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Charter Schools in America...Triumph or Debacle?
The goal of the first charter schools was to challenge the public school system to be more responsive to its students and to work harder to provide a better education by offering healthy competition and to pressure traditional public schools to provide an equivalent or enhanced service. Of the nation's 48.9 million students enrolled in public schools, charter schools serve about 6% or around 3 million students ("Fast Facts"). As congress and the general public consider alternatives to public schools, charter schools are the most the popular. It seems that the general dissatisfaction of the performance of public schools, based on standardized tests scores, and pressure form the American people for change, has provoked many lawmakers to advocate charter schools as the solution to the public school woes. As charter schools and traditional public schools vie ultimately for their survival, the government has passed laws in favor of charter schools development and expansion. As popularity and enrollment of charter schools increases, the general view of public schools deteriorates along with dwindling student counts. But, are charter schools successful enough to be deemed a viable option of education reform? Is there data that supports the claims that charter schools are more successful than traditional public schools? Why is the government endorsing charter schools? Despite the lack of proof that charter schools are more successful at educating America's students, the government continues to endorse and invest in charter schools, fueling their growth and prompting for-profit companies and investors to explore the new, lucrative business that the public educational system has become.
There has been no proof that charter schools better serve student than public schools. Because of their popularity, the general population commonly believes that any charter school is better than every public school. By the way that government promotes them, one can understand why the public feels this way. But, contrary to popular belief, studies have shown that charter schools are no better at educating America's youth than traditional public schools and are often worse according to national standardized test scores. In what many call the most detailed study on the productivity of charter schools to date, the 2009 survey conducted by the Center for Educational Outcomes (CREDO) at Stanford University found of all charter schools that participated in its study, which spanned 16 states including about half of the charter schools in the country, only about 17 percent of charter schools proved to be achieving better student performance while 37 percent performed significantly worse than comparable students at traditional public schools ("Credo"). They also found that the majority of charter schools did no better or worse than equivalent traditional public schools on standardized tests ("Credo"). Skeptics believe that the results of achieving charter schools can be attributed to charter schools that have admission tests that filter students by their aptitude.
By injecting the commercial objective to turn profits into the public educational system, charter schools can simply siphon money to their for-profit management companies. Some charter schools are publicly traded on the stock market. Many who oppose charter schools see this as a grave conflict of interest. K12 Inc. is the largest online primary and secondary education company. The company began to be publicly traded on the stock market five years ago, after raising about $140 million in revenue. Since its stock market debut, the company's net worth has grown to more than $500 million and continues to grow. (Flanagan) The market-based business system is counterproductive in the educational system where success should be measured by scholastic achievement not monetary gains. Unfortunately, the correlation of charter schools and profits are becoming more common to investors. "David Brain, chief executive officer of Entertainment Properties Trust, which has historically owned movie theaters but branched out to invest in charter schools, saying he remains convinced charter schools are a profitable sector" (Simon).
The American government, as a method of public school reform, has encouraged the growth of charter schools. Over the last decade, countless elected politicians, from mayors and senators to governor and presidents, have endorsed charter schools as the primary alternative to failing public schools. Former President George W. Bush promoted charter schools heavily in his administration shown in the No Child Left Behind (NCLB) bill which promoted charter schools as a school choice that parents should consider ("No Child Left Behind"). President Barack Obama is also a strong supporter and has routinely propagated charter schools as a benefit of the American public education system and hopes to see more charter schools become operational. As such, his administration has launched the "Race to the Top" initiative to spark more innovative and reform efforts with the public education system. In his presidential proclamation of National Charter Schools Week, President Obama said "charter schools give educators the freedom to cultivate new teaching models and develop creative methods to meet students' needs" (Obama). He expressed, "[charter schools] that consistently help students succeed can serve as models of reform for other public schools" (Obama). He added that states must remove caps on the number of charter schools allowed to be able for funding. Further illustrating the government's endorsement of charter schools were the congressional passing of bills including the All Students Achieving through Reform (All STAR) Act, and the U.S. House of Representative's passing of the Empowering Parents Through Quality Charter Schools Act, (H.R. 2218). H.R. 2218 was amended to give an additional $300 million to charter school developers "to provide financial assistance for the planning, program design, and initial implementation of charter schools, and support the financing of charter school facilities" (H.R.2218). As a result of the political and legislative endorsements, the number of charter schools in America has grown to nearly 6000 schools that service nearly 3 million students.
Charter schools have now become an investment opportunity. The problem with the U.S. government investing so much money in charter schools is that many of the nation's charter schools are run by for-profit companies. Adversaries of charter schools feel that they provide a cunning way of attaining public money for private gains. Nearly 35 percent of the nation's charter schools are run by for-profit educational management organizations (EMO). In Arizona, much like the rest of the nation, charter schools have become the primary system for privatizing public education. Many opponents view this as a grave conflict of interest. In his article "Charter Management Organizations and the Profit Motive", David Safier wrote "The corporatization of charter schools -- where, instead of being localized, earnest attempts at creating educational alternatives, charters become statewide/nationwide conglomerates sucking up government money for profit -- is one of the dangers inherent in the charter school movement." (Safier) This sentiment is echoed nationwide through teachers unions, public school proponents, and others opposing the expansion of charter schools. In an article by Stephanie Banchero and Matthew Dolan in The Wall Street Journal, it was reported that public schools in Highland Park, Michigan were outsourced to the Leona Group LLC, a for-profit management company. They also reported that the Leona Group will receive more than $7000 per pupil and, in addition, "the Highland Park district will pay Leona a $780,000 annual management fee" (Dolan, and Stephanie Banchero ). Profits like this are not uncommon to EMOs which generally charge a management fee for their services than can range from 10 to 25 percent of the schools total budget according to The National Alliance for Public Charter Schools (NAPCS). According to the NAPCS, during the 2009-2010 school year, there were more than 1200 CMO and EMO-run charter school across the nation.
Charter schools make profits for the governing organizations by abusing their financial autonomy. Charter school operators are allowed to determine the best way to use the federal funds that they receive. This autonomy, opponents say, allows for abuse of public school funding by charter schools and their parent companies. The issue of financial autonomy in charter schools is discussed in Professor David Arsen and Yongmei Ni's publication entitled "Is Administration Learner in Charter Schools?". Ni and Arsen found that many charter schools that are governed by for-profit EMOs use a majority of their funding on administrative costs. They found that, "compared to traditional public schools, charter schools on average spend nearly $800 more per pupil per year on administration and $1100 less on instruction" (Arsen, and Ni ). This practice of devoting more funding to administrative costs than to instruction illustrates the business side of charter schools that also need to improve their EMO's profit margin. The National Alliance for Public Charter Schools (NAPCS) explain that "CMOs and EMOs play an important part in the scalability of the charter school movement by enabling the replication of models that work, creating economies of scale, encouraging collaboration between similar schools, and building support structures for schools. Philanthropic foundations as well as federal policymakers have promoted the growth of CMO and EMO run schools" (NAPCS).
The lure of profits from charter schools bring private investors from different countries and make the American public uneasy. Some of these investments have attracted national attention and criticism. The government's EB-5 program is one such program that has opened the eyes of many investors looking to capitalize on the public school system. The EB-5 program is an immigrant investment program that allows immigrant investors to gain lawful, permanent U.S. residency for themselves and their immediate family according to the Unites States Citizenship and Immigration Service. An investor who invests in a federally approved business will receive a temporary visa by investing $500,000 in a "high unemployment area" or $1 million in any other area. If 10 or more jobs are saved or produced within two years of the investment, the investor and his immediate family are eligible for permanent residency in the United States ("EB-5 Immigrant Investor "). Many of these investments are made to charter schools because they are located in high-unemployment, urban areas and also because the investors believe that their investments will be returned by the flow of guaranteed government money that will fund the school. One such investor, a 37 year old Pakistani citizen named Ali Faisal, toured Arizona charter schools to see what he would be investing in. In the Stephanie Simon article, "The new U.S. visa rush: Build a charter school, get a green card" release by Reuters News Corp, Faisal said that his investment into a charter school would allow him to also expand his consulting business to the U.S. claiming, "the easiest way to do that is to get a green card" (Simon ). Simon reports, "Charter schools have become particularly trendy because they are pitched as recession-proof", adding that Chinese investors view charter schools as, "nearly fool-proof investments because they can count on a steady stream of government funding to stay afloat" (Simon ). With the attention of the IRS now focused on the tax exempt non-profit schools accepting these investments and the EMOs seeing more capital gains, greater oversight is being sought by opponents of charter schools.
The charter school eruption of the last decade can be attributed to decisions made by the federal and local governments brought on by public pressure for educational reform. While charter schools were started innocently to experiment with alternative methods of teaching and to improve innovation, as a whole, they have become entities far from their intent. Charter schools that serve the private sector will further exacerbate the public educational system by draining it of the much needed funding to educate America's future. As our national falls further behind other industrialized nations educationally, it is extremely important that our educational system be overhauled to produce a better, brighter, and more innovative student; but, the validations made to charter schools are unfounded and are prematurely given. If the government continues to endorse charter schools without satisfactory performance records and without adequate measures for financial oversight and enforcement, the public school sector will continue to deteriorate and for-profit companies will continue to victimize America's youth.
