Part III

Opening a Market in School Improvement

On paper, the passage of No Child Left Behind opened up a k-12 market dominated by a handful of publishers. It promised to change transactions with school districts from a sale of inputs to outcomes. Educators would stop purchasing “textbooks,” “software” or “workshops” and start buying “improvements in performance.” By requiring that federal education funding be used exclusively to purchase products, services and programs proven effective by evaluation, NCLB threatened to replace brand as a sign of quality with demonstrated results.

School reform laws are not self-executing. Federal legislation does not create markets in public education; people do. Entrepreneurs must set up shop. Investors must bet on the new market and its entrepreneurs. Buyers must be educated on their options and understand the rules. Established firms and institutions advantaged by the old regime must give way.

In principle, by blunting the big publisher’s marketing presence, the new law made it possible for very small firms to compete directly with multinational corporations. Literally hundreds of school improvement providers formed during the state-based standards and accountability movement (and covered in edbizbuzz.com, New Education Economy® and School Improvement Industry – Provider Announcements), and their venture investors, saw NCLB as their great opportunity.

Participants in the development of charter schools of Supplemental Educational Services (SES) will say that government is the most important factor in any public education market. Elected and appointed officials, and their civil service staff, implement the law. They must turn legislation into regulation. They must act in ways that encourage market development. In situations that affect real buyers and sellers, they must make decisions that observers believe are equitable and reasoned. If government officials send discouraging signals to entrepreneurs and investors, market growth will slow. Indeed, there may only be a market on paper.

Implementing Reading First

The emerging school improvement industry saw Reading First as the first stage of development in a school improvement industry based on federal law. Many new, small providers offered literacy programs with strong or at least promising records of evaluation. In contrast, the major publishers’ programs had few if any demonstrations of efficacy. The stricter the translation of “scientifically based reading research” (SBBR) into evaluation requirements, the more likely the major publishers would loose substantial portions of this $1 billion a year market to the upstarts.

Unlike SES, in the case of Reading First, states and school districts seem to have acted in good faith to participate in the development of rules to encourage an equitable market. The federal government - or to be more specific, its officials - did not. Federal-state negotiations deviated from historic patterns in one very significant respect. With the passage of NCLB, the education agencies were not meeting as co-equal sovereigns. If states wanted to make use of federal funds provided under NCLB, they were required to do as the U.S. Department of Education decided on matters that went to the heart of teaching and learning. Politics beyond the four corners of the legislation would certainly be brought to bear on the deliberations, but under NCLB states lost the ability to take the money and do as they thought best. 

We now understand that Federal officials interpreted SBBR in a way that permitted most of the major publishers' literacy programs into the market. The Department of Education’s Reading First program director, Chris Doherty, had been a foot soldier in the Reading Wars and perhaps even more thasn his Republican superiors was ideologically committed to phonics. Doherty et al decided not to interpret the SBBR provision to require that the effectiveness of specific literacy programs be evaluated. Instead, they determined that phonics was the only effective approach to literacy and that with Republican control of the federal government politics declared phonics victorious in the Reading Wars. Therefore, programs associated with the academic literature on phonics met the SBBR requirement;  programs not closely tied to phonics were presumed not to fall short regardless of their evaluations of efficacy. The exceptions to this rule were program providers like Success for All that could be slighted, but had too much political clout to be disregarded entirely. In contrast, Reading Recovery's managers lacked the pull of Bob Slavin and could be ignored completely, irrespective of the scientific evidence.

To be fair to Doherty and others, it is worth pointing out that the decision to interpret the phrase “based on" in Reading First's SBBR provision as “associated with” was adopted by the Department in the 1998 Comprehensive School Reform Demonstration Program. However, elucidation of the SBBR requirement in NCLB leaves far less room for any interpretation other than “proven by.”

Moreover, there is no reason to believe Doherety and other officials made their decisions in order to profit financially. As sympathetic partsans Mike Petrilli and Checker Finn have said, they were simply carrying out oders under the Administration's pro-phonics policy. It may have been unlawful and worthy of individual punishment, but it was motivated by ideology rather than greed.

Part IV:  Enter the Academic Consultant