In a flood of news stories during the last year, we’ve learned that as many as 16 million autos may be subject to recall due to defective air bags supplied by the Takata Corporation. After reading this and other stories about recalls in the automotive manufacturing and parts sector, including a huge mess with storied German automaker Volkswagen, where more than 8 million vehicles in Europe alone are subject to recall, that got me thinking on the topic of other headlines detailing problems recently in another industry.
Here are some examples of problems in that other, non-automotive, non-manufacturing industry:
- A record 17 industry locations in one city – Columbus – closed in just one year.
- One of the industry’s treasurers embezzled nearly $500,000 from several locations, earning a two-year prison sentence.
- An executive in the industry, operating under a phony consulting contract, also embezzled about a half-million dollars, while employee salaries had to be cut in an economy move.
- In Cleveland, five industry executives were charged with stealing nearly $2 million in a scheme that saw the creation of five shell companies to receive public funds. Even the board chairman, who owned the building in which the industry operated, was part of the fraud that was detailed in a 32-count indictment.
- Three industry treasurers were singled out several years ago for their responsibility with more than $1 million in “questionable spending,” according to audit findings.
- A national chain appeared to be spending more on lease payments for its sites than on employee salaries and benefits, a practice that raised eyebrows both inside and outside the industry. And, oh, the lease payments were owed to the parent company, which happened to own the buildings in which the industry conducted its business.
- Several industry locations in Ohio, part of a national chain with extensive international ties, were served with search warrants by the FBI last year, and the public is still waiting to find out the particulars of the federal investigation.
And yes, there’s much, much more. You can check this site for a recent chronology of even more problems in this industry.
Excuse me, which industry?
The envelope, please.
We are, of course, talking about the Ohio charter school industry, an enterprise that has been called the Wild, Wild West by some of its proponents and the Dark Side by others who work in this murky environment also known as charterworld.
The scope of theft and corruption in charter schools has so alarmed various groups that several studies have examined the extent of the problem and concluded that this industry presents a high risk for fraud and abuse of public funds.
But whatever words are used to describe it, the industry’s operation is clearly defective in design, as these stories amply demonstrate. The examples show how systemic the extent of charter school failure and fraud have been in Ohio, and, for that matter, other states as well.
If the charter school industry were a manufacturing enterprise, its defective design would have been so apparent that it would have been recalled like Takata, Volkswagen, or any other entity that produces something that might blow up or otherwise harm the buyer.
In this case, the buyer or purveyor of this industry is the state legislature, a public body that funds and promotes this defective design, a model for the privatization of a public function that contains a faulty mechanism for oversight and monitoring, and no means for a feedback loop that can assist with corrections to improve the operation.
By contrast, public school boards – elected bodies – do that, as they hire the superintendent and treasurer, and provide feedback in the form of annual evaluations and reviews. But as we’ve seen before, the treasurers tend to be hand-picked by the school developer or operator, and the needed review mechanism is all too often absent – as the stories in the links clearly show.
One other small thing: every once in a while, qualified voters show up to further review and evaluate the operation. The process is called an election.
Indeed, if the charter school industry operated in the manufacturing or consumer products sector, there would be cries for a widespread recall of its product. But the product of this industry is supposedly another form of “public” education, a service that the public pays for but has no input in the result or an opportunity to vote for or against the directors of the operation – the board of education.
Remember though, it’s about “choice,” as we are told again and again.
That’s what school privatization is all about. Sure, we’ll take those public funds the corporatists say, but don’t bother asking us about how we do business. We’re a private corporation, and the information you’re asking for is proprietary. Besides, we own the equipment, furniture and other assets.
If there are those who might be skeptical about the analogy to product recalls like those for Takata and Volkswagen, consider the recent actions of the Washington Supreme Court. According to the Washington Post:
Washington state’s Supreme Court has become the first in the nation to decide that taxpayer-funded charter schools are unconstitutional, reasoning that charters are not truly public schools because they aren’t governed by elected boards and therefore not accountable to voters.
To its credit, the Washington Supreme Court identified one major defect in the design of these schools. So when an appellate court spends a year examining the charter school model and concludes that such entities aren’t public and therefore are unconstitutional, that’s equivalent to a recall.
Sadly, the much touted HB2, the so-called major charter school reform law, still comes up short in addressing major defects in charter school design. The legislature is out to lunch on further needed reforms – or, better yet, junking the model entirely because of its inherent, faulty design. But when you look at campaign contributions, the charter school industry has picked up the tab for that perpetual legislative lunch – and dinner.
It’s great to know that when it comes to defective products, we don’t have to wait for Congress to act. Instead, we have a U.S. Consumer Product Safety Commission and a National Highway Traffic Safety Administration to look out for our interests. Just ask Takata and Volkswagen about that.
And in Ohio, when we have an industry that is prone to waste, fraud and abuse, can anyone recollect – or is the better word choice recall – who is watching out for us?
Denis Smith is a retired school administrator and a former consultant in the Ohio Department of Education’s charter school office.
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