School & District Management

U.S. Aid Urged for Education’s Entrepreneurs

October 21, 2008 7 min read
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With the presidential candidates both underscoring their support for entrepreneurial initiatives in education, policy experts are advancing ideas for helping such efforts flourish.

In their Oct. 15 debate at Hofstra University, both Sens. John McCain of Arizona and Barack Obama of Illinois used questions on education to talk about school choice and charter schools. And Sen. McCain, the Republican nominee, singled out the New York City-based nonprofit Teach For America as the type of entrepreneurial venture he would encourage.

Andrew J. Rotherham, the co-director of the Washington think tank Education Sector and a former education adviser to President Clinton, said the candidates’ previous attention to entrepreneurial activity in education helped inspire a new report on ways the federal government could advance such efforts.

“Both candidates have actually expressed an interest in using federal resources and the federal role to leverage entrepreneurial solutions to various social problems, including education,” said Mr. Rotherham, who co-wrote the report with Sara Mead, the director of the early-education initiative at the New America Foundation.

New Office Proposed

In their new report, the two analysts call for establishing a “robust” new Office of Educational Entrepreneurship and Innovation. They suggest the office would “expand the boundaries of public education by scaling up successful educational entrepreneurs, seeding transformative educational innovations, and building a stronger culture to support these activities throughout the public sector.”

Meanwhile, a new book edited by Frederick M. Hess, the director of education policy studies at the American Enterprise Institute, another Washington think tank, offers a close look at the emerging field of K-12 entrepreneurship, examining the challenges and steps needed to nurture “a more dynamic and quality-conscious sector.”

Mr. Hess draws on a variety of scholars, analysts, and entrepreneurs to explore the efforts needed to increase human capital in K-12 education, attract more investment capital, ensure quality control, improve research and development, and remove what he describes in the book as “the barriers that hinder new providers” so that entrepreneurship can “make a real difference in the education of America’s children.”

The new report from Ms. Mead and Mr. Rotherham suggests creating a “Grow What Works” fund at the Education Department, with up to $300 million, to support the “scale up” of successful entrepreneurs such as charter school networks, suppliers of new teachers and principals, and technology providers. It also calls for an Education Innovation Challenge fund, with $150 million invested annually into longer-term “high-risk but potential high-payoff educational R&D.”

Finally, the authors call on the federal government to help eliminate barriers to new and innovative approaches, and to help build networks of entrepreneurs.

The report argues that the current Office of Innovation and Improvement at the Education Department is “too divided and diffuse in its mission and practices to support innovation.” As an alternative, they propose a new office in the federal agency “with a small and nimble staff and an independent review board” to provide oversight.

‘Forever Optimistic’?

Michael J. Petrilli, a vice president at the Washington-based Thomas B. Fordham Institute, said he sympathizes with some of the core ideas in the report for promoting entrepreneurship, but suggested the authors have unrealistic expectations for the federal government.

“Mead and Rotherham are forever optimistic about the federal government’s ability to do right in education, even when the evidence points in the other direction,” said Mr. Petrilli, who served as an Education Department appointee under President Bush—in the Office of Innovation and Improvement.

A 12-year-old participant in the Youth Music Exchange, which enables students to help create record labels, works on a song at Sunset Park Center School in New York City. The co-founder of the exchange, Columbia University faculty member Michael Bitz, received the first-ever Education Entrepreneurship Fellowship from the Mind Trust, a nonprofit group in Indianapolis.

He also cautioned that the department would be setting itself up for charges of political bias in picking entrepreneurs to back, a problem he recalls encountering during his tenure.

In the presidential debate last week, both White House hopefuls, while never using the term “educational entrepreneurship,” talked up ideas that are at the core of that work, especially Sen. McCain.

“Choice and competition amongst schools is one of the key elements that’s already been proven in places like New Orleans and New York City and other places, where we have charter schools, where we take good teachers and reward them and promote them,” Sen. McCain said.

He also highlighted the work of Teach For America, which recruits outstanding college graduates to teach in high-need urban and rural schools.

“We need to encourage programs such as Teach For America and [the federal] Troops to Teachers [program] where people, after having served in the military, can go right to teaching,” Sen. McCain said.

For his part, Sen. Obama emphasized his strong support for charter schools and performance pay for teachers, while criticizing Mr. McCain for promoting federal school vouchers. “I think it’s important to foster competition inside the public schools,” Sen. Obama said.

Earlier this month, at a Washington forum hosted by the American Enterprise Institute, education advisers to both campaigns discussed educational entrepreneurship.

Sen. Obama has proposed creating a Social Entrepreneurship Agency within the federal Corporation for National and Community Service, noted Michael Johnston, an adviser to the Obama campaign who is a public school principal in Denver, Colo., and was a co-founder of New Leaders for New Schools, a New York City-based nonprofit organization that recruits and trains principals for urban schools.

“There’s not the right infrastructure right now to support strong entrepreneurship in the social sector,” said Mr. Johnston. “There’s just not enough venture-capital startup dollars in this sector, and there isn’t, once we have those dollars, a real sense of results-driven accountability.”

The new agency, he said, would “coordinate, cultivate, expand, grow social entrepreneurship activities in multiple sectors, education certainly being one of them.”

New Charter Funding

Also, Sen. Obama has called for creating an Innovative Schools Fund, providing grants to states and districts to implement plans for offering a “portfolio” of successful public schools, including charter schools, career academies, and theme-focused schools.

In addition, Mr. Johnston said, Sen. Obama is proposing to double funding for the $190 million Charter Schools Program, which provides federal seed money for new schools. The extra money, the campaign has said, would only go to states that improve accountability for charter schools, allow for interventions in struggling charters, and have a clear process for closing down chronic low performers.

“This promise is about creating higher quality by letting unsuccessful ventures die and letting successful ones expand,” Mr. Johnston said.

The campaign, he noted, has also called for substantially increasing federal research and development spending in K-12 education.

Lisa Graham Keegan, an adviser to the McCain campaign and a former state schools chief in Arizona, cautioned that the GOP nominee is far less inclined to propose a raft of new programs than Sen. Obama. But she said that should in no way signal a lack of enthusiasm by Sen. McCain for educational entrepreneurship, or for finding ways to help.

“It’s one thing to say they’re going to add these new ideas on top of the [existing] system,” she said. “The bigger question is going to be, what’s the fundamental shift?”

Redefining the System

The core of Sen. McCain’s approach, she said, is to redefine the K-12 system as one “in which the resources that the public gives kids follow them into schools that work for them. Those schools in return turn around and report out to us how they’re doing, based on some non-negotiable standards that the states set. And then parents make their choices.”

She added: “Educational entrepreneurship and bringing people to the fore is only going to happen if we allow the system to be redefined so that money can move in ways that support it.”

Mr. Hess’ new book explores many of the existing barriers to spurring more K-12 entrepreneurship, but also warns that an unfettered market is no guarantee of quality.

“[M]ost advocates of school choice and social entrepreneurship have tended to assume that, if demand exists, the supply of quality providers will take care of itself,” Mr. Hess writes. “Unfortunately, experience both inside and outside education suggests the frailty of that assumption.”

He argues that “dynamic markets” require a range of supports and conditions, from financial capital to the availability of talent, research and development, adequate quality-control mechanisms, and the removal of harmful regulatory and institutional barriers.

Although he sees some “bold ventures” showing “promising work,” Mr. Hess writes that the entrepreneurial sector is far too small. “[T]he scope of existing activity pales beside the larger American education enterprise,” he writes.

A version of this article appeared in the October 22, 2008 edition of Education Week as U.S. Aid Urged for Education’s Entrepreneurs


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