Your weekly rundown of news and analysis about the privatization of education, water, and other public goods—and about the people fighting back. Not a subscriber? Sign up.

Highlights

1) National: In the Public Interest is introducing online teaching sessions for policymakers, organizers, and advocates on ways to govern in the public interest. The trainings and teaching sessions will include:

  • How to prevent the privatization of public goods
  • The 40-year war on democracy… and the long game for the common good
  • What’s the deal with charter schools and private school vouchers?
  • How privatization increases inequality and furthers systemic racism
  • Understanding infrastructure financing and public-private partnerships

Interested? Email info@inthepublicinterest.org. 

2) National: In a major speech at a Pittsburgh union hall [transcript], President Biden has announced the broad outlines of a $2 trillion infrastructure development initiative rivaling FDR’s New Deal and Eisenhower’s interstate highway program. It includes spending on bridges, transit, ports, broadband, the electric grid, electric vehicle development, clean drinking water and more. The administration hopes a bill can be passed this summer. A second bill on what the administration calls “human infrastructure” (including education, family care and healthcare) is expected to be unveiled in the coming weeks.

The battle in Congress over the content of the bills will be intense, and the lobbying expenditures massive. At stake is a paradigm shift in how Americans view the role of government. Success at passing a bold bill would mark the end of the dominance of a 40 year war on government begun by the right wing infrastructure under Ronald Reagan—specifically the Heritage Foundation (see here and here). Heritage is now waging a desperate bid to block Biden’s agenda. If a corporate tax package passes to help fund the plan, this would also be a blow against the Prop 13  mentality, which has obstructed California’s public services and infrastructure for decades. The government will have climbed out of Grover Norquist’s bathtub. But the Washington Post’s Greg Sargent says “given that Republicans seem to have ruled out supporting Biden’s call to fund it all with a corporate tax hike, it’s hard to see many Republicans supporting anything other than infrastructure via a tax-break-and-privatization scheme.”

As In the Public Interest’s Jeremy Mohler has written, a key issue is whether the infrastructure bills will be hobbled by privatization and a lack of commitment to redressing decades of racial discrimination in infrastructure policy. “Decades of tax cuts have shrunk infrastructure spending at all levels of government. As roads, transit, schools and water systems break down, a growing industry of private equity investors, construction giants, and global water companies have sprung up, selling public-private partnerships—i.e. private financing—as a silver bullet. Everything from toll roads to university dorms have been financed with expensive private capital, often increasing costs for the public and handing over control to faraway investors. Poor and working people, particularly those of color, have shouldered the worst outcomes of these trends.”

These battles will largely take place behind the scenes, in legislative drafting sessions and leadership conferences over whether so-called public-private partnerships will be part of the legislation, whether the private water companies will grab the water infrastructure funding, whether the broadband oligopolies will grab the broadband money, whether the privatization industry will grab transit money (as in Maryland’s Purple Line) and school construction money, and so forth. 

Will the infrastructure bills get less bang for the buck because private corporations will be siphoning off a big slice of the money to pad their bottom lines? As Corporate Accountability says, “infrastructure should be funded by the public sector and for the public good. This includes through progressive taxation to ensure these costs are borne by those most able to pay—billionaires, millionaires, and the corporations who have exacerbated the crises we face today—not low-income people or communities. No incentives for privatization (including  ‘public-private partnerships’), which have failed time and again across sectors.”

3) National/Think Tanks: What would happen if we actually taxed the rich? Robert Reich has a few ideas.  “It’s not radical to rein in this irresponsibility. It’s radical to let it continue,” he writes. On Friday, the Institute on Taxation and Economic Policy released a report showing that 55 corporations paid $0 in federal taxes on their 2020 profits.

4) National: The Interior Department says it will create nearly 19,000 jobs through improvement projects in national parks, wildlife refuges and Bureau of Indian Education schools through funding allocated last year from a bipartisan conservation bill. “We must address the long-delayed maintenance needs of the nation’s aging buildings and infrastructure. Importantly, this funding also honors our commitment to Tribal communities by investing in Bureau of Indian Education-funded schools for current and future generations,” says Interior Secretary Deb Haaland. 

5) Missouri: Federal stimulus money will help neighborhoods that were supposed to benefit from the failed airport privatization deal in St. Louis, reports the Post-Dispatch. “The infusion of federal money comes less than a year after some area leaders ended efforts to lease St. Louis Lambert International Airport to a private operator. The rationale for that effort was that a lease could provide as much as a $1 billion upfront payment to the city to pay for dire needs and investment in the region’s poorest neighborhoods in north St. Louis.”

6) New York: State Senator Jessica Ramos (D-Queens) says “#HALTsolitary has been signed into law! Thanks to the leadership of @JuliaCarmel & AM Aubry & tireless work by advocates like @NYCAIC @CCA_NY & many others who saw this fight to the end, no NYer will be subjected to the inhumane practice of prolonged solitary confinement again.” 

Education

7) National: Public schools lose over $2 billion a year to corporate tax breaks. According to Good Jobs First, economic development tax abatements given to corporations cost public school districts $2.37 billion in foregone revenue in fiscal year 2019. That’s an increase of 13 percent—a $273 million jump—from just two years earlier and came during the pre-pandemic period of economic prosperity. Good Jobs First: How Students Pay for Corporate Tax Breaks.

8) National/Think Tanks: Bloomberg CityLab points to new research showing that corporate tax breaks are eating into school funding. “Quantifying the immediate and long-term impact of such blockbuster tax-break deals is the focus of a new report from the nonprofit think tank Good Jobs First, which tracks and analyzes tax abatements and incentives given to corporations in the name of boosting economic development. The report concludes that such arrangements cost U.S. public school districts at least $2.37 billion in fiscal year 2019—an increase of $273 million from two years prior, or a 13% bump. It follows the nonprofit’s 2018 report tracking what its researchers call an ‘intergovernmental free lunch,’ where one part of local government spends another part’s money.”

9) Florida/Think Tanks: Jennifer Berkshire points us to a League of Women Voters Florida Education Task Force report (p. 7) showing that “Step Up for Students,” the organization that administers Florida’s voucher program “has ballooned to become the 21st largest charity in the U.S., with assets of $618 million.” Step Up’s board of directors and advisory board include a charter school lawyer, a private equity co-founder, a federal congressperson, the Speaker Pro Tem of the Florida House, someone who “spent 10 years at Burger King Corporation in various finance roles and operations,” the “Director – Sales & Use Taxes at HCA-Hospital Corporation of America (HCA)” and a lobbyist for Waste Management.

10) Indiana: In a letter to the editor of the Goshen News, Ron Chupp says vouchers are being used to skirt the separation of church and state. “I read the recent article stating that Republicans were “resolute” on their desire to expand school vouchers. Of course they are. Let’s be real. Vouchers are their way of trying to privatize public education so their cronies can get rich from educating our children, without using the word “privatization.” When Mitch Daniels was governor we didn’t have any money for schools, until the day after the Legislature approved his voucher program. He immediately “found” another $400 million, which all went to his buddies’ charter schools, many of which are Christian schools. Face it; vouchers are Republicans’ way of using our tax dollars to skirt around the issue of separating church and state.”

11) Iowa: Charter schools, but not vouchers, advance in the state legislature. “Among Thursday’s second ‘funnel’ casualties were Gov. Kim Reynolds’ proposal to provide state-funded ‘students first’ scholarships to private school families—known popularly as vouchers.” In the Senate, “members of the Senate Education Committee approved House File 813, a bill that would allow an expansion of charter schools as an alternative to traditional public schools. Proponents say charter schools would foster innovation, opportunities and educational choices. The measure would allow a founding group to apply directly to the state Department of Education to form a charter school. The bill would retains the current method of applying to a local school board to create a charter.

12) Kentucky: Republican lawmakers overrode Gov. Andy Beshear’s veto of a bill that promises to make it easier for students to attend private schools or cross district lines. “According to Beshear, the bill will siphon hundreds of millions from public education to unaccountable private organizations with little oversight. House Bill 563 creates a $25 million tax-credit scholarship fund giving Kentucky families an option to send their kids to different school districts or private schools by paying for school tuition, tutoring and other educational expenses. (…) The Kentucky Association of School Superintendents also voiced opposition to what it described as ‘the privatization of public funds for education through tax credits for educational opportunity accounts.’”

13) New York: The Buffalo School Board has voted to shutter two city charter schools. “The school board voted to close both schools saying they are underperforming. (…) According to a Buffalo Schools spokesperson, ‘the Buffalo School Board has directed the superintendent to collaborate and develop a plan with each school to protect the educational stability of the students for next year and beyond.’”

14) New York: A charter school is suing Hempstead Village over an apartment project. “”School officials and parents of the 2,000-student K-12 school have opposed the project, citing concerns of traffic and the safety of students walking between the school’s two buildings. The charter school filed a lawsuit in Supreme Court in Albany in February appealing the village’s ruling.”

15) New York: Prospects for charter school expansion at the state level are DOA. “State lawmakers and an embattled Gov. Andrew Cuomo are blocking a bid to significantly expand access to charter schools.” Democrats “are resisting any lifting of the charter cap, which is set at 460 statewide, with 290 of those slots set aside for New York City.” So “negotiations largely center on a much more modest proposal: reauthorizing 20 so-called “zombie” licenses to new charter school applicants. These currently unused charter licenses were issued for charter schools that closed, for example.”

16) Oklahoma: The first legal challenge to a charter school funding deal has been filed. “Oklahoma City Public Schools went to district court and filed a petition challenging the state board’s authority in the matter and seeking a temporary restraining order and temporary injunction to block any reallocation of revenue that currently flows only to traditional public schools. The petition also seeks declaratory judgment about how Oklahoma statutes and the state constitution’s provisions on school funding should be interpreted, as well as the State Board of Education’s authority.”

17) Pennsylvania: In an op-ed, Rep. Joe Ciresi (D) says the state’s “charter school law is old and broken—and it’s time we fix it. (…) If we’re going to treat all schools fairly — and put kids and families first — we need charters to be partners with our traditional public schools, not competitors for dollars taken from long-suffering homeowners. We need to be tough on the schools failing our kids when it comes to academics, ethics and cost. We need to reward solid performers who are innovating, while still delivering on the state’s obligations. We can do it. We can save taxpayers a quarter-billion dollars each year and make our current system better, and there’s a plan to do that—the Charter School Reform Act of 2021, H.B. 272.”

18) Rhode Island: Writing in Counterpunch, Joe Frady says Rhode Island labor will not be defeated. “Providence Public Schools have been under attack from neoliberal education de-formers for a long time. The latest crew of cynical apparatchiks, trained by Jeb Bush’s education privatization mill Chiefs for Change, are RI Education Commissioner Angélica Infante-Green and Providence Superintendent Harrison Peters. (…) Over the next several weeks, I will be posting reports for Counterpunch about how the district administration is trying to severely harm students, faculty, and staff to serve their paymasters on Wall Street. As other reporters have pointed out previously, there’s a direct link between the hedge funds that the former Treasurer Gina Raimondo invested the pension in and the charter schools now trying to destroy public education in the city. For starters, I have a note provided by Ralph Fortune, a retired teacher and union activist who has some important words of wisdom.”

19) Texas: Charter school advocates are pouring big money into a political action committee ahead of the El Paso Independent School District board elections. “Several board directors of the Council on Regional Economic Expansion and Educational Development have contributed over $60,000 into the Kids First of El Paso Political Action Committee, according to a campaign finance report. All major directors have made contributions to the PAC except for Amy O’Rourke, who is the choose to excel director for the nonprofit. CREEED Chairman Richard Castro, Vice-chair Woody Hunt, treasurer Raymond Palacios, secretary and executive director Eduardo Rodriguez, data director Manuel Soto Jr. are listed among contributors to the PAC. Rodriguez is listed as the PAC’s treasurer. Additionally, CREEED directors Ruben Chavez, Henry Gallardo and Dan Olivas are on the report. CREEED is credited with providing grants and scholarships to educational institutions throughout the region but receives consistent pushback due its efforts to expand the charter school market in El Paso.”

20) Texas: Rapid charter school expansion in Texas is putting a squeeze on school funding. “Of the 16,440 students who transferred out of Austin ISD for the 2019-20 school year, 14,435 left to attend a charter school, while 2,005 attended classes at another independent school district. (…) However, while charters educate 7% of Texas students, their operations take up more than 15% of the state’s education budget. Unlike public districts, charters cannot generate property tax revenue or hold bond elections to raise funding. As a result, they are fully funded by the state and on average receive $1,150 more per student from the state than a public school district. The number of charters in Texas has almost doubled since 2010, and some legislators fear that charters are hindering the ability for all schools in Texas to be adequately funded. This legislative session lawmakers have filed 18 bills related to charter school funding or expansion as of March 15.” 

21) Utah: Questions have been raised about how a Washington County charter school is managed. Tuacahn Center for the Arts also runs Tuacahn High School for the Arts, a charter high school. “Student Body President Gabriela Merida said students are told the two entities are equal, but she said it’s the arts center that regularly gets top priority. She said recently the dance students were told, without warning, that the arts center had rented their studio to a professional production, and that students would not have access to it for the rest of the year. ‘None of us knew that was happening until that point, so now they don’t have anywhere to rehearse,’ Merida said. ‘It completely derails us.’”

Infrastructure

22) National: Public Works Financing, a trade journal promoting privatization, is trying to discern who the winners and losers will be in Biden’s infrastructure plan. Relying on his reputation as “Amtrak Joe,” they figure rail projects will get priority. “Biden’s rail push will likely have far more funding than the $11 billion Obama Administration HSR program in 2009. It will likely be even bigger than the $53 billion HSR program then‐Vice President Biden proposed in 2011, which never made it through Congress. The scale this time will be different, but so are the projects. The prior programs were designed to entice states to invest and to get projects shovel ready. Many of today’s rail projects aren’t just shovel ready, they are desperately in need of federal funding. No enticements are needed—these projects are already too big to fail.” [Public Works Financing, March 2021; sub required]

23) National: Girard Miller, the finance columnist for Governing, has some market-friendly suggestions on “cost-cutting ways for Congress to help states and localities float the bonds to fund their share.” They include:

  • “Rebrand BABs as B4s.” (i.e., make them partially taxable bonds).
  • Go bigger with cheap muni money, right now. (“Just eliminate restrictions on investment income before 2026”)
  • Open the Federal Financing Bank window to Build Back Better.     
  • Provide a tax break for qualified P3 bonds and dividends.

In what is perhaps the quote of the week in a week heavy with quotes, Miller homes in on the private finance industry’s favored income stream in that last item: users of roads and public services—i.e., us. “Various projects to fund facilities that can be financed by user charges are ripe targets for such privatization or semi-privatization,” he writes. This is the fine print of the clamor for user fees instead of corporate taxes to pay for infrastructure. Don’t be too surprised if some well paid enterprising lobbyist sticks this into the multi-thousand page bill that will emerge from the hallowed halls of Congress. 

24) National: There will be a lot of jockeying over how to define and implement universal broadband. “Key to offering broadband for all is making it affordable. Biden says that while subsidies for low-income families may be a short-term solution, the greater problem is that companies charge too much for broadband. (…) As well as being expensive, the official U.S. definition of ‘high-speed broadband’ has been described as outdated, and the FCC wants consumers to tell it what their broadband service is really like.” Is this program going to be all-public or public-private, and if the latter will it turn into an overpriced corporate subsidy feeding trough? 

25) Maryland: “Maryland’s P3 law, like in other states, seeks to attract private investment by limiting the potential for political interference,” reports the Washington Post. “Political interference,” as in democracy? 

26) Pennsylvania: Public Works Financing is up in arms because Pennsylvania lawmakers are looking at changing the state’s P3 enabling legislation to make it more democracy-friendly. “Legislation was introduced in the House and Senate that would give the General Assembly an opportunity to block the Major Bridge P3 Program. It would also require legislative approval of any future P3s involving user fees. The Senate legislation passed out of committee this month, and the House Transportation Committee held hearings on a bill on March 24th.” [Public Works Financing, March 2021; sub required]. Imagine that. Taxation with representation.

27) International: Max Chandler-Mather explains how the Labor Party sold Australia’s public assets for a song. “Privatization in Australia was a bipartisan affair. Keating’s neoliberalization of the Australian economy paved the way for his Liberal successor John Howard, who went on to accelerate the transformation Labor had initiated after taking office in 1996. More than two decades after the great sale of public assets began, we can now draw up a damning balance sheet of the whole experiment.” 

Criminal Justice and Immigration

28) National/Alabama: Is Barclays violating its vow not to provide financing for private prisons? Bloomberg reports that “two years ago, Barclays Plc joined a chorus of major banks announcing that they would no longer provide new financing to private prison companies, whose model of profiting from incarceration has drawn controversy for years. But the bank is now poised to raise US$634 million for Alabama lockups to be built and owned by carceral giant CoreCivic Inc. Barclays is the lead underwriter for a bond issue scheduled to be sold through the Public Finance Authority, an agency in Wisconsin set up to rent its access to the municipal-debt market. In this case, the debt is being sold on behalf of an entity fully owned by Tennessee-based CoreCivic. The proceeds will be used to build two new prisons to be leased and staffed by the Alabama Department of Corrections. While Barclays isn’t directly lending to CoreCivic, the bond deal illustrates just how entangled private prison companies remain in the financial system and the limits to banks’ pledges to avoid them.”

29) National: Remember when almost three years ago a government immigrant minors contractor was accused of “creating a zombie army of children forcibly injected with medications that make them dizzy, listless, obese and even incapacitated”? Well guess what? In January the government “quietly renewed” a three-year grant to the contractor. 

30) Alabama/National: Writing in Truthout,  Madeleine Freeman and Luigi Morris say “Amazon has also enlisted the efforts of the Bessemer Police Department to act as ‘security’ for the facility to intimidate not only workers, but also the many supporters, canvassers, and press who have come from far and wide to cheer on and agitate for the workers’ struggle. Off-duty cops guard the facility at all hours. Bessemer police trucks constantly ride up and down the streets around the facility and patrol the parking lot.” 

31) Maryland: Lawmakers’ efforts to shut down deals between Maryland jails and ICE are at a crunch point. Legislators there are worried that companies such as Immigration Centers of America (ICA) want to expand into the state, and “are this month engaged in a full-court effort to delegitimize ICE operations in Maryland and the operations of the companies that do ICE’s dirty work. On March 18, 86 of the state’s 141 delegates—enough to override a likely veto by Republican Governor Hogan—voted in favor of the Dignity Not Detention Act. The legislation bars counties from entering into contracts for immigration enforcement with ICE or with private prison companies, and sets in motion a phase-out of the t hree existing ICE facilities in the state by October of 2022. Senate leaders are going to schedule a vote on the bill before the session ends in mid-April, and they are confident that they also have enough votes to override a Hogan veto if the need arises. However, this confidence has a caveat attached: If the veto comes after the session ends, the override would have to wait until next January, and proponents worry that some senators might end up getting cold feet during an election year.” 

32) Texas: Johnson County’s long running contract with LaSalle Corrections expires at the end of August. “Nothing against LaSalle,” Commissioners and Johnson County Sheriff Adam King said.  “But I think at that point it really began to make sense for the county to take back operations of the jail at this time. Financially and operationally it’s going to be better for our taxpayers and give us a lot more opportunity for positive impacts on our staff and inmates.” 

33) Washington: The state Senate has passed a bill “that bans private, for-profit prison companies that contract with local, state and federal agencies such as Immigration and Customs Enforcement, or ICE, from operating in the state. If signed by Washington Gov. Jay Inslee, the new legislation would force the ICE detention center in Tacoma to shut down after its contract expires in 2025. The law would also prevent other private detention centers—whether criminal or civil—from opening. This is the second year Washington state has attempted to pass such legislation, but Rep. Lillian Ortiz-Self, D-Mukilteo, one of the sponsors of the bill, said people’s testimonies about abuses they had suffered while detained at the ICE detention center in Tacoma made a difference.”

Public Services

34) National: Who helps pay Amazon, Walmart and McDonald’s workers? You do, says Bloomberg News. “In short, corporate America is pawning off the cost of rock-bottom wages on taxpayers. And one of the most prominent companies socializing the cost of substandard wages is Amazon.com Inc., according to a study from the Government Accountability Office. Amazon figured prominently in a Senate Budget Committee hearing Wednesday that looked at the human and economic perils of income inequality in the U.S.”

35) National: Public sector jobs were up last month, but are still far below pre-Covid levels. “Teryn Zmuda, chief economist for the National Association of Counties, pointed out that March was too soon for the billions of dollars in state and local aid from the latest coronavirus recovery package—the American Rescue Plan Act—to significantly influence workforce decisions. Zmuda said that once the aid is allocated to localities, hiring is apt to pick up. ‘I would anticipate over the next couple months we’ll see small gains and it will likely be summer before we see any significant local government job gains,’ she said. Zmuda also predicted that as the economy recovers, local governments would add jobs, not just replace the ones lost over the past year. ‘I think we’re going to see new jobs created,’ she said.”

36) National: As severe budget cuts approach at the local government level, public sector workers and community activists are preparing to respond. “No matter how generous, the current stimulus is a one-time infusion into city and state coffers. That’s why union activists around the country are focused on fixing our upside-down tax system and making corporations and the ultra-wealthy pay their fair share. During the first 11 months of the pandemic, U.S. billionaires saw their wealth increase by 40%—a whopping $1.3 trillion. This has prompted a growing number of union activists to push for aggressive revenue strategies.” 

37) National: Law360 reports that “the American Federation of Government Employees has sent the U. S. Department of Defense a letter arguing that the agency failed to adhere to laws prohibiting the outsourcing of certain civilian jobs during the Trump administration, which resulted in a ‘stealth privatization’ of certain functions.” In 2019 similar questions arose regarding Trump’s executive order on Medicare Advantage expansion. 

38) Oregon: Where should temporary shelters go? The issue is being debated in Portland. “Proposed changes in city zoning code under a new policy, the Shelter to Housing Continuum, sparked intense debate among Portlanders about where city-approved, managed homeless shelters should be allowed to go (‘Whose Woods Are These?’ WW, March 24). Last week, following public outcry, the Portland City Council said it never intended to allow housing in parks and pledged that open space zones affected by the policy would not include parks or natural areas. Here’s what our readers had to say.”

Everything Else

39) Florida: “60 Minutes” alleges that Republican governor Ron DeSantis “funneled the state’s coronavirus vaccines to rich communities and privatized the vaccine rollout to benefit donors while many minorities in the state struggle to obtain access to an inoculation.” The Hill reports that “CBS reporter Sharyn Alfonsi presented a far-ranging report for “60 Minutes” Sunday evening critical of Florida’s vaccine rollout. Among other allegations, Alfonsi said DeSantis gave a contract to distribute coronavirus vaccines to the grocery store chain Publix after Publix made a $100,000 donation to his political action committee.” Watch the “60 Minutes” segment, “How the wealthy cut the line during Florida’s frenzied vaccine rollout.” [Video, about 13 minutes]

40) National/International: The Pentagon could open itself up to costly litigation from contractors if the U.S. pulls out of Afghanistan this year. “Some of these contracts may be canceled under what’s called ‘Termination for Convenience of the Government,’ where the contracts are ended ‘in the Government’s interest.’ The contractor can then agree to a settlement with the government, or the contractor sue if they don’t agree upon a settlement, explained Zakheim, who also served as the Defense Department’s coordinator of civilian programs in Afghanistan under President George W. Bush. ‘That’s really the issue. The government can’t just say, “The hell with you.”’ said Zakheim. ‘The thing about termination for convenience is that the government is probably going to have to pay the contractor.’” 

41) Think Tanks/International: Global Labour University is offering a course called Just and Green: Labour’s Ecological Question. “This FREE online course explores different aspects of the ‘jobs vs. environment dilemma’ through a lens of current struggles, as well as academic and policy debates.”

 

Photo by Eli Christman.

Related Posts