I’ll admit it: while she’s not perfect, I’m still a huge fan of Michelle Rhee, what with her “let’s not mince words” style and her all-in approach to school reform. So it’s not surprising that I found her Wall Street Journal “manifesto” (co-signed with her former boss, Adrian Fenty) to be worthy of several cheers and hurrahs.

For sure, I found it somewhat lacking in humility (a common problem these days), particularly the assertion that “most people know at least the basics of how to turn around our urban school systems.” But it was also disarmingly honest in one respect: she (and Fenty) admitted that their reforms relied upon money they didn’t have:

We bargained with the teachers’ union for 2½ years and won significant concessions. How did we do it? By striking the sort of grand bargain that could serve as a model for other troubled school districts. The formula is really quite simple: more money and resources, in exchange for more accountability from teachers….

D.C. went for more than two years without a new teachers’ contract, but we kept at it. Since the city did not have the money for a significant raise, we implored several foundations to consider providing the resources to enact a groundbreaking contract. The funders, including the Broad Foundation and the Walton Family Foundation, were clear that they would put up the money, but not if they were only backing a marginal improvement. The contract had to set a new precedent.

These might be the two most important paragraphs in all of school reform today, because they demonstrate the corner we’ve backed ourselves into: making reform conditional upon more money. (It’s not just D.C.; think Race to the Top, too.) Guess what: the money is drying up. So now what?

The most likely course, over the next few years, is for the budget crisis to stop reform in its tracks. It’s hard to buy off the unions when school revenue is actually declining; say goodbye to “grand bargains” that allow teacher accountability, merit pay, or charter schools to flourish.

Reformers need a new playbook. We need to learn how to promote reform via budget cuts–for instance, pushing to end “last in, first out” not just because it’s wrong, but because it’s expensive. (Why fire all of your youngest, cheapest teachers when a bunch of well-paid veterans are no longer getting results?)

But this will be much harder than riding the “reform plus results” wave as Rhee and Fenty, Klein and Bloomberg, and most other reformers have been able to do in recent years. Who will lead the way? And what, exactly, will their manifesto say?