Charter School entrepreneur Eli Broad in 1996: "We have our cake..and are eating it, too."

madfloridian

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Wed Dec-30-09 10:47 AM
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Charter School entrepreneur Eli Broad in 1996: "We have our cake..and are eating it, too."

He is said to have chuckled when he said it after a profitable Wall Street transaction.

And it seems they are still having it both ways even now. The Department of Education is handing out financial "incentives" to school districts to convert to charter schools.

The Broad Foundation is one of the largest corporations involved in forming charter schools. Venture capitalism.

The blogger called The Perimeter Primate reminds us of and links to a New York Times article from 1996 about the SunAmerica empire.

What Makes Eli Broad Laugh

A person's sense of humor reveals a lot about how their mind works.

Considering the state our economy is in, and how it happened, this report about Eli Broad from 13 years ago is very illuminating. As one of the main people controlling the direction of today's public education reform, this peek into how Broad thinks should be enough to convince you that he cannot be trusted with the well-being of the masses. Despite what may come out of his mouth, Broad is a corporate schemer who is not naturally inclined to look out for the children of poor and working class people.

The 1996 New York Times article:

Wealthy, helped by Wall Street, find new ways to escape tax on profits.

Last spring, Wall Street bankers made an irresistible sales pitch to Eli Broad, the billionaire home builder and co-founder of the booming SunAmerica insurance empire. For a fee, they would help him lock in $194 million in profits on some of his SunAmerica stock and free up cash to pay family debts -- best of all, without having to sell the stock and give up all future profits on his shares. He would therefore not owe a penny of the estimated $54 million in taxes he would face if he sold the shares.

Mr. Broad accepted. "We have our cake," he said recently with a chuckle, "and are eating it too."

The thousands of less affluent investors who also own SunAmerica stock, either individually or through mutual funds, get no such deals. To cash in on their stock, they almost invariably have to sell it and face a Federal tax of up to 28 percent on their profits.

Seventy-five years after it was enacted, the Federal tax on profits from the sale of stock, land or other assets -- known as the capital gains tax -- is becoming largely academic to the nation's wealthiest taxpayers. Even as a growing number of Americans with more modest incomes are paying capital gains taxes because of their growing mutual-fund profits, wealthy taxpayers like Mr. Broad can take advantage of a growing arsenal of Wall Street techniques to delay or entirely avoid taxes on their investment gains.

The Perimeter Primate, an educator who blogs, covers the new business scheme she calls Venture Philanthropy.

She mentions the book "The Politics of Venture Philanthropy in Charter School Policy and Advocacy," by Janelle Scott.

Scott explains the billionaires' strategy to push charter schools onto communities by careful maneuvering of their immense foundation-giving. She also describes the not-always-well-intentioned, and/or misguided, history of foundation "giving" which has targeted communities of color in the past.

The outcome of the foundation-giving programs of today requires an important trade-off from the local communities, namely, the relinquishment of interest and power over their own public schools to the public education notions of a few immensely wealthy oligarchs. What does it tell us that the communities where this is occurring necessitated first being placed under authoritarian rule (a.k.a. wealthy oligarch/billionaire-influenced mayoral &/or state control)?(The backroom deals are being made in every city where pro-charter school forces have gained a foothold...)

The author describes the flow of money to groups like EdVoice, Center for Education Reform, TFA, NewSchools Venture Fund, NewLeaders for New Schools, KIPP, Green Dot, Democrats for Education Reform, and the EEP.

The post is long, but here are a few snippets about Eli Broad's work in pushing charter schools.

Speaking of propaganda, I've recently learned how Broad has bought off large, important portions of PBS, and how M. Gates, a major supporter of the KIPP organization, is on the board of the Washington Post, home to Jay Mathews, the staff writer with an education column who perpetually praises and promotes KIPP schools.

..."Another small item that may be of interest to some of you is that the Broad Foundation paid the Century Foundation $100,000 (in 2004) and $29,973 (in 2007) to "support research on the late union leader Albert Shanker." View the Broad Foundation 990's here. This interest of theirs is certainly connected to how much pro-charter forces like to mention that Albert Shanker was responsible for the idea of charter schools (as if to brush off any responsibility for them!). They use this statement frequently to both justify the existence of charter schools, and to attempt to disarm the teachers' union complaints about them. Of course, they don't tell the whole story.

Shanker is quoted here often to make sure that everyone believes unions love charter schools. Bottom line is the unions fell for Arne's big money...it is love of money more than love of charter schools.

But any excuse will do, I guess.

Shanker's views were not those of Eli Broad (rhymes with toad). He wanted something different.

In a speech to the National Press Club in 1988, he proposed the idea of teacher-led "charter schools" where rules could be bent if the great majority of teachers in a small school approved. He called on districts to "create joint school board-union panels that would review preliminary proposals and help find seed money for the teachers to develop final proposals."

..."Shanker "watched with alarm as the concept he put forward began to move away from a public-school reform effort to look more like a private-school voucher plan. Shanker came to believe that the charter school movement was largely hijacked by conservatives who made many charter schools vulnerable to the same groups that made voucher schools so dangerous: for-profit corporations, racial separatists, the religious right, and anti-union activists...Shanker watched with dismay as 'those who had tremendous contempt for public education' jumped on to the charter school bandwagon."

Here is more on how the Broad Foundation and others practice their http://seattle-ed.blogspot.com/"> venture philanthropy

The Broad Foundation
The Broad (which rhymes with "toad") Foundation claims to be a philanthropic organization, created by billionaire Eli Broad. The Broad Foundation supports privately run charter schools and actively develops a system of charter schools in urban areas.

Broad claims it engages in "venture philanthropy":"Our Approach to Investing: Venture Philanthropy. We take an untraditional approach to giving. We don't simply write checks to charities. Instead we practice 'venture philanthropy.' And we expect a return on our investment."

..."Many of us have recently discovered the Broad Foundation's presence within SPS and are requesting an explanation for why it is here and what its' objectives are. Broad recently gave SPS a $1M "gift." That money has not shown up on any budget and no one knows how the money is being spent.

..Broad supports and actively promotes mayoral control of school districts. Eli Broad's preferred model of mayoral control means that the mayor selects the school board members and superintendent who are therefore unelected and are beholden only to the mayor, not the people of that city."

Eli Broad and Harold Ford recently penned an editorial in the Wall Street Journal urging educators and others not to try to water down Obama and Arne's charter schools goals. Talk about an obvious connection and pitch to corporations?

Harold Ford DLC urges us not to try to water down Obama's education agenda.

It seems to impress Harold Ford that Newt Gingrich is part of this effort. That should give us fair warning right now that this is not good for education.

Now, however, President Barack Obama has launched "Race to the Top," a competition that is parceling out $4.35 billion in new education funding to states that are committed to real reform. This program offers us an opportunity to finally move the ball forward.

To that end Mr. Obama and Education Secretary Arne Duncan are pushing states toward meaningful change. Mr. Duncan has even stumped for reform alongside former Republican House Speaker Newt Gingrich. Yet the administration must continue to hang tough on two critical issues: performance standards and competition.

Already the administration is being pressured to dilute the program's requirement that states adopt performance pay for teachers and to weaken its support for charter schools. If the president does not remain firm on standards, the whole endeavor will be just another example of great rhetoric and poor reform. Competition among the states is also vital to reform. The administration is resisting the temptation to award funds to as many states as possible. And that's good. To be effective, Race to the Top funds cannot become a democratic handout. Competition brings out the best performance. That's true in athletics and in business, and it's true in education.

Race to the Top funds will not serve their purpose if they are awarded based on good intentions and promises. Instead, the administration is right to look at results.

No, competition in learning does NOT bring forth the best learning. It simply rewards good test takers. No education system should be based on one test developed secretly without regulation and graded privately without oversight.

The new drive to privatize the schools by testing them to death and then calling them "failed"...is not about what is best for the children.

It is about profit-making and influence within public schools which should instead be free from such moneyed powers.