Monday, December 8, 2014


Mayor Rahm Emanuel, Goldman Sachs CEO Lloyd Blankfein and Warren Buffett 
Ben Joravsky wrote a devastating Sun-Times expose of Rahm Emanuel's promised expansion of Pre-K to about 2,600 new students. Melissa Sanchez at Catalyst also has an excellent piece.  Still more must be asked about this curious program, which transfers about $17 million in public school money over to the big banks.

By guest blogger Susan Klonsky

Rahm's shiny new pre-K program contains a recipe for civil rights violations--especially against children with special needs. Buried within the loan agreement is an insidious incentive aimed at reducing the number of children who receive special-education services after pre-kindergarten.
The new CPS pre-K program will be funded with loans from Goldman Sachs, the Pritzkers, and other hedge funders and financial Houdinis. They're calling these loans “Social Impact Bonds” (aka SIBS). 

The Mayor boasted that the new pre-K program is chock-full of incentives for the lenders. Not just the unusually high rate of interest on the loan, which in itself is quite a tidy sum. My grandson will  be paying for this loan when he’s a grandpa himself.

No, there’s still more money to be made in the promised BONUSES for "success." In fact, this is called a Pay-For-Success loan.  No bonuses to the schools or to the educators (as in so-called “merit pay” for high test scores). These are bonuses for the LENDERS themselves…on top of the interest they will receive.

The bonuses are promised for supposedly measurable improvements in or reductions in certain outcomes. The announcement  described them as follows:
The SIB targets would be met with payments for each pupil who, after pre-K, does not get placed in a special education program ($9,100 per pupil), is deemed ready for kindergarten after pre-K ($2,900), and scores above the national average for third-grade reading ($750).
The most egregious incentive is the one that reduces the number of special-needs students. For any child who, after attending one of these funded pre-K’s, does NOT receive an IEP or special education services, the lenders will rake in an additional $9100 per student.   

This deal brazenly incentivizes civil rights violations—indeed,  it is all but a conspiracy to deprive young children of essential services to address special needs. For every kid who does NOT get a speech therapist or a classroom aide in elementary school—Ka-ching! 9100 bucks goes into the hopper for Goldman Sachs CEO Lloyd Blankfein and Chicago’s own Penny Pritzker. 

So whatever fast move Rahm thinks he’s pulling here to score some bread for his Wall Street friends, he’d better set something aside to defend against the lawsuits for civil rights violations against children with disabilities. They’re coming.


  1. Salt Lake City set up the same scam last year as written about in Ed Week

    To guarantee enrollment, Arne has cut the federal funds to Head Start the bone.

  2. In an effort to preempt civil rights lawsuits, Arne has been deregulating SPED for several years. In 2011 he stopped all compliance efforts at the federal DoEd and is merely monitoring test scores. Last spring he closed state support centers in every state. These centers were the places for parents & teachers went for info and training in SPED rights and responsibilities. Compliance officers were housed in regional centers in large states. Is it any surprise that Arne is now going to "reform" SPED?

    His recent regs changes are an effort to usurp some control over the IEP process. IEP's are a legal contract between the schools and child/family. The decisions made in the IEP team guarantee individualized instruction,accommodations, modifications, and assessment. Measurement of success is based on mastery of appropriate goals & objectives.

    Arne's recent proclamation that SPED success will be tied to SPED kids NAEP scores oversteps the contractual obligation of using the IEP to determine if that child is receiving an appropriate education as measured by the IEP. This is just the beginning of his dismantling of SPED.
    IDEA has not been reauthorized since 2004. For a bill that has flown through congress every 4 years with no opposition, it's unusual that we are now 10 year late. We need to be aware of Arne & the banksters influence in IDEA reauthorization or we'll lose 50 years of progress in SPED.

  3. Tennessee Lamb,

    Mr. Duncan and his friend Kevin Huffman, who ran the schools down here in TN, have said over and over that SPED and disabilities are all in your head and that student success is simply a matter of expectations...

  4. The Pope gets it. It is survival of the fittest. Does Duncan? Of course he does.
    After all, he imposed PARRC and Smarter Balance tests, which are purposely designed to fail 50% of students. And he couldn't care less about those whose learning issues are -- in his mind -- imaginary. Accommodations for them are cut, and their future opportunities circumscribed. Some 'bright light ' politico decided to go to China and just copy their curriculum, cramming and testing regimens. That may be why the CC materials are worded so poorly. They are translations.


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