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Michigan neo-liberalism: creating the material conditions for privatization

Susan Notes:

I have had personal experience with the K-12 curriculum. Here is a list of topics for the K-12 history curriculum.

And here is the article about "doing" the curriculum. Of special interest is the teaching technique provided by K-12: When a child has difficulty with a lesson and the parent asks for advice, the advice comes back: Have the child do the lesson again.

Meanwhile, a Michigan teacher reports what's happening in her district:

  • 17% pay cut

  • increased cost of health insurance

  • planning period cut in half

  • elementary music and library programs terminated

  • How many of the district's teachers have signed up to march in Detroit's Labor Day parade as visible, collective protest?


    How many union officers have signed up to march in Detroit's Labor Day parade as visible, collective protest?


    Maxim: If you let the privatizers walk all over you, prepare to be trampled.

    This article is accompanied by a picture of the K12, Inc. group as they happily hear the news of their new contract to open a 65,000 student body cyber charter school in the state of Michigan.

    by Danny Weil

    Neo-liberal policies and creating the new material conditions for privatized education: Grand Valley State University and the Citizens Research Council of Michigan

    At their website, the Citizens Research Council of Michigan provides a small description of its organization:

    The Citizens Research Council of Michigan is a privately funded, not-for-profit public affairs research organization, founded in 1916. For over 90 years, the objective of CRC has been to provide factual, unbiased, independent information on significant issues concerning state and local government organization and finance. CRC believes that the use of this information by policymakers will lead to sound, rational public policy formation in Michigan.

    The Citizens Research Council of Michigan is noted for the accuracy and objectivity of its research. Over the years, CRC has made significant contributions to the ongoing debate over the appropriate role of government and has gained vast experience in virtually every facet of state and local government.

    CRC does not lobby, support or oppose candidates for public office, or take positions on ballot issues. Instead, CRC relies on the presentation of its research findings to bring about sound public policy on state and local issues. The hallmark of CRC is timely, reliable information researched in an independent, nonpartisan manner. As a result of the credibility earned by CRC, it is often the only organization that can address controversial issues in an objective fashion.

    While hailing itself as an 'objective', 'factually based' and 'unbiased' organization, a closer scrutiny of the organization shows something entirely different. In fact, the "fair and balanced" claim by the CRC is similar to the claims made by Fox News.

    The organization is hosting its 94th annual meeting soon and the keynote speaker will be Robert Bobb, the Detroit Public Schools Emergency Financial Manager who has come under both court and public attack for his brutal smash and grab privatization policies he has and continues to employ in the city of Detroit. I have written many articles on Bobb and his Eli Broad connections. Bobb is one more in a long line of supplicants for the so-called philanthropists like Gates, Walton and Broad who are now turning cities like Detroit into charter school enclaves and union busting battlefields. Here is the notice from the group:

    94th Annual Meeting of the
    Citizens Research Council of Michigan

    School Reforms &
    Budget Challenges

    Keynote Speaker
    Mr. Robert Bobb
    Detroit Public Schools
    Emergency Financial Manager

    Friday, September 10, 2010

    10:00 a.m. â" 2:00 p.m.
    Detroit Athletic Club, Detroit, Michigan (http://www.crcmich.org/)

    You might be wondering why Robert Bobb will be speaking to a privately funded organization like CRC of Michigan. The answer is very clear: CRC is a campground for bivouacking charter school promoters and privatizers who are seeking to turn the educational landscape of Michigan into 'priority schools', as they love to refer to them in Detroit; but these are really 'charter schools' under a new rhetorical guise.

    Looking at the 'trustees' for the Citizens Research Council of Michigan the name Thomas J. Hass comes up. Thomas J. Haas is also the president of the Grand Valley State University. At the website for the university it states:

    As part of this mission, the GVSU Board of Trustees seeks to impact public K12 education through its leadership in Michigan's Charter Schools.

    GVSU chartered its first three schools in 1995, serving a total of 350 students. GVSU currently charters 28 schools and 3 urban high school academies serving over 17,800 students. (http://gvsucso.org/).

    The fact is that GVSU is a charter school minting and clearing house. They currently act as 'authorizers' for twenty eight schools and they are growing rapidly. They cannot even keep up with the applications for charter school authorizations, as noted in the 2010 News and Publications section of their website:

    June 1, 2010

    On Friday, April 2, 2010, the Grand Valley State University Charter Schools Office Phase One Charter Application process closed. We are no longer accepting Phase One Charter Applications.

    Phase One ran from January 6 to April 2 and resulted in 57 applications submitted. Grand Valley's Charter Schools Office will review the applications based on, but not limited to, the following criteria: a promising vision, sound instructional plan, a quality educational program, and a sound business plan evidencing the ability to offer excellent programs. Applicants should be prepared to meet high standards both at the application level and throughout the term of the contract. Grand Valley reserves the right to accept or reject any application and to announce individual or extended application periods (http://gvsucso.org/news/).

    The goal of the GVSU president, Thomas J. Haas along with the GVSU charter school board is to increase dramatically the number of charter schools in the state of Michigan. This is why Citizens Research Council of Michigan invited Robert Bobb to speak, for their visions are compatible. The fact that Haas serves both as president of a university that authorizes charter schools faster than public schools close while also a trustee on the Citizens Research Council of Michigan, is troubling in terms of any claims to objectivity.

    With Thomas J. Haas on the trustee board for the Citizens Research Council of Michigan the CRC activities are now more understandable. CRC is crawling with charter school advocates and is hardly fair and balanced when it comes to its objectives and goals. In fact, it is part of the neo-liberal government that is building the new material conditions for the privatization of education, as well as privatized services in general

    So who funds the CRC?

    It is hard to find specific information on non-profits. This is one reason the status is now the favored and preferred legal posture for privatizers as a non-profit an organization is only required to file what is called a 990 form with the IRS. Guidestar, which is an online service that makes these forms available, shows that the CRC grew astronomically from 2008 to 2009, the date of the 990 last filed with the IRS. In fact, the growth was huge.

    The organization went from an asset base of $1,724,133 in 2008 to a whopping $3,089,539 in 2009, more than a 60% increase. Their 990 form 2009 shows revenues totaling $1,903, 677 but 990âs do not require a company to be specific when reporting the source of the revenues so we do not know exactly who funds the CRC. What we do know is that their investment income was $52,748 in 2009, down from 2008. 'Other revenue' from 2009 is indicated as $370,815 but we do not know from the IRS form the source of this 'other revenue'. What we do know is that in 2008 'other revenue' was $649,719!

    For an organization that has only six employees and one part time employee, the costs for salaries and benefits is $723,115. This seems quite a large sum for such a small staff.

    What is also interesting to find on the 990's is the amount paid for fundraising by the CRC. This number was $163,114 for 2009. In 2008 the sum was far more, $297,789 and one can only wonder how the money was spent and why (http://www.guidestar.org/FinDocuments//2009/381/539/2009-381539991-0607d922-9.pdf). What kind of fundraising do they do and how are the funds collected and by whom?

    In a section entitled 'The Value of Objectivity' CRC states:

    With business mergers and acquisitions and the proliferation of nonprofit organizations, CRC has underscored the importance of a stable financial base. As Michigan's economy and government evolve--with term limits for politicians profoundly affecting the process and increasing the need for relevant and unbiased information--new, critical, and controversial public-policy questions and issues arise, creating ever-greater demand for CRC's independent, nonpartisan policy research.

    In response, the leadership of the Citizens Research Council has put in place an ambitious plan for its future funding. At the center is a $14 million funding initiative to be implemented over the next five years (The case for support, CRC, http://www.crcmich.org/information/effect.html).

    We cannot know if the future plans for funding will include rightwing organizations that for years have promoted privatization. We do know that a Google search finds that the Mackinac Center is mentioned in the same breath as CRC.

    According to Rightwing Watch:

    The Mackinac Center for Policy Research focuses on advancing government privatization and espousing conservative fiscal policies. The group actively advocates school vouchers and the privatization of the University of Michigan. The Center publishes the Michigan Education Report in support of its policies. In promoting other limited-government, free-market economic principles, the group advocates measures such as privatizing Amtrak and prisons facilities and eliminating government subsidies for arts and culture initiatives. The Center is also anti-union, having pursued initiatives to limit union political spending and attacked mandatory union membership policies. Additionally, the Center's President, Lawrence Reed runs a "think-tank school" on establishing and effectively maintaining state-level conservative think-tanks.

    In the last few years, the center has received grants from: Sarah Scaife Foundation, Roe Foundation, Ruth and Lovett Peters Foundation, Rodney Fund, Orville D. and Ruth A. Merillat Foundation, JM Foundation, Earhart Foundation, Charles G. Koch Foundation, Walton Family Foundation, Dick and Betsy Devos Foundation and Lynde and Harry Bradley Foundation, Inc.
    [source] http://www.rightwingwatch.org/content/mackinac-center-public-policy).

    Citizens Research Council of Michigan has large plans for growth and with their ties to Grand Valley State University; a literal mint for charter schools throughout the state one can only infer that they will be supporting increased privatization of education and social services for the state of Michigan. It is unknown if they receive any funds from Mackinac but what is known is their agendas are similar if not compatible.

    CRC pushing for more neo-liberal policies and privatization in Detroit

    Take the speech given to the January 22, 2010 to the Detroit Charter Revision Commission by the CRC of Michigan reported in a presentation entitled: Provisions that restrict ability of elected officials to streamline the city government. Here, the group claims that privatization restrictions were one large provision in the city charter that restricts the ability of Detroit to streamline government. In their recommendations to the Detroit Charter Revision Commission the CRC states:


    ⢠New provisions in 1996 Charter

    ⢠Section 6-307 provides a process for consideration of privatization

    ⢠Some provisions are simply best practice (e.g., requiring cost study)

    ⢠Most of provisions were written on behalf of city unions to prevent loss ofjobs

    ⢠Subsection 7 requires supermajority vote (2/3) by city council to approve privatization (http://www.crcmich.org/PUBLICAT/2010s/2010/Detroit_Charter_Comm_Orientation_01-22-10.pdf).

    The recommendation from the Citizen Research Council of Michigan:

    If city is to seek economies and efficiencies through collaboration and contracting, then these provisions need revisited (ibid).

    This of course is shorthand for allowing for less than a two-thirds vote for privatization policies. All of this is keeping with the plans launched by Robert Bobb and Mayor David Bing in his lost bid for mayoral control. Closing public schools and opening priority schools, aka charter schools, is what Robert Bobb is doing. Bing moved for mayoral control but was rebuffed. From the point of view of the CRC of Michigan:

    In order to address what could be an accumulated general fund deficit exceeding $400 million Detroit city government must be restructured. The new structure must reflect both the reduced tax base and the limited ability of state government to provide shared revenues. Restructuring will necessitate process improvements, load shifting, load shedding, privatizing, concentrating service delivery on an area smaller than 138 square miles, and other strategies. The most recent Crisis Turnaround Team has recommended closing facilities, privatizing services, improving and centralizing processes, renegotiating contracts, improving debt collection, restructuring debt, and other actions. It remains to be seen whether the city's elected officials will be able to implement these recommendationsâ (April 2010, report 361, http://www.crcmich.org/PUBLICAT/2010s/2010/rpt361.pdf)

    Grand Valley State University approves K12. Inc. to run a new 65,000 student cyber charter school

    On April 30, 2010 Grand Valley State University's Board of Trustees approved the authorization of a new cyber charter school to be called the Michigan Virtual Charter Academy. According to the Grand Valley State University website the school will offer a "blended curriculum" for K-12 students. Tim Wood, director of the GVSU Charter Schools Office stated:

    Students will do half of their work online and the other half at an established learning center (http://gvsu.edu/gvnow/index.htm?articleId=500D43BF-CB80-6EE7-4FF9A895A7C2026D)

    Wood said Michigan Virtual Charter Academy will bring "McChoice" to underserved students across the state. The stale rhetoric still lingers. The contract to run and manage the school was given to K12, Inc. K12, Inc, based in Reston, Virginia, is the brainchild of former junk bond felon Michael Milken and former 'virtues' US Secretary of Education William Bennett.

    This is a big move by the university and its authorization board and a huge contract for K12, Inc. Charter schools are currently capped at 400 students in Michigan, but the new cyber-school will allow for the addition of up to 1,000 more students. Wood said for every two students added, one must be a high school dropout. He also noted that:

    Students will be given a computer, a modum (sic), Internet access and textbooks (ibid).

    William Bennett's company, K12, Inc. has been given the contract to open the new 65,000 Cyber School. K12, Inc. is a for-profit charter school company based in Virginia that is operating cyber charter schools in 28 states, currently serving 65,000 students. The company operates, among other things, the Ohio Virtual Academy (OVA) in the state of Ohio. The Ohio Virtual Academy School is a virtual, online charter school that enrolled 3,408 students in the 2006-2007, school-year. In early December of 2007, K12, Inc. held an initial public offering of its stock. Even though only 63% of it's hoped for $172.5 million was raised, the Washington Post reported K12's share price rose 36%. The company has operated the Ohio Virtual Academy since the 2002-2003 school year and currently not only enrolls 3,408 students in Ohio, but over 27,000 in its combined national schools for-profit operation (Columbus Educational Association Website, http://www.ceaohio.org/GD/Templates/Pages/CEA/ceaDefault.aspx?page=1).

    And who is the owner and operator of K12, Inc.? The company was founded and is directed by William J. Bennett, the former Secretary of Education under Ronald Reagan. Bennett is a notorious right wing advocate with his own AM radio show that is right up there with Glenn Beck, Hannity and Bill O'Reilly.

    According to the Columbus Educational Association, out of the 3,408 students OVA enrolled in the 2006-2007 school year, eighty eight percent of its students were white (versus 28.4% for CCS), 8.0% were African-American (versus 62% for CCS), 42.7% were economically disadvantaged (versus 73.3% for CCS), no students were listed as Limited English Proficient (versus 7.7% for CCS) and 6.7% of students were classified as having disabilities (versus 15.6% for CCS). Yet state data gathered on the school indicates that the school spends 33% less per student than the state average. Furthermore, records show that although the company made about $108 million from the initial public offering (IPO), it continues to pay its 91 non-unionized teachers an average of $32,341 per year (ibid).

    The New York Times reported on September 1, 2010 that the market capitalization of K12, Inc. is now $704.5 million and when compared with comparable companies, it has seen a 52 week change in its stock prices of 12.58%, this while similar companies show losses as high as 30% for Bridgeport Education, Inc. another virtual charter school outfit (http://topics.nytimes.com/topics/news/business/companies/k12-inc/index.html).

    Certainly gaining a contract for a 65,000 student cyber charter school for the state of Michigan has pushed the share price of K12, Inc. up. And the company continues to grow with mergers and acquisitions.

    The opportunity to make huge financial profits off of the growing emergence of virtual charter schools cannot be understated and thus also serves as one argument as to why we see the growth of these for-profit providers. The fact is, companies like K12, Inc. and their investors shrewdly see tremendous financial gains in further disabling public education in favor of 'choice' and the virtual charter school is surely the latest vehicle for this political and economic convergence of forces demanding privatization. Furthermore, with many home-schoolers wanting the imprimatur of graduating from a public school without the 'public', the virtual charter school offers the convenience of disassociation from having to physically attend public schools while fostering claims the virtual charter schools provide a 'public education' as well as innovation to improve TPS. Caught in a tight embrace with political allies, for-profit companies (like K12, Inc. and many, many others) work assiduously with their political constituencies in the home school community to garner political, community and parental support for their business plans. This is really their base and gaining the support from neo-liberal policy makers is essential to maximize profits and expand marketshare.

    K12, Inc. profits grow exponentially

    On July 26, 2010 K12, Inc. announced an all-stock acquisition of KC Distance Learning, Inc. (KCDL), a privately-held, nationally-recognized provider of distance learning programs for middle and high school students, with a newly-issued class of non-voting shares having a value of $63.1 million under the terms of the Merger Agreement.

    The acquisition bolsters K12's position as a leader in K-12 online education. The move adds a new line of products and services to K12's privatized offerings for public and private schools, international schools, and individual consumers. Additionally, K12(R) significantly increases the size of its online private school offering through the acquisition of KCDL (The Wall St. Journal, Market Watch, July 26, 2010, http://www.marketwatch.com/story/k12-inc-announces-acquisition-of-kc-distance-learning-inc-2010-07-26).

    In January 2010, the Massachusetts Legislature joined the privatization fray and passed and the disgraced former Governor Deval Patrick signed into law, an education reform bill aimed at transforming Massachusetts public schools by promoting more innovation and choice. The law included a provision enabling school districts to establish Innovation Schools to help improve student achievement and performance. Innovation schools give school districts more autonomy and flexibility to provide alternative education programs, including virtual schools, and increase public school options for students.

    In August 2010, K12, Inc. pounced on the new state privatization opportunities and announced a new partnership with Greenfield Public Schools to launch Massachusetts' first full-time, statewide online public school. According to Yahoo: Finance:

    The new Massachusetts Virtual Academy at Greenfield (MAVA@Greenfield) will serve up to 500 students in grades K-8 across the Commonwealth this coming school year. MAVA@Greenfield plans to expand to offer high school in subsequent years. The tuition-free public school is now accepting applications and will be hosting numerous information sessions for interested families and school districts. Enrollment information can be found at www.K12.com/mava.

    "K12 is excited to partner with Greenfield Public Schools to offer our award-winning curriculum and online school program to families in Massachusetts," said Ron Packard, founder and CEO of K12 Inc. "The Massachusetts Virtual Academy at Greenfield will be a school true to the goal of the state's Innovation Schools legislation, providing excellent education programs designed to meet students' individual needs. Over 200,000 students have used the K12 program and we look forward to successfully serving students and families in Massachusetts." (K12 Inc. Announces Partnership with Greenfield Public Schools to Open Massachusetts Virtual Academy, August 17, 2010, http://finance.yahoo.com/news/K12-Inc-Announces-Partnership-bw-3892116690.html?x=0&.v=1)

    MAVA@Greenfield says they will provide students the complete K12® curriculum, which includes engaging online lessons and hands-on education materials, along with what they call state-of-the-art technology that connects students to a vibrant school community.

    The new 65,000 student cyber school in Michigan will double the amount of students that use K12, Inc. curriculum and operate under its management. This is great news for investors and will also serve to impress other states and governments who are looking to the cyber charter school model. Market dominance is now looking more and more favorable for K12, Inc. Take a look at the Milken filed 10K filed with the Security and Exchange Commission on July 23, 2010 for a look at company revenues and itemized costs (http://www.istockanalyst.com/article/viewsecfiling/articleid/4348846).

    Neo-liberalism and Citizens Research Council of Michigan and Grand Valley State University: privatization enablers

    It is clear that the goals and objectives of the Citizens Research Council of Michigan and Grand Valley State University is to assure that the material conditions for rapid privatization of all services, but especially education, goes on unbridled and with little regulations or government oversight. Partnering with K12, Inc. is simply one piece of evidence for this claim. As one citizen who has a child in a Michigan public school wrote me:
    "Mr. Weil, my city looks like a war zone, actually. It is very sad. GM is not holding up to their bargain and maintaining it, so it's all growing up with weeds, rubble sits in piles, etc. Citizens of my community are not happy, to say the least" (personal e-mail).

    For the citizens of Michigan the great unraveling is truly sad for generations that will be and are being lost as the state reboots. However, for the privatizers lying in wait, this couldnât be a better time. They have hit on their own 'Katrina moment'and will use the financial disaster that is hitting Michigan like a Buford 10 force wind force to assure that private companies will become the primary providers of education while the public institutions starve. This is why Robert Bobb will speak to and with Citizen Research Council and why Thomas J. Haas is involved with the organization.

    The cross breeding is palpable; the double cross to citizens is in the making as their children will be thrown into cyber learning centers and schools will be replaced by âestablished learning centersâ â" all the double speak of privatization advocates as they hit the road to turn education into nothing more than a publicly traded commodity on the New York Stock Exchange.

    — Danny Weil
    Daily Censored


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