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Bonanza! Silicon Valley Sees Gold in Corporate-Driven School Reforms

For some of the tech tycoons, there's profit to be gained by transforming the education system.

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When Los Angeles Superior Court Judge Rolf Treu struck down the tenure rights of the state’s public school teachers last month in Vergara v. California, his decision was hailed by Theodore J. Boutrous Jr., lead attorney for the plaintiffs, as “a terrific, wonderful day for California students and for the California education system.”

The lawsuit, which had been brought on behalf of nine California schoolchildren, argued that the retention of “grossly ineffective” teachers through five due-process statutes violated the students’ civil rights.

The suit and its accompanying public relations blitz had been bought and paid for by Silicon Valley entrepreneur David Welch under the umbrella of Students Matter, Welch’s personal Menlo Park education reform nonprofit. Welch made his fortune designing large-capacity fiber optic transmission systems for the global service-provider market.

“I have not devoted my career to education policy,” Welch admitted when launching the  Vergara campaign last summer, “but I do believe I’m an expert on what you need in an environment to get the most out of people.”

Welch’s obsession with restructuring public education hardly marks him as an outlier among Silicon Valley tycoons. Reed Hastings, CEO of Netflix, sits on the boards of Microsoft, KIPP and CalCharters (the California Charter School Association), and is a founding funder of Green Dot and a co-founder of, Aspire Public Schools and Hastings summed up his vision for transforming education last March, when the newly minted billionaire called for the end of locally elected school boards and announced a goal of moving 90 percent of America’s public school kids into charter schools over the next 30 years. That’s a tall order, especially in light of a 2009 Stanford University study showing that when averaged across all schools, the impact of attending a charter has a slight — but statistically significant — negative impact on both math and reading gains.

Judge Treu’s decision not only marked a significant legal victory against teachers and their unions. It was also an important public affirmation for Welch, Hastings and other well-heeled Silicon Valleyites and their revisionist narrative of progressive public education. By placing the blame on teachers for poor student outcomes, the Vergara ruling ignored decades of research establishing families’ socioeconomic background as the predominant factor affecting how children perform in school — research that also singles out small class size and experienced teachers as being directly beneficial to learning.

The reasons why tech titans like Welch and Hastings have decided that they know how public education can best be “fixed,” and why they are backing those hunches with big money, have been a matter of some speculation. In celebrating Vergara’s nullification of public school teacher job protections, however, Los Angeles schools superintendent John Deasy may have inadvertently dropped a clue when he declared, “Every day that these laws remain in effect represent an opportunity denied.”

The precise nature of that opportunity was immediately grasped by those who stand to gain the most from Vergara. In an ecstatic, post-verdict op-ed piece published on TechCrunch, the online news site that serves Silicon Valley’s tech-startup community, writer Danny Crichton gloated over what he described as “a key opening for startups to begin thinking about grade school in a post-tenure world” now that teachers were out of the way.

When they speak to the general media, Silicon Valley ed reformers sound much like Welch, talking altruistically about the underserved and the right of the state’s children to a quality education. But when they speak to each other they are more apt to talk in the language of money – that is, about the potential gold rush represented by the $638 billion spent on K-12 education between 2009 and 2010 by American taxpayers.

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