Edison Takes Aim at Philly

Philadelphia is heading into uncharted territory in the privatization of public education. The state of Pennsylvania is preparing to take over the Philadelphia schools and has plans to implement for-profit management not just of schools but portions of the district’s central administration.

If a state takeover goes through, the controversial for-profit Edison Schools, Inc., is in line to manage 45 or more of Philadelphia’s schools starting next fall.

Philadelphia activists have been mo-bilizing to urge Mayor John Street and Gov. Mark Schweiker to drop privatization plans as they negotiate over the future of Philadelphia schools. But the governor holds most of the cards because state funds are needed to rescue the chronically underfunded system.

Edison had also sought a contract to take over the top management of the Philadelphia system. But growing public outcry forced the governor to withdraw his plan to have Edison fill top management jobs. At the same time, Edison may still be in line for a contract to provide management services.

While the Philadelphia situation poses certain risks for Edison – will the company, for example, be able to manage such massive and immediate growth – the proposed contracts could be a huge boon for Edison and its stock in the short run. The company, which now manages 136 schools, has yet to turn a profit. Its stock sold at around $18.60 a share in late November, just above its initial asking price two years ago of $18 a share.

TAKEOVER BACKGROUND

The state’s takeover threat arose out of two long-standing crises in the Philadelphia schools: financial problems and low academic achievement. The fiscal crisis came to a head this August when the School District lacked enough cash to meet payroll.

Philadelphia’s financial crunch can be directly attributed to a state school funding formula that is one of the most inequitable in the country. Legal and political efforts to address issues of funding equity in Pennsylvania have so far failed. A federal civil rights suit against the state is on hold while the state and city negotiate.

The state stepped in with extra cash in August to bail out the district as part of a deal between then-Governor Tom Ridge and Philadelphia Mayor John Street. That deal says that after a period of study and then negotiation, the city and state must reach agreement on a solution to the district’s academic and financial woes by Nov. 30, or the state will take full control of the 210,000-student district.

It was no surprise that privatization was part of the ensuing package put forward by the state. The governor’s views were well known. While he failed in three efforts over two terms to establish a voucher program, then-Governor Ridge was relentless in promoting nonpublic education and free market strategies for school change.

Pennsylvania, for example, adopted a charter school law in 1997, and with support from the state there has been a charter school boom in Philadelphia. There are currently 40 charter schools in the city, half the state’s total. Last spring the state legislature passed a law that, in one measure, established a tax credit for corporate contributions to private school scholarships, began a “voucher” plan for students in low-performing schools to purchase after-school tutoring, and established a new creature – “independent schools” – that are even freer from public oversight and regulation than charters.

The architects of these initiatives include Ridge’s former education secretary, Eugene Hickok, a leading figure in the privatization and voucher movements, who landed a job this spring as undersecretary of education in the Bush administration. Charles Zogby, his successor in Pennsylvania, like Hickok before him, is active in the Education Leaders Council, a conservative policy group of state education officials.

Thus it was not completely surprising that Pennsylvania officials came up with a plan for Philadelphia this fall that was a frontal assault on public education and the most comprehensive privatization plan since the now-defunct Education Alternatives Inc tried to take over the Hartford, CN, schools in 1994.

First, officials hired Edison for $2.7 million to recommend how to fix the Philadelphia school system. In October, Edison, with new governor Schweiker’s blessing, recommended hiring a private company to operate the district, including the top 55 management positions. Edison and the governor also proposed that 60 low-performing schools be run by private companies (45 of them by Edison) in partnership with a short list of community groups that are already involved with charter schools or with Edison. Finally, the report identified privatization of thousands of living-wage, non-professional jobs as a key cost-cutting strategy, claiming that jobs cleaning schools and staffing school buses could be done more cheaply.

Under the governor’s proposal, privatization would be hard to reverse. Edison would answer to a five-member school reform commission, with four members appointed by the governor and one by the mayor. Lengthy terms mean that the commission would be dominated by the current governor’s appointees through 2006.

COMMUNITY OPPOSITION

In New York City last spring, a grassroots campaign and a community-labor coalition led by ACORN and the teachers’ union successfully beat back a plan to install Edison in five low-performing schools (for more information, see www.takebackourschools.org). In Phil-adelphia, a coalition of 30 grassroots groups – Philadelphians United to Support Public Schools – quickly emerged to challenge Edison and fight privatization. However, the local unions were initially cautious about joining the effort, and parent and community groups were not able to mobilize large numbers.

Student and youth organizations such as Philadelphia Student Union, Youth United for Change, and Asian Americans United have organized the most vocal opposition to the privatization moves. High school students have denounced the lack of public input into the plans and have hammered home the message, “We are not for sale!” A thousand students went to the state capitol in Harrisburg to protest the privatization plan. The next step in the escalating protest is student walkouts.

As more details of the plan became public and threats of privatized jobs loomed, the unions finally began to mobilize, buying radio ads and organizing mass protests. And as Mayor Street voiced his opposition to the sweeping plans for privatization and the lack of a voice for the city in district governance, other local elected officials, Philadelphia’s school board, and community groups like the Black Clergy of Philadelphia and the NAACP turned up their criticism.

“By any means necessary, we will disrupt, we will do what it takes,” said Rev. Vernal Simms of the Black Clergy at an Oct. 31 rally.

Massive public resistance appears to be the only way to block the privatization plan. How far Mayor Street is willing to go in his opposition is unclear. Governor Schweiker has the power to assume control of the district and impose his plan, but he may think twice about imposing unpopular privatization measures if it appears that the state’s every move will be challenged. Providing him with some political cover are a handful of African-American elected officials and organizations in communities of color that support Edison and the proposed blend of community control and privatization. These include some long-time school reformers who are fed up and say Edison is worth a try.

But Edison’s support in Philadelphia’s African-American communities is still thin. Parent activist Wendell Harris of the Philadelphia Home and School Council is one vocal critic of privatization of the district. “There are a lot of things that need to be done to improve it and a lot of people to be held accountable,” Harris said. “But I support the efforts of our teachers – the ones who are dedicated and trying to do the best they can with the minimal support that they have.”

“I feel my children are being attacked,” he added. “We’ve got to let the parents and everyone know that the community in Philadelphia the parents, the students – we’re all being attacked, and we have to stand up and fight back.”

The coming weeks and months will test the organizing and coalition-building skills of Philadelphia activists. And even if Edison is able to win this round, it still faces two major hurdles: improving academic achievement and turning a profit in order to keep stockholders happy. Clearly, this is not an issue that will be resolved any time soon.