The School-For-Cash Obsession

It is easy to think of the concept of oligarchy as something distant and fantastical – something that involves exotic destinations like Manhattan, Monaco, Macau and Moscow but not the Middle America locales that you’d never see in, say, a glitzy Jason Bourne flick. I guess the assumption at work is that in a place so often derided as Flyover Country, there’s not much that any true oligarch might covet.

Of course, there’s a good case to be made that oligarchy is actually more of a powerful social, political and cultural force out here than anywhere else. From yesteryear’s Copper Kings in Montana to today’s epic land and water grab all over the Midwest and Rocky Mountain region, the heartland has always been the oligarchs’ playground. It is also their laboratory – the place where the ruling class brutally imposes its hare-brained schemes on the population, as if we are guinea pigs.

You can see what this local version of oligarchy looks like most clearly in education. Indeed, in the last few days, the national media momentarily reported on such oligarchy when the GOP’s prospective 2016 presidential candidate, New Jersey Gov. Chris Christie, publicly berated teachers with the ugly “you people” epithet. The headline-grabbing exchange came after an educator dared to question him about his efforts to turn his state into a laboratory for the destructive ideology of anti-public-school oligarchs. Christie, who has slashed public school funding and worked to divert public education resources into private schools, responded to the question with the oligarch’s let-them-eat-cake attitude, saying of teachers “I’m tired of you people.”

But, then, as shocking as this let-them-eat-cake attitude may seem when it is evinced so brazenly by a national politician, it is the same oligarchic attitude that now dominates local education politics all over the country. Perhaps most illustrative of the trend is my home state of Colorado. This state has unfortunately become the national petri dish of the Education Oligarchs – people like the Walton family, of Wal-Mart fame; Bill Gates, chairman of Microsoft; Michael Bloomberg, the anti-union media mogul; and Philip Anschutz, the billionaire sponsor of right-wing Christian causes. These oligarchs and others aim to put everything – including our kids future – up for sale to the highest bidder in the Colorado education system.

One way to see this is to look at how the Walton family and Gates have deployed their wealth to make an opportunity out of this square state’s infamous education finance problems. Leveraging their tax-subsidized foundations, they purport to come to the financial rescue of budget-strapped schools. Yet, they typically tie their seemingly altruistic beneficence to ideological demands.

For example, some foundations make their cash contingent on schools tearing up teachers’ union contracts and putting more unproven technology into the classroom.

Some go further and push specific technologies into classrooms – technologies that, not coincidentally, their corporations stand to profit from. One example: Microsoft chairman Bill Gates has used $100 million from his foundation to ram his company’s corporate partner, inBloom, into the Colorado’s largest school district. InBloom collects student data to share with technology companies like Gates’ Microsoft, which then develop for-profit education software to sell back to schools. According to the New York Times, parents objecting to the surveillance-like technology feared “officials might be unable to evaluate inBloom objectively, given its backing by the Gates Foundation, a major donor to public schools whose grant money Jeffco was hoping to attract.” The school district ultimately received a coveted $5.2 million grant from the Gates foundation and – not surprisingly – decided to keep using inBloom.

Most recently, some of these billionaires make headlines financing Colorado ballot initiatives that seem altruistic in their ostensible goals of raising revenue for schools. Yet, the oligarchs make sure that the details of those initiatives quietly steer a massive chunk of the new education revenue away from public schools and into the coffers of privately administered charter schools – the ones that on the whole don’t provide better educational outcomes, but do serve those billionaires’ desires to undermine teachers’ unions.

Still another way to see what the local effects of oligarchy look like on a day-to-day basis is to behold the hideous school board politics of my hometown of Denver, where data show years of anti-public-school “reforms” have seriously harmed children. I first learned about this depressing situation a few years ago when my wife ran as a pro-public-school candidate for an unpaid school board position and suddenly faced a $200,000+ campaign against her, including an election-timed appearance from George W. Bush to rally the school privatization movement. It is a hard-to-believe situation – but it is, alas, very real.

As I have previously reported, five years ago, the school system here was turned into a Wall Street profit center and prospective campaign contribution engine by then-school superintendent Michael Bennet. Bennet had zero experience in education policy when he came into the job, but he did have vast business connections from his tenure as a corporate raider for Anschutz, the right-wing billionaire. He put that to work when in 2008 he orchestrated a pension financing deal that made Wall Street banks so much money and cost the school system so much cash it became a national cautionary tale on the front page of the New York Times. Bennet, though, was long gone by the time the destruction was evident. Within a year of the original deal, he was on his way to getting handsomely repaid for his work, with the financial industry that his scheme enriched conveniently serving as one of his top U.S. Senate campaign contributors.

The school budget crisis this scheme exacerbated has empowered billionaires’ foundations to leverage their wealth in the name of corporatist ideology. With Denver schools especially strapped for cash in the wake of Bennet’s scheme, the Waltons, the Gateses and others have in the Denver Public School system a perfect target. The schools’ budget crisis makes local schools particularly willing to trade education policymaking – say, tearing up a school’s union contract – for the much-needed operating cash that foundations provide. Under the rule of this oligarchy, Denver has for years now been on a pro-charter-school, anti-union tear. Despite data showing that such ideology has often produced terrible academic results in Denver, the corporate “reforms” have nonetheless been loyally backed by the city’s corruption-plagued school board. Even by modern standards, that oligarchy-serving corruption is breathtaking, as Denver school board members moonlight in jobs that give them personal financial interests in anti-public-school “reforms.” As I recently reported:

(The school board’s) current president is paid by a private education foundation whose stated goal is to put more public money into privately run charter schools. It’s immediate past president resigned to go work for a private education foundation that does business with the school district. Another of its board members runs a foundation that gets money from the school district. A previous board member went from the board to a run a group looking to bring more corporate influence into the school system. And now another leading candidate for a board vacancy, the pro-voucher former lieutenant governor Barbara O’Brien, says that even if she wins the board seat, she will ignore concerns about self-dealing and remain the paid executive director of a pro-charter foundation to which the school board gives public money.

All of this has created a political climate where corruption and conflicts of interest are just right out in the open. In this local oligarchy, nobody even tries to hide what’s really going on. There simply is no shame anymore – nor is there any pretense surrounding what education politics is now really all about. To see that in action, consider this year’s school board candidate Michael Johnson.

Like O’Brien and the other slate of anti-public-school candidates, Johnson is campaigning on a promise to take more money out of the public school system and put it into privately run charter schools. But what distinguishes him is his role making huge money off the public school system for his private law firm, Kutak Rock. He did this as one of the key participating private attorneys in the aforementioned Wall Street financing scheme that pulverized the school system’s budget.

According to financial documents obtained by Salon that Bennet allies in the school system have until now kept secret, Denver taxpayers have been forced to cough up more than $3.6 million to Johnson’s private law firm for bond work in the last decade. One fifth of that sum was generated since just 2008 – specifically for the budget-busting refinancing deal that made Wall Street so much cash. Johnson was one of the Kutak Rock attorneys who worked on that deal. Yes, that’s right – a key player at the law firm that made so much money off the infamous refinancing deal and that has made millions off school board business is running for a decision-making position on the school board.

The potential for self-dealing and conflicts of interest should be obvious if Johnson is elected to a school board that has done so much business with his law firm (no doubt, this is why Kutak Rock employees are scattered throughout his campaign reports – though thanks to Colorado’s pathetic campaign finance disclosure laws, we won’t know if there was more such money financing the outside groups supporting him).

Incredibly, to help him navigate the legal questions surrounding those potential conflicts of interest, Johnson’s campaign was by his own admission provided legal counsel at taxpayer expense by the Denver school administration. This is grotesque, but not all that surprising. After all, this is the same administration that has been a champion of Johnson’s pro-charter-school platform. It is also the same administration that is so cavalier with taxpayer cash that it is now diverting a huge chunk of resources out of Denver classrooms and into the renovation of a lavish new downtown headquarters for school administration officials.

In a minimally functioning democracy, these facts would doom a candidate in a local school board election. But this isn’t a functioning democracy – this is an oligarchy. And so these facts have been drowned out by the anti-public-school slate’s huge money advantage – an advantage which allows these “reform” candidates to overwhelm voters with mail and paid canvassing, all while the underfunded opposition doesn’t have matching resources to get inconvenient facts out.

That money advantage, of course, comes from – you guessed it! – the oligarchs. For instance, as Westword reports, Johnson and O’Brien have cashed huge checks from right-wing billionaire Phil Anschutz, who is famous in Colorado for funding anti-gay ballot initiatives and sponsoring conservative Christian political groups like Colorado for Family Values.

They have also cashed similarly large checks from oilman and former Colorado Republican Party chairman Bruce Benson. And they have received huge donations from Kent Thiry and/or Thiry’s wife. Thiry is the CEO of a scandal-plagued health care conglomerate that has made a name for itself as a target of federal criminal and civil investigations.

Thanks to this, the oligarchy-backed slate in this one city is now awash in an unprecedented amount of money that allows the slate to grossly outspend the pro-public education forces. According to the latest campaign finance reports, the slate of four anti-public-school candidates in Denver has collectively raked in almost $600,000. That figure doesn’t even counting the hundreds of thousands of dollars more in “independent expenditures” almost certainly being spent on their behalf by out-of-state education “reform” groups. One of those we already know about is called “Great Schools Denver”. Its name implies it is a local group, but its $200,000+ slush fund is provided by just 9 Education Oligarchs, the majority of whom aren’t from Denver. Indeed, a third of its money is provided by Bloomberg, and another third is provided by an arm of a D.C.-based front group sponsored by Wall Streeters.

One reaction to all this is to be thankful that we here in Colorado at least still have elections for school boards. After all, in more and more locales, the oligarchs have used their money to buy an end to such elections and vest all school decisions with the mayor. That makes schools easier for those oligarchs to control, because they only have to buy and sell one big political office rather than many small ones that still face some semblance of grassroots accountability.

But while we can be thankful that the patina of democracy still exists here, it is just that: a patina. With the amount of cash oligarchs are pouring into the education politics of this state and with the revolving door spinning so fast between school boards and the corporate oligarchy those boards do business, the elections often turn out to be predetermined affairs. One side has all the cash and thus overwhelms – and confuses – voters with reams of glossy mailers. The other side has earnest folk who knock on thousands of doors – but can rarely break through the noise.

That, of course, is by design. Democracy becomes oligarchy when enough cash is marshaled to effectively cut off a debate. This is especially true in the increasing number of places like Colorado where an ideological Citizen Kane-like monopolist makes sure there’s as little objective coverage of education as possible.

The only hope is that enough voters become aware of what’s going on – and actually do something about it. But that first requires a general awakening – which is exactly what the oligarchs are trying most desperately to prevent.

David Sirota is a staff writer at PandoDaily and the best-selling author of the books “Hostile Takeover,” “The Uprising” and “Back to Our Future.” E-mail him at ds@davidsirota.com, follow him on Twitter @davidsirota or visit his website at www.davidsirota.com.