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Debate Intensifies Over Alleged Profit Motive in Public Education

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As BESE elections loom, Coalition warns against privatization while business leaders point to the cost of failing schools

Are business interests plotting to take over the public education system and turn a profit at the expense of the public?

That is the charge leading figures within the Coalition for Public Education have aimed against Gov. Bobby Jindal and the candidates pursuing seats on Louisiana’s top school board who favor expanding the number of charter schools. The Coalition includes the Louisiana School Boards Association, the Louisiana Association of Superintendents, several of the state’s teachers unions and other public education stakeholders.

But business industry representatives counter that these same coalition officials fail to acknowledge that the public school system has been draining Louisiana taxpayers while delivering an inferior product. Moreover, the coalition members have failed to explicitly identify which individuals and which organizations are actually turning a profit as a result of their affiliation with the charter school system, Brigitte Nieland, vice-president and communications director of the Education and Workforce Development Council for Louisiana Association of Business and Industry (LABI), said.

“We are talking about a union-led coalition that does not like to be described as union-led, that gets paid by the taxpayers to work on public time and to work against the interests of taxpayers,” she said. “That irony can only exist in public education.”

In the aftermath of Hurricane Katrina, state officials created the Recovery School District (RSD) in New Orleans Parish and took control of schools that were viewed as failing. Charter schools, which are governed independently by a board of directors, figure prominently within this equation.

Charter schools are part of the public education system, but they are permitted to operate with a certain degree of autonomy and they are not subjected to all the rules and regulations that govern traditional public schools. The idea is to provide charter operators with room for creativity and innovation in lesson planning. The state Board of Elementary and Secondary Education (BESE), which oversees the RSD, authorizes charters for a five-year period, with a performance review every three years. Statewide, there are 101 charter schools now up and running with over 70 in New Orleans.

Lee Barrios, a retired middle school teacher from Abita Springs, and a candidate for the BESE seat in District 1, is ardently opposed to an expansion of the charter school system. The “capitalist theory” standing behind privatization efforts undermines a quality education, she argues.

“There are some high performing charter schools,” Barrios acknowledged. “But there is very little accountability and some have done very poorly. The privatization that [Gov.] Jindal has planned goes too far. I’m dead set against expanding charters, they’ve been expanded too much already. There is a capitalist theory that says there is money to be made in schools, but that’s wrong. Public schools are not set up for the purpose of making a profit, they are a different kind of animal.”

This assessment is well off the mark, Nieland, the LABI representative said in response.

“Charter schools are best described as public schools with an additional layer of accountability,” she observed. “They have to perform in a five year period, and if they don’t they are shut down. BESE has shut down charter schools that are not working. How many other public schools get shut down when they are not working?”

Nieland continued:

“There is a model still in place for public education that has not worked in decades,” she said. “Isn’t it terrible that we are now offering more choice to parents and students, instead of letting the education bureaucrats exercise total control.”

LABI has endorsed Jim Garvey of Metairie, the incumbent BESE member in District 1, who Barrios is challenging. Garvey said Louisiana residents should be encouraged by the progress charter schools have made in just a short period of time. He also points out that the overwhelming majority of charters are operated by non-profit organizations.

“The argument about a profit motive is bogus,” he said. “Who exactly is making money here? When you look at the charter school boards, and the organizations running the schools, they are almost all non-profits.”

There are only eight charter schools out of 101 that have contracted with for-profit groups, according to LABI. But instead of fixating on whether or not a particular organization is non-profit, or for-profit, education officials should look the results charters are delivering, Garvey argued.

“The place where charter schools have had the biggest impact is in turning around failing schools and that’s what we see in New Orleans,” he said. “We have seen real gains in school performance scores and they compare favorably with the rest of the state. If the charters are producing good results why should anyone be concerned if a small percentage are operated by for-profit companies. We should care more about the results we are getting for our children. If they [the charters] don’t get results, BESE will shut them down, and BESE has.”

The concept of “failing schools” has been oversold to the public in an effort to create an opening for the charter school movement, Barrios claims. Moreover, she suggests that parents may not have as much control and latitude within the charter school system as they may think.

“It’s very easy to go into big cities and high poverty areas and present charters as being innovative and autonomous and it’s very easy to create this picture where the schools are failing,” Barrios said. “But that’s not the reality. You are not going to turn out a good product if the money is going toward profit, and not toward the children. Also, parents don’t have any real control in the charter schools because they have to sign a contract.”

While charter school proponents are quick to point out that they are largely non-profit outfits, the professional management companies standing behind them use “code words” like “free market system for schools” and “schools must compete against each other” that point to “a perspective which establishes schools as markets rather than a public trust,”  Dr. Michael Walker-Jones, executive director of the Louisiana Association of Educators (LAE), a Coalition member, said. “We believe the business interests have an agenda to privatize the public schools for profit.”

When asked to name which business entities are out to turn a profit at the expense of public education, Walker-Jones cited Teach for America, a non-profit group that recruits college graduates to teach in urban and rural settings for a two-year period.  Barrios, the District 1 candidate, pointed to prominent business leaders including Michael Milken and the Walton family.

“Here is where I get into a real heavy debate with the conservative viewpoint,” Walker-Jones said. “If you look at education strictly from the viewpoint of economics, I think you lose the art and craft and science of the practice. If we believe that the capitalism overrides everything else then we are missing out on the complexity that goes into an effective education.”

He added:

“Our schools are not a business, they are public trusts, and if we operate them like a business then I think this destroys the whole democratic underpinning of what it is that we have schools for in the first place. They are here to train and teach citizens to be critical thinkers and part of the intelligent decision making and democratic structure of this country.”

Robert Evans, a board member of the Choice Foundation, which runs the Lafayette Academy and Esperanza Charter Schools, advises the voting public to be wary of the information Coalition members are putting into circulation in the run up to Saturday’s elections.

“There is no individual profit motive involved in the running of these schools,” he said. “Charter school board members get paid nothing for the time that they spend working for their schools. In fact, most board members donate money, and in many cases, significant amounts of money to their schools. The reason that the individuals I know get involved in the governance of charter schools is because they genuinely want to be a positive force to help transform the historically horribly under-performing schools of Louisiana.”

Garvey, the BESE 1 incumbent, sees a deliberate effort at work on the part of Coalition members to misrepresent the goals of Teach for America.

“The union members are not giving us an accurate picture of what Teach for America is all about,” he observed. “It is non-profit group that is recruiting highly qualified teachers to go into challenging areas where they are producing above average results. They are only required to stay two years, but they usually stay longer. Teach for America has been very effective.”

Union officials are making a concerted effort to “vilify the word profit” because they recognize that average citizens are asking serious questions about how their tax dollars are being spent on schools that are not delivering an effective education, Nieland, the LABI representative said in response.
“It is a fallacy to say there is no profit in public education,” she pointed out. “The current system cuts too much money out of the classroom. Tell the school boards they can no longer do contracts and we’ll see if they put their money where their mouth is.”

Most school boards are the largest employers in their parish and most have budgets that are larger than the city or municipal budget, Nieland explained. The boards purchase and contract out for many items including capital construction, textbooks, vehicles and improvements to the buying and selling of land.

“To say there is no flexible money which equals a profit in public education is not true,” she continued. “If there was no profit in the system, all of the money would be going into the classroom, and no district would have a central office building. The superintendents are paid as well as CEOs, and have benefits that rival or exceed the private sector.”

The progress charter schools have made in a short period of time should be cause for encouragement and continued support, Evans, the Choice Foundation board member, said. Since the movement was initiated in the 2006-07 academic year, the School Performance Scores (SPS) in New Orleans have improved by almost 50 percent, he said.  Specifically, in the first school that the Choice Foundation chartered, Lafayette Academy, the SPS has gone from 58.8 in the 2007-2008 school year to 88.5 in the 2010-2011 school year.

“The school reform movement in New Orleans is considered one of the most promising examples in the country of what can be accomplished if new approaches are taken,” Evans said. “I have always felt that the key to economic prosperity, lower crime rates and self realization is a good educational foundation. This was lacking in our state.”

Kevin Mooney is an investigative reporter with the Pelican Institute for Public Policy. He can be reached at and followed on Twitter.


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  • Anonymous

    of California discrimination
    against Californians. Chancellor Robert J Birgeneau ($500,000 salary) displaces
    Californians qualified for public university education at Cal. for a $50,600 payment and a foreign
    passport. Need for transparency at UC Berkeley has never been so clear.


    UC Berkeley, ranked # 70 Forbes, is not increasing
    enrollment.  Birgeneau accepts $50,600
    FOREIGN students at the expense of qualified instate Californians.


    UC Regent Chairwoman Lansing and President Yudof agree to discriminate
    against Californians for foreigners. Birgeneau, Yudof, Lansing need to answer to Californians.


    Opinions make a difference; email UC Board of Regents

  • Anonymous

    I have lived in New Orleans my whole life 
    and I am the mother of three, and there are two sets of data. ONLY 60%
    of the people came back after hurricane Katrina, and a lot of them were people
    who had the resources to come back.

    One of the most important things I want people to think about, is why the experiments?
    Things like no recess, and quiet lunches, are happening with certain children
    but not with others. I also ask that people take a long hard look at the
    schools in which these things are happening. Are the majority of the children
    in that school African Americans? Are the majority of them poor? And in the so
    called high performing charters, which were before the storm high performing
    traditional schools containing the best and the brightest, what are the
    population of those schools?  

    Lushers, Benjamin Franklins, and Audubon montessies, do these schools have no
    recess and quiet lunches? Do theses schools have 90% first year teach for
    America teachers, with degrees in everything but teaching? And when we talk
    about schools that are preparing our children for collage, ask yourself if some
    of these schools are even teaching critical thinking skills. By the standards
    set for some of our children, where leap test is the most important thing
    measuring our children’s understanding and intelligence, there is a good
    possibility that not even Albert Einstein would have been deem a success or
    intelligent enough to go to collage.

    Are they “experimenting” with our children???  WE have all known for almost 60 years
    how to educate children successfully. Piaget, Maslow, and a host of others tell
    us what to do and how to do it.

    IN BOTH EXPERIMENTS the subject were POOR and Black

    IN BOTH EXPERIMENTS they already had the solutions.

    are calling this an Experiment.  We
    have been experimented on before, and we did nothing, because we did not know what
    to do. We know now, so what are we going to DO?

     Tuskegee  experiment

    Tuskegee syphilis experiment (also
    known as the Tuskegee syphilis study
    or Public Health Service syphilis study)
    was an infamous clinical
    study conducted between 1932 and 1972 in Tuskegee, Alabama by
    the U.S.
    Public Health Service to study the natural progression of untreated syphilis in poor, rural black
    men who thought they were receiving free health care from the U.S. government. [1] 

    Einstein applied directly to the Eidgenössische
    Polytechnische Schule a high school (ETH) in Zurich, Switzerland. Lacking the
    requisite Matura certificate,
    he took an entrance examination, which he failed,
    although he got exceptional marks in mathematics and physics.    


    Maslow studied what he called exemplary people such as Albert Einstein, Jane Addams, Eleanor Roosevelt, and Frederick Douglass rather
    than mentally ill or neurotic people,
    writing that “the study of crippled, stunted, immature, and unhealthy
    specimens can yield only a cripple psychology and a cripple philosophy.”Maslow
    studied the healthiest 1% of the college student population.

    Maslow’s theory was fully expressed in his 1954 book Motivation and Personality.


     Ashana Bigard