The Bland Accuracy of the GAO

Today the GAO released an evaluation of District of Columbia Public Schools (DCPS). Long known as one of the worst-performing districts in the country, it has been the site of radical change in the last two years ever since Mayor Adrian Fenty took over the schools and hired Chancellor Michelle Rhee. Today's GAO report is both a sober reminder of how hard change is, as well as a refresher course on just how bad things were.

Change is hard, and the implementation has been anything but smooth:

DCPS lacks certain planning processes, such as communicating information to stakeholders in a timely manner and incorporating stakeholder feedback at key junctures, which would allow for a more transparent process. In addition, DCPS did not gauge its internal capacity prior to implementing certain key initiatives, which, if addressed in the future, could help ensure the sustainability of initiatives. Without these planning processes, an organization risks having to revamp initiatives, leading to delays and compromising the implementation of timely, critical work. While having these planning processes in place will not eliminate all implementation issues, it will help to identify and mitigate risks associated with implementing bold initiatives and identify needed changes in the early stages of the initiative. Furthermore, a lack of these planning processes can result in decisions that are made on an ad hoc basis with resources unevenly distributed as was the case with the District’s new staffing model. Ultimately, the lack of such processes while planning and implementing initiatives has impeded the success of some of DCPS’s initiatives and could impede the District’s continued success and progress in reforming its school system.

But it was needed:

To increase accountability of its central office, DCPS developed an accountability system and an individual performance management system for central office departments and employees. The central office, which is responsible for providing academic and nonacademic supports47 to DCPS, had operated without such accountability systems prior to the recent reform efforts. For example, previously, performance evaluations were not conducted for most DCPS staff. As a result, central office employees were not held accountable for the quality of services they provided to support schools.

It's no wonder Chancellor Rhee inherited a central office where employee records were kept in boxes, paychecks were often inaccurate, and repair orders went unfilled for long stretches of time: the employees responsible for these tasks were never evaluated on whether these assignments were completed. It's worth remembering that what most people take for granted as a basic element of a well-functioning organization, evaluating employees and holding them responsible for completing their work, isn't so basic everywhere.

Just Asking

To all those who argue mayoral control of schools is bad for democracy, isn't it a good thing that schools are the issue in this year's New York City mayoral race? There's an incumbent mayor up for reelection using his success running the schools as his major claim, and now we have a challenger disputing those claims, issuing audits, and questioning the data. Someone please explain to me how schools could be more accountable to the public.

The Libertarian's Dilemma, Cont'd

Last week I wrote that the problem of runaway college spending presents libertarians with something of a dilemma, because, "the best way to bend down the long-term higher education cost curve and thus reduce government spending is to increase government regulation in the form of mandatory reporting [of information about institutional performance]."

Unsurprisingly, Neal McCluskey of the libertarian Cato Institute disagrees. I think he's unpersuasive, but before I explain why it's worth reviewing the central argument of the paper that prompted this discussion, The Revenue-to-Cost Spiral, by Robert Martin, published by the conservative John William Pope Center for higher education policy.

Martin begins with the principal / agent problem, an issue that's endemic in large modern organizations. Essentially, the problem arise when the interests of people who own or otherwise have a stake in an organization (the principals) are misaligned with the people who actually run the organization (the agents).

For example, a few years ago the shareholders (i.e. principals) of insurance giant A.I.G. employed a guy (i.e. an agent) named Joseph Cassano who sold billions of dollars of insurance to other large financial companies, essentially protecting them against the risk that their securities backed by sub-prime mortgages would become worthless in the event of a huge real estate market collapse. Cassano was paid tens of millions of dollars based on the short-term profits A.I.G. booked, some of which he used to buy a really expensive house in the Knightbridge section of London. Now A.I.G. shareholders have been devastated, but Cassano still owns the house.

In higher education, Martin argues, the principal / agent disconnect is less about risky profit-taking and more about status. Colleges are inherently status-maximizing institutions, even if the principals--taxpayers, donors, and students--would rather colleges focused on a different set of priorities, like giving every student a high-quality affordable education. As Martin writes,"senior administrators can persuade themselves that lavish offices, extensive building projects, expensive public relations events, luxury travel, and high compensation are in the institution’s interest. Board members may consider expensive social events to be in the institution’s interest." The same could be said for giving too much weight to the research mission at the expense of teaching and lots of other things.

How do you get more status, particularly in an industry where reputations are seemingly as ancient and permanent as the stone buildings themselves? You buy it, by purchasing nicer buildings (old-looking stone is a popular choice of materials) and more prominent researchers and students with better SAT scores. Or you just let it accumulate in the endowment, also a major benchmark of prestige. All of this dovetails with Bowen's revenue-to-cost-hypothesis: college spending is capped only by revenues and colleges have every incentive to spend, so they constantly build up fixed costs, raise more money, spend more money, raise more, spend more, and so on.

Martin's solution? More information. To mitigate the principal / agent problem, give the principals more data so they know what's really going on. And the government has to play a role:

[Reform] has to involve private groups, state and local governments, and the federal government. The most important federal government contribution to reform would be a significant increase in transparency requirements. The information requirements for tax-exempt status should be increased, and the IRS should conduct more and more-intense audits of these institutions. Further, the information provided to the IRS should be in the public domain immediately and available on the institution’s Web site or gathered in a single place. The federal government can also increase the quantity and the quality of the information reported to the National Center for Education Statistics (NCES).

That's the libertarian's dilemma in a nutshell--if you think seriously about restraining college costs, it brings you around to more meddling by the IRS, the Department of Education, etc.

McCluskey disagrees. "Wouldn’t the best, most direct way to “reduce government spending” obviously be to, well, reduce, or even stop, government spending?" he asks, before advocating for massive public disinvestment in higher education that would cripple thousands of institutions and shut the doors to college for hundreds of thousands of students nationwide. Well, sure! But that's like saying the best way to control long-term health care costs is to spend less money on health care. The relevant question is how. (Just to be clear: I'd like to spend more public money on higher education, not less, albeit in a way that's substantially more performance-sensitive and directed toward institutions that serve academically and economically at-risk students.)

McCluskey goes on to assert that "Clearly, we don’t need government to set standards or inform consumers – markets will do those things themselves." He notes that the market provides consumers with plenty of information about things like hamburgers and cars. Which is true in part while ignoring the government's role in mandating reporting of things like nutritional information and gas mileage.

But the much more obvious example is the way the free market has reacted to the issue at hand, higher education. The free market has given us the U.S. News & World Report college rankings, which are all about status and spending. Fully ten percent of each college's score is based on a simple measure of spending per student--the more you spend, the higher you rank. Another 20 percent is based on things that cost money to buy--low class sizes, faculty salaries, etc.--and much of the rest flows from larger reputational and selectivity factors that are directly and indirectly enhanced by spending.

In other words, the free market has created an information environment that exacerbates the runaway college cost problem that McCluskey is supposedly interested in trying to solve.

Meanwhile, George Leef weighs in at Phi Beta Cons (at the National Review) to endorse the McCluskey spend-less-money-by-spending-less-money solution, assert without evidence that there is "wildly excessive demand for educational credentials" (From who? The private sector employers who have freely chosen to pay more and more for those credentials over the years?) and essentially disavow the central conclusion of a paper published by the Pope Center, where he (Leef) happens to be the Director of Research.

Jane Shaw, president of the Pope Center, also rejects Martin's proposed solution, saying:

Wouldn’t it be better if schools were motivated to provide the information that their customers — parents and students — want? Different schools could provide information suited to their potential customers. Wouldn't it be more valuable to have information along the lines of Princeton Review's multi-dimensional ratings, which tell you, say, where the party schools are — and let students decide whether those are positive or negative features? I believe that we would have a richer, more satisfying marketplace for education that way than we would with a mandatory website containing statistical "student-learning outcomes" that end up looking rather similar to one another. Rather than asking the federal government to intervene (which it does much too much of already), let's figure out ways to empower the customers.

"Motivated"? What would motivate a college to disclose information that didn't flatter the institution and burnish its status and reputation? Look, I'd be pleased as punch if colleges disclosed the good with the bad out of a sense of civic obligation, but I'm not going to hold my breath. And I'd sort of assumed that the steely-minded conservatives over at the National Review would have a similar view of human nature. There's no contradiction between Shaw's hope for multi-dimensional ratings, which I support, and a transparency agenda. But it's naive to think that colleges are going to get there on their own, which leaves one option--the government, like it or not.

Reviewing the Review of What Happened in Montgomery County

Jay Mathews reviews the new book Leading for Equity, which chronicles Montgomery County’s successes, so far, in closing the achievement gap. Straight out of the gate, Mathew’s is right about one thing —the six “lessons” are convoluted and sound more like titles for paper submissions to AERA than book chapters (Lesson 1, for example: Implementing a strategy of common, rigorous standards with differentiated resources and instruction can create excellence and equity for all students). But his critique of the book as too process-oriented is wrong. Process has tripped up many a reform and understanding what sequence of events and efforts lead to change is key to any district’s improvement strategy. Sit in on union-district negotiations, listen to testimonies at board and council meetings, dig into PTA minutes going back ten years and more, and you’ll see that Weast’s success is one of process---getting a strategic collective of people (aforementioned) to make difficult decisions for the right reasons.

Central to this success, which the book describes, was the mapping of two zones of affluence—the wealthier Green Zone and the less-affluent Red Zone—that illustrated for all the inequities of the county and its schools. As someone who was educated by MCPS (in the Red Zone before it was the Red Zone), and is now sending my son to MCPS (still Red Zone), I know the practical implications of living in the lesser of the zones. My kids will go to school with a lot of kids who don’t have as much as they do, who have parents that work two jobs and who don’t speak English and who don’t walk them to school every day or read with them every night or schedule extra conferences with their teachers. But they will also be in schools that give a little extra to these kids to even the playing field—from the initial full day kindergarten program to the extended learning opportunity summer sessions that are going on right now.

Mathews says the book misses the real story, which is how MCPS gets and keeps great teachers. I agree that human capital tops the list of public education concerns and that MCPS is successful largely because it has quality teachers, but I’m unconvinced that the story of Montgomery County rises and falls on the teacher reforms. MCPS has done a lot to improve teaching and teachers—its professional growth system, for example, is touted as one of the best in the nation. But Superintendent Weast’s struggle to close achievement gaps is not merely a teacher problem, at least not the way Rhee’s might be in DC. Getting and keeping great teachers in all MCPS schools is a product of the county’s convenient close-in spot to DC (it would be great to know, by the way, the % of MCPS teachers than are spouses to the federal government, think tank and World Bank trifecta—count my family as one) and its ability to offer a job that’s better (in pay and otherwise) than PG and DC school systems.

The real story is about how a county that was unaware of or unconcerned with school inequities, or both, bought into a differential approach to schooling that has resulted in significant gains for the poorest kids. This doesn’t always happen, is still quite contentious, and is definitely a long, involved process—one that is as important as it is difficult to capture.