“Edison,” from p.15 Benno Schmidt’s design team recommended a math curriculum designed at the University of Chicago and a language arts curriculum designed at Johns Hopkins. “Developing a school program requires a lot of experience,” Molnar said, “and these bozos coming together couldn’t do shit…. They began to buy things off the shelf.” Whittle now admits that Edison’s curriculum does not represent an educational breakthrough. “With these schools, there’s nothing new,” he said, “if you take everything individually.” Even taking everything collectively, Elm Creek’s principal agreed that Edison is bringing little more to SWISD than “the technology push” and a great deal of excitement. She cited the influx of computers as a catalyst to teach children “technology as a second language.” SWISD Superintendent Clifford has a more traditional notion of what a second language is and believes that Edison will provide one for every student at Elm Creek Elementary. “This gave us an opportunity to offer a second language to all students at the campus,” Clifford said, “and so fin kindergarten] we will be beginning Spanish as a second language to all children, regardless of whether they’re bilingual or not. The emphasis, as those kids transition into middle school, will be moving into Latin, and then into a third language as they get to high school.” Molnar dismisses Edison’s ambitious language plans, saying that as far as he knows, the Edison Project employs no linguistic curriculum specialists. Without a specific, quality curriculum, such rhetoric, Molnar says, “sounds like authentic western gibberish to me.” Edison has retained a “language teaching” consultant but does not have a permanent staff member working on second-language programs. If the foreign-language program is as ambitious as Clifford believes it is, Edison will have to find the money to do what no other school district can seem to afford in Texas, where language programs are often resisted for financial and other reasons. And if Edison hires enough foreign language teachers to educate every student at Elm Creek, what will happen to stockholders’ dividends? A LOT MORE THAN LUNCH MONEY While its critics have their doubts about the educational value of the revolution Edison promises, few of themranging from The New Republic to educator and author Jonathan Kozol to the late President of the American Federation of Teachers, Albert Shankerquestion Edison’s profit potential, or the company’s ability to wring profits from tight public school budgets. Clifford and Garrett, on the other hand, don’t see Edison profiting from their districts. Garrett told The New York Times that he would “be surprised if they were making a profit in Sherman.” Clifford was more forthright. “They’re not going to make any money from the SWISD,” Clifford said in an interview. He predicts that Edison will use Elm Creek as a loss-leader, a deficit-producing program that will attract attention and ultimately bring in a net profit by leading to more lucrative contracts around the country. “We see an opportunity for us to be a flagship of this project…,” Clifford said. “Edison is very interested in working with us to model a true bilingual program.” If he’s correct, potential Edison buyers will have to consider that what works at Elm Creek might not work in other districtswhere Edison ultimately will have to make a profit. 18 THE TEXAS OBSERVER File photo release financial data, but in Molnar’s Giving Kids the Business: The Commercialization of America’s Schools, it is clear that the company has had persistent financial troubles. Dating back to his initial efforts in the early 1990s, Whittle has failed to reach his own fundraising goals for the Edison Project; indeed, Schmidt might be the greatest single asset Whittle succeeded in attracting. Late last year, Edison announced a $30.5-million infusion from an “investor group.” A closer look shows that Whittle and Schmidt are themselves two of the eight nancial shell game is not new to Whittle’s ventures. In 1995, Edison announced a major investment of $30 million; but a closer look revealed that $3 million came from a group led by Benno Schmidt and a whopping $15 million came from Whittle himself. Edison’s financial future couldn’t have been helped by George Bush’s defeat in 1992. Bush’s Secretary of Education Lamar Alexander, who supports privatizing public schools and using tax vouchers to create school choice, is both a close friend and a former investor of Whittle’s \(they met while both attended the University of Tenconsulting fees during Alexander’s tenure as governor of Tennessee. Alexander also bought $100,000 worth of stock in Whittle Communications Corporation, transferred the stock to his wife, and collected $330,000 one year later when Whittle bought the stock back. Alexander’s departure from the Department of Education hurt Whittle’s fundraising prospects and caused him to scale back his plans. In 1992, Whittle projected that Edison would run 200 school campuses nationwide by 1996. Last year the company had contracts with twelve campuses, and for the 1997-98 academic year Edison is running twenty-five schools. Even now, Edison is not making a net profit and shareholders have yet to see their first dividends. MILKING EVERY DROP Garrett and Clifford’s claitris that Edison isn’t making a profit on their campuses might come as a surprise to Chris Whittle and Benno Schmidt. Whittle claimed that all twelve Edison schools turned a profit last year, and, according to Nancy Van Meter of the American Federation of Teachers, Schmidt recently told a Smith Barney investment conference in New York that Edison achieved its projected 4 to 8 percent profit at each site. Profits on campuses do not cover Edison’s administrative payroll and the cost of its New York office; and if the information gleaned from Whittle and Schmidt is correct, that is why the company is in the red. The only way out of the red is to increase profits on campuses, and Schmidt SEPTEMBER 26, 1997
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