We Need Charter AND District Systems: On Private-Public Partnerships


Building on my last post, in which I challenged Neerav Kingsland’s presumption that charter systems and schools are inherently superior to that of district systems and schools, here’s an important TED talk by economist Mariana Mazzucato worth watching that presents a refreshing new angle on this topic:

The narrative that charter supporters often promote is one in which traditional district schools are failures because they are:

  • Mired by bureaucracy and politics
  • Constrained by teacher’s unions
  • Unable to innovate and adapt to the needs of the 21st century
  • Beholden to the state
  • Unresponsive to the needs of parents and communities

All reasons, they suggest, that require us to turn to the private sector and its proven ability to disrupt, innovate, and provide competitive choice. The market, they claim, has been demonstrated to promote quality and efficiency, whereas the state has proven only to be cumbersome, to stand in the way of change, and to maintain the status quo.

Parallel to that conversation is our national shift away from representative democracy’s mechanisms for political decision-making and deliberation via a balance of power to that of the vagaries of capitalist markets.

NYC stands central to that shift, tracing back to the fiscal crisis of the 70s.

A Short Diversion into History

Prior to the 70s, NYC was the paragon of a social democratic state. City colleges were free to attend*. Public transit, daycare, hospitals . . . The government worked with labor unions to deliver strong public services.

But that beatific vision came crashing to an end when NYC found itself on the verge of bankruptcy in 1975. It had been borrowing to pay down debt for far too long.

Though the unions ended up bailing the city out—most notably via Al Shanker-led UFT’s investment of teacher’s pensions into municipal bonds—that moment is when, as Richard D. Kahlenberg suggests in his book on Shanker¹, “the relationship between democracy and capitalism had shifted.” Quoting journalists Jack Newfield and Paul DuBrul, Kahlenberg notes that at this moment, there was “a revolution in the governance of New York City,’ where bankers effectively took over the running of the city.”

Writing in The Nation, Kim Phillips-Fein² provides further perspective on the legacy of the crisis:

Today, the rituals of fiscal crisis—the blaming of public sector workers, the vilification of the poor who use government services suddenly deemed excessive luxuries—may seem familiar. . . . 

The crisis brought about a transformation of the very language and conception of politics, as the rhetoric of fiscal necessity and business acumen replaced a vision of politics as a domain of struggle and negotiation.  

. . . the diminished expectations we have for the public sector and the increasing difficulty of living a middle-class life in the city suggest the legacy of the fiscal crisis even now. City governments today—including New York’s—seem primarily to be vehicles to attract and maintain private investment. 

Back to Our Narratives on State vs. Private Sectors Today

Thus, the narrative about the efficacy of charterization for delivering what was once solely a government service is placed within a wider context, and it helps to explain why so many pro-charter folks not only denigrate unions, but furthermore the public sector et al.

And this is why Mariana Mazzucato’s challenge is so important to pay heed to.

Mazzucato argues that contrary to the anti-government narrative, innovation occurs as a result of government intervention. At minute 7:00 in her talk, she states:

Now, what’s interesting in all of this is the state, in all these examples, was doing so much more than just fixing market failures. It was actually shaping and creating markets. It was funding not only the basic research, which again is a typical public good, but even the applied research. It was even, God forbid, being a venture capitalist.
. . . In all these sectors, from funding the Internet to doing the spending, but also the envisioning, the strategic vision, for these investments, it was actually coming within the state.

Rather than wasting wind denigrating the state, she suggests, we should instead seek “public-private partnerships.”

This is what I was suggesting in my last post when I stated “Perhaps the answer lies somewhere in between [district or charter systems].”

As a side note, I recently read Peter Thiel’s Zero to One, and I found his ideas about how to innovate as an entrepreneur compelling. Yet I had a moment of cognitive dissonance when he suggested, in his contrarian way, that enterprises are most successful when they can gain a monopoly, rather than endure heavy competition. When I read that, I thought:

But the state IS the biggest monopoly!

The government is not necessarily the enemy of innovation. Unions aren’t either.

And on the other side, the private sector is not necessarily the enemy of democracy and strong social enterprises.

The question becomes: how can we leverage partnerships across government, unions, and private organizations to most effectively serve our nation’s future?

* Can you even imagine that happening today in the US? You’d have to be some kind of a socialist!

1 Kahlenberg, Richard D. Tough Liberal: Albert Shanker and the Battles over Schools, Unions, Race, and Democracy. New York: Columbia UP, 2007. Print.

2  Phillips-Fein, Kim. “The Legacy of the 1970s Fiscal Crisis.” The Nation. The Nation, 16 Apr. 2013. Web. 23 Aug. 2015. <http://www.thenation.com/article/legacy-1970s-fiscal-crisis/&gt;.

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