ALEC Has Theirs. Now They Want Yours.


The massive amounts of money America’s rich spend to keep from paying taxes seems as irrational as it is obsessively ideological. There’s something creepily cultish about it. This week’s massive leak of corporate-written model legislation from the Koch brothers-financed American Legislative Exchange Council (ALEC) has further exposed the depth and breadth of the corporate capture of what was once billed as government of, by, and for the people.

Grover Norquist, the once enfant terrible of the Right, has for years promoted the idea that taxation is theft. He has likened progressive taxation to the Holocaust. Yet so long as those tax dollars flowed their way, there were certain features of “big government” that oligarchs liked just fine – defense contracts, bank bailouts, for-profit prisons, etc. But this new breed of conservative has taken Norquist a step further. Now, if the tax dollars aren’t flowing their way, they seem to view it as theft in terms of lost opportunity cost. Why have low-paid enlisted men perform military housekeeping tasks that can be farmed out to KBR at a markup to taxpayers? They have moved beyond free-market fundamentalism into for-profit zealotry.

For people so concerned with keeping the government’s hands out of their pockets, the ALEC documents reveal that they have spent quite a lot of effort on getting their hands into yours. The Center for Media and Democracy describes ALEC’s public education efforts as an attempt to turn education into a “private commodity rather than a public good.” Charter school expansion is at the top of the agenda, and ALEC-inspired charter school bills have passed this spring in several states. Charter school chains are poised to move in. Public subsidy of charter companies like White Hat and Imagine Schools means private profit not only from state tax monies but also from complex sale-leaseback arrangements on the valuable real estate, private development subsidized at public expense or acquired through eminent domain.

The impulse among conservatives to privatize everything involving public expenditures – schools included – is no longer just about shrinking government, lowering their taxes and eliminating funding sources for their political competitors. Now it’s about their opportunity costs, potential profits lost to not-for-profit public-sector competitors. It’s bad enough that government “picks their pockets” to educate other people’s children. But it’s unforgivable that they’re not getting a piece of the action. Now they want to turn public education into private profits too.

Why are millionaires and billionaires targeting public education? For the same reason banksters pimped mortgage loans. For the same reason Wall Street wanted to privatize Social Security. For the same reason Willie Horton Sutton robbed banks.

Answer this question: What is the largest portion of the budget in all 50 states?

Writing in Harpers, Jonathan Kozol wrote,

Some years ago, a friend who works on Wall Street handed me a stock-market prospectus in which a group of analysts at an investment-banking firm known as Montgomery Securities described the financial benefits to be derived from privatizing our public schools. “The education industry”, according to these analysts, “represents, in our opinion, the final frontier of a number of sectors once under public control” that “have either voluntarily opened” or, they note in pointed terms, have “been forced” to open up to private enterprise … From the point of view of private profit, one of these analysts enthusiastically observes, “the K-12 market is the Big Enchilada”.

The animus toward public education isn’t really about big government. It’s about corporate America’s insatiable appetite. Big government is just fine by them so long as public money is flowing their way. It’s the rest that is wasteful spending. What they want now is a piece of the action from remaining large blocks of public funds, like Social Security and … public education.

From this perspective, it’s bad enough that states are not providing education on at least a not-for-profit basis. But it’s far worse than that. They’re giving it away! That’s a mortal sin. A crime against capitalism. The worst kind of creeping socialism. Hundreds of billions of tax dollars spent every year in a nonprofit community effort to educate a nation’s children, and the moguls are not skimming off the top. The horror.

So just as the business community tried with Social Security, there’s a massive effort to convince America that there’s something wrong with the public being involved in public education. If the public cannot be convinced, corporate-funded groups like ALEC obviously consider state legislators a softer target.

(Cross-posted from Dirty Hippies.)


  1. barry says:

    Well said. Now, what can we do about it?

  2. Tom Sullivan says:

    Since November 2010, we have seen a massive push by ALEC and its allies to enact their agenda. By throwing so much in the air at once, their goal is to overwhelm any defense and get through as many of their wish list items as possible.

    The public has been slow to recognize that this is a coordinated, national effort, not simply a series of bills appearing in several states. Many of the legislators filing these bills probably even believe in the stated political or ideological goals — improving education, for example. What some ALEC legislators may not recognize themselves is for their puppet masters, it’s all about the money. It’s about getting taxpayers to boost their profits and pay their bonuses as they strip America to the walls.

    The first step in stopping that is unmasking them.

  3. barry says:

    Aside from our own Tim Moffitt, the only current Senator or Representative I can find who’s openly affiliated with ALEC is State Rep. Harold Brubaker, currently the Chair of the House Appropriations Committee. RightWingWatch lists him as a member of ALEC’s Board of Directors. Here’s the list of bills he’s introduced during this session. My favorite was the attempt to link extended unemployment benefits to the Governor caving in on the budget. Brubaker was responsible for that one. He was also the principle sponsor of HB93, which gutted the Earned Income Tax Credit for poor working people. They talk about cutting taxes, but then turn around & raise them on the poor.

    There have to be more smartALECs in the GA. Rep. Paul Stam is cited by ALEC as the author of the “Protect Health Care Freedom Act”, the ‘anti-ObamaCare’ bill modeled on their “Freedom of Choice in Health Care Act” which was passed but then vetoed by the Governor.

    Activists in Wisconsin filed an open records request, and found that 12 state Senators had used taxpayer funds to pay their ALEC dues. No news on whether those are the only ALEC members in that house…

    Maybe we should do something similar here?

  4. tombuckner says:

    Little note here: folks generally don’t really grasp how friggin rich the very rich are. The Koch brothers, whose creature ALEC is, are worth about $20 billion each, or $40 billion together (that’s forty thousand million for any British readers).

    In 2010 the census said Charlotte, that big ol’ city down the road, had a population of 731,424. Charlotte’s per capita income for 2009 was $31,270. The Koch’s fortune would pay everyone in Charlotte’s combined salary for a year and nine months. Or Asheville for about seventeen and a half years.

    Makes it easier to understand how these aristocrats can afford to set up think tanks and buy politicians.

  5. TJ says:

    “The massive amounts of money America’s rich spend to keep from paying taxes seems as irrational as it is obsessively ideological. There’s something creepily cultish about it.”

    “Charter school expansion is at the top of the agenda,”

    I don’t understand the problem with Charter schools. My kids have grown up in them, although my son is going next year to SILSA (I attribute it in part to the encouragement to excel these past years with smaller classrooms, able to allow differences in styles of learning and the ability to challenge him-rather than him have to keep the “status quo” of the regular public school he could have attended.

    We are not wealthy, and charter has allowed the “private” school atmosphere in a (at least, partially) publicly funded school… the rest is parent-supported…

    If he had been offered the same quality in the regular school, I would have had no problem with that. But, having the opportunity to allow him to stretch himself, has afforded him the opportunity to go even further (his goal is attend MIT).

    Our charter school has had fundraisers to build one new building each year for the past two years. As far as I know, they have not been able to “profit not only from state tax monies but also from complex sale-leaseback arrangements on the valuable real estate.”

    They have stayed on the same piece of land in West Asheville since my son was in the second grade… mostly in trailers, with only in the past couple of years building two new buildings.

    So, call me naive, but, where is their “profit?” They’ve even had to let a couple of part time teachers go due to cuts, and can’t participate in the public school food program because it costs them too much to support it.

    I will always be grateful for their school, and until I see the public schools offer the same kind of settings, I guess I will be one of the “creepily cultish?”

    My son had the option to go to the Asheville School, but I’m not THAT “creepily cultish.” 😉

  6. TJ says:

    “The rich can afford private schools for their children and have little need for educated workers in the multiple cities where they own houses. How much education do gardeners and waiters really need anyway?”

    I get that people say that charter schools take public school money. Either way, the children of lesser means get an education, it seems (or, am I missing something else? Very possible, since I don’t know all the ins and outs still). How does it hurt for those with less getting the higher quality of education if they can’t go to the private schools? And the charter schools get cuts, also, so I am not sure where they are getting a “better deal” than the public schools? I have seen parents intensely involved and providing multitudes of volunteer hours to make things happen and create community. I don’t see how public school parents are any less able to do so, but it does not happen as much, it appears. So, should I sacrifice my children’s opportunities in order to feed in a few dollars more into a school system struggling to even offer a full curriculum?

  7. TJ says:

    “Little note here: folks generally don’t really grasp how friggin rich the very rich are.”

    Unfortunately, got an up-close and personal view in my life growing up. My father not only had a multitude of resources, he also felt invincible and immune to the everyday workings of “normal” life. Allowed him to live out his sociopathic fantasies, and act like a black hole in the universe when it came to moral standards (all the while appearing admirable to the naked eye of the unaware and uninitiated.

    Ironically, having “it,” he didn’t bother passing on any financial wisdom and skills. Even though I had a financial adviser in CA, I managed to get rid of the lot. And having lost it, I can’t say I like having to count the dollars to see a concert or some such thing with my kids, but we have learned how to access the same things on a smaller budget. My kids have less of a sense of entitlement to struggle with, and for some strange reason, I manage to avoid most opportunities to gain ground financially (although, I admit I am a little more ready to hit the private practice road), and even though I admittedly wear more than my share of Polo shirts, I usually get them at the lowest sale price possible [I’ve always loved horses 😉 ].

    Does that make me one of the “bad guys?” I certainly hope not. I don’t play Lotto (another scheme to steal from the poor), but I’ve always told my kids that if I won, I’d be broke pretty quickly, because I would give it away, aside from a chunk for my kids’ college money. I don’t see money itself as “evil,” but I have seen PLENTY of what it can do to people. I don’t tell my kids about MY life insurance policy OR the Menendez brothers…. ::::sigh::: I doubt they would react the same way, though.

    So-where’s the line? We don’t have to be Mother Theresa, and I sure don’t like the top elite, so…. ????

  8. Tom Sullivan says:

    Not all charter schools are for-profit operations … yet. On the other hand, there are growing numbers of for-profit charter management chains that are gaining increasing influence with cities and might eventually crowd out community-organized non-profits (like yours?).

    The school your children attend may in itself not seem a threat to universal public education. But all-in-all it’s just another brick in the (privatization) wall.

    If you’re missing anything it’s this (like I said in my first comment). Voucher programs have failed to get real traction, so charters are now the preferred investment vehicle. There are probably some people pushing the ALEC privatization agenda who actually believe the publicly stated goals – school choice, improved education, innovation, etc. Results are mixed, and some of them result from “cherry picking” students to inflate scores and make them look better than they are.

    What I am suggesting is that the stated goals of expanding charters are not the real goals, and not ALEC’s goals. Getting those billions in public education dollars funneled into for-profit operations is. When for-profit charter management firms move in, our tax dollars that used to fund universal public education are being diverted to for-profit operations that (naturally) are either going to cost the public more by marking up the cost of providing that education or else by shortchanging children through cutting costs to keep their profits up at our children’s expense.

    And/or, they’ll use public subsidy of their operations (cheap rent, land acquired through eminent domain and/or those leasing agreements) to generate private profits from what was historically a public service, that is, by privatizing it. As I understand it, for-profit charters get the buildings or public land free, subsidized or through eminent domain, then can build new schools (at their expense) that they then lease back to the school district (at a profit, naturally) and provide the education services too, paid for with public education tax money (at a profit, naturally).

    I don’t have the numbers handy, but I’ve read recently that for-profit charter schools are now seen as a very lucrative investment (as the prospectus mentioned in my piece above suggests). Once public education has been hollowed out enough through charter expansion, we’ll eventually have the for-profit system they desire (privatization by attrition).

    Now ask yourself this question: What happens to America and its children once investment gurus decide the K-12 market is no longer the wisest place to invest money?

  9. Tom Sullivan says:

    They’re telling you charter expansion is about “choice” or “innovation” or whatever. Why are business moguls really promoting charter expansion so hard?

    It turns out that at the tail end of the Clinton administration in 2000, Congress passed a new kind of tax credit called a New Markets Tax Credit. And what this allows is it gives an enormous federal tax credit to banks and equity funds that invest in community projects in underserved communities, and it’s been used heavily now for the last several years for charter schools. And I focused on Albany, New York, which in New York state is the district with the highest percentage of children in charter schools. Twenty percent of the schoolchildren in Albany are now attending charter schools. And I discovered that quite a few of the charter schools there have been built using these New Markets Tax Credits.

    And what happens is, the investors who put up the money to build the charter schools get to basically virtually double their money in seven years through a 39 percent tax credit from the federal government. In addition, this is a tax credit on money that they’re lending, so they’re collecting interest on the loans, as well as getting the 39 percent tax credit. They piggyback the tax credit on other kinds of federal tax credits, like historic preservation or job creation or Brownfields credits. The result is, you can put in $10 million and in seven years double your money.

    That’s not about your kids’ education, it’s about real estate.

  10. TJ says:

    “Results are mixed, and some of them result from “cherry picking” students to inflate scores and make them look better than they are.”

    Now, this I DO see occur. My son has regularly tested between the 85th and 99th percentile on state EOG’s, progressively for the past years. On the SAT’s, he tested(I think) around 83% better than students testing for competitive private schools, and higher for the remaining students. I know he was accepted at SILSA (for a fee for out of district enrollment) because he is seen as a bright student… so, really, the public schools are doing that as well. However, I WILL say that our district school did not complain (I don’t know what they COULD have done, but they did not contest his change of placement). In that sense, I DO believe the area schools should get credit for the academics the students have. ANY school providing a challenging education should be rewarded, not have funding removed. I know in CA, the voucher idea was popular, except with the parents whom camped out overnight just to get a place in line, without even a promise of being selected from the lottery. I was glad to not be a part of that, and I dreaded my son coming of age in that system. The idea was supposedly that a parent could choose to use the voucher where they felt their child would get the “best” education, but THAT I saw as a lie, and as a way of cheating the schools, because they lost the money that child would have utilized. THEN, supposedly, the school would become more competitive and offer a higher curriculum to entice parents to choose THEIR school. A losing proposition for all.

    “As I understand it, for-profit charters get the buildings or public land free, subsidized or through eminent domain, then can build new schools”

    Ours is non-profit, and if I saw that starting to occur, I would not let my child attend. So far, they provide living wages for the teachers, and it has no delusion of exploding into a corporation with more branches(unlike a church in the area, I know of). However, I see your point.

    “Now ask yourself this question: What happens to America and its children once investment gurus decide the K-12 market is no longer the wisest place to invest money?”

    That question has ALREADY been on my mind, as these cuts of teachers have occurred. If I had invested my money in CA the way they “invest” in education, I would have lost it all even more quickly. It is painfully clear that, while the appearance is that we give lip service to “good education,” that there is little value placed on the idea that children deserve a rich and expanded education. Of course not, that would mean that a generation could grow up and know how to ask questions and challenge those in positions of power. “They” are still trying to weed out those of us whom remember our history enough and have been educated enough to not feel content with the status quo.

    What will happen? What is already happening in multiple arenas (beyond educational systems)… the devaluation of and the suppression of anyone whom even whispers a hint of the idea that our society might go further if we nurture and care for our children, in order to raise a new generation able to participate in and become the creative leaders of the future. In biblical times, they sacrificed their children to baal. Now, our children are sacrificed to the gods whom control the $$, wherever that may be.

  11. TJ says:

    “And often there are interlocking relationships between the charter school boards and the nonprofit groups that organize and syndicate the loans.”

    I would be curious about this and will ask about this at our school.

    “That’s not about your kids’ education, it’s about real estate.”

    And, that is very sad. Real estate has done poorly for many years, and now the schools are sucked into that vacuum?

    I know many people don’t like the idea of home-schooling, but this kind of view makes it seem more appealing to me. At least, then, I would know it IS about my kids’ education.

  12. Susan says:

    They (ALEC) are pushing charter schools because they want to ruin/end public education…. or make it nearly useless. They are doing this by taking money away from public education and leaving them with the poorest, most troubled, least parental-involved students.

    They will call it “separate but equal” when they are through.

    I was in Cincinnati in April 2011 and there was a big ALEC meeting there. I went to the rally and protest, and we walked around the block of the fancy hotel chanting: ALEC, ALEC, YOU CAN’T HIDE, WE WILL FIND YOU NATIONWIDE.

    They are holding another meeting in New Orleans in early August. I can’t go, but if you are free and feel like going to NOLA, please do so. The more attention they get, the better, and we can be 100% sure that this will NOT be covered by the corporate media.

  13. barry says:

    Website up for the ALEC protests. I would rouse myself for this one, sadly I will be working at a show that whole week…

    What I am suggesting is that the stated goals of expanding charters are not the real goals, and not ALEC’s goals.

    In 1936, who would’ve believed that General Motors, Firestone Rubber, Standard Oil, Phillips Petroleum and Mack Truck were colluding to erase the public-owned electric trolley car systems from cities all over the US, in favor of bus systems that used their products? Decades later, it became clear that that was what happened.

    Why not public schools?

  14. tombuckner says:

    TJ asks, re: great personal wealth: “So-where’s the line? We don’t have to be Mother Theresa, and I sure don’t like the top elite, so…. ????”

    There’s no clear line. However, here’s one way to look at it. Suppose you could put all the good you do with your money on one side of the scale, and all the harm getting it and having it does to society on the other side. If the scale clearly tilts toward the good, you’re not too rich. If it clearly tilts to the bad, you are. J.K. Rowling made a billion dollars with the Potter books, miraculously doing little if any harm in the process. Nobody had to buy them. However, most people with anywhere near her fortune have gained it in ways that are very destructive to the rest of society. Bill Gates (of whom I have a far lower opinion) says he’ll give away most of his money. But he can never do 1% as much good as if he had spent 1% of it keeping George W. Bush out of the White House.

    Re: charter schools. I simply don’t see the need for these and have never trusted the idea. Fannie and Freddie were much better run when they were 100% government agencies; semi- or full privatization is frequently a scam. Why not just make the public schools better? There have always been people who wanted the public school system to fail. The more sociopathic elites do not want your child to get a good education, and later on compete against their children. Educated people think for themselves. Educated people are hard to rule.

  15. TJ says:

    “Why not just make the public schools better? There have always been people who wanted the public school system to fail.”

    That is a GREAT question. And, of course, the less educated people are, they easier they are to rule. That was part of what happened when “the church” had no common book that all could read and know for themselves what “God wants.”

    I guess my problem is that I don’t want my children to lose out, and be one of the “ruled,” until the public school shows an improvement. It seems to be a catch-22.

    Meanwhile, ” Educated people think for themselves.”. True, yet, obviously, those oppressed can too, or we would not have countries with uprisings, slaves running away, etc. It surprises me that “they” cannot see that denial of such “rights,” will make people MORE uncontrollable-even when it’s out of sheer desperation.