The Sick Consequences of "Competition" in Education

ADDING: Big props to @pippi longstocking for guiding me to this story.

 There are two ways to get you to buy my product:

1. Convince you my product is good.
2. Convince you the other guy's product sucks.

Sure, there are plenty of companies that base their marketing strategy around a positive message. But if my product isn't really that good to begin with, it's going to be hard to convince you to fork over some cash for my stuff. It's probably easier, and more effective, to just bad-mouth my rivals.

Now, we are currently living in the golden age of competition in public education. Milton Friedman's dream of pubic schools having to compete for students has finally come true. Which means charter schools have to go out and make their case for enrollment, either by extolling their virtues, or by denigrating the public schools with which they compete.

The problem is that when you're opening a brand new charter school, it's hard to prove to people you're better than the local public school district -- the same school system that has been at the heart of the community for generations. The same district that brings America Friday night football games and kindergarten Halloween parades and high school spring musicals and all the other traditions tightly tied to our nation's identity.

That pretty much leaves you only one choice:

This is an actual mailer sent to families in the Bethlehem, PA area, recruiting for the Innovative Arts Academy Charter School. Sara K. Satullo, reporting for lehighvalleylive.com, picks up the story:

A promotional mailer claiming to be from a new Catasauqua charter school paints Liberty High School students as drug users, sparking outrage among many Bethlehem residents. 

Innovative Arts Academy Charter School denies it had anything to do with sending out the promotional mailer, which lists the school's return address. 

The postcard references the September 2015 drug arrest of a 17-year-old Liberty student and asks "Why worry about this type of student at school? Come visit Arts Academy Charter School. Now enrolling grades 6-12."

It shows a stock image of a teenager holding their head in their hands and reprints a Morning Call headline: "Teen busted by Liberty HS officials with more than $3,000 of heroin, cocaine."

Photos of the mailer spread quickly on Facebook and Twitter and led some to share their disgust. [emphasis mine]

Drugs are a serious problem in America's schools, no question. Of course, about five minutes on Google will probably give you all the examples you need of drug busts in affluent, "nice" schools, including private schools. But they aren't the ones competing with charters (yet).

IAACS says it had nothing to do with this outrageous attack on the local public school:

Fennick, the school's attorney, sent a letter to The Express-Times on Saturday saying that The Morning Call has twice run ads, most recently in Saturday's newspaper, to purportedly recruit students for the school. 

"The school did not write, authorize, approve, nor pay for either of those ads. The school did not have knowledge that these ads would be published," Fennick wrote in the letter.

"We do not know if there are ads in the pipeline with your publication. The purpose of this letter is to advise you that we do not consent to any advertising being run without the express written authorization of the Board of Directors (Kelly Bauer, President) or the chief executive officer (Loraine Petrillo)." 

Now that's very curious -- for a few reasons. First: this story ran on August 21, 2016. But just four days later, Petrillo, the CEO, handed in her resignation:

The CEO of the new Catasauqua charter school embroiled in controversy over an unauthorized mailer quit Thursday morning amid concerns about the landlord's involvement in the school. 

Innovative Arts Academy Charter School is set to open Sept. 6 at 330 Howertown Road in a building owned by developer Abe Atiyeh. About 330 students are enrolled in the grades 6-12 school. 

On Tuesday, Chief Executive Officer Loraine Petrillo announced she planned to resign once a replacement was found due to concerns about outside forces undermining her efforts. 

In e-mail messages obtained by lehighvalleylive.com Thursday morning, Petrillo announced her resignation was now effective immediately and raised major concerns about Atiyeh's involvement in the school and charter school board members' ties to him. 

Atiyeh agreed to loan $100,000 to the fledgling charter school after its application for a line of credit was denied, Bethlehem Area School District Superintendent Joseph Roy said. 

Roy said he learned of the loan in a conversation with Petrillo. The school has borrowed $75,000 from Atiyeh so far, according to Roy. 

Reached by phone Thursday, Petrillo declined further comment but confirmed she sent the emails. 

"Those emails were internal emails," Petrioll [sic] said. "I am very, very upset that they were leaked." [emphasis mine]

Oh, I'm sure you were -- almost as upset as the good people of Bethlehem, PA, who would have had access to these emails as public documents had they come from a public district school superintendent.*

And so we return, once again, to a key difference between public and charter schools: Because they aren't state actors, charter schools are not subject to the same standards of transparency as public schools. Petrillo could have simply walked away from IAACS had these emails not leaked, and we wouldn't be any the wiser.

Which is the next curious aspect of all this: why did Atiyeh, who owns the building, loan the school money? Could it be that it's worth it to him to keep the school afloat so he can collect his rent? Is that why Petrillo resigned? It's a fair question given what's in her emails:

Petrillo does not identify the landlord in the emails. But the building at 330 Howertown Road, Catasauqua, is owned by a limited liability corporation associated with developer Abe Atiyeh. 

"For the life of me, I don't understand why the board is still seeking the landlord or associated company's involvement in our financing after this past weekend. It might be 'legal' but certainly, in my humble opinion, unethical," Petrillo wrote. [emphasis mine]

Oh, my. Well, was this an isolated incident for Atiyeh?

Atiyeh, who did not respond to multiple requests for comment, has become one of the greatest advocates of local charter schools. 

He owns three buildings used by charter schools in the Lehigh Valley – Innovative Arts, Arts Academy Elementary Charter School at 601 Union St., Allentown, and Arts Academy Charter School at 1610 Emmaus Ave. in Salisbury. 

Medical Academy Charter School was housed in his Howertown Road property before closing in June amid discipline and academic issues. 

In May 2014, Atiyeh told The Morning Call he has shelled out "a couple hundred thousand bucks" for each proposed charter. 

"I don't have a limit on how much money I can put into a school," Atiyeh told The Morning Call. 

Nearly three years ago, he upset the Allentown School Board over his recruitment practices after the board first rejected the application for the Arts Academy Elementary Charter School. After the rejection, Atiyeh hired Fleck Consulting, Mike Fleck's now defunct firm, to drum up 1,000 signatures from community members that its revised application needed. 

Atiyeh also offered $30 for every student Fleck Consulting signed up to attend. Then-Allentown School Board President Robert E. Smith called it "dirty" and "unethical."

So here we've got a guy who has repeatedly closed deals with charter schools to rent out his buildings, and then went out and recruited kids -- hard. He counts on enough students enrolling so those charters can get public funding and make their lease payments to him. If they don't get enough students, he's out of luck, isn't he?

Which leads to the third curious thing about this whole mess:

Days after a mysterious mailer sparked outrage by slamming Liberty High School, an employee of developer Abe Atiyeh filed a public records request seeking 10 years of student arrest records for the Bethlehem school. 

[...] 

Records show that on Tuesday, David Harte, of Willow Race LLC, filed a Right-to-Know request with the Bethlehem Area School District seeking a list of all the times and reasons police were called to Liberty High in the last decade. The school district provided lehighvalleylive.com with a copy of Harte's request in response to the news organization's own Right-to-Know request. 

Harte also sought all incident reports for activity that required a police response to the high school. 

Harte is vice president of business development for PA Venture Capital, an Atiyeh company. He did not return a e-mail message seeking comment Thursday. His request did not say why he wanted the records and is not required to specify that. [emphasis mine]

Oh, I'm sure he was just a curious citizen, eager to know all about the police activity at a local high school. I mean, who doesn't like to curl up with a nice cup of tea and peruse arrest records...

I think Petrillo herself sums this whole nasty business up best:

"I now believe some of you thought you hired a puppet who would not ask questions and go along with things," Petrillo wrote. "When asked recently about where we stand with financing, I have been told...'I got this...I am speaking to people I know, I don't need to know this;' when questioned."

Petrillo said she was soured and disturbed by recent developments.

"It is sad that this has worked out the way it has," she said as part of her email chain with the charter's board and lawyer. "Something sinister has been going on behind the scenes, and I am not going to take anymore of a hit for whatever arrangements have been made with the landlord." [emphasis mine]

To recap: IAACS is set to open in mere days in the Bethlehem area. Its CEO, however, has resigned, apparently over what she perceives as "something sinister" going on with the landlord. That landlord, who has repeatedly struck similar deals with charter schools in the region, will not get paid unless the charter actually opens and enrolls students; for this reason, he has loaned the school hundreds of thousands of dollars.

In addition, one of his employees sought police records related to the local public school, which will "compete" with IAACS for enrollments. In a remarkable coincidence, a flyer has been distributed around the community highlighting a drug arrest at the public school.

Quite the story, huh? But let's step back a bit, because there are two big issues on my mind:

1) When you move school governance away from state actors, don't be surprised when private operators spring up with the sole mission of moving taxpayer monies into their own pockets -- as quietly as possible.

Is anyone actually surprised this crap goes on all the time in Pennsylvania? The last governor's biggest campaign contributor runs a charter school; according to Harrisburg insiders, he basically wrote Corbett's education policies.

Oh, but I know, charter cheerleaders -- you think this is an outlier. This isn't reflective of what's really going on across the charter sector, right?

Baloney -- Profit taking is the new status quo in the charter sector. Even so-called "non-profit" schools are far too often shell corporations set up to allow deals like this one to go through.

This isn't "innovative," it's not "cage busting," and it's sure as hell not "all about the kids." What happened here, as Bruce Baker and Gary Miron have explained so well, is the inevitable outcome of an education policy that introduces market forces into public education. It's the logical consequence of moving schools away from being civic institutions and toward being places of commerce.

2) When you introduce market-style "competition" into public education, don't be surprised when that competition turns nasty.

Did you really think, charter cheerleaders, that it was all going to be good, clean contest, complete with hearty pats on the back and a "Great game, fellas!" at the end? That the people whose fortunes are riding on charter school investment schemes were simply going to shrug their shoulders and go away if they didn't get the returns they expected?

Did you really think the charters, which you set up to compete with public schools, were going to quietly fold up their tents and move on if they couldn't convince enough families to "vote with their feet"? Especially after you let them set up these byzantine, secretive real-estate and management deals -- even in the states with "good" authorizers and overseers?

I know a lot of you folks haven't actually run businesses, so let me explain how this works: not everybody goes down without a fight. Some people, when they see that things aren't going their way, play dirty. And they know they'll get away with it if the federal, state, and local education officials who are supposed to be monitoring them are, in reality, ideologues who can't be trusted to be fair arbiters of the system.

Are you shocked by that mailer above? If you are, let me be the first to tell you something: you've been completely dishonest with yourself.

Of course this was going to happen -- it has happened before, and it will happen again. The satellite dish folks make their money by convincing people that cable stinks. The cell phone providers are happy to remind folks of all the places the other carrier doesn't cover. The Apple people ran an ad campaign for years telling us PCs were nerdy and defensively neurotic.

The difference here is only a matter of degree. Bad-mouthing public, district schools is the new status quo.

Look for a mailer just like the one above in your mailbox soon -- very soon.

The great Rob Tornoe.

ADDING:

When Eva Moskowitz takes to the pages of the Wall Street Journal and paints the public schools as "fight clubs" that are out of control...

When Campbell Brown takes to the pages of the NY Daily News to make the NYC schools appear to be staffed by hordes of perverts...

When Philip Anschutz bankrolls a major Hollywood movie whose plot revolves around a failing public school that is saved by charter conversion...

Tell me, charter cheerleaders: Is that functionally any different than the flyer above?

Just this once, see if you can answer me honestly.

ADDING MORE:

I have to give a shout out to Sara Satullo, who's been reporting on all of this. Local reporting like hers is the only thing that's keeping these guys from completely bilking the system.

AND MORE:

Just looking again at the flyer: "Why worry about this type of student at school?"

Can we finally please admit that nearly the entire appeal of charter schools is wrapped up in a student's peers? That "innovation" and "freedom from regulations" has nothing to do with why people sign their kids up for charters?

I have said repeatedly that I will never, ever fault a parent for enrolling their child in a charter school if they are doing so because they perceive it is a better option. But I have no patience for charter cheerleaders who refuse to acknowledge that peer effects are a huge part of the lure of charter schools.

Some on the pro-charter side, like Michael Petrilli, have acknowledged this, and I respect them for it. I wish more of his compatriots would joint him -- then maybe we could have a serious conversation about segregation, privilege, and "choice." Lord knows we're long overdue for one.


* Ken Libby, who knows quite a bit about this stuff, says via Twitter that charter school emails are supposed to be subject to PA's open public record laws. But it doesn't appear that happens in practice the way it should.

Of course, as private companies, Atiyeh's LLCs aren't subject to any of these laws. So a request for emails related to advertising for the charter by the charter's leaseholder isn't going to be fulfilled.

Is everybody fine with that?