Charter Schools in America

When the idea of charter schools was thrust into public domain by Ray Budde in the 1980s, education policy specialists on one hand and education entrepreneurs and state legislature on the other hand would argue out Budde’s concept, significantly altering it to the point of privatizing public education contrary to what Budde had in mind. In the different forms, the charters were passed in every state, the commonality in the laws was that they allowed parents, teachers, private companies, or non-profit organizations freedom to establish and run public schools on the condition that they performed better than the traditional district schools. This paper examines how charter schools became a license for free market profiteering in public education and creation of a category of losers and winners based on socio-economic status.

Origin of Charter Schools Concept

The concept of charter schools was first developed by Ray Budde in 1974 in a paper he presented to the society of General Systems Research titled ‘‘Education by Charter.’’ After the release of the Nation at Risk in the 1980s, Budde republished with the North East regional lab and circulated it to as many people as possible, including the then president Bush. His idea of charter schools had gained support from the American Federation of Teachers (AFT) president Al Shanker who publicly acknowledged that Budde had coined the best name for the schools: ‘‘charter schools’’ (Kolderie 1).

Budde’s original proposal only sought to restructure the district from a four level to a two level line, allowing groups of teachers in existing schools to receive charters from the school board to carry out instructions. Al Shanker expanded the idea by proposing that teachers start new schools within the existing schools buildings. Both Budde and Shanker did not implement their ideas but their concepts were picked up by the State of Minnesota where a study committee led by John Rollwagen further modified the concepts and proposed a framework of state policy where charter schools could be authorized by state as well as the district boards. In 1991, a compromised version of charter schools program (public schools initiative) was signed into law by Governor Arne Calson opening the way for the passing of charter schools laws across the country. In the year that followed, California passed into law a different form of charter schools program. In 1993, more than 13 states passed their own versions of the program. Michigan, for instance, passed a non-district authorized version while Colorado passed a state level district appeal authorized version (Kolderie 2).

The charter schools concept found its way to Washington under sponsorship by Senators Dave Durenberger (R) and Joseph Lieberman (D). With support from the Clinton administration in 1994, the Federal charter school grant program became law encouraging states to pass charter schools laws (Kolderie2). The idea of reforming the district school system by Budde and Shanker was driven by concern over student achievement where the public system of education was failing. The public schools operating under school district had no legal autonomy and were directed by district superintendents and administrators in the central offices. Parents and principals alike had no say on the running of the school and could not control or influence resource allocation or utilization (Millot 2). This structure meant that decisions were made by a body of persons who were far out of touch with the communities and the classrooms where the decisions were meant to be implemented (Burns 2).

Shanker’s proposal did not aim at giving every teacher administration license without oversight or supervision but the opportunity to analyze policy and practices retain the best practices and abandon those that did not work. This would promote teacher professionalism and discourage apathy (Burns, 4). Instead, Shanker’s proposal waived state restrictions allowing charter schools to be autonomous entities, allowing movement and engagement of teachers and policy entrepreneurs from other states (Burns 5). This would lead to the rise of opposing coalitions on schools charters across the nation leading to legislature and policy improvement (Burns 6). Those who supported increased school autonomy argued that it would create competition for tax dollars that was allocated for public education and increase accountability ensuring the individual schools were accountable for educational performance (Millot 3).

Peterson, an education policy advisor, argues that Joe Nathan and Ted Kolderie fundamentally altered the charter schools concept. They proposed that schools be authorized by state wide agencies that were free of local district control in contrast to Budde’s original idea that envisaged charters to be authorized by the school districts but run by teachers without interference from the central office administration and well within the collective bargaining agreements negotiated between districts and unions (1). The Charter School Expansion Act of 1998 (Public Law, 105-278) expanded the number of quality charter schools available to students across the nation giving more powers to the charters in planning, designing, and initial implementation of charter schools. Public charter schools teachers were given the freedom to be innovative in improving learning outcomes for students in structures that were suitable and tailored to the students’ needs. The schools would be run by partnerships between parents and teachers who would be held accountable for improving student achievement.

Achievements of Charter Schools Movement

Josh Cunningham argues that the when charter schools were established in the 1990s, it was thought that the autonomy and flexibility given to the schools would ultimately result in significant improved student performance, but the answer to this question still remains unclear. He further opines that it is hard to explain and define student achievement with the most common narrow indicators of student performance such as standardized i.e. National Assessment of Education Progress-NAEP , state-wide exams, SATs, and ACTs (1).

Mead, Mitchell, and Rotherham highlight the growth of charter schools between 2010 and 2015, citing a growth in trend in hike in percentage of students enrolled and charter schools established. Performance has also improved on the aggregate in major cities, for disadvantaged student sub groups; some subsets of charter schools have included technology in their school models (3). In 2015, there were 6700 charter schools in more than 42 states in the country, three times the number that existed in 2000, ten years after the first state passed into law the charter schools programs. Further, charter schools students’ enrollment has grown rapidly more than the number of charter schools. This was attributed to schools adding more grades to grow overtime and enrollment from virtual schools which had large numbers of students (Mead, Mitchell, and Rotherham 5)

However, the three also note that 1,100 charter schools had closed between 2010 and 2015 because of poor academic performance among other reasons. This helped to improve the overall performance of charter schools and the rate of closure has remained low and consistent at between 3% and 4% (10-12). They also argue that all the three categories of Charter schools – EMOs, the Education Management Organization (for profit), CMOs – Charter ManagementOrganization (not for profit) and Free Standing Charters (not affiliated) are increasing in number. Out of the three, Free Standing Charters had the highest number of new schools followed by CMOs which accounted for 22 % and EMOs at 15% (Mead, Mitchell, and Rotherham 13).

Despite the charter growth Mead, Mitchell, and Rotherham estimate that more than one million students end up on the waitlists each year nationally with New York leading the pack followed by Texas, Los Angeles, Boston, and Washington D.C. (5) However, this finding was not conclusive as only 16% of the charter schools were reported to have admitted to having waiting lists. Charter schools produced better results in terms of performance compared to the district public schools; they were the strongest at the elementary and middle school level and benefitted poor black students in terms of learning compared to white non-poor students (23).  The achievements by charter schools are complex and varying with no clear data but a combination of several factors. CMO charter schools serve a higher percentage of Black and Latino students compared to traditional district schools but serve a lot less students with disabilities in comparison. Mead, Mitchell, and Rotherham note that some subsets of CMOs are also on the forefront in incorporating technology to personalize learning (20)

Challenges Faced by Charter Schools Movement

Charter schools face various challenges, some of which have been around since the inception of the program. Mead, Mitchell, and Rotherham list several challenges facing these chartered schools going forward, including lack of access to facilities including qualified human resource, ineffective board management, challenges in initiating new quality schools, and expanding existing high performing schools, challenges in accessing startup capital, political opposition, state policies, inequitable funding, concerns over equity for all students, poorly performing schools, ineffective authorizing, and lack of racial and political diversity among the charter leaders among others (5).

There is a high rate of teacher turnover in charter schools compared to traditional schools. According to Michelle Extrom, this is detrimental in any school setting and can result in instability in the school and lead to financial losses to the district and state (1). The schools have less experienced teachers with 30% of the teachers having 3 years’ experience while the rest having less than 10 years’ experience. In terms of pay, charter schools use the same approach of years and level of education to compensate teachers. This creates a challenge where the schools fail to attract teachers with certain skills or qualifications are required to teach in hard to staff schools and subjects.

Michelle Extrom also points out that 20 states and District of Columbia exempt charter schools from collective bargaining agreements (1). Only Iowa includes charter schools to all collective bargaining agreements with the remaining twenty states falling somewhere in between. Other challenges faced by the charter schools arise from the unwillingness of the Authorizers to approve quality applications and allowing too many weak schools to open. Authorizers also lack accountability and transparency, have poor monitoring evaluation standards, double standards (lack of clear laws in revocations), and lack political will to perform their functions effectively (Mead, Mitchell, and Rotherham 31).

Christopher Bonastia argues that the idea of offering public education dollars to private entrepreneurs has historical links to white resistance to desegregation in the school system (1). Citing the Brown vs. Board of Education (1954), this resulted in fewer or no black students in white schools. Whites sought to dupe the integration by offering taxpayer funds to segregated private schools. Bonastia further explains that charter schools have rigorous interview methods that cut out low performing students using a bogus referral system where the low achievers are recommended for special needs programs not present in the charter schools, thus, effectively transferring them to public schools. The fact that charter schoolsexistence relies on performance and high test scores means that there would be no incentive for charter schools to be fair and equitable in enrolling students. Entrepreneurs operate many of these charter schools, which Bonastia argues that they only respond to incentives and the impetus for charter school operators is to ‘‘skim the cream’’ and avoid undesirables (1). Antonia Darder argues that several myths were peddled that duped states into passing laws that created the charter schools.

The first myth. This was based on the Nation at Risk report that supported the neoliberal ideology of privatization, free market, deregulation, and accountability. Championed by William Bennet, former Education secretary, and Diane Ravitch a die- hard critic of multiculturalism, it is no wonder that charter schools would later create deep divisions in the education of low income students of color.

The second myth. This purported to provide school choice to all students of different backgrounds would enable them fair access to a good school without socio-economic or racial restrictions. This was the logic behind charter schools “free market” ideology that ended up profiling low income students of color, capitalizing on discourses of ‘‘high-risk’’ students and ‘‘achievement gap’’ to rig the system against them.

The third myth. Based on market freedom, which touted freedom and autonomy for teachers and students, the myth ended up locking out many poor and students of color from charter schools based on minor technicalities. Disenfranchised students have eventually found their way into prison in what Darder calls school- prison pipeline.

The fourth myth. Darder calls this one the myth of innovation. While a few charter schools have tried to bring innovation especially in the field of technology in the classroom, the overall picture is that majority have done nothing to improve the pedagogical practices including curriculum assessment. They have instead focused on high test scores and student college readiness. Furthermore, the innovations in the charter schools are skewed against schools in poor Latino and black neighborhoods.

The fifth myth. Based on the falsehood of better alternative, this myth packaged charter schools as the best alternative to public schools (a notion that had been held by neoliberal conservatives for a long time)  leading to many people of color thronging the charter schools.

The sixth myth. Promised school ownership and expanded decision making for teachers and parents and their communities but actually failed to do so. Most of the teachers and parents do not actually make decisions. The decisions are made by the boards of the managing companies of the charter schools, effectively replacing the school district boards with charter schools bureaucracy.

The seventh myth. This portrayed charter schools as cooperatives because of the equal involvement of different stakeholders all working together, sharing the benefitswas fallacious. Racism, class, privilege, and ethnocentrism were and still are deeply embedded in the charter school culture as they are in most institutions in America. While the people of color have opened charter schools to increase education opportunities for their children, affluent mainstream communities have done the same and opened largely homogenous schools that enjoy far greater resource allocation without having to contend with disparity in resource allocation. Meritocracy that guides recruitment in the charter schools is imbued with elitism and privilege making it difficult for students of color to meet the threshold of the narrow rationality of the mainstream curriculum.

According to a 2010 report by UCLA, segregation among black students is higher in charter schools compared to public schools. The report noted that charter schools had majority of black students (32 % vs. 16 % in the entire public school population) with whites underrepresented (39% vs. 56% in public schools) while the rest (Latinos, Asians and Native Americans were fairly represented. Other charter schools have been known to under enroll students qualifying for free lunch and English language learners thereby effectively reducing the enrollment of low income and Latino students (Bonastia 1).

Following a fierce public debate in Massachusetts in 2016, State officials okayed the creation of four more charter schools in a wider effort to raise the state’s limit on charter seats. This decision was vehemently opposed by teachers and parents who claimed it would drain tax payers’ money and that the charter schools accepted far fewer English speakers and students with special needs (Fox, 1).

Regulatory Capture/Where do charter schools fit with other reforms?

The term “regulatory capture” is associated with George Stigler, a Nobel Laureate who argued that concentrated producer groups are able to exercise influence on the conduct of regulators enough to shape regulation to benefit their interests instead of social welfare. It stems from the interaction between policy makers and market participants, which inadvertently opens up the regulatory process to the risk of unduly favoring narrow industry interest at the expense of public interest. According to Stefano Pagliari, Concerns regarding undue special interest influence are not unique to financial policy making and extends beyond financial realms such as communication energy markets and automobile industry (5). Carpenter and Moss describe regulatory capture as ‘‘the result or process by which regulation is consistently or repeatedly directed away from the public interest and directed from public interest and towards the interests of the regulated industry by the intent and action of the industry itself (73).

According to Pagliari, Regulatory Capture has been associated with undue influence on the regulator in two different phases, the rule making phase and the implementation phase (7). In financial regulation where different valid conceptions of public interest may be put forward by competing interest groups, the financial sector always comes out on top. Carpenter and Moss identify two theories; the traditional theory and the public interest. The traditional capture theory of material self-interest manifests in form of bribes and cash changing hands while the public interest theory is where there is a complex matrix of influence that sometimes compels agencies to follow general interest, sometimes the industry exercises control over the regulators and sometimes the regulators have the space to act on ideological grounds (75).

Carpenter and Moss further argue that regulators may also be irrationally influenced, especially where interest groups are seeking favorable policy outcomes, which can also be considered a form of favorable policy outcome (76). They identify other cases of capture including “information capture” where interest groups take advantage of administrative law to manipulate regulators with complex information, especially if the source is the affected entities to bring the regulators to see things from their point of view thereby gaining favorable policy outcomes. They discuss another form of capture called “social capture” in which the regulators world view may be influenced by the composition of their social networks even when they believe they are doing their best (77). The financial crises that hit the United States in 2008 is a good example of how the regulator, the federal government, thought that what was good for wall street was ultimately good for America. The cognitive biasness by Federal Reserve not to examine the mortgage originators during the housing bubble is a classic case of cognitive regulatory capture (78).

In 2009 and 2011, some regulations were enacted to address a series of pay to play corruption scandals that had been reported in several state investment firms, which prohibited investment advisors from providing advisory services for compensation for two years if the advisor had made a contribution to an elected official in a position of influence. The companies that run charter schools may not be captured in the regulations because they are not considered state entities yet, they provide public education (Wagner 7).

Carpenter and Moss identify three mechanisms of influence likely to operate in the regulatory context: group identification, status, and relationship networks (80). They coin the word “cultural capture” because it operates through a set of shared world views and because it can produce the same outcome as traditional capture; regulatory actions that serve the end of the industry. An industry may deliberately set out to influence its regulators to identify with the industry members and interests, thus, rendering the regulators’ decisions a colonized concept of public interest. It is very hard to identify empirically and can occur simultaneously with traditional materialist channel.

According to Cox and Rodríguez, President’s Obama’s action to announce sweeping executive reforms in immigration in 2014 to protect millions of illegal immigrants was welcome but met with opposition from the congress calling the attempt by congress to constrain enforcement power futile (5). Instead of focusing on how the executive was to institutionalize discretion in carrying out the immigration policy, the authors argue that the congress instead chose to focus on who would benefit. More than 3.6 million illegal immigrants would directly benefit and parents would be able to obtain green cards allowing them legal work status. Immigration is a federal function; thus, the president has powers to affect executive orders and enforce them as well. Education however is not really a federal function (the word ‘Education’ does not appear in the constitution) and the states have more say in the models and caps they apply as regards charter schools (Cox and Rodríguez 5). 

Moss and Carpenter cite the example of the 2010 during an onsite visit by the Consumer Financial Protection Bureau (CFPB) in one financial institution, an executive from the Bank Regulatory Agency identified themselves with the banking industry more than with the CFPB regulatory body. People tend to conform more readily to the opinion and expectations of others when others are watching than when they are not (Moss and Carpenter 89).

Charter schools may experience regulatory capture where regulators (the state and local district) rely so much on the opinion of education policy specialists such asJoe Nathan, Ted Kolderie, Al Shanker, and Ray Budde. As a result of the status the individuals hold in Education and their qualifications, state regulators may have been influenced into allowing the charter schools to make their own rules and even supervise themselves as well. According to Yilan Shen and Alexander Berger Charter schools are funded by public money (both local and state) and this has limited the amount of money available for school districts. Over the last 4 decades, funding has shifted to the state, which has enabled equitable distribution among districts. States can vary their revenue based on the number and characteristics of students enrolled. When students enroll in a charter school the money follows them from the resident district. Charters have budget autonomy but they have to ensure top academic performance.

The Future of Charter Schools

In 2014, the US senate made amendments to the charter schools program to expand funding for high-quality public charter schools.  The aim was to allow flexibility in funding, prioritize access to facilities, and support innovation and research ultimately increase the number of high quality charter schools. According to Public Law 105, Expanding Opportunity through Charter Act (1998) approved up to 300 million dollars for fiscal year 2005 and ‘such sums as may be necessary’’ for the subsequent years up to 2010 in program that was earmarked for three items. The first would be to establish high quality charter schools through grants to state entities to open new schools replicate, expand, and ensure high quality charter schools authorizing. The second item included facilities financing assistance where grants to public or private nonprofitentities were extended for innovation and enhancement. The third item would be national activities where grants to charter management organizations (CMOs) to replicate and expand high quality charter schools offer technical assistance and strengthen charter school authorizers.

Meanwhile, parents and private citizens have gone to court to challenge state and federal decisions to increase the number of charter schools or expand their operations. The Arkansas Times in 2016 reported a law suit brought against the state of Arkansas that argued that charter schools expansion would harm the district schools enrollment causing an exodus of up to 5,000 students from the public schools into e-stem a charter school. This suit followed a raft of previous suits that had been brought on the effects of segregation by the charter schools in the district, showing that already charter schools had done some damage to the public school system instead of improving it.

Charter schools operate in a complex environment according to Joey Gustafson and the sheer number of staff needed for an effective authorizer stands at least five to seventy (3). They must understand relationship management, legal and fiscal issues; possess experience in public sector, state education department or large foundations, districts and legislature. Every year, Gustafson notes, different states pass laws to strengthen charter laws that have an impact on authorizing (4). Many have lifted caps to charter school expansion and proposed funding for authorizers that is stable and permanent to guarantee accountability. However, Heitner disagrees arguing that charter school system is ‘unfeasible system wide’ because selectively serves only a few of the vast student population.

Research by a Rutgers professor Bruce Baker reveals how the Newark Charters enroll about 20% of all students but serve only fewer levels of the highest needs students (5). As a result, the district public schools increasingly end up with a larger percentage of students who are English learners, very poor, and severely handicapped (Heitner 5). In addition, Heitner argues that entrepreneurs have turned charter schools into grounds for recruitment of cheaper teachers who are not unionized, work more hours for less pay, less experienced, and with no requirement for certification. This has essentially privatized public education, creating competition for profits rather than learning outcomes. The false claim that privatization charter is part of the ‘new civil rights movement,’ Heitner warns that it is only a ploy by investors who seek to erode the public school system by treating the charter schools as the better alternative (6).

As Nathan Newman argues, the problem with privatization is the failure of the states to collect enough data on the risks and costs and to assess the degree of privatization and best practices across different sectors. In the charter schools concept, privatization has delinked the goals of public education into a commercial enterprise, creating lobby groups and advocates for and against their establishment. It is clear that education, just like health is a sensitive public sector that cannot be left in the hands of private investors. Public interest, which the charter schools are all about, rarely forms the subject of the bottom-line in a free market economy. It’s always profit; that’s the reality policy advisors, state and local actors will have to grapple with behind the façade of ‘‘performance’’ in charter schools.

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