Less than two years later, in his first major education address as president, delivered to the Hispanic Chamber of Commerce in March 2009, Obama explicitly backed paying teachers for performance, a reform the unions vehemently oppose. “Too many supporters of my party have resisted the idea of rewarding excellence in teaching with extra pay.”

Behind this seeming contradiction on performance pay is a complex set of political and policy strategies. Obama and his team are caught in the narrow channel between two important Democratic constituencies: establishment organizations that are opposed to performance pay and the increasingly prominent education-reform crowd that generally supports it. And while the administration appreciates the merits of differentiated teacher pay, this is but one of many teacher-quality policies it hopes to change.

The public record reveals how the administration has navigated these shoals, setting a new course for the federal government’s role in the reform of teacher pay. As senator and president, Obama has made known his education-reform commitments and hesitations in speeches to both unions and business groups. The inclinations of his secretary of education, Arne Duncan, are evident from actions he took while serving as head of the Chicago public school system. Finally, the administration’s handling of two prominent federal programs, the Teacher Incentive Fund (TIF) and the Race to the Top (RTT), offers important clues to the strategic thinking at work.

My analysis of this history has led me to two conclusions. First, though the administration’s apparent tentativeness on performance pay can be partially explained by its deference to organized labor, a larger factor is its interest in creating a new and comprehensive framework for advancing teacher quality. Second, the administration’s strategy for generating change through a combination of incentives, collaboration, and optional reforms did not initially bear much fruit for performance pay, but it may reap benefits over the long term, both for performance pay and for other teacher-quality issues.

Developing a Position

In Senator Obama’s 2007 speech to the NEA, he gave an establishment-friendly interpretation of recent education-reform events. He called No Child Left Behind “one of the emptiest slogans in politics” that amounted to “fill[ing] in a few bubbles on a standardized test.” He vigorously supported an active role for unions in education and said that teacher salaries should be raised across the board.

But he also said that schools should be open to paying more to teachers in tough-to-staff subjects, to those who take on additional work, and to those helping students excel academically.

Politically, this equivocation was savvy: he buttressed his liberal bona fides while nodding toward reform. But it also foreshadowed the challenges his administration would face in trying to run the performance-pay gauntlet by staying in the middle of the road.

In the speech, he attempted to reconcile his support for both sides by arguing that differentiated-pay programs should move forward but that they should be created in collaboration with teachers, not imposed on them, and that such programs should never be based on “some arbitrary test score.”

This raised difficult questions: How do you fairly implement a differentiated-pay plan without empirical measures of student performance, and what if organized labor refuses to accept performance pay at all? The first question would eventually be addressed diplomatically by his education secretary; the second lingers on to this day.

One year later, with the election drawing near, Obama again spoke at the annual meeting of the NEA. He was in no position at this time to reveal how the circle was to be squared. In fact, passages specifically related to compensation were either unusually clumsy or cleverly delusive. He said superb teachers should be rewarded through “better pay across the board.” One spectacularly oblique sentence left muddled whether a teacher should be rewarded for learning new professional skills or raising student achievement and whether that reward should be praise or compensation. He was, however, firm that pay systems should be developed with, not imposed on, teachers.

After entering the White House, President Obama felt less need to dissemble on the subject. In his March 2009 speech to the Hispanic Chamber of Commerce, he intimated that his administration would not only support retention bonuses and additional compensation for teaching in hard-to-staff schools and subjects, but also pay increments for those able to measurably influence academic growth. “Good teachers will be rewarded with more money for improved student achievement.”

Left undecided, however, were the role of the standardized “bubble” tests and the implications of union opposition.

Secretary Duncan refined the administration’s position before the NEA in July 2009. Billed as a “challenge” to the union to “think differently” about job security, evaluations, and more, the speech also revealed that the administration was beginning to think holistically about the policies affecting the teaching profession.

Duncan began by acknowledging the wide distribution of teacher effectiveness. Current practices, the secretary argued, unfortunately treat “all teachers lik e interchangeable widgets.”

To gain a better understanding of variations in teacher quality and then make use of this information, we need improved teacher evaluation systems, Duncan argued. Those currently in place are “deeply flawed.”

Then Duncan opened the door to the use of empirical measures of student achievement in teacher evaluations and therefore, presumably, in teacher pay and other personnel decisions. While acknowledging that today’s “tests are far from perfect” and that “the complex, nuanced work of teaching” can’t be fairly measured by “a simple multiple choice exam,” the secretary defended the use of test scores.

Though they “alone should never drive evaluation, compensation, or tenure decisions…to remove student achievement entirely from evaluation is illogical and indefensible.” Duncan was beginning to sketch a new framework for teacher policies, one that integrated student performance data, teacher evaluations, and a range of personnel decisions, including compensation. In time, this shift would prove to be consequential.

But Duncan also echoed his boss’s deference to labor. “The president and I have both said repeatedly that we are not going to impose reform but rather work with teachers, principals, and unions to find what works.” This hedge would also prove consequential.

A good deal can be learned about both the roots and implications of the Obama administration’s evolving position on performance pay from Arne Duncan’s experience with the federal Teacher Incentive Fund (TIF) in Chicago (see sidebar) and the administration’s efforts to fund and reform the program since 2009.

The Teacher Incentive Fund

Since 2006, the federal government has funded a small program to support differentiated compensation, the Teacher Incentive Fund. Developed by the Bush administration, TIF provides funding on a competitive basis to states and districts that implement performance-pay programs for teachers and/or principals in high-need schools.

In its first years, TIF had several strikes against it. It was a new program during a period of domestic budget austerity. It sought to advance what was still a politically contentious policy. And it was advocated by an unpopular administration facing a Congress controlled by the opposition party. Accordingly, Congress never fully embraced TIF during the Bush years, and that administration’s annual budget requests (ranging from $100 to $500 million) were never fully funded. Appropriations were generally just under $100 million each year, a relatively small amount for a federal education program.

The Obama administration could have taken the knife to this Bush-era initiative as it has with the school voucher program in Washington, D.C. Instead, it sought to expand TIF by both seeking increased funding and embedding it in a newly proposed, larger program tentatively called the “Teacher and Leader Innovation Fund” (TLIF).

The 2009 federal stimulus package, known as the American Recovery and Reinvestment Act (ARRA), provided TIF with an additional $200 million (on top of its $100 million regular appropriation for that year).

Coming on the heels of the ARRA was the administration’s 2010 budget request, in which the Obama team proposed nearly $487 million for TIF, more than the Bush administration had requested since the program’s inaugural year in 2006. Congress proved receptive, providing $400 million, by far the program’s largest regular annual appropriation.

In its FY2011 request, the first real opportunity for the administration to put its full mark on the federal budget (since the 2010 proposal went to Congress shortly after Obama was sworn into office), the U.S. Department of Education sought to significantly change TIF by including its priorities in the new, broader TLIF program. The $950 million request was approximately double the previous year’s.

According to administration documents, if created, TLIF would support the expansive category of state and district efforts to develop “innovative approaches to human capital systems.” Though differentiated pay would be a core component of the program, TLIF would also support efforts to increase the number of effective teachers, more fairly distribute high-quality teachers among differently resourced schools, improve educator-preparation programs, develop additional professional opportunities for effective teachers, strengthen evaluation systems, remove ineffective teachers from the classroom, improve professional development, and support school turnaround efforts.

So what is to be made of the Obama administration’s initial embrace of TIF and subsequent inclusion of many of its objectives into the TLIF proposal? What does this tell us more broadly about the administration’s views on and intentions for performance pay?

Two different interpretations seem plausible. The first is a political explanation. By supporting TIF, both the Bush-era version and even more so the amended TLIF version, the administration can keep one foot in the reform camp and another in the establishment camp.

Even the original TIF program allows for a wide array of approaches to differentiated pay, some of which opponents find easier to swallow than others, like those that reward all adults in a school rather than just the teachers who measurably increase student performance. TIF also permits grantees to apply program funds to a range of more traditional activities, such as professional development and data collection. This list of less controversial activities would grow under the proposed TLIF initiative. Both programs are optional, so no district or state is required to differentiate pay. Finally, since the program is directed toward high-need districts and schools, most of which have collective bargaining agreements, a state’s or district’s participation in the program ordinarily means that organized labor was involved in crafting the new arrangements. The administration can claim the mantle of reform while standing by its pledge that reform will not be forced on teachers and their unions.

A second interpretation is that the administration is attempting to develop a new, comprehensive federal approach to improving teaching, one that combines student performance data, teacher evaluations, and a host of personnel decisions. The roots of this approach can be seen in Secretary Duncan’s TIF experience in Chicago and in his 2009 NEA speech.

This interpretation is supported by TIF draft regulations released by the education department in early 2010. Among other things, the agency sought to require grantees to measure student growth and use these data in robust teacher evaluations, which would then be aligned with professional development. Language in the administration’s 2011 budget description of the new TLIF implied that TIF was too myopic, treating performance pay as a discrete activity when, instead, policy should reflect the “interconnectedness” of compensation reform and other teacher issues. TLIF, according to the budget document, recognized that it is “important to think of [these issues] in a coherent, integrated way.”

So which interpretation better explains the Obama administration’s approach? Support for both can be found in the administration’s signature program, the Race to the Top.

Race to the Top

Included within the ARRA’s nearly $800 billion in spending was the largest competitive grant program in U.S. Department of Education history, the $4.35 billion Race to the Top (RTT).

The official RTT application was a blend of reform and deference to the establishment. The four major ARRA reform categories—data use; standards and assessments; failing schools; and teacher quality—served as its backbone. But the administration added a good bit of muscle. States would earn points for having in place each of the 12 data elements required by the federal America COMPETES Act. They’d be rewarded for having policies authorizing aggressive interventions for failing schools. They’d be significantly penalized for lacking a charter school law. And they’d be barred from even applying if they had “data firewalls” preventing student performance information from being tied to individual teachers.

But states also earned significant points for crafting plans that earned the blessing of their school districts and unions. In a number of cases, those who scored state applications gave extra weight to stakeholder “buy-in” by subtracting points from proposals that lacked the support of these groups.

Though Duncan would later downplay the importance of consensus, when Delaware and Tennessee were announced as the only first-round winners the secretary emphasized that these two states stood apart in their ability to develop strong proposals that also had broad support. In fact, the most hotly debated RTT question in the spring of 2010 was how states would address the tension between reform and union buy-in in their second-round applications.

RTT and Performance Pay

At first glance it is striking, even startling, how small a role performance pay played in round one of Race to the Top. The application has six main sections: one for each of the four ARRA reforms; an introductory section largely dedicated to buy-in issues and previous reform successes; and a final catchall section.

The fourth section (D), “Great Teachers and Leaders,” contains the most points of the six (138 out of 500, or 28 percent). It is broken into five subsections, one of which is titled “Improving teacher and principal effectiveness based on performance.” This comprises four sub-subsections, including “Using evaluations to inform key decisions.” That is broken into four sub-sub-subsections, one of which includes performance pay. Performance pay is one of three elements in this area, along with promotion and retention.

In other words, in the Race to the Top, performance pay is a sub-sub-sub-subsection.

Were a peer reviewer to score by the book, a state without a performance-pay plan would lose just over 2 points out of 500. By comparison, a state without a charter law would lose 32 points.

The most straightforward interpretation is that the administration capitulated to performance-pay opponents. But this analysis seems incomplete, even unfair. Had pleasing the establishment been the administration’s priority, it might simply have kept performance pay out of the application altogether.

In fact, subsection (D)(2) offers compelling evidence for the alternative interpretation. It asks states to measure student growth and to tie these results to individual teachers. It also asks states to develop annual teacher evaluations and include student growth as a component of each teacher’s official assessment. Finally, it asks them to use these evaluations to inform a number of personnel decisions, such as tenure, removal, and compensation.

The Obama administration appears to be offering a new—not to mention tight and rational—framework for improving the teaching profession. However, consistent with the administration’s nonconfrontational method for advancing reform, the new framework is optional. Since RTT is a competitive grant program, no state is forced to participate; states uncomfortable with the framework are free to disregard it.

It is too soon to tell whether this new framework will lead to better student outcomes. But it is not too soon to test the administration’s theory of action for bringing about change. Did the Race to the Top’s use of financial incentives, rewards for collaboration, and optional reforms lead to progress in performance pay and other policies that affect the teaching profession?

State Race to the Top Applications

In the first round, 40 states and the District of Columbia submitted Race to the Top applications. To test the effectiveness of the Obama administration’s approach, I reviewed each application’s (D)(2) section. Figure 1 illustrates how many proposals include an affirmative response to the nine questions embedded in the RTT framework. Will the state…

1.  measure student academic growth?

2.  conduct annual teacher evaluations?

3.  include student growth in teacher evaluations?

4.  use teacher evaluations to inform professional development decisions?

5.  use teacher evaluations to offer additional professional opportunities?

6.  use teacher evaluations to inform compensation decisions (performance pay)?

7.  use teacher evaluations to inform tenure decisions?

8.  use teacher evaluations when considering promotions?

9.  use teacher evaluations to inform termination decisions?

Of the 41 entrants, 39 have systems in place to measure student growth, are building such systems, or have committed to building them. Most states (32) also agreed to conduct annual teacher evaluations. In some cases, this represents a major shift in policy; for example, under current practices, tenured teachers in Hawaii are evaluated only once every five years.

Only about half of the states (21) agreed to include measures of student growth in teacher evaluations. Several committed to having 50 percent or more of each teacher’s evaluation composed of such data. A number of states, however, simply ignored this matter in their applications or only committed to forming a stakeholder committee to discuss it.

Almost all states (34) committed to using evaluations to determine which teachers need which types of professional development. But states were far less likely to commit to using evaluations to make tougher personnel decisions. Only nine were willing to link teacher evaluations to processes for terminating the lowest-performing teachers.

Sixteen states committed to performance-pay plans. But only five states proposed what could be considered strong plans (Arizona, Delaware, Florida, South Carolina, and Washington, D.C.). Notably, Florida required all LEAs (local educational agencies) participating in the state’s application to make student achievement growth the most significant component of compensation, ahead of years of experience and academic degrees.

Two plans could be considered of moderate strength. Minnesota planned to expand its “Q Comp” program, but nearly all details were to be negotiated at the local level between unions and districts, raising questions about the ultimate impact of the plan. In Georgia, participating districts agreed to adopt ill-defined step increases for high-performing teachers.

The remaining nine performance-pay plans were of dubious seriousness. In several applications, including Oklahoma’s and West Virginia’s, the state promised to create a bonus pool but made district participation optional, so it is possible that no teacher would receive extra pay based on merit. In Massachusetts, 1 percent of the state’s districts would pilot a locally determined, yet-to be-defined, differentiated compensation plan. In Idaho, all employees of schools in the top three quartiles of statewide student growth would receive small bonuses, meaning half of the state’s below-average schools would get schoolwide bonuses.

Before choosing Delaware and Tennessee as the first round winners, the education department identified 16 finalists. Figure 2 shows how committed the group was to key components of the new teacher-effectiveness framework.

So far, RTT has not had a revolutionary impact on performance pay. This seems to raise questions about the administration’s belief that large federal financial incentives will lead states to embrace controversial reforms. The limited use of student-performance data in teacher evaluations offers further evidence for this point. Although states, in order to apply, had to remove data firewalls, only half of applying states took the critically important but optional next step: actually making student growth a part of evaluations.

An additional data point calls into question another component of the administration’s theory of action—that major reform can be brought about through collaboration with unions. As noted above, five applicants proposed strong performance-pay plans. South Carolina has no teachers unions. Washington, D.C.’s proposal received no union support. In Florida and Arizona, 8 and 21 percent of local teachers unions, respectively, supported the state’s plan. Only Delaware was able to both craft a strong performance-pay plan and earn broad union support (100 percent).

A Solid Footing

Several factors have diluted the administration’s work on performance pay. First, Duncan, as a general rule, prefers to make reform optional, using incentives to alter behavior. Second, the secretary appears to be more interested in changing the teaching profession broadly than in advancing the narrower issue of performance pay. Third, and most important, the president and secretary remain committed to securing union support for change, reform “with” labor not “to” labor. RTT winner Tennessee made alternative compensation systems completely optional for districts and required that, before a local performance-pay plan is implemented, it receive the blessing of the local union.

But it may still be the case that, in the long term, the administration’s efforts will have a profound positive impact on performance pay. A few states were willing to consider performance pay to an extent that they hadn’t before. And while giving unions a great deal of power in negotiations about differentiated pay will severely limit the number and strength of plans adopted, it might help ensure the strength and sustainability of the few plans that do emerge. Finally, by encouraging states to measure student growth, embed student learning in annual teacher evaluations, and use evaluations to inform a range of personnel decisions, the administration has laid the foundation for performance-pay plans in the future.

The Obama administration, if nothing else, has changed the politics of performance pay. No longer can it be assumed that leading Democrats will oppose efforts to financially compensate high-performing teachers.

On January 19, 2013, in other words, we’ll be able to ask of a Democratic administration a once inconceivable set of questions. How many billions did it spend on performance pay? How many new state-level performance-pay plans did it bring about? Did its activities cause unions to drop their reflexive opposition? Is performance pay now widely viewed as one part of an integrated teacher policy framework?

Depending on the answers to these questions, performance pay and the new teacher framework—not turnarounds, a reauthorized ESEA, or another higher profile issue—may be the Obama administration’s most important education legacy.

Andy Smarick, a former U.S. deputy assistant secretary of education, is an adjunct fellow at the American Enterprise Institute and the Thomas B. Fordham Institute.

To many education reformers,  the passage of the federal government’s massive stimulus plan, the American Recovery and Reinvestment Act (ARRA), appeared to be a final bright star falling into alignment.

For years, consensus had been building across the political spectrum that the nation’s schools, especially those in urban America, were in urgent need of fundamental change. The election of reform-friendly Democrat Barack Obama presented the opportunity for K–12’s Nixon-goes-to-China moment. The subsequent selection of Arne Duncan, the battle-tested former Chicago schools chief, as secretary of education provided a trusted, steady hand to lead the charge and take the flak.

The ARRA seemed to complete the constellation: an astounding $100 billion of new federal funds—nearly twice the annual budget of the U.S. Department of Education—to jump-start and sustain the improvement of America’s schools. When Duncan expressed his intention to make the very most of this once-in-a-lifetime “moon shot,” some advocates eagerly prophesied an epochal shift for reform.

The ARRA’s results to date, however, have been soberingly quotidian. So far, the vast majority of its funds have served to sustain the status quo, funding the most traditional line items and actually helping schools and districts go about their everyday business. With one notable exception (spurring long overdue changes in some state laws), the implementation of this mammoth statute has confirmed several humbling, hoary lessons of federal policymaking, including the limited ability of Uncle Sam to drive education reform.

Though deflating (not to mention terribly expensive), these bumps and bruises, if taken to heart, could help build a better understanding of the federal government’s inherent strengths and weaknesses in K–12 education policy, a particularly valuable exercise as NCLB reauthorization looms. As important, they could still have a critical influence on the ARRA itself—helping to salvage its crown jewel of reform, the vaunted Race to the Top (RTTT).

Easy Money

The ARRA was crafted during the darkest stage of the recession and signed into law in February 2009. To help revive the nation’s flagging economy, Congress and the administration were determined to have funds enter the financial bloodstreams of states and districts as quickly as possible. So about $75 billion of the $80 billion the law designated for K–12 schools was funneled through formula-based programs, including the Individuals with Disabilities Education Act (IDEA) and Title I, two of the nation’s oldest and most familiar federal education funding streams. Simply by virtue of having students, states and districts would begin receiving funds. No grant competitions, no long, complicated applications, no review teams with complex scoring rubrics.

The lion’s share of these ARRA education dollars was appropriated through the new $50 billion State Fiscal Stabilization Fund (SFSF), a population-based program created to expeditiously replenish education budgets decimated by declining tax revenue.

Despite the priority placed on getting lots of money out on the double, some policymakers were determined to see that these funds were also well spent. So the legislation required that, in advance of receiving their SFSF allocations, governors sign “assurances,” statements promising that their states were taking action to improve teacher quality, develop better data systems, enhance standards and assessments, and address low-performing schools. Duncan went even further, repeatedly telling state leaders that these formula dollars had to be used to improve student learning and innovate, not merely fund more of the same.

States that spent the funds unwisely, the secretary warned in March 2009, would seriously compromise their ability to vie for the $5 billion of ARRA competitive grants. “States that are simply investing in the status quo will put themselves at a tremendous competitive disadvantage for getting those additional funds,” Duncan said. “I can’t emphasize strongly enough how important it is for states and districts to think very creatively and to think very differently about how they use this first set of money.” The department also took the unusual step of creating a document for state and district leaders that explained how these funds could be used in reform-oriented ways.

Had everything gone according to Hoyle, this massive infusion of federal funds would have protected state and district education budgets from major cuts while advancing invaluable reforms by supporting new, innovative, and promising programs. But as is often the case in education policy, the best laid plans of Uncle Sam went awry.

Reality Check

In a July 2009 report to Congress, the Government Accountability Office (GAO) found that SFSF dollars were being used to protect the status quo. After studying a sample of 16 states and select jurisdictions within them, GAO reported that federal funds were in fact being used for “retaining staff and current education programs.” Instead of advancing important reforms, states and districts were addressing a “more pressing” matter—their fiscal needs. In discussions with district leaders, GAO found that “most did not indicate that they would use [SFSF] funds to pursue educational reforms”; instead, they wanted to fill their existing budget holes. For example, officials in Flint, Michigan, decided to use SFSF funds to “cope with budget deficits rather than to advance programs.” Miami-Dade planned to save 2,000 teaching jobs; Richmond County in Georgia funded teachers, paraprofessionals, media specialists, and other existing positions.

Then, in an August report that the Washington Post referred to as a “reality check,” the American Association of School Administrators (AASA) also found that funding was being used to protect jobs and programs. The survey of administrators reported that most of the funds were merely repairing budget holes and that little if any reform was being accomplished. “Everybody appreciated getting the money,” the association’s executive director told the Christian Science Monitor, “but primarily all the money did was help to backfill the budget deficits they were already facing.”

The single-minded focus on jobs and the status quo was confirmed by hard numbers. In September, the U.S. economy lost 190,000 jobs, but the education sector gained nearly 11,000 jobs. In October, the Obama administration announced that more than half of the 640,000 jobs created or saved across the entire economy by the ARRA were in education. In November, after studying states’ quarterly stimulus reports, Education Week found that 96 percent of the ARRA education funds spent to that point had been “focused on creating and saving jobs.”

How did one of the ARRA’s education goals (reform) get completely displaced by the other (job and program preservation)? The answer can be found in two sets of factors, one mostly economic and beyond the federal government’s control but the other legislative and fully within it. Combined, they offer an unmistakable overarching lesson: local dynamics, not the will of Washington, determine the pace and scope of education reform.

Survival Instincts

The greatest confounding factor was the severity and duration of the nation’s financial decline. Revised 2009 figures indicated that the U.S. economy had contracted twice as much as previously estimated, amounting to the largest downturn since the Great Depression. Nationwide, unemployment topped 10 percent in October, considerably higher than most experts had anticipated.

State budgets were drastically affected. California famously faced a $26 billion shortfall, but many other states, including Ohio and Illinois, confronted multibillion-dollar deficits as well. A University of Denver study declared that Colorado’s government had been hit by a “budgetary tsunami.” The chair of Alabama’s finance committee called the state’s financial crisis “worse by far than we’ve ever seen it.” One estimate predicted that, were the recession to end in 2009, the states would still have combined deficits of $230 billion, comparable to the entire gross domestic product of Singapore.

Regrettably, but predictably, education systems went into self-preservation mode. Part of the explanation can be found in districts’ DNA. Local education systems, particularly the largest urban districts, are infamously Byzantine, change-averse organizations. They are also generally among their communities’ largest employers. Notably, both the GAO and AASA studies reported that local school officials felt compelled to disregard the calls for reform given “the realities of strained federal, state, and local budgets,” and the resulting likelihood of layoffs and other cuts.

External forces exacerbated these internal tendencies. In some cases, unions pressured policymakers to direct funds toward job protection. The California Teachers Association organized a “Pink Friday” rally to protest pink slips and furloughs. In Michigan, a local union sued a district over layoffs. Some in Montana sought to use stimulus funds to shore up teacher pensions, and the Utah Education Association ran television ads urging legislators to dedicate ARRA dollars to restoring education programs.

As a number of commentators have noted, the economic downturn offered school systems the opportunity to alter expensive, outdated practices such as strict salary schedules, protective tenure rules, and bloated pension programs. Though sensible in theory, this was probably wishful thinking when applied to the often confounding realities of K–12 politics and policy. Indeed, Kevin Carey, of the Washington-based think tank Education Sector, has written that there is no evidence that districts “implement a whole suite of needed reforms” in response to recessions.

Carey’s argument is strongly supported by recent events. In instances where stimulus funds failed to fill budget holes completely, states and districts generally did not blaze a trail for reform, instead opting for temporary, shortsighted cuts designed to help them hunker down and ride out the current storm. A number of states instituted flat reductions in district aid, while others made across-the-board cuts to programs. California’s Saddleback Valley district cut athletic programs, while districts from Houston to Boston to Atlanta slashed bus service. Seattle-area schools eliminated groundskeeper positions, Prince George’s County in Maryland cut “parent liaisons,” and Illinois reduced spending on bilingual and early-childhood programs. There was a nationwide trend in summer-school reductions, and Hawaii cut school days. Lake Washington School District in Washington had teachers remove microwaves from their rooms to reduce energy bills. In total, it appears that when education budgets wane, schools’ survival instincts, not their reform inclinations, kick in.

Policy Matters

Though the course of the recession, local political dynamics, and district preferences were beyond the reach of federal policymakers; the contours and implementation of the ARRA were not. They could have factored in these considerations to craft and administer a plan more likely to bring about reform. Astonishingly, however, the legislative language and departmental pronouncements enabled—actually, all but guaranteed—this $75 billion investment in the status quo.

While the use of formula-based programs certainly facilitated the speedy distribution of funds, it also set the stage for conventional spending patterns. In the case of Title I and IDEA, states were provided grants under their existing program agreements, meaning the federal government provided billions without extracting new reform promises.

Guidelines made clear that these funds had to be used in ways consistent with long-established program requirements. But over decades, tens of billions of dollars have flowed through these programs, failing to generate the improvements needed. Instead of tying new dollars to specific reform-oriented strategies, the law required that they fund more of the same.

Even more trouble was embedded in the SFSF. The law stipulated that states first use their allotments to fill budget holes and, instead of giving states the opportunity to reconsider their allocation of resources, it mandated that they use their existing funding formulas. So, rather than requiring or even encouraging state leaders to use this $50 billion investment to pursue new projects and ways of thinking, the ARRA prioritized preservation of the current order.

If dollars remained after budget holes had been filled, states were not allowed to invest them in new reform initiatives; they had to distribute what was left to the districts by formula. Districts then had nearly unfettered control over how these funds were spent; activities merely had to comport with four major federal education statutes, including the Elementary and Secondary Education Act—laws that, despite many years and billions invested, hadn’t adequately improved our schools.

Congressional leaders could have empowered governors, often among the nation’s leading education reformers, to direct how portions of these funds were used. Instead, federal guidance made clear that governors and state superintendents were prohibited from doing so.

Finally, meaningful federal oversight was lacking. States were not required to provide advance details of how dollars would be spent. The applications approved by the department are staggeringly devoid of specifics. While governors had to sign a form committing their states to pursuing four general areas of reform, these assurances carried little weight. States could receive their first allotments without explaining how the funds would actually be spent, and, amazingly, states could receive their second allotments even if they hadn’t followed through on their promises. In an April 2009 letter to governors, Secretary Duncan wrote, “States are not required to demonstrate progress in order to get phase two Stabilization funds. We are only asking…that states have in place systems to report on final metrics that are developed through rulemaking so that parents, teachers, and policymakers have clear and consistent information about where our schools and students stand.”

In retrospect, it’s easy to see why the new federal funds didn’t lead to reform. Though $75 billion now appears to be a lost cause, it did buy important lessons. If properly applied, these lessons could contribute mightily to the ARRA’s final major education initiative.

Racing to the Top?

As expectations for the formula-based stimulus funds have rightfully abated, hopes for the reform-driving Race to the Top fund have risen. At $4.35 billion, RTTT is petite compared to other ARRA programs, but as a competitive grant program, it represents by far the largest amount ever at the discretion of an education secretary (see Figure 1).

The administration has tried to make the most of this opportunity by identifying specific reform priorities and requiring interested states to craft proposals that respond to each (see Table 1). While some roundly criticized the department’s audacity—former assistant secretary of education Diane Ravitch called the strategy embedded in the department’s draft documents “coercive” and North Carolina governor Beverly Perdue described it as “prescriptive”—others believed this would ensure the wise investment and use of these funds. That is, if a state doesn’t agree with the department’s favorite reforms, it simply won’t apply; if a state does agree, it will devise the strongest possible plan that faithfully responds to all priorities.

Unfortunately, that’s unlikely to be the case. First, because states are still desperate for money, it’s doubtful they will take a pass on the opportunity to compete for several hundred million dollars. In fact, a month before the first filing deadline, no state had announced that it would forgo the entire competition. Moreover, states’ financial fortunes are expected to get worse.

State budgets typically suffer most in the year after a recession ends. The Rockefeller Institute has found that education spending remains depressed several years after economic growth returns. These effects could be even more pronounced this time. Nationally, property taxes still account for 30 percent of all school revenue. The recession and associated housing crisis have significantly depressed property values; according to one widely used index, home prices declined continuously for three years beginning in July 2006. As rolling assessments catch up with these reduced prices, property tax revenues are likely to be adversely affected. An August report from the National Conference of State Legislatures noted, “While Fiscal Year 2009 can be summed up in one word: dismal, FY 2010 can be characterized by two words: even worse.” The National Governors Association and National Association of State Budget Officers concur: governors’ 2010 budget submissions showed the largest general fund reductions since 1979.

Second, federal dictates don’t alter local preferences; they only force them into temporary hiding. Yes, governors signed the ARRA’s reform assurances but states didn’t use SFSF dollars for reform. Yes, states developed standards and assessments as No Child Left Behind (NCLB) required, but many adopted weak standards and set low cut scores. Yes, districts developed policies for NCLB public school choice and supplemental education services, but they cleverly thwarted the full implementation of these programs, evidenced by the shockingly low student participation rates. As others have noted, the federal government can make states and districts do what they don’t want to, but it can’t make them do it well.

We know that states and districts desperately need money, that they have a preference for preserving the status quo, and that when the federal government asks them to do things they’re not fond of, they may just go through the motions. So when the U.S. Department of Education places $4.35 billion on the table during a serious recession and tells states to respond to Washington’s favorite ideas, it would be wise to anticipate their responses with a stockpile of skepticism.

Trust but Verify

The ultimate challenge for the administration will be reducing the gulf between reforms promised and reforms delivered. Among actions deserving a raised eyebrow are the modifications made to state laws since the passage of the ARRA. Duncan ingeniously used Race to the Top to induce states to improve their policies. If you want a grant, said the secretary, your state had better be hospitable to reform. The swift and positive response from the states amounts to the greatest achievement of Secretary Duncan’s tenure: Illinois, Louisiana, and Tennessee lifted charter school caps. California and Wisconsin ended prohibitions on linking student performance data to individual teachers. Delaware passed legislation making the state more hospitable to Teach For America, and Rhode Island put a stop to all seniority-based teacher assignments. A number of states, including Massachusetts and Michigan, were hurrying to make legislative changes before the first submission deadline in January, and others, including Maine, Maryland, Nevada, and Washington, were planning to apply in the second round to give their legislatures time to pass reform laws.

But as discussed above, there’s considerable daylight between a reform-oriented policy and its faithful implementation. The department should remember that while many states permit linking teachers to student test scores, few districts actually do so, and that while Virginia and Mississippi have each had a charter law for more than a decade, combined they have only five charter schools. In November, Tennessee provided a perfect and alarming example of how this might play out with regard to RTTT: though the state lifted its charter cap as Duncan desired, in the span of two days Memphis and Nashville denied all 24 charter applications submitted to them.

A good leading indicator of whether a state’s heart will actually be in its reforms is whether it sees the RTTT as an engine for change or as bags of cash. Secretary Duncan has said that the program “is not about the money,” and that “If folks are doing this to chase money, it’s for the wrong reasons.” But there have been numerous indications that the potential for a titanic federal payday is a huge, if not the decisive, consideration for many. Maybe the starkest case came from Massachusetts, where Governor Deval Patrick, after years of consistent charter school antagonism, conducted a high-profile volte-face and announced his support for lifting his state’s restrictive charter cap. This occurred after a visit from Secretary Duncan and a reminder that the Bay State was on the brink of disqualifying itself from RTTT consideration.

There are plenty of other examples. Illinois governor Pat Quinn said, “We want to get Illinois in that race and make sure we get as much money as possible from Washington.” The spokesperson for Idaho’s department of education noted, “Race to the Top is the only opportunity for education to get additional funding over the next two to three years.” A lobbyist for the California School Boards Association said, “The money would be nice because of our budget situation.” Even Ohio’s reform-minded Senator John Husted said, “During these tough and uncertain financial times, I believe it is imperative that Ohio be in a strong position to take advantage of the Race to the Top dollars.” A Wisconsin legislator angry about the lack of teeth in an ostensibly reform-oriented piece of legislation may have spoken for many when he said, “This is basically a race for the money, not a race for the top.”

Also to be approached with suspicion are the promises that will appear in state applications. To satisfy the administration’s requirements, states will have to change policies affecting teachers, intervene in failing schools, support charters, and more. With so much money at stake, we should expect carefully assembled plans that convey earnest guarantees of reform. But the SFSF assurances taught us the hard way that reform commitments plus a governor’s signature do not necessarily equal real reform.

So when state proposals hit Arne Duncan’s desk, the secretary must become the toughest schoolmarm in America. The first step is to not reflexively reward the states that improved their policies in response to the RTTT carrot. The department should instead view such moves cynically. Had these states really believed in reform, they would have adopted these measures ages ago. Deathbed conversions are always suspect.

Lifting a legislated charter cap shouldn’t be enough. There should be proof that state and district officials are not inhibiting charter growth, that new schools are opening, and that they have the requisite flexibility and funding to thrive. Likewise, a new law that brings down a “data firewall” should be coupled with affirmative policies that link individual test scores to individual teachers in the state data system and watertight district policies that tie this new information to tenure and evaluation decisions.

When a state promises in its RTTT application to develop a new teacher-preparation system, the administration must pry: Is this really a new initiative or just a renaming of your existing certification process? When a state proposes to create a major new intervention for failing schools, the department must confirm that this isn’t just gussying up an old and meek school improvement strategy.

As important, the department must insist that all reform proposals be completely shovel-ready upon submission. A state’s promise to launch a performance pay system is meaningless unless all pieces of the supporting architecture are already in place. That means the state legislature has authorized the program, union contracts have been modified to allow it, data systems have been updated to support it, and a state disbursement process is prepared to allocate funds as soon as the federal grant arrives.

Watch and Wait

There is some reason to wonder just how tough the department will be. Though the final documents released in November are still laudable, they certainly represent a step back from the publicly released draft versions. States can score points for a charter law with a cap. A state without a charter law can score points with a pale facsimile of one. A performance-pay system plays a smaller role than many expected. The door was opened to weak interventions for failing schools. And, possibly most curiously, despite Duncan’s earlier warning that a state’s unwise use of early ARRA funds would cause it to be tremendously disadvantaged in the RTTT competition, this issue only comprises 1 percent—5 of 500—of the total points available (by comparison, not signing on to the common standards initiative would cost a state 8 times the number of points). These shifts were widely noticed. In an editorial titled “School Reform Retreat?” the Wall Street Journal noted that the administration had eased requirements, and the Washington Post editors wrote bluntly, “draft regulations have been weakened.” Equally instructive was the national teachers unions’ support for the changes.

Despite these shifts, hope remains that the department will stand firm for reform. Joe Williams, executive director of Democrats for Education Reform, told the New York Times, “The administration clearly listened to the unions, but they haven’t backtracked.” As the first competition got underway in the fall, Secretary Duncan maintained that the bar will be “very, very high,” telling Education Week, “There will be a lot more losers than winners.”

In hindsight, perhaps Washington should have crafted a different education package for the ARRA. Under alternate circumstances, federal leaders might have recognized that stabilizing and reforming our schools are quite different goals and that the complications associated with driving education reform from the nation’s capital are at least equal to the opportunities. But in early 2009 the economy’s condition didn’t afford much time for deliberation, and in the wake of the historic 2008 elections, few ascendant federal policymakers were overflowing with modesty and prudence.

Much will be learned from these experiences in the years ahead, but for the time being one immediate takeaway merits repeating: Local policy prerogatives and dire financial conditions trumped federal pleas for reform and led to the spending of massive amounts of aid on preserving the status quo and protecting existing jobs and programs.

With similar factors coalescing around RTTT, the administration should be wise to the potentially regrettable outcomes absent additional protections. Moving forward, the administration might reconsider talk of “moon shots” and transformational change and instead adopt a more humble creed: Fool me once, shame on you; fool me twice, shame on me.

Andy Smarick, a former U.S. deputy assistant secretary of education, is a distinguished visiting fellow at the Thomas B. Fordham Institute and adjunct fellow at the American Enterprise Institute.

As I wrote on Flypaper, I’m very disappointed with the Department’s decision to name 16 states RTT finalists.  A number of these states have glaring deficiencies that would make them unable to get over a medium bar much less the “very, very high bar” that Secretary Duncan said he would set.

In a number of tweets, the Department’s press team explained the long list by saying that there was a natural break in the scoring (around 400 points of 500) and reassured that the bar is still high, that very few of these finalists will win.  I want to believe them; I really do.

But they didn’t have to take 16 states just because there was a natural break there.  They could have only selected the top 2 or 5 or even 8.  That would’ve sent the right signal: that the administration is serious about big reforms not average proposals.

Sixteen sends precisely the wrong signal.  Take for example New York, which wrangled over reform legislation until the very last day before deciding just hours before the filing deadline that they were going to reject the Department’s priorities.  Yet New York is a finalist.  Kentucky doesn’t even have a charter law, but they too made the finals.

I’m afraid this won’t make states more willing to embrace reform.  It will bolster their sense of complacency, that the status quo is good enough.

[Please see the blog entries here and here and here and  here and here and here for more discussion of the Race to the Top finalists.]

Several letters to the editor were received by the magazine in response to the article, and even more comments were posted on the Ed Next website.

I appreciate the careful reading of and thoughtful responses to the “Turnaround Fallacy” by those who have written, not only the letter-writers (Feinstein, Cohen, Hawley Miles, and the Hassels), but also the many others who have contacted me since its publication.  It’s encouraging that so many talented and energetic people are working to improve the opportunities available to kids assigned to troubled public schools.

But I’m as convinced as ever that closing schools in a persistent state of failure is necessary.  Rather than restate that case (which you can also watch me argue during this Fordham/Education Next event on school turnarounds), I’ll just respond to the most frequent comments I’ve received.

First, readers have often made the case that we haven’t really tried turnarounds yet.  I tried to address that contention in the original article by giving lots and lots of examples of the things we have tried and by citing the research showing that, despite all of that, we still don’t know what would work better.  Some seem to think that decades of past failure suggest a lack of effort or smarts—that we just need to be tougher and more thorough.  I think it speaks to a much broader theme, which I argued in the article: that turnarounds seldom work in any field.

Accordingly, my prediction is that that vast majority of “turnaround” efforts funded by the $3.5 billion federal School Improvement Grant program and the $4.35 billion Race to the Top will look much like previous efforts, and therefore most will fail.  For those interventions that are “stronger” (which each turnaround advocate seems to define as the strategy he or she prefers), the success rates will be similarly low.

Second, I have never made the case that all new starts will work; in fact, I concede that many won’t.  But as I point out, the best urban schools in operation today are either schools that were started new or have long been excellent.  Indeed, I struggle to find schools that were once in a chronic state of tragic underperformance and are now consistently generating exceptional results.  Moreover, as the last third of the article argues, continuous new starts are essential to the healthy functioning of a system.

To those who say that we don’t have the capacity to grow enough new schools, I say that’s because we have a system that was mistakenly built a century ago to populate schools by geography, to keep schools open in perpetuity, to homogenize offerings, and to own and operate all public schools in a designated area.  That “one best system,” which Ravitch and Viteritti aptly called the “decrepit factory” a decade ago, has failed us in countless ways and most assuredly is not suited to do what is needed going forward.  We need to build a system that will enable new starts to be more frequent and robust—a system that seeds new school development organizations, builds human capital, equitably distributes operational funding and facilities, and more.

Finally, some say that we can’t close all low-performing schools because there are too many.  First, that’s a chilling indictment of the current system and our generations of attempted turnaround efforts.  Second, neither I nor anyone I know would argue that all failing schools must be closed tomorrow.  The operational challenge is figuring out how to time and choreograph the closure of these schools, the replication and expansion of superior schools, and the starting of promising new schools.  This is the ultimate task of the leader of the urban school system of the future: properly managing a city’s portfolio of schools.  No one has the perfect playbook yet, but I’m extremely encouraged by the efforts of Joel Klein’s team in New York City.

In closing, I’d simply say that if we want dynamic, responsive, high-quality, and self-improving systems of urban schools, we need to stop stubbornly preserving the failed schools of yesterday and get about the business of building mechanisms that continuously introduce new offerings, grow successes, and phase out schools that don’t work for kids.

Coinciding with today’s deadline and the important work about to begin, Education Next is releasing my new article “Toothless Reform?” which makes the case that previous ARRA education funding hasn’t been used for reform and that the department needs to go to great lengths to ensure that the RTT generates the changes needed.  As I write in the article, “when state proposals hit Arne Duncan’s desk, the secretary must become the toughest schoolmarm in America.”

A combination of factors led states and districts to spend nearly $75 billion in stimulus funding to prop up the status quo.  Though most education observers are sanguine about the RTT’s potential, these same factors—enormous state budget deficits, local resistance to federal education directives, school-level preferences for existing jobs and programs, union opposition—are still in play and could lead to the same disappointing spending patterns.

I encourage the department and its peer reviewers to approach state proposals with significant skepticism and work overtime to ensure that states and districts intend to faithfully implement meaningful reforms.

If you’re interested in the stimulus, education reform, or the Race to the Top, consider giving the article a read.  While education coverage over the next several days is going to focus on state applications and, later, on winners and losers, this article will provide the necessary context.  In short, elsewhere you’re likely to hear lots of state promises, lots of stakeholder excitement, and lots federal crowing, but if this $4.35 billion investment in reform is going to do the trick, the feds will need to develop a terribly critical eye and expend gallons of elbow grease in the weeks to come.

If multimedia is your thing, you can watch a video (with Checker Finn) about the article here or listen to an audio interview (with Joe Williams) here.

Listen to the Podcast

For more on this topic by Andy Smarick, see “Toothless Reform?” in the Spring 2010 issue of Education Next.

For more on this topic by Andy Smarick, see “Toothless Reform?” in the Spring 2010 issue of Education Next.

First, advocates must answer a fundamental question: What type of relationship should the nascent charter sector have with the long-dominant district sector? The tension between the two is at the heart of every political, policy, and philosophical tangle faced by the charter movement.

But charter supporters lack a consistent vision. This motley crew includes civil rights activists, free market economists, career public-school educators, and voucher proponents. They have varied aspirations for the movement and feelings toward the traditional system. Such differences are part of the movement’s DNA: a National Alliance for Public Charter Schools (NAPCS) study found that the nation’s charter laws cite at least 18 different goals, including spurring competition, increasing professional opportunities for teachers, and encouraging greater use of technology.

Because of its uniqueness, chartering is unable to look to previous reform efforts for guidance. No K–12 reform has so fundamentally questioned the basic assumptions—school assignments based on residence, centralized administrative control, schools lasting in perpetuity—underlying the district model of public education. Even the sweeping standards and assessments movement of the last 20 years, culminating in No Child Left Behind, takes for granted and makes use of the district sector.

Though few charter advocates have openly wrestled with this issue, two camps have organically emerged. The first sees chartering as an education system operating alongside traditional districts. This camp contends that the movement can provide more options and improved opportunities, particularly to disadvantaged students, by simply continuing to grow and serve more families.

The second group sees chartering as a tool to help the traditional sector improve. Chartering, the argument goes, can spur district improvement through a blend of gentle competitive nudging and neighborly information sharing.

Both camps are deeply mistaken. For numerous policy and political reasons, without a radical change in tactics the movement won’t be able to sustain even its current growth rate. And neither decades of sharing best practices nor the introduction of charter competition has caused districts to markedly improve their performance.

Both camps have accepted an exceptionally limited view of what this sector might accomplish. Chartering’s potential extends far beyond the role of stepchild or assistant to districts. The only course that is sustainable, for both chartering and urban education, embraces a third, more expansive view of the movement’s future: replace the district-based system in America’s large cities with fluid, self-improving systems of charter schools.

A Parallel System

Charter advocates are rightfully proud of their achievements. As of spring 2007, 4,046 charter schools were serving more than 1.1 million children across 40 states and the District of Columbia. In a number of cities, charters educate a significant proportion of public school students (see Figure 1). But when compared to the expanse of the traditional district-based system and the educational needs of low-income families, the movement’s accomplishments are modest.

Nationwide, only 2 percent of public school students attend charters. Over the last five years, an average of 335 new charters started annually. At this rate, it would take until 2020 for chartering to corner just 5 percent of the national market. Even these humble figures inflate the movement’s true national standing. In 2007 nearly two-thirds of charter schools were in only seven states. Today, 24 states have less than 1 percent of their students in charter schools. Though strong expansion continues in places like California and Florida, the 2006–07 school year saw 26 states open five or fewer new schools, while 5 states—because of closures—began the school year with fewer charters than they had the year before.

None of this, however, should be taken as an assault on charters’ popularity or effectiveness. In New York, 12,000 students are on charter wait lists; in Massachusetts 19,000; in Pennsylvania 27,000. Students on all of the nation’s charter wait lists would fill an estimated 1,121 new charter schools.

Research on student achievement in charters is encouraging. A recent analysis of the charter school studies since 2001 that measured student or school performance over time—the ideal way to measure a school’s “value added”—reported that 29 of 33 studies found charters performing as well as or better than traditional public schools. The New York Times Magazine spotlighted charter networks KIPP, Uncommon Schools, and Achievement First in a major feature on how to close the achievement gap. Yet despite these successes, chartering’s current status and growth trajectory won’t enable it to become a parallel system large enough to serve the millions of needy students across the country within the foreseeable future.

Some might respond, “Then just accelerate growth.” But the forces that have held chartering back over the last 15 years aren’t going away. Worse, even today’s growth levels may be in danger.

Twenty-five states have imposed some type of cap on charter expansion, and in eight states those limits currently constrain growth. The battle against caps must be fought state by state by under-resourced, overextended charter advocates against entrenched opponents. In New York, an expensive and sophisticated multiyear effort by charter advocates that was supported by the governor and New York City’s mayor and schools chancellor finally resulted in legislation that raised the cap, but only by 100 schools. The new limit will be reached in just a few years.

Unequal financing is another obstacle. A Fordham Institute study found that on average charters receive $1,800 less per student than traditional public schools, despite serving more disadvantaged students. This discourages educators from starting new charters and traditional schools from converting. It also inhibits existing charters from growing enrollment or expanding to new campuses. Facilities are a major piece of this puzzle. While traditional public schools are provided a building, charters still must find, secure, and pay for a roof and walls. Only 13 states and Washington, D.C., provide some sort of facilities assistance.

The greatest impediment to growth is the wide array of political, legal, and administrative attacks. Institutional players—teachers unions, school boards, and state and district administrators—frequently petition state leaders for charter caps and reduced charter funding and vigorously oppose alternative authorizers and facilities aid. The nationwide Democratic landslide in the 2006 elections left many state governments less charter-friendly. For example, Ted Strickland, Ohio’s new Democratic governor, made a moratorium on new charters one of his top priorities.

In a number of states, most recently Ohio and Michigan, coalitions have attacked chartering through the courts. Though these challenges have been beaten back so far, even one loss could force the closure of hundreds of schools. A 2006 Florida Supreme Court decision was foreboding. Striking down the state’s voucher plan for contravening the state constitution’s requirement of a “uniform” public education system, the court opened the door to challenges to the state’s 350 charters, which, by definition, are not uniform.

Finally, chartering is held back by its administrative arrangements. Ninety percent of authorizers are local school districts, many of which view charters as an administrative inconvenience, competitive nuisance, or worse. In a NAPCS survey of charter school leaders, nearly two-thirds said working with the district was a problem. This summer, a high-performing KIPP charter school in Annapolis, Maryland, was forced to close because it couldn’t find a permanent facility, even though the school district, according to its own study, had 900 empty seats in a nearby, underutilized school. Responding to the school’s pleas for help, the district’s superintendent told the local newspaper, “It’s not my responsibility. It’s not my school.”

The “parallel system” approach to chartering’s future rests on two mistaken assumptions: first, that by simply creating new schools and not purposely antagonizing the traditional system, chartering wouldn’t attract the ire of defenders of the status quo; and second, that if chartering proved successful and popular, the sky was the limit on growth. As it turned out, district stakeholders have fought charters tooth and nail from the beginning, and they have erected policy obstacles that have severed the link between charter demand and supply.

The District Partner

The second camp envisions a vastly improved traditional school system, achieved through charter cooperation. This group believes that consistent collaboration between the two sectors would enable charters to experiment and then share lessons learned so all students, the vast majority of whom still attend traditional public schools, could benefit. “I believe that districts and charters will benefit by building more collaborative relationships,” says Tom Hutton, a staff attorney for the National School Boards Association and a former board member of the Thurgood Marshall Charter School in Washington, D.C.

Like Hutton, many in this camp are veterans of the traditional system who recognize the value of chartering. But they assume district immortality—districts have been the sole delivery system of public education for generations—and believe a collaborative relationship to be wise, pragmatic, and ultimately necessary. The late Appleton, Wisconsin, superintendent Tom Scullen supported charters within his district but cautioned, “Charter schooling will fail if it tries to become a second track of public education. There isn’t enough money to support two systems.” Deborah McGriff, executive vice president of Edison Schools and former Detroit superintendent, agrees: “Charters need to start thinking about how we move from suspicion and competition with districts to collaboration and cooperation.”

This collaborative relationship is becoming institutionalized. The federal Charter School Program, which provides charter start-up funds, requires that states disseminate charters’ best practices to districts. KIPP has an open-door policy for local teachers and principals; they are welcome to visit and take away whatever lessons they can. Funders in particular are buying into this strategy. NewSchools Venture Fund, whose goal is to improve school districts, invests in charter entrepreneurs in the hope that they can “spark broader transformation in the public school system.” One of the Boston Foundation’s high priorities in its education giving is supporting the sharing of effective practices between chartered and traditional schools.

Though the move toward greater cooperation has emotional appeal, to embrace it you have to believe that districts, including major urban districts, are both willing and able to change and significantly improve student achievement at scale. Sadly, there is prima facie evidence that they are not. The achievement gap has been well documented for 40 years: in the Coleman Report, NAEP data, SAT scores, and state assessments. Given the threefold increase in per-pupil spending and countless policy changes, blue-ribbon panel recommendations, and foundation initiatives in the intervening years, it is undeniable that districts have already tried, or have been forced to try, to shape up.

Diane Ravitch recently reported in the Education Gadfly (June 7, 2007) on the disappointing achievement scores from New York City, whose much-heralded schools leader, Joel Klein, has implemented some of the nation’s most aggressive reforms. Ravitch found that during Klein’s five-year tenure academic gains have been smaller than during the previous five years and that the reading scores of cohorts of students are actually declining as they progress through the system. New York’s inability to improve despite major interventions is far from unique. NAEP’s Trial Urban District Assessment, which measured the performance of 11 large urban systems in 2005, provides compelling evidence of the futility of district-based reforms: even the highest-performing district studied (Charlotte) had only 29 percent of its 8th graders at or above proficient in reading.

It is unreasonable to believe that charter collaboration will significantly alter these stubbornly disappointing district results. High-performing low-income schools, though too rare, have been documented for decades, and yet their lessons have never been translated into comprehensive district improvement. This is despite major efforts to spread best practices widely, including the work of education schools and $15 billion spent annually on teacher professional development. All in all, the uncomfortable but unavoidable question for collaboration advocates becomes, why should chartering invest in a strategy—helping major urban districts solve the achievement gap—that has consistently failed for 40 years when pursued by others?

Many strong believers in school choice, myself included, were convinced that the competitive pressure exerted by charters would lead to a renaissance in the traditional system. The vast district improvements we expected never materialized. The clearest evidence comes from Dayton, Ohio, and Washington, D.C., two cities with significant charter sectors.

In the nation’s capital, 26 percent of students attend one of the city’s 71 charter schools. The city’s charter sector is remarkably innovative and energetic, including such standouts as KIPP KEY Academy, the SEED School, and DC Prep. Nevertheless, the District’s traditional system remains among the very worst in the nation. Of the 11 cities participating in the NAEP Trial Urban District Assessment in 2005, Washington, D.C., had the lowest scores in math and reading in both grades tested. Among its 8th-grade students, only 12 percent reached proficiency in reading and 7 percent in math. A Progressive Policy Institute study of D.C.’s charter experience summarized the situation perfectly: “There is no clear evidence that charter schools have had a direct impact on student achievement in DCPS schools or otherwise driven systemic reform.”

Charters educate 28 percent of Dayton’s students. Last year, the district reached only one of 25 state indicators and failed to make AYP. Seventy and 56 percent of its 8th graders failed to reach proficiency in math and reading, respectively. Residents are understandably frustrated: a 2005 Fordham Foundation survey found that 69 percent of Dayton residents are in favor of either major change from the district or an entirely new education system.

Some studies, like those by Hoxby (see “Rising Tide,” research, Winter 2001) and by Holmes, Desimone, and Rupp (see “Friendly Competition,” research, Winter 2006) have found a small bump in a district’s achievement when it faces charter competition. Bifulco and Ladd (see “Results from the Tar Heel State,” research, Fall 2005) and Buddin and Zimmer, however, found none. There are legitimate disagreements about the influence of additional factors in these studies, such as the amount of competition, the policy environment, and the type of test data used. But when this research is considered alongside our other experience, the only fair conclusion is that competition hasn’t dramatically altered district performance for the better.

Charter competition has caused one unexpected and fascinating phenomenon. When facing a growing number of charters, districts turn to advertising. In January 2006, the Boston Teachers Union and the district were in negotiations to spend $100,000 to promote the virtues of traditional public schools to families choosing charters. Also in early 2006, the Cincinnati district sent letters and held information sessions designed to have charter families reenroll in traditional public schools. In May 2007, the St. Louis district awarded a no-bid contract to a marketing firm to “drive the message of the negative impact of charter schools.” Seemingly unable to improve results, districts rely on public relations to stem the migration of students to other schools.

Why is it that major urban school districts are unable to improve student learning at scale? A compelling argument, and a roadmap for charter schooling’s future, can be found in Ted Kolderie’s excellent and underappreciated book, Creating the Capacity for Change. Kolderie applies to K–12 education the lessons Harvard economist Clayton Christensen has drawn from the private sector. Christensen, studying how industries evolve and improve over time, found that critical advancements don’t come from old firms changing their ways. They come from new firms (or independent subsidiaries) entering the market, introducing new products and systems, and responding nimbly to the demands of consumers.

When an industry experiences a major change, existing firms find themselves unable to adjust to navigate the new world. Every aspect of its identity—culture, staffing, practices, priorities—was geared toward succeeding in the old environment. When the environment changes, it’s impossible for the horse and carriage to transform into a steam locomotive.

The implications for public education are profound. For 150 years, public schooling has been a one-factory town: a board- and superintendent-led district manages, staffs, and oversees an area’s entire portfolio of public schools. But in this time, the world has become a radically different place and the expectations of schools have changed even more. As Kolderie points out, if private firms, which are built to respond to competition, are unable to make this kind of leap, we can’t expect gigantic, byzantine school systems, which are insulated from competition, shackled by union contracts, and constrained by a sticky web of regulations, to do so.

The system is the issue. The solution isn’t an improved traditional district; it’s an entirely different delivery system for public education: systems of chartered schools.

A Transformed System

Charter advocates should strive to have every urban public school be a charter. That is, each school should have significant control over its curriculum, methods, budget, staff, and calendar. Each school should have a contract that spells out its mission and measurable objectives, including guaranteeing that all students achieve proficiency in basic skills. Each school should be held accountable by an approved public body.

“Charter” will no longer be seen as an adjective, a way to describe a type of school, but as a verb, an orderly and sensible process for developing, replicating, operating, overseeing, and closing schools. The system would be fluid, self-improving, and driven by parents and public authority, ensuring the system uses the best of market and government forces. Schools that couldn’t attract families would close, as would those that ran afoul of authorizers for academic, financial, or management failures. School start-ups, both the number and their characteristics, would reflect the needs of communities and the interests of students, but would also be tightly regulated to generate a high probability of school success.

So, while the government’s role would still be significant, it would no longer operate the city’s entire portfolio of public schools. Instead, it would take on a role similar to the FAA’s role in monitoring the airline industry or a health department’s monitoring of restaurants. Today, we take airline safety for granted and make our choices based on service, connections, and so on. Similarly, we know all restaurants have fire exits and meet food safety standards, so we choose based on our tastes and schedules. A well-regulated chartered school system could guarantee that all public schools were providing a safe, high-quality education and properly managing operations, thereby allowing families to choose a school based on other criteria.

The government’s substantial oversight role in guaranteeing safety and quality would differentiate a charter system from a universal voucher program. To many, a voucher system would undesirably blur the lines between church and state, add the profit motive to schooling, remove the “public” from K–12 education, and leave too much to the vicissitudes of the market. By contrast, in a chartered system, public schools would be nonreligious, managed by nonprofits, overseen by a public authority, and held to clear performance standards.

But a chartered system would capitalize on market forces largely absent from district systems, such as constant innovation, competition, and replication. Replication is arguably the most valuable. Chartering has not only created some of America’s finest schools, it has enabled their leaders to identify the characteristics that made those schools so remarkable and then develop systems for creating additional, equally successful schools. In addition to well-known charter management organizations like KIPP, Achievement First, and Uncommon Schools, new ones continue to emerge: Green Dot, High Tech High, Aspire, Noble Street, IDEA, and more. Major funders like the Charter School Growth Fund and NewSchools Venture Fund are helping other high-performing charters expand as well.

So how do we transform today’s urban district systems into chartered systems? Absent political realities, the shift could be quite simple. Any district could decide tomorrow to relinquish day-to-day control of its schools and develop performance contracts with each. Every school could develop its own governing board and acquire control of its budget, staffing, and curriculum. The district could then change from a central operator to an authorizer, monitoring schools, closing them when necessary, and allowing new ones to open. The “every school a charter school” idea is not new; others, most prominently Paul Hill of the Center on Reinventing Public Education, have been writing variations on this theme for some time.

Unfortunately, for reasons having more to do with power than student learning, this scenario is highly unlikely. Most districts assiduously avoid the loss of one school, let alone all schools. When one of Washington, D.C.’s highest-performing traditional public schools pursued plans to convert to a charter in 2006, the district agreed to several of its demands in exchange for the school’s agreement to stop flirting with charter status. This spring, after faculty at Locke High School in Los Angeles signed petitions to convert into a Green Dot charter, district officials scrambled to put together a counterproposal and convinced some teachers to rescind their signatures.

No government entity likes to lose control of any of its components and the budget and prestige that go with them, especially when the loss suggests a failure by the organization. But shifting from an operator into an authorizer would mean cutting hundreds of central office jobs as well: since charters handle their own transportation, facilities, staffing, and more, district employees filling those responsibilities would become redundant. Such a shift, then, would be vigorously opposed by district staff and those who represent them. Countless powerful organizations, like unions, book publishers, and service providers, would also be adversely affected by a decentralized system of schools.

Clearly we can’t expect the political process to swiftly bring about charter districts in all of America’s big cities. However, if charter advocates carefully target specific systems with an exacting strategy, the current policy environment will allow them to create examples of a new, high-performing system of public education in urban America.

Here, in short, is one roadmap for chartering’s way forward: First, commit to drastically increasing the charter market share in a few select communities until it is the dominant system and the district is reduced to a secondary provider. The target should be 75 percent. Second, choose the target communities wisely. Each should begin with a solid charter base (at least 5 percent market share), a policy environment that will enable growth (fair funding, nondistrict authorizers, and no legislated caps), and a favorable political environment (friendly elected officials and editorial boards, a positive experience with charters to date, and unorganized opposition). For example, in New York a concerted effort could be made to site in Albany or Buffalo a large percentage of the 100 new charters allowed under the raised cap. Other potentially fertile districts include Denver, Detroit, Kansas City, Milwaukee, Minneapolis, New Orleans, Oakland, and Washington, D.C.

Third, secure proven operators to open new schools. To the greatest extent possible, growth should be driven by replicating successful local charters and recruiting high-performing operators from other areas (see Figure 2). Fourth, engage key allies like Teach For America, New Leaders for New Schools, and national and local foundations to ensure the effort has the human and financial capital needed. Last, commit to rigorously assessing charter performance in each community and working with authorizers to close the charters that fail to significantly improve student achievement.

In total, these strategies should lead to rapid, high-quality charter growth and the development of a public school marketplace marked by parental choice, the regular start-up of new schools, the improvement of middling schools, the replication of high-performing schools, and the shuttering of low-performing schools.

As chartering increases its market share in a city, the district will come under growing financial pressure. The district, despite educating fewer and fewer students, will still require a large administrative staff to process payroll and benefits, administer federal programs, and oversee special education. With a lopsided adult-to-student ratio, the district’s per-pupil costs will skyrocket.

At some point along the district’s path from monopoly provider to financially unsustainable marginal player, the city’s investors and stakeholders—taxpayers, foundations, business leaders, elected officials, and editorial boards—are likely to demand fundamental change. That is, eventually the financial crisis will become a political crisis. If the district has progressive leadership, one of two best-case scenarios may result. The district could voluntarily begin the shift to an authorizer, developing a new relationship with its schools and reworking its administrative structure to meet the new conditions. Or, believing the organization is unable to make this change, the district could gradually transfer its schools to an established authorizer.

A more probable district reaction to the mounting pressure would be an aggressive political response. Its leadership team might fight for a charter moratorium or seek protection from the courts. Failing that, they might lobby for additional funding so the district could maintain its administrative structure despite the vast loss of students. Reformers should expect and prepare for this phase of the transition process.

In many ways, replacing the district system seems inconceivable, almost heretical. Districts have existed for generations, and in many minds, the traditional system is synonymous with public education. However, the history of urban districts’ inability to provide a high-quality education to their low-income students is nearly as long. It’s clear that we need a new type of system for urban public education, one that is able to respond nimbly to great school success, chronic school failure, and everything in between. A chartered system could do precisely that.

Andy Smarick is former congressional aide and charter school founder. Until recently, he served as chief operating officer of the National Alliance for Public Charter Schools.

For more on this topic by Andy Smarick, please see his article The Turnaround Fallacy.

For as long as there have been struggling schools in America’s cities, there have been efforts to turn them around. The lure of dramatic improvement runs through Morgan Freeman’s big-screen portrayal of bat-wielding principal Joe Clark, philanthropic initiatives like the Gates Foundation’s “small schools” project, and No Child Left Behind (NCLB)’s restructuring mandate. The Obama administration hopes to extend this thread even further, making school turnarounds a top priority.

But overall, school turnaround efforts have consistently fallen far short of hopes and expectations. Quite simply, turnarounds are not a scalable strategy for fixing America’s troubled urban school systems.

Fortunately, findings from two generations of school improvement efforts, lessons from similar work in other industries, and a budding practice among reform-minded superintendents are pointing to a promising alternative. When conscientiously applied strategies fail to drastically improve America’s lowest-performing schools, we need to close them.

Done right, not only will this strategy help the students assigned to these failing schools, it will also have a cascading effect on other policies and practices, ultimately helping to bring about healthy systems of urban public schools.

A Body at Rest Stays at Rest

Looking back on the history of school turnaround efforts, the first and most important lesson is the “Law of Incessant Inertia.” Once persistently low performing, the majority of schools will remain low performing despite being acted upon in innumerable ways.

Examples abound: In the first year of California’s Academic Performance Index, the state targeted its lowest-performing 20 percent of schools for intervention. After three years, only 11 percent of the elementary schools in this category (109 of 968) were able to make “exemplary progress.” Only 1 of the 394 middle and high schools in this category reached this mark. Just one-quarter of the schools were even able to accomplish a lesser goal: meeting schoolwide and subgroup growth targets each year.

In 2008, 52 Ohio schools were forced to restructure because of persistent failure. Even after several years of significant attention, fewer than one in three had been able to reach established academic goals, and less than half showed any student performance gains. The Columbus Dispatch concluded, “Few of them have improved significantly even after years of effort and millions in tax dollars.”

These state anecdotes align with national data on schools undergoing NCLB-mandated restructuring, the law’s most serious intervention, which follows five or more years of failing to meet minimum achievement targets. Of the schools required to restructure in 2004–05, only 19 percent were able to exit improvement status two years later.

A 2008 Center on Education Policy (CEP) study investigated the results of restructuring in five states. In California, Maryland, and Ohio, only 14, 12, and 9 percent of schools in restructuring, respectively, made adequate yearly progress (AYP) as defined by NCLB the following year. And we must consider carefully whether merely making AYP should constitute success at all: in California, for example, a school can meet its performance target if slightly more than one-third of its students reach proficiency in English language arts and math. Though the CEP study found that improvement rates in Michigan and Georgia were considerably higher, Michigan changed its accountability system during this period, and both states set their AYP bars especially low.

Though alarming, the poor record for school turnarounds in recent years should come as no surprise. A study published in 2005 by the Education Commission of the States (ECS) on state takeovers of schools and districts noted that the takeovers “have yet to produce dramatic consistent increases in student performance,” and that the impact on learning “falls short of expectations.”

Reflecting on the wide array of efforts to improve failing schools, one set of analysts concluded, “Turnaround efforts have for the most part resulted in only marginal improvements…. Promising practices have failed to work at scale when imported to troubled schools.”

Like Finding the Cure for Cancer

The second important lesson is the “Law of Ongoing Ignorance.” Despite years of experience and great expenditures of time, money, and energy, we still lack basic information about which tactics will make a struggling school excellent. A review published in January 2003 by the Thomas B. Fordham Foundation of more than 100 books, articles, and briefs on turnaround efforts concluded, “There is, at present, no strong evidence that any particular intervention type works most of the time or in most places.”

An EdSource study that sought to compare California’s low-performing schools that failed to make progress to its low-performing schools that did improve came to a confounding conclusion: clear differences avoided detection. Comparing the two groups, the authors noted, “These were schools in the same cities and districts, often serving children from the same backgrounds. Some of them also adopted the same curriculum programs, had teachers with similar backgrounds, and had similar opportunities for professional development.”

Maryland’s veteran state superintendent of schools, Nancy Grasmick, agrees: “Very little research exists on how to bring about real sea change in schools…. Clearly, there’s no infallible strategy or even sequence of them.” Responding to the growing number of failing Baltimore schools requiring state-approved improvement plans, she said, “No one has the answer. It’s like finding the cure for cancer.”

Researchers have openly lamented the lack of reliable information pointing to or explaining successful improvement efforts, describing the literature as “sparse” and “scarce.” Those attempting to help others fix broken schools have typically resorted to identifying activities in improved schools, such as bolstering leadership and collecting data.

However, this case-study style of analysis is deeply flawed. As the U.S. Department of Education’s Institute of Education Sciences (IES) has noted, studies “that look back at factors that may have contributed to [a] school’s success” are “particularly weak in determining causal validity for several reasons, including the fact that there is no way to be confident that the features common to successful turnaround schools are not also common to schools that fail.”

Researchers have noted that the Department of Education has signaled its own ignorance about what to do about the nation’s very worst schools. One study reported, “The NCLB law does not specify any additional actions for schools that remain in the implementation phase of restructuring for more than one year, and [the Department] has offered little guidance on what to do about persistently struggling schools.” Indeed, the IES publication, “Turning Around Chronically Low-Performing Schools” practice guide, purportedly a resource for states and districts, concedes, “All recommendations had to rely on low levels of evidence,” because it could not identify any rigorous studies finding that “specific turnaround practices produce significantly better academic outcomes.”

Still in Its Infancy?

The prevailing view is that we must keep looking for turnaround solutions. Observers have written, “Turnaround at scale is still in its infancy,” and “In education, turnarounds have been tried rarely” (see “The Big U-Turn,” features, Winter 2009). But, in fact, the number and scope of fix-it efforts have been extensive to say the least.

Long before NCLB required interventions in the lowest-performing schools, states had undertaken significant activity. In 1989 New Jersey took over Jersey City Public Schools; in 1995 it took over Newark Public Schools. In 1993 California took control of the Compton Unified School District. In 1995 Ohio took over the Cleveland Metropolitan School District. Between 1993 and 1997 states required the reconstitution of failing schools in Denver, Chicago, New York City, and Houston. In 2000 Alabama took over a number of schools across the state, and Maryland seized control of three schools in Baltimore.

Since NCLB, interventions in struggling schools have only grown in number and intensity. In the 2006–07 school year, more than 750 schools in “corrective action,” the NCLB phase preceding restructuring, implemented a new research-based curriculum, more than 700 used an outside expert to advise the school, nearly 400 restructured the internal organization of the school, and more than 200 extended the school day or year. Importantly, more than 300 replaced staff members or the principal, among the toughest traditional interventions possible.

Occasionally a program will report encouraging success rates. The University of Virginia School Turnaround Specialist Program asserts that about half of its targeted schools have either made AYP or reduced math and reading failure rates by at least 5 percent. Though this might be better than would otherwise be expected, the threshold for success is remarkably low. It is also unknown whether such progress can be sustained. This matter is particularly important, given that some point to charter management organizations Green Dot and Mastery as turnaround success stories even though each has a very short turnaround résumé, in both numbers of schools and years of experience.

Many schools that reach NCLB’s restructuring phase, rather than implementing one of the law’s stated interventions (close and reopen as a charter school, replace staff, turn the school over to the state, or contract with an outside entity), choose the “other” option, under which they have considerable flexibility to design an improvement strategy of their own (see “Easy Way Out,” forum, Winter 2007). Some call this a “loophole” for avoiding tough action.

Yet even under the maligned “other” option, states and districts have tried an astonishing array of improvement strategies, including different types of school-level needs assessments, surveys of school staff, conferences, professional development, turnaround specialists, school improvement committees, training sessions, principal mentors, teacher coaches, leadership facilitators, instructional trainers, subject-matter experts, audits, summer residential academies, student tutoring, research-based reform models, reconfigured grade spans, alternative governance models, new curricula, improved use of data, and turning over operation of some schools to outside organizations.

It’s simply impossible to make the case that turnaround efforts haven’t been tried or given a chance to work.

A Better Mousetrap?

Despite this evidence, some continue to advocate for improved turnaround efforts. Nancy Grasmick supports recognizing turnarounds as a unique discipline. Frederick Hess and Thomas Gift have argued for developing school restructuring leaders; Bryan Hassel and Emily Ayscue Hassel have recommended that states and districts “fuel the pipeline” of untraditional turnaround specialists. NewSchools Venture Fund, the Education Commission of the States, and the research firm Mass Insight have offered related turnaround strategies.

And the Obama administration too has bought into the notion that turnarounds are the key to improving urban districts. Education secretary Arne Duncan has said that if the nation could turn around 1,000 schools annually for five years, “We could really move the needle, lift the bottom and change the lives of tens of millions of underserved children.” In the administration’s 2009 stimulus legislation, $3 billion in new funds were appropriated for School Improvement Grants, which aid schools in NCLB improvement status. The administration requested an additional $1.5 billion for this program in the 2010 budget. This is all on top of the numerous streams of existing federal funds that can be—and have been—used to turn around failing schools.

The dissonance is deafening. The history of urban education tells us emphatically that turnarounds are not a reliable strategy for improving our very worst schools. So why does there remain a stubborn insistence on preserving fix-it efforts?

The most common, but also the most deeply flawed, justification is that there are high-performing schools in American cities. That is, some fix-it proponents point to unarguably successful urban schools and then infer that scalable turnaround strategies are within reach. In fact, it has become fashionable among turnaround advocates to repeat philosopher Immanuel Kant’s adage that “the actual proves the possible.”

But as a Thomas B. Fordham Foundation study noted, “Much is known about how effective schools work, but it is far less clear how to move an ineffective school from failure to success…. Being a high-performing school and becoming a high-performing school are very different challenges.”

In fact, America’s most-famous superior urban schools are virtually always new starts rather than schools that were previously underperforming. Probably the most convincing argument for the fundamental difference between start-ups and turnarounds comes from those actually running high-performing high-poverty urban schools (see sidebar). Groups like KIPP (Knowledge Is Power Program) and Achievement First open new schools; as a rule they don’t reform failing schools. KIPP’s lone foray into turnarounds closed after only two years, and the organization abandoned further turnaround initiatives. Said KIPP’s spokesman, “Our core competency is starting and running new schools.”

A 2006 NewSchools Venture Fund study confirmed a widespread aversion to takeover-and-turnaround strategies among successful school operators. Only 4 of 36 organizations interviewed expressed interest in restructuring existing schools. Remarkably, rather than trusting successful school operators’ track records and informed opinion that start-ups are the way to go, Secretary Duncan urged them to get into the turnaround business during a speech at the 2009 National Charter Schools Conference.

The findings above deserve repeating: Fix-it efforts at the worst schools have consistently failed to generate significant improvement. Our knowledge base about improving failing schools is still staggeringly small. And exceptional urban schools are nearly always start-ups or consistently excellent schools, not drastically improved once-failing schools.

So when considering turnaround efforts we should stop repeating, “The actual proves the possible” and bear in mind a different Kant adage: “Ought implies can.”

If we are going to tell states and districts that they must fix all of their failing schools, or if we are to consider it a moral obligation to radically improve such schools, we should be certain that this endeavor is possible. But there is no reason to believe it is.

Turnarounds Elsewhere

Education leaders seem to believe that, outside of the world of schools, persistent failures are easily fixed. Far from it. The limited success of turnarounds is a common theme in other fields. Writing in Public Money & Management, researchers familiar with the true private-sector track record offered a word of caution: “There is a risk that politicians, government officials, and others, newly enamored of the language of failure and turnaround and inadequately informed of the empirical evidence and practical experience in the for-profit sector…will have unrealistic expectations of the transformative power of the turnaround process.”

Hess and Gift reviewed the success rates of Total Quality Management (TQM) and Business Process Reengineering (BPR), the two most common approaches to organizational reform in the private sector. The literature suggests that both have failed to generate the desired results two-thirds of the time or more. They concluded, “The hope that we can systematically turn around all troubled schools—or even a majority of them—is at odds with much of what we know from similar efforts in the private sector.”

Many have noted that flexibility and dynamism are part of the genetic code of private business, so we should expect these organizations to be more receptive to the massive changes required by a turnaround process than institutions set in what Hess calls the “political, regulatory, and contractual morass of K–12 schooling.” Accordingly, school turnarounds should be more difficult to achieve. Indeed, a consultant with the Bridgespan Group reported, “Turnarounds in the public education space are far harder than any turnaround I’ve ever seen in the for-profit space.”

Building a Healthy Education Industry

We shouldn’t be surprised then that turnarounds in urban education have largely failed. The surprise and shame is that urban public education, unlike nearly every other industry, profession, and field, has never developed a sensible solution to its continuous failures. After undergoing improvement efforts, a struggling private firm that continues to lose money will close, get taken over, or go bankrupt. Unfit elected officials are voted out of office. The worst lawyers can be disbarred, and the most negligent doctors can lose their licenses. Urban school districts, at long last, need an equivalent.

The beginning of the solution is establishing a clear process for closing schools. The simplest and best way to put this into operation is the charter model. Each school, in conjunction with the state or district, would develop a five-year contract with performance measures. Consistent failure to meet goals in key areas would result in closure. Alternatively, the state could decide that districts only have one option—not five—for schools reaching NCLB-mandated restructuring: closure.

This would have three benefits. First, children would no longer be subjected to schools with long track records of failure and high probabilities of continued failure.

Second, the fear of closure might generate improvement in some low-performing schools. Failure in public education has had fewer consequences (for adults) than in other fields, a fact that might contribute to the persistent struggles of some schools. We should have limited expectations in this regard, however. Even in the private sector, where the consequences for poor performance are significant, some low-performing entities never become successful.

Third, and by far the most important and least appreciated factor, closures make room for replacements, which have a transformative positive impact on the health of a field. When a firm folds due to poor performance, the slack is taken up by the expansion of successful existing firms—meaning that those excelling have the opportunity to do more—or by new firms. New entrants not only fill gaps, they have a tendency to better reflect current market conditions. They are also far likelier to introduce innovations: Google, Facebook, and Twitter were not products of long-standing firms. Certainly not all new starts will excel, not in education, not in any field. But when provided the right characteristics and environment, their potential is vast.

The churn caused by closures isn’t something to be feared; on the contrary, it’s a familiar prerequisite for industry health. Richard Foster and Sarah Kaplan’s brilliant 2001 book Creative Destruction catalogued the ubiquity of turnover in thriving industries, including the eventual loss of once-dominant players. Churn generates new ideas, ensures responsiveness, facilitates needed change, and empowers the best to do more.

These principles can be translated easily into urban public education via tools already at our fingertips thanks to chartering: start-ups, replications, and expansions. Chartering has enabled new school starts for nearly 20 years and school replications and expansions for a decade. Chartering has demonstrated clearly that the ingredients of healthy, orderly churn can be brought to bear on public education.

A small number of progressive leaders of major urban school systems are using school closure and replacement to transform their long-broken districts: Under Chancellor Joel Klein, New York City has closed nearly 100 traditional public schools and opened more than 300 new schools. In 2004, Chicago announced the Renaissance 2010 project, which is built around closing chronically failing schools and opening 100 new public schools by the end of the decade.

Numerous other big-city districts are in the process of closing troubled schools, including Detroit, Philadelphia, and Washington, D.C. In Baltimore, under schools CEO Andrés Alonso, reform’s guiding principles include “Closing schools that don’t work for our kids,” “Creating new options that have strong chances of success,” and “Expanding some programs that are already proving effective.”

Equally encouraging, there are indications that these ideas, which once would have been considered heretical, are being embraced by education’s cognoscenti. A group of leading reformers, the Coalition for Student Achievement, published a document in April 2009 that offered ideas for the best use of the federal government’s $100 billion in stimulus funding. They recommended that each state develop a mechanism to “close its lowest performing five percent of schools and replace them with higher-performing, new schools including public charter schools.”

A generation ago, few would have believed that such a fundamental overhaul of urban districts was on the horizon, much less that perennial underperformers New York City, Chicago, and Baltimore would be at the front of the pack with much of the education establishment and reform community in tow. But, consciously or not, these cities have begun internalizing the lessons of healthy industries and the chartering mechanism, which, if vigorously applied to urban schooling, have extraordinary potential. Best of all, these districts and outstanding charter leaders like KIPP Houston (with 15 schools already and dozens more planned) and Green Dot (which opened 5 new schools surrounding one of Los Angeles’s worst high schools) are showing that the formula boils down to four simple but eminently sensible steps: close failing schools, open new schools, replicate great schools, repeat.

Today’s fixation with fix-it efforts is misguided. Turnarounds have consistently shown themselves to be ineffective—truly an unscalable strategy for improving urban districts—and our relentless preoccupation with improving the worst schools actually inhibits the development of a healthy urban public-education industry.

Those hesitant about replacing turnarounds with closures should simply remember that a failed business doesn’t indict capitalism and an unseated incumbent doesn’t indict democracy. Though temporarily painful, both are essential mechanisms for maintaining long-term systemwide quality, responsiveness, and innovation. Closing America’s worst urban schools doesn’t indict public education nor does it suggest a lack of commitment to disadvantaged students. On the contrary, it reflects our insistence on finally taking the steps necessary to build city school systems that work for the boys and girls most in need.

Andy Smarick is a distinguished visiting fellow at the Thomas B. Fordham Institute and adjunct fellow at the American Enterprise Institute.

Today, Education Next is releasing my article “The Turnaround Fallacy,” which strongly argues that the education reform world needs to abandon its current fixation on “school turnarounds.”

Though the inclination to fix our worst schools is understandable and is often the result of the best intentions, it is misguided.  The article explains why.  Turnarounds have not only consistently failed in education; they fail in the vast majority of instances in other industries and sectors.  Moreover, and most importantly, continuing to pursue turnarounds actually inhibits our ability to build healthy urban school systems.

This is more than a philosophical debate.  Unless we apply the brakes post haste, we’re going to head down the wrong (and costly) tracks at a breakneck pace.  Secretary Duncan has been strongly advocating for turnarounds since his first days in the administration.  His U.S. Department of Education received $3 billion in “school improvement funds” through the stimulus legislation that might be applied to these activities.  One of the four focus areas for other stimulus programs, including the $50 billion State Fiscal Stabilization Fund and the much-ballyhooed $4.35 billion Race to the Top fund, is intervening in persistently struggling schools.  Duncan is also encouraging the nation’s best education reform organizations to get into this business.  In short billions of dollars, scarce human resources, and lots of young lives are at stake.

I’m as fierce a proponent as there is for addressing the nation’s worst schools and giving hope to the millions of currently disadvantaged students assigned to them.  Turnarounds aren’t the only option; we have a much, much more promising alternative.

Quite simply, we need to do what every other industry, field, and sector does to address its lowest performers.  This is the first step toward building healthy urban school systems—systems that are dynamic, responsive, and self-improving.

So what is it??!?

Give “The Turnaround Fallacy” a read and find out…

(or click below to check out an interview I did with Education Next.)