Portfolio Districts: One Ring to Rule Them All

By 01/30/2015

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We’ve been having a good discussion this week about portfolio districts and the best way to regulate choice schools.  I’ve written on this topic before, but let me try to explain more clearly why I am wary of portfolio districts, mayoral takeovers, and other proposals for a super-regulator to govern all choice and traditional schools.

I understand that all school systems, choice or traditional, require some regulation.  And I understand that all regulatory schemes are susceptible to capture by status quo interests.  But it is wrong, as Matt Ladner and others have suggested, to just throw up one’s hand and say that eternal vigilance is the price of good policy or that in the long run we are all dead. Some regulatory approaches carry more risks of capture than others and may produce fewer benefits.  We should consider the incentives created by different regulatory approaches to think about what we should prefer.

In general, centralized, monopoly regulators are more susceptible to capture than decentralized, multiple regulators.  The problem with portfolio districts is that they are trying to be one ring to rule them all.  They govern traditional, charter and (under some proposals) publicly subsidized private schools.  They decide which schools should be allowed to open, which should be closed, which empty spaces should be allocated to whom, and they impose testing, transportation, and other regulations on all.  Supporters of portfolio districts may think that Sauron was offering his hand to help, but Gandalf understood the danger of concentrating power:

Don’t… tempt me Frodo! I dare not take it. Not even to keep it safe. Understand, Frodo. I would use this ring from a desire to do good… But through me, it would wield a power too great and terrible to imagine.

Well, portfolio districts don’t quite pose the same risks as the One Ring, but the logic of the danger is the same.  The ability to control who operates all types of schools and what regulations govern them is too much power not to attract bad people to it or to corrupt those who possess it.

The solution is to decentralize power so that schools are governed by multiple regulators.  It’s better to have the entity responsible for authorizing charter schools be separate from the one regulating traditional public schools.  When school districts or a state board of education is the sole authorizer of charter schools they are likely to be captured by traditional public school interests and approve few charters or even mischievously approve bad charter operators or charters that focus only on groups of students traditional public schools don’t mind losing so much (adjudicated youth, pregnant teens, dropout recovery, etc…).  When a single authority imposes a single set of standards, single curriculum, and single set of tests, there is real danger of regulatory capture by status quo interests.

When that power is dispersed, it is too hard to capture all of them and they compete with one another to keep regulations reasonable.  This is the logic behind separation of power and federalism.  It is the virtue of Tiebout choice.  The superiority of dispersing and checking power was understood by the founders.  It was understood by Montesquieu.  It was really Woodrow Wilson who launched a full-frontal attack on the idea of dispersed power and it is his progressive descendants who continue to this day to believe that they can wield the One Ring for good.

All of this being said, I can understand the argument for temporary concentrations of power for the purpose of creating its long-term dispersion.  Perhaps the only way New York City could get a thriving charter sector was for Bloomberg to concentrate power in his own hands and create scores of charter schools within existing public school facilities.  The creation of those charter schools dispersed power enough so that de Blasio could be blocked in his attempt to close them and re-centralize power into his own hands.

Even the American Revolution required the concentration of power in the hands of General Washington so that we could be freed from the British monarchy and create our new system of separated powers and federalism.  The danger is that in temporarily concentrating power we might end up with Napoleon instead of Washington.

My concern with the portfolio district backers is that they don’t see it as a temporary measure to create a system that ultimately disperses power.  They see it as the ultimate goal.  And in that I believe they are completely mistaken.

– Jay Greene

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