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At long last, Michelle Rhee’s funders revealed

Michelle Rhee portrait
dol.govMichelle Rhee

Walking Rorschach test Michelle Rhee is back in the headlines this week, put there by a reporter who found a crack in the infamous wall shrouding the funding sources for her national education-reform lobbying powerhouse StudentsFirst.

Whatever you thought of Rhee five minutes ago, prepare to have it confirmed. Her multi-million-dollar backers include top donors to the campaigns of both Barack Obama and Mitt Romney, as well as foundations that back charter school proliferation, so-called parent-trigger laws and public-sector union reform.  

Also confirmed: Rhee plans to raise a whole lot of money in a short amount of time: $225 million between 2010 and 2013, according to StudentsFirst’s IRS application — much of which it will spend creating state-level branches.

A quick aside on something we’ll work our way back to: Its calls for changes to teacher staffing and layoff policies notwithstanding, the group Put Kids First Minneapolis is not one of them. The local group is one of several grassroots efforts by Minneapolis Public Schools parents and community leaders to push for major changes to the district’s contract with its teachers union.

Rhee’s rise to notoriety

Funny and sharp-tongued, Rhee was appointed chancellor of Washington, D.C.’s notorious school system in 2007 by then-Mayor Adrian Fenty, a Democrat. Her efforts to overhaul the district, which had been placed in the equivalent of a receivership, included a bureaucratic house-cleaning and the implementation of controversial teacher evaluation program that led to firings.

In part because of her central role in the feature documentary “Waiting for Superman,” Rhee quickly became one of the most well-known names in education reform. After Fenty lost a 2010 re-election bid, she stepped down and started StudentsFirst.

Notoriety followed. A federal investigation into “Erasergate,” allegations of cheating on tests on her watch, has yet to be resolved, although Huffington Post reported that the field of inquiry has been narrowed to 35 classrooms.

In the political realm, pundits on both sides of the aisle have seen her willingness to join forces with odd education policy bedfellows as proof she is in cahoots with one or another ideological team.

Rhee is married to former basketball star Kevin Johnson, who was elected mayor of Sacramento in a nonpartisan election but who is widely believed to be a Democrat.

Like scores of other groups that spend money to influence public policy in the current no-holds-barred climate, the nonprofit StudentsFirst has both a 501 (c) 3, which must disclose its financial activities to the IRS, and a 501 (c) 4, which doesn’t. The group has drawn fire for refusing to disclose information about its funders.

A reporting loophole found

Huffington Post education reporter Joy Resmovitz found a side entrance, so to speak, to the donor list. A Pennsylvania law requires organizations that spend more than a certain amount to report the identity of any donor who gives more than 10 percent of its funding in a given reporting period.

According to Resmovitz, in response StudentsFirst named the Texas-based Laura and John Arnold Foundation and New Jersey hedge fund mogul David Tepper, who also founded and funds the group’s New Jersey offshoot.

The group also received $500,000 in startup funding from philanthropists Eli and Edythe Broad’s Broad Foundation, which has championed a host of education reforms, most of them fairly characterized as conservative efforts.

Resmovitz then looked up the donors’ track records, using Federal Election Commission records:

Tepper has given upwards of $23,000 to the Democratic National Committee; $5,000 to Glacier PAC, a backer of Democratic Rep. Max Baucus — and $5,000 to Mitt Romney for President this December. This January, he gave $375,000 to Restore Our Future, a Romney PAC….

Billionaire John Arnold, a former Enron trader, and his wife Laura, were slated to host in their Houston home a $10,000-ticket Obama fundraiser to feature Michelle Obama last October (the event was postponed). Arnold describes himself as a libertarian, and his wife Laura identifies as a Democrat. Still, Arnold was one of Obama’s top 2008 donors, a bundler who gave the campaign between $50,000 and $100,000. According to Huffington Post’s FundRace, he has given $35,800 to the Obama Victory Fund 2012….

Arnold is currently funding efforts to have legislatures convert the pensions of public employees, such as teachers, into 401k plans. According to the Arnold Foundation’s most recent tax returns, it had $650 to $750 million in assets in 2010.

Back to Put Kids First Minneapolis: The local group was born before Rhee’s became a household name, when a handful of Minneapolis residents unhappy with the way MPS staffs schools began comparing notes. Many of the changes they seek are similar to the reforms that landed Rhee in the hot seat in the first place, although even a brief tour of their website will reveal a much more measured tone.

Comments (5)

  1. Submitted by Bernice Vetsch on 03/01/2012 - 03:07 pm.

    Beth, please also see

    the March 1 discussion on the numerous public school closings in Chicago at the website for Democracy Now. Mayor Rahm Emanual told the Karen Lewis, president of the Chicago Teachers Union, that a certain number of kids “will not amount to anything anyway” and that he therefore was “not going to throw any money” at efforts to educate them.

    Emanuel hired a business type CEO to manage the system. He, not being an educator, hired an organization called the Academy for Urban School Leadership which, according to Ms. Lewis, knows naught about urban education.

    Control is being taken away from parents and educators. The school board is now headed by an Emanuel appointee and is described by Lewis as an “unelected” body. Seventeen schools, their teachers and staffs, including custodial workers. are being fired because they are underperforming (test scores in math and reading not good enough).

    One young teen who was studying science at a magnet school in preparation for a career in the sciences says her school has dropped science and switched to a business curriculum.

    New York City is apparently in line for the next mass firing and school closure treatment, with Mayor Bloomberg fully on board.

    (Can mayors be recalled?)

    I think what you describe and what is happening in these two cities, and no doubt elsewhere, is all part of the effort to privatize the public schools. Teachers unions have to go, of course, and teaching seems to be heading toward “training” for corporate employment rather than learning for life.

    See also The Guardian articles about the Heartland Institute, a Koch Brothers/ALEC funded organization that is working on (among other environmental issues) discrediting climate change science by getting the schools to teach the “controversy” rather than the facts(, search “Heartland Institute”). I have very little money, but would be willing to bet a chunk of it that ALEC is behind both this energy-industry-pleaser and much or all of the fight to kill the public schools.

  2. Submitted by Ray Schoch on 03/01/2012 - 08:42 pm.

    Everything the Koch brothers touch

    …turns to cancer. Education is no exception.

    Since teacher pensions in my former state of residence are already the result of private investment, I can’t help but wonder what’s motivating John Arnold’s quest to have teacher pensions converted to 401(k)s. The possibility that a retiree might actually be able to pay her bills in retirement must be truly frightening. That, or the prospect of retirees living in cardboard boxes under a bridge is especially attractive.

    I look forward to explanations from… anyone, really… pointing out how and why smart, talented young college graduates would want to ignore reasonably lucrative positions in the private sector so that they can take jobs as teachers, where they’re likely to be paid less than median wages, be evaluated by people who either cannot or don’t want to do the job they’re doing, be the objects of occasional witch-hunts by individuals or groups in the community who just plain don’t like them, fired because of the lack of ability or work ethic of others over whom they have no control, and, should they survive that draconian regime long enough, have their meager retirement dependent upon the whims of a marketplace dominated by some of the most ethically-challenged humans on the face of the earth.

    Yessiree, sounds to me like a perfect recipe for attracting the best and the brightest…

  3. Submitted by Joe Musich on 03/02/2012 - 05:08 pm.

    well now I am being educated!

    Was a teacher who ran down the shooter in Ohio. Was not a teacher who cheaped hardworking citizens out of billions of dollars in the many financial scams. What is the reason teachers are on the chopping block for trying to protect their interests as employees ? Maybe if the teaching profession was predominately a male profession all this crap would not be happening to teachers.

    A Michelle Rhee here or there does not make up for the inequity as does a Michelle bachmann here or there make up for inequity in another segment of the workforce.

  4. Submitted by Dennis Tester on 03/03/2012 - 01:56 pm.

    Sounds like

    the teachers union took all your money, Ray, and you got nothing in return. Why indeed would any talented young college graduate want to be forced to join a labor union and be treated like a factory worker?

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