Millot: Where I'm Headed With These Series On Abuse in the Charter Market
Markets don’t work very well for society if participants can’t trust the information provided by research, sellers are prepared to bend and then break the law in pursuit of their business plans, buyers lack the capacity or motivation to pursue quality outcomes, regulators can’t be expected to base decisions on objective facts, and the people managing the hundreds or thousands of market actors don’t take their duty of loyalty seriously. Public markets, funded by the taxpayer and even more reliant on good faith and transparency, work even less well.
The market for public charter schools isn't working well enough to scale.
Most people, most firms, most institutions in the charter market are not bad actors. They may not succeed as well as we would like, but they are trying to balance their own interests with those of students, teachers, taxpayers and society. Most people - yes, even most in the for-profit sector - lean towards students.
This is good, but not good enough. The financial crisis taught us that if bad actors are tolerated too long, they gain a competitive edge that forces everyone else to follow suit, creating an ethical race to the bottom that will eventually, inevitably destroy the market. There are reasons to believe the highly fragmented “national” charter market is poised to follow suit.
Over the last several months, I've used academic fraud at think tank Education Sector and CMO Imagine's disregard for the statutory independence of charter schools to draw attention to serious shortcomings in the charter market's research and provider sectors. Monday, I'll begin to analyze how political pressure from Massachusetts' Secretary of Education led its Commissioner of Elementary and Secondary Education to see that a charter was approved by a state board "in violation of the provisions of law, regulation, and procedure.... never validly awarded and should be deemed void ab initio."