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Anti-Union Ads in Chicago Paid for By Hedge Funds, Billionaires

by David Dayen - FireDogLake  |  09/19/2012

I wish I had known about this before the Chicago Teachers Union suspended their strike and returned to work, but it may shed some light on the timing of the suspension. At the least, it provides a little more context for what teachers unions have to deal with on the ground.

Apparently [an] anti-union ad played non-stop on television in Chicago throughout the strike. It’s the product of Education Reform Now, a group that also sometimes goes by Democrats for Education Reform, depending on what pot of money they want to use. Formed in 2005, Education Reform Now has spent millions of dollars over the past few years, whether massaging public opinion or lobbying state legislatures or intervening in school board races.

Education Reform Now spent $10 million in New York state over a two-year period, lobbying Albany for changes to state law on teacher evaluations. They plan to be active in next year’s mayoral election. Former New York City school chancellor Joel Klein, who eventually made his way to work for Rupert Murdoch at News Corp, was the chairman of the Education Reform Now board. The group is closely affiliated with Students First, Michelle Rhee’s lobbying and advocacy group.

Take a look at some of the other members of the New York effort:

Joel Klein isn’t the only connection between Democrats for Education Reform and StudentsFirstNY. The Education Reform Now board includes some heavy-hitting charter school donors from the hedge fund world, including John Sabat of SAC Capital and Sidney Hawkins Gargiulo of Ziff Brothers Investments. Democrats for Education Reform was co-founded by John Petry of Columbus Capital Management, who also serves on the board of both that organization and Education Reform Now. All three board members are deeply involved in the Success Charter Network run by former City Councilmember Eva Moskowitz – who herself will serve on the StudentsFirst board.

In other words, a coterie of hedge fund managers, who have a vested interest in privatizing education through the charter schools they fund. The group got the Senate Majority Leader in New York to insert a provision into the budget allowing for for-profit charters in New York. It eventually got removed, but it’s sure to be back. That’s the whole enchilada.

Education Reform Now doesn’t disclose its donors, but we do know the other source of funding for the group: foundation money.

Private foundations are playing a growing role in financing the nonprofit educational wings of several prominent K-12 advocacy groups, according to reviews of the foundations’ grant records and annual tax filings.

The efforts they underwrite run from the mundane—translating school district materials into Spanish, for instance—to activities deeply intertwined with policy, such as providing information to parents on topics like teacher evaluation and school choice.

Since 2005, the Bill & Melinda Gates Foundation has donated or pledged some $5.2 million in grants to Stand for Children’s Leadership Center, including a two-year, $3.5 million grant in 2010 focused primarily on its teacher-quality work. The Eli and Edythe Broad Foundation provided $500,000 in startup costs to StudentsFirst and has funded Education Reform Now to the tune of $2 million since 2008.

And beginning in 2010, the Walton Family Foundation has supported all three of those advocacy organizations, including $2.5 million for Stand for Children, $1 million to StudentsFirst, and $2.4 million to Education Reform Now, which is associated with the political action committee Democrats for Education Reform.

The Walton Family Foundation is what you think, that’s the foundation of the founders of Wal-Mart. Eli Broad is slowly buying up all of Los Angeles. The reputation of Bill and Melinda Gates [precede] them. The Pershing Square Foundation, run by Pershing Square Capital Management CEO Bill Ackman, has also donated to Education Reform Now/Democrats for Education Reform. This site has much more on their donor network.

This is a BIG money game. So when a teachers union, even one with a formidable war chest, challenges the prevailing ideology on education reform, they go up against hedge funds and billionaires who will attack and smear them. That’s just a sampling of the pressure they face. They also have to contend with a biased media and a general culture tilted against them as well. Despite all that, parents supported the strike in Chicago. But there was going to be a time limit to that.

I just think that needs to be part of the context of understanding this fight.

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Chicago Teachers Union