Submitted by Elaine Magliaro, Guest Blogger
In a 2010 New York Times article titled Charter Schools’ New Cheerleaders: Financiers, reporters Tripp Gabriel and Jennifer Medina wrote the following about what was going on in the state of New York:
Wall Street has always put its money where its interests and beliefs lie. But it is far less common that so many financial heavyweights would adopt a social cause like charter schools and advance it with a laserlike focus in the political realm…
Although the April 9 breakfast with Mr. Cuomo was not a formal fund-raiser, the hedge fund managers have been wielding their money to influence educational policy in Albany, particularly among Democrats, who control both the Senate and the Assembly but have historically been aligned with the teachers unions.
They[hedge fund managers] have been contributing generously to lawmakers in hopes of creating a friendlier climate for charter schools. More immediately, they have raised a multimillion-dollar war chest to lobby this month for a bill to raise the maximum number of charter schools statewide to 460 from 200.
That same year—2010—Juan Gonzalez believed that he had uncovered one of the reasons why hedge fund managers, some wealthy Americans, and the executives of some Wall Street banks had become such big proponents of charter schools and had gotten involved in their development. Gonzalez said the banks and other wealthy investors had been making “windfall profits” by taking advantage of “a little-known federal tax break to finance new charter-school construction.” That little know tax break, the New Markets Tax Credit, can be so lucrative, Gonzalez said, “that a lender who uses it can almost double his money in seven years.” He added that the tax break “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.”
Continue reading “Charter Schools and The Profit Motive” →
Last week, Attorney General Eric Holder left no question about the Administration’s support of the abusive treatment of Aaron Swartz by US Attorney Carmen Ortiz and Deputy US Attorney Stephen Heymann. Heymann was previously linked to a suicide in another prosecution. We have discussed the abusive prosecution earlier and Swartz’s suicide after months of unrelenting threats and coercion. Holder heralded the treatment of Swartz as an example of the “good use of prosecutorial discretion.” Swartz’s girlfriend has come forward to denounce Holder and the Obama Administration for its misrepresentations in the case.
