Union-Busting Corporate Giveaways in Michigan

Image from Flickr by Christopher Dombres

Michigan’s infamous Financial Martial Law is now well known to those paying attention to this sort of thing. Numerous towns, cities and jurisdictions—including Detroit Public Schools (DPS)—have already been declared financial catastrophes and had “emergency financial managers” (generally business executives) imposed on them. These managers have the authority to override or fire elected officials, lay off unionized workers, cut services, and give away public institutions (like public schools) to private, for-profit operators.

According to Detroit News.com, 800 DPS teachers will not be hired back next year, while their counterparts in the suburbs of Muskegon Heights and Highland Park will not know if they have jobs until their financial managers can find private charter companies to run them. Once these public institutions have been given away to private corporations, it will be up to the charter operators to determine which teachers get rehired, with few (if any) being allowed to retain union representation.

Muskegon Heights recently signed a contract with Mosaica, a private, for-profit charter chain, giving them control over every school in the district. The details of the deal have not been disclosed, including the amount of taxpayer dollars the district will be handing over to the company.

These corporate giveaways are intended to save the districts from financial calamity.  (Muskegon Heights has a roughly $12 million deficit, while Highland Park Schools' deficit soared is over $11 million). However, the only way this is possible (and the only way their private operators can turn a profit) is by lowering labor costs by shredding union contracts, increasing class sizes, decreasing services, and gutting pay and benefits.

Privatization of public schools in Detroit has been an ongoing problem under former financial manager Robert Bobb (see here and here). Current manager Roy Roberts has slashed teachers’ wages by 10% (in violation of their contract, but apparently perfectly legal under Michigan’s Financial Martial Law), reduced maternity leave to only 12 weeks.

Like much of the Ed Deform movement, Michigan’s unique approach depends on the fabrication of a crisis through years of tax breaks for the wealthy supported through the slashing of education and other social services. The school districts themselves are then blamed for their fiscal woes and businessmen are called in to clean up the mess, as if the public should believe that only businessmen are capable (and trustworthy) enough to solve the schools’ problems. And like the rest of the business world, these businessmen are indeed in it only to make a profit, at whatever cost to the public good. Sadly, despite the nearly daily examples of corporate greed and criminality (and the dearth of evidence that districts run by businessmen perform any better than those run by educators), the public continues to accept the notion that business leaders make good school administrators.

What’s Good for GM Is Good for American Kids, Not

Michigan Gov. Rick Snyder, like an increasing number of politicians across the country, has placed a business executive with no experience running a public school district in charge of Detroit Public Schools (DPS). The incompetent and corrupt Bob Bobb will be replaced by a former General Motors executive Roy S. Roberts as the new Emergency Manager of DPS, with the power to nullify teacher contracts, fire all teachers and privatize DPS schools to his heart’s content under Michigan’s financial martial law.

Roberts, like Bobb, has a similar sounding name and a history of serving the interests of capital. Unlike Bobb, Roberts has no direct connection with Eli Broad, which means his $250,000 salary won’t be further bloated with donations from the Broad Foundation (Bobb’s salary, including foundation support, was $425,000). It should be pointed out, though, that after his stint at GM, Roberts worked for Reliant Equity Investors, alongside Thomas Darden, who did attend the Broad Superintendent’s Academy before being hired as an administrator in Philadelphia (See Broad Academy website). Presumably they shared notes from time to time?

However, the lack of official Broad support will probably mean very little when it comes time to close the DPS budget gap. Roberts will be under the same pressure as Bobb to get results in a district that has a rapidly shrinking student population and funding stream and shares Bobb’s cockiness. The Wall Street Journal quoted him saying, "I'm not going to let anybody in this state deter me." Roberts, like Bobb, is fully invested in the reform mania plaguing the nation.

The WSJ said that Bobb’s agenda of closing and privatizing schools was being called into question, especially by the governor, implying this was the reason for the change of guard. However, considering the governor’s love for big business, a more likely explanation for Snyder’s displeasure with Bobb was his failure to close the district’s budget gap, stabilize enrollment or win the support of parents. Perhaps Bobb was not ruthless enough in his attacks on teachers, and Snyder wants someone with more business experience to be his axe man in Detroit. Roberts would certainly be the man for the job, having served as Vice President in charge of personnel at GM in 1987.

Roberts himself lends credibility to this hypothesis, saying he intends to continue with Bobb’s plan to close 14 schools and convert up to 45 others to charter schools by next year, according to the Detroit Free Press, a move that demonstrates his allegiance to private business and his disdain for teachers.

Detroit Mayor Asks God to Close Budget Gap

Huck/Konopacki Labor Cartoons

Detroit’s mayor Dave Bing was quoted in the Wall Street Journal saying "I'm not afraid of an emergency financial manager being named . . . he or she almost becomes god and can do whatever is necessary to bring financial stability back." Bing could be anointed god of Detroit under Michigan’s Financial Martial Law legislation, which allows the Governor to declare any city or school district a failed state and impose a financial manager who has the authority to shred union contracts, fire everyone (and let some other god sort it out later.) Bing, a Democrat, has already slashed city workers' health care and pensions to close a $200 million city budget gap. However, he said that if city unions refuse to agree to rollbacks, the budget gap could reach $1.2 billion by 2015, setting up the unions as straw men to justify declaring financial martial law in Detroit.

Detroit Public Schools (DPS) has already been declared a failed state and has had its own financial manager, Robert Bobb, for several years now. Bobb has taken advantage of his god complex by sending out pink slips to every one of DPS’ 5,466 employees, according to the WSJ, including all of its teachers and 250 administrators. Reuters reports that Bobb has pledged to use his powers as financial manager to address the school districts $327 million budget hole, threatening to make unilateral changes to teacher contracts and abolish seniority rules. Bobb has already shut down dozens of Detroit schools and plans on closing dozens more or converting them to private charter schools.

Meanwhile, opposition has already begun, with at least twelve students and teachers occupying the Catherine Ferguson Academy for pregnant, parenting teens, to prevent it from being shut down, according to the Daily Censored. The protest was organized by the group By Any Means Necessary, which fears that the school will be converted to a charter school and cease to provide services for pregnant and parenting youth. Hundreds of others joined the protest outside, providing logistical support for those inside the school and attempting to block the police from entering. Eventually, though, the protesters were arrested for trespassing and taken to jail, including young mothers and their children. Police threatened to turn their children over to Child Protective Services. However, the children were eventually released back to the parents, all of whom were cited and released.

Detroit’s Continuing School Problems

Robert Bobb, now in the final months of his contract as state-appointed emergency financial manager for Detroit Public Schools (DPS), has failed to close the district’s budget deficit, which currently stands at $327 million. He has shuttered dozens of schools and privatized many others. He has also proposed closing half of DPS’ remaining schools (which would raise class sizes to 62) or privatizing 41 within the next six months. The Detroit Free Press says that this would make DPS the 2^nd largest chartering district in the nation. However, many charter operators believe it is impossible to achieve Bobb’s ambitious goal within his 6 month timeframe.

DPS plans to release the list of schools slated for privatization within the next week and will choose charter operators within a month. The Detroit Free Press says that KIPP, Edison and Green Dot are not interested in DPS, but White Hat and Leona (both for-profit) are interested. It is indeed unlikely that White Hat and Leona, alone, could take over 41 schools and have them all up and running by fall. Furthermore, the charter plan is opposed by teachers who would lose their contracts and union protections, and possibly even their jobs in the conversions. DFT President Keith Johnson says the conversions won’t happen under his watch, but there have already been dozens of charter conversions under his watch, as well as numerous cuts to teachers’ pay, benefits and working conditions. Detroit teachers should not count on Johnson to look after their interests.

If the charter plan does not fly, Governor Rick Snyder could simply shut down DPS entirely under Michigan’s new financial martial law legislation, thus nullifying all existing contracts with teachers and support staff, and place the district in the hands of a new financial manager. This would allow Detroit to create a new district from the ground up with all new contracts offering much lower wages and benefits. While this would not instantaneously achieve the Bobb/Duncan/Broad goal of privatizing all the schools, it would certainly weaken the union and bring them a step closer.

Bob Bobb the Terrible, Poised to Become Michigan’s First Dictator?

Robert Bobb, the Emergency Financial Manager of Detroit Public Schools (DPS), has proposed turning 41 “failing” schools over to private charter companies, according to The Detroit News. Under existing law, this decision would have to be made by the elected Board of Education. However, under Michigan’s new “Financial Martial Law” legislation, the power to make that decision would transfer entirely to Bobb.

The financial state of DPS is certainly grim and Bobb’s proposal would reportedly save the district as much as $99 million. However, this is not the real motivation for the plan. If Bobb truly wanted to save the district money and help it out of its fiscal morass he would be doing something to keep students enrolled in DPS. There are currently 8,000 students fleeing the district each year as he cuts arts, music and other programs and increases high school class sizes to 60. (The loss of students is costing the district of $58.4 million per year). Furthermore, since he began his tenure, Bobb has actually overseen a worsening DPS’s debt by $127 million, according to Michael Winerip, of the NY Times, suggesting that he is grossly incompetent or has ulterior motives, either of which should be grounds for purging him from his job.

Many critics believe the latter is the case. Since taking over, Bobb has overseen the closing of many DPS schools and plans to shutter 50% of the remaining schools, and he has already turned over many to private charter companies. Bobb is a graduate of Eli Broad’s Superintendents Academy (class of 2009), which trains CEOs and business leaders how to privatize public school systems and he receives a portion of his salary ($56,000) from the Broad foundation, which should be considered a  conflict of interest..

Under the new legislation, Bobb would have total authority over academics and curriculum and have a free hand in converting schools to charters. He would be able to nullify the existing contracts with teachers and support staff, effectively crushing their unions and allowing him to further attack their wages, benefits and working conditions. In 2009, the school board sued Bobb and stopped him from making academic decisions, including charter conversions. So he has an axe to grind with them, too, and will soon have the authority to crush them, along with the unions.

Detroit Students Win A Small One Against Bobb and Broad

As I have reported several times on this blog, Detroit Public Schools (DPS) Financial Manager Robert Bobb has been slashing and burning DPS, closing up to half of its schools, and raising high school class sizes to 60 students per class. Bobb has not limited his axe to schools. He has also been cutting arts, music and other programs at many schools. At Southeastern High, students decided to fight back against cuts to their music program with walkouts and a press conference, ultimately winning the right to perform at a statewide choir competition. The following is based on the reporting of Danny Weil, from Daily Censored, and Diane Bukowski, from the Voice of Detroit.

Bob Bobb insisted that cutting the arts/music program (along with his other cuts) was necessary to keep the district solvent. The students insisted he was wrong, walking out of school three times in order to prove it. They also engaged in a sit-in at their school where they were maced by the police. Ultimately they won authorization to compete in the Michigan School Vocal Music Association Choral Festival on March 11.

Bobb was installed as a financial manager ostensibly to help get DPS’ finances in order. In reality, he has helped worsen DPS’s financial problems, increasing the system’s debt from $200 million when he arrived, to $327 million today, according to Michael Winerip of the NY Times. Meanwhile, 8,000 students per year are fleeing the district, costing the district $58.4 million per year. For this financial mismanagement he is paid $425,000 per year.

Last week, the Michigan legislature approved a bill that would allow financial managers like Bobb terminate the teachers’ contract. On the other hand, he could simply convert all the remaining schools into charters and terminate their contract this way. Currently, 50% of Detroit students are already in charter schools, and there has been talk of converting the remaining schools into charters. Last Saturday, Bobb presented a plan to convert one-third (41) of DPS schools into charters.

All this might seem hard to believe except that Bobb is a disciple of Eli Broad, the billionaire charter school funder and union-basher (and Detroit native). Bobb is a graduate of Broad’s Superintendents Academy (class of 2009), a 10-month training program that teaches CEOs and other business types how to squeeze as much profits as possible out of public school systems. Bobb receives a portion of his generous salary ($56,000) from the Broad foundation, which would appear to be a conflict of interest since Broad supports private charters and Bobb has been facilitating their creation in Detroit, yet a judge ruled this ok last year.