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Businesses Sign On to Bush Plan,But Many Also Raising Concerns2

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In the two weeks following President Bush's call for a privately funded corporation to spur the design of "a new generation" of schools, the business community has rapidly mobilized in an effort to transform the vision into a reality.

But, even as business leaders have moved to meet the President's challenge, some members of the business and philanthropic communities are questioning the role of business in the enterprise and its agenda for change.

Under Mr. Bush's America 2000 plan, business leaders have pledged to estab
lish a nonprofit organization called the New American Schools Development Corporation and to raise $150 million to $200 million for the research-and-devel0 opment work needed to design the new schools.

But in interviews last week, philanthropists and members of the business community expressed four main concerns about the President's strategy. They question:

  • Whether the federal government is shirking its responsibilities for improving the nation's schools by foisting them onto the private sector.
  • Whether the project will become the pet school-improvement initiative of chief executive officers, overriding the needs of other reform efforts already under way.
  • Whether a closed circle of ceo's will use the corporation to promote controversial parental-choice proposals.
  • And whether such a massive research effort is necessary, given the numerous successful education models that have been developed over the past decade.

"There is openness, and there is skepticism," said Joan Lipsitz, program director for elementary and secondary education for the Lilly Endowment. "But I sense this is a wait-and-see type of skepticism, not nihilist, but more like a pause for thought."

A 'Manhattan Project'

On April 18, Mr. Bush and Secre0 tary of Education Lamar Alexander urged the private sector to spearhead an effort to radically transform the nation's schools.

A week later, 11 chief executives from some of the country's largest corporations formed a "business core group" to address the President's challenge, said Roger D. Semerad, a senior vice president of the rjr Nabisco Corporation and the head of the working group organizing the school-development corporation.

The corporation is expected to award the most lucrative education-research contracts in U.S. history--between $15 million and $20 million each--to three to seven research teams. The teams could involve, among others, corporations, universities, think tanks, or educators.

Denis P. Doyle, a senior fellow at the Hudson Institute, called the drive an educational equivalent of the Manhattan Project, referring to the all-out push during World War II to produce the atomic bomb.

"When I first heard about this, I thought it was a corporate natural," said Mary K. Leonard, director of precollegiate-education programs for the Council on Foundations. "People who make their living creating projects of the future understand the role of R&D in facilitating progress, and they understand this is high-risk money."

"You put in a lot of money all at once, and who knows," she added, "you may discover nylon."

Members of the group working to set up the corporation say they hope to raise $150 million to $200 million from corporate, foundation, and in dividual sources by the end of the year.

The contracts are scheduled to be awarded early next year, said Rob ert Schneider, a former vice president of the Xerox Corporation and the head of the fund-raising drive. By 1994, demonstration projects should be up and running, with radi cally new ideas well-developed and ready for adoption, he said.

At that point, federal start-up grants of $1 million each would be awarded to those public or private educators, corporate groups, or oth ers selected to set up an experimen tal school.

The Administration hopes to es tablish 535 such schools--one for each House district and two more for each state--by 1996. Applicants would be encouraged, but not required, to draw from the reports of the research teams. (See related story, page 1.)

'High Drama'

Advocates of the program are con fident that the money will be raised, given the power and prestige of the group, though they readily acknowl edge that it will be a challenge.

But many reform advocates said last week that they worry that the President's challenge will end up di verting money from current school- improvement projects to the new R&D corporation.

"People are deathly frightened this will become a ceo project," said one business observer who re quested anonymity. "They're really afraid the ceo's concern will com pletely override things they've put years [of effort] into."

William H. Kolberg, president of the National Alliance of Business, noted that business currently con tributes between $225 million and $250 million a year to a vast spectrum of K-12 education projects across the country.

Ms. Leonard of the Council on Foundations said she is optimistic that businesses and foundations will not shift funds already committed to ongoing projects.

"The people already in the choir, those who are well aware of the im portant issues of education, are go ing to continue the fine work they're doing," she said.

How the fund-raising effort plays out will be apparent remarkably Loon, observers said, noting that of ficials of the corporation hope to raise a bulk of the money needed in the next few months.

"This is high drama," Mr. Doyle said. "It's a hell of a lot of money to raise in the private sector."

He said the Bush Administration made a conscious decision to tap the private sector as the funding source in an effort to engage more players in the project. For the federal gov ernment to earmark $200 million for the project would be virtually meaningless, Mr. Doyle noted, but to raise such a sum through private sources will take a cooperative effort that will ensure they have a person al stake in the outcome.

Private money will also not be in fluenced by pork-barrel politics and bureaucratic red tape, advocates said, adding that the flexibility of the private sector should make the money go further.

Shirked Responsibility?

But other observers attributed the Administration's move more to stin giness than to development strategy.

While the Education Department budget is $27.1 billion, they said, the current budget for the agency's of fice of educational research and im provement is a scant $130 million.

"Sure [$200 million] is a drop in the bucket," Ms. Leonard said, "but the faucet's turned off."

Sandra Kessler Hamburg, education-studies director for the Commit tee for Economic Development, a national business organization, said the group is wary about the federal government dumping education reearch onto the business community.

Agreed Eugene Wilson, president of the arco Foundation in Los Angeles, "We have long felt here that pub lic education is a public obligation.

" Business's role, he added, should be to push for and broker change, not to bankroll it. He pointed to a similar project in California, but one in which business played a very different role.

In 1990, the California Business Roundtable helped push a bill through the legislature that set side $6.8 million in state funds for planning grants for schools interested in restructuring.

Acknowledging that a relatively small amount of public money was earmarked for the project, Jere Jacob, an assistant vice president of the Pacific Telesis Group in San Francisco and a member of the state's business roundtable, said that the appropriation was, nonetheless, symbolically important.

"This is an important public-policy issue," he said, "and if it's important public policy, it has to be declared so by the government."

The Bush Administration's reluctance to put its money where its mouth is, he said, may be of equal symbolic significance.

A Train Track to Choice

Some educators and potential funders also said they are worried that the corporation could promote parental choice by channeling funding to innovative private and parochial schools, then using the demonstration projects as proof that private schools do a better job than public schools of educating students.

"If this approach is structured so 0 that everyone comes to the starting 0 line with the same baggage, thenLel10lfine," said Sharon Robinson, director of the National Education AssociL$ation's National Center for Innova0 tion. "But to say a school which can 0 select its own student body and which 0 is free of public regulatory mechaL0 nisms has a better shot at defining 0 new knowledge and teaching techL0 niques, I don't regard that as equal."0

"If we see this is a ploy to intro0 duce choice," she added, "we'll have 0 something to say about it."$

Mr. Semerad of the working L$group organizing the school-devel0 opment corporation insisted that L$there is no hidden agenda on choice. 0 But, he asserted, for the project to 0 work, it must be open to all potential 0 sources of innovation, including pri0 vate and parochial schools.$


Charles E.M. Kolb, deputy assis0 tant to the President for domestic L0 policy, did, however, link the new-0 schools initiative to the other pieces of 0 Mr. Bush's package, some of which 0 explicitly espouse parental choice.

"Lamar Alexander has described the programs as four trains leaving Union Station at the same time," he said. "The four parts are definitely related to each other."

At this point, Ms. Lipsitz of the Lilly Endowment said, the choice jitters relate more to who is proposing the new-schools initiative than to the initiative itself.

The ceo's who have become involved in the effort are all affluent, white males with the same social perspective, she said, adding that many of them have already whole heartedly endorsed parental choice.

"In order to have the kind of broad enterprise that we need, we would need to see some diversity around the policymaking table," Ms. Lipsitz said.

She added, "It's the leaps into policy based on the naive ideals by people not grounded in formal educa tion-reform study that's very bothersome."

Mr. Semerad said seating at the table will soon be expanded. In the coming weeks, the group of ceo's will be formalized into a true board of directors with voices from founda tions, education, and advocacy groups, he said, acknowledging, though, that business will maintain some semblance of control.

Looking for Answers

In the final analysis, though, many detractors are questioning the need for the privately funded corporation at all.

Educators already know what works in the classroom, they said, pointing to the same innovative initiatives highlighted by the President: James P. Comer's program for disadvantaged students, Theodore R. Sizer's Coalition of Essential Schools, and Henry M. Levin's "accelerated schools," for instance.

"Parents, students, and educators know what works to a large extent," Ms. Hamburg of the ced said. "Now they need to be shown how they can make it work in their own schools."

While advocates of the Bush plan acknowledge that some school-im provement projects have shown some remarkable successes, they say there is still much work to do.

The consortia and demonstration schools "don't have to discard the best they can find in existence," said Chester E. Finn Jr., a professor of education and public policy at Vanderbilt University who worked with Mr. Alexander on the initiative. "If they want to pluck faculty guidance from Ted Sizer, community relations from James Comer, and accelerated learning from Henry Levin, that would be great."

"But," he added, "we're saying there isn't one mold yet that we can say: 'This is it. Let's replicate it nationally.

"Even Mr. Sizer, the chairman of the education department at Brown University, admitted that admirers of his Coalition of Essential Schools may be exaggerating his successes.

"To say we have nice, iron-clad an swers already is just false," he said.

Whatever the fate of the New American Schools Development Corporation, Ms. Lipsitz said, it will have an enormous impact on the ed ucational landscape.

A success could further solidify corporate commitment to education reform and ensure the issue remains atop the public-policy agenda, she said. But, by the same token, she added, a failure could be disastrous.

"If these people, who are extremely powerful, feel at the end of several years that they have bombed out, we have all lost a great deal," she said. "They are the heads of multinational corporations. They don't really have to employ many Americans; they can give up on public education."

"Without a doubt, this is a high- risk venture," she concluded. "It has potential, but it could be extremely dangerous."

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