Brennan cares about living in lux…no, about children. He loves them so much he is willing to go out of his way to host fund-raising dinners in Florida for hard-working Ohio politicians.

Another neat White Hat trick, when franchises…ahem, for-profit schools…fail is to close them. Then they reopen with cool new names, in the same buildings, with much the same staff, so that profits for Mr. Brennan are nearly impossible to kill. Kind of like zombies.

Campaign donations:  just one cost of running for-profit schools.

How does Brennan prove his love for Ohio’s kids? According to the Akron Beacon Journal he and his wife Ann contributed $3.8 million to fifty-one politicians between 2004 and 2012. Almost every cent went to GOP lawmakers.

Really? Why would anyone be surprised? Where education and profit clash education loses. Read up on the shyster tactics used by major for-profit colleges. Or consider the shady operations of for-profit charter school chains in Pennsylvania.

At least you’ll get a laugh for your tax dollars.

Today, however, let’s follow the money under Alexander’s plan and see where it ends up. Let’s look at how K-12 Inc., a for-profit virtual education company does business. K-12 was started in 1999. Its founders were two giants in education. No, no, I’m messing with you. The founders were Michael Milken, one-time junk bond king, and Ronald Packard, a hedge fund banker.

The first chairman of the K-12 board was Bill Bennett. Like Senator Alexander, Bennett was a former U. S. Secretary of Education. But he was forced to resign in 2005 after suggesting that if you wanted to lower the U. S. crime rate you could abort every black baby. He quickly added that this would be reprehensible. Still, “your crime rate would go down.”

In other words, these are exactly the kind of people you know are going to devote themselves to helping low-income families. In 2013, K-12 took in $848 million. And 86% ($731 million) came out of the pockets of taxpayers. Profits have nothing to do with for-profit schools. Trust these guys. Trust them with your kids.

Helping kids is hard–but $9.5 million makes the effort all seem worthwhile.

Helping children is hard, of course. Every teacher knows that. So you have to pay to keep quality employees. You have to pay Packard $19,489,223 for five years if you want to be sure he keeps helping. You have to pay his chief financial officer $3.3 million in 2013.

Every for-profit school needs an executive chairman—a man who would never enter the field unless he was sure he could help children. And get paid $9.5 million in 2013. So let’s hear it for Nathaniel A. Davis. There’s no educator in America who cares more about young people than Davis does!

In fact, the top eight educators at K-12 needed $21.4 million to get by just last year.

What’s the moral of this story? Obviously, Congress should listen to Senator Alexander. Federal dollars must be shoveled in this new direction. We need to support the efforts of these heroes in education.
Do a little more math.

Your tax dollars at work!

What happens when we funnel money to for-profit schools? Figure the first 1,810 children who use federal funds will help Brennan provide new campaign donations to GOP politicians. The next 2,857 will use grant money to ensure that Brennan can keep living in a mansion in Florida. The next 4,524 will use their funds so that Davis can be fairly compensated in 2014. Finally, 9,281 low-income children will use their money to make sure that Ronald Packard sticks around for another five years and keeps doing what he does so well.

Let’s make sure Packard keeps helping kids get the best education our tax dollars can buy.