Businesses, teachers unions benefit financially from status quo in education

Editor’s note: Corporate greed! Profits! Privatization! Shout the same, alarming buzz words enough – as critics of education reform are doing – and it defines the debate. But as Doug Tuthill, a former teachers union president, argues in this post, businesses benefit more from the status quo in education than they will from expanded parental choice.

Public education would not exist without the products and services provided by for-profit corporations. Every year, for-profit corporations receive billions of tax dollars from school districts to build schools and supply them with desks, books, computers, pens, pencils, paper, calculators, buses, crayons, and power to turn on the lights. And yet school choice critics continue to assert that giving parents more schooling options is a plot by for-profit corporations to make more money.

I don’t buy it.

The profit margins of businesses providing goods and services to public education are greater under the current command-and-control system because the costs of sales and servicing contracts are lower when the customers are large, centrally controlled organizations.  My friend Jean Clements, who is the teachers union president in Hillsborough County, Florida, was the first person to explain this to me.

Four years ago, I asked Jean why her union refused to sell union memberships to private school teachers. Her answer? She would lose money. Jean said the membership revenue she would receive from teachers in small, non-district schools would not cover the costs of negotiating and servicing their collective bargaining contracts.

Large school districts allow teachers unions to spread their costs across a large number of members, which is why large districts are their preferred market. It’s also why unions are so opposed to public education occurring in schools not owned and managed by school districts.

I suspect the same economy-of-scale issues influencing Jean’s business decisions are also relevant for Dell, Pearson and Apple.

Dell would much rather sell $30 million worth of computers to the Hillsborough school district than to 400 small private schools, which is why I’m confident the profit motive is not behind the national effort to expand school choice.

Despite the best efforts of school boards and teachers unions to preserve the status quo, the continued expansion of parental empowerment in public education is inevitable. But the efficiencies found in large economies of scale will cause independent schools to increasingly organize themselves into purchasing cooperatives. These new systems of schools will be less centrally controlled than today’s school districts, but, as we’re seeing in the charter school movement, some consolidation is inevitable.

The 1920s model of industrial unionism that teachers adopted in the 1960s is no longer a viable model for public education employees. As public education becomes increasingly more decentralized, teacher organizations will need a business model that reflects this reality. Jean Clements is correct in saying her current business model doesn’t work for non-district K-12 schools, but the answer is finding a business model that does work.

Making corporate greed the face of parental empowerment is a clever political strategy for people hoping to maintain the dominance of traditional school districts, but it has no basis in reality. If we stay focused on providing all children with the customized education that best meets their needs, the various corporate interests doing business in public education will adjust – and we’ll all be fine.

(Image from murninghanpost.)

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BY Doug Tuthill

A lifelong educator and former teacher union president, Tuthill has been president of Step Up For Students since August 2008.

One Comment


Thanks for challenging the myth that public school districts are these quaint organizations composed of selfless education “missionaries” looking to serve mankind.

Education is a huge industry and the dollars at stake are staggering – the districts are, in most places, the largest employer in their respective counties with multi billion dollar budgets. A good chunk of which already goes to vendors, contractors, providers, consultants, etc.,

Sadly, the current battle isn’t over choice or education, it’s about dollars and where they will flow.

As with most conflicts – the first casualty is truth – there is no free lunch – it costs money to run a school system and the powers that have been at the helm for generations will fight feverishly to maintain their empires and so will those that benefit from the current quasi monopolistic system.

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