Privatizing Oakland Schools

Eugene Stovall

04 Feb 2020

Eli Broad (rhymes with “toad”) conconcted a scheme to privatize Oakland’s public schools and produce a revenue stream for his billionaire cronies.

“Operating unethically and illegally, Broad managers used their training to cripple and plunder Oakland’s schools.”

Eli Broad is a liberal Democrat. He opposes Trump’s Muslim ban, immigration policies and withdrawal from the climate change treaty. In fact, like Democratic billionaires Tom Steyer and Michael Blloomberg, Broad opposes Trump’s entire right wing agenda. However, just as the Trump Foundation created the Trump University scam, the Eli Broad Foundation created the Broad Superintendent Academy, an educational enterprise that has become so successful that it is now associated with the home of the Skull and Bones Society, Yale University. But despite its aura of respectability, the Broad Superintendent Academy is no less a scam than Trump University.

Billionaires Want More

Eli Broad created two Fortune 500 companies, Kaufmann-Broad Homes and SunAmerica Bank. With an estimated net worth of $6.7 billion, Eli Broad ranks as Forbes Magazine’s 78th wealthiest man in the United States. But like many billionaires who create mechanisms to increase their wealth, Broad created a “non-profit” academy as his entré into the private education market. The Broad Superintendent Academy attracts applicants who willingly pay exorbitant tuition fees for the chance to get placed in a top management public education position. Broad academy applicants do not need educational degrees or teaching certificates. Neither are they experienced teachers or successful school administrators. The Broad academy is uninterested in strategies for improving student achievement and does not teach its students about fundamental educational issues, pedagogies and methodologies. The Broad academy only indoctrinates and commits its students to the privatization of public education and the generation of revenues for private corporations. Broad Academy attendees are taught the disruptive management tactics needed to ignore “best educational practices.” They are taught how to overcome objections when mandating school closures and school property sell offs to the billionaire-owners of private schools. When Broad placed his academy graduates in management positions at the Oakland Unified School District, they left a trail of fiscal mismanagement, budget overruns and demoralized staff, students and teachers. Operating unethically and illegally, Broad managers used their training to cripple and plunder Oakland’s schools.

The Broadies Who Plundered Oakland’s Schools

In 1998, Eli Broad recruited Jerry Brown, the former Governor of California and a former presidential contender, to become mayor of Oakland. Broad needed someone with Brown’s political clout with the Democratic Party to implement his plan to privatize Oakland’s schools. Broad had been a close personal friend of Jerry Brown’s father, Pat Brown, and had financed all of Jerry Brown’s political campaigns. Now Broad realized California’s top Democrat and his control over the statewide Democratic Party machine gave him a unique opportunity to make money from private education.

Broad’s scheme to privatize Oakland’s public education resources required the support of other billionaires capitalizing on the private education market. Netflix founder, Reed Hastings, a Bay Area resident with a net worth of $3.7 billion, was associated with the multi-million dollar Rocketship Charter Schools. The late founder of The Gap, Don Fisher, with a net worth of $3.3 billion, was associated with the Knowledge is Power Program (KIPP), one of the largest chains of charter schools in the country. With a net worth of $3.5 billion, John Doerr, partner in the investment firm, Kleiner, Perkins, Caufield & Byers, the firm that brought Google and Amazon to the market, cofounded the New Schools Venture Fund which sucks public school resources into for-profit K-12 corporations. Another critical partner in Broad’s clique of billionaires was the bishop of Oakland’s catholic diocese, a representative of the multi-billion dollar, worldwide Vatican empire. With its profound interest in co-opting public funds and real estate for its own network of parochial schools, Oakland’s catholic bishop gave Broad’s unholy coalition a solid block of votes that not only put Jerry Brown in City Hall, but changed Oakland’s charter into the ‘strong mayor” form of government, that gave “Boss” Brown the power function as Eli Broad’s “bag man.” In return for its electoral support, the diocese of Oakland received a multi-million dollar cathedral on the downtown shore of Lake Merritt.

Once “Boss” Brown controlled City Hall, Reed Hastings went into action. Hastings funded another charter amendment that gave the mayor the authority to pack the school board with his own unelected appointees. Greasing the wheels of the Democratic machine, Hastings financed the passage of a State Assembly bill that permitted charter schools to operate without accreditation and to hire teachers without teaching credentials. Then Hastings funded the Proposition 39 campaign to force local school districts to share revenues with charter schools. “Boss” Brown’s buddy, Democratic Governor Gray Davis, who later was recalled on corruption charges, put Reed Hastings on the State Board of Education. In the meantime, Don Fisher gave Jerry Brown’s wife, Gust Brown, the position of CEO over The Gap Corporation.

Getting Control Of The Schools … And The Money

In 2001, the Oakland Unified School District had a $37 million budget deficit. The district’s fiscal managers decided to resolve the shortfall by borrowing from its construction fund, a practice other California school districts in similar situations routinely used. But Brown and Broad saw the school deficit as an opportunity to advance their scheme.

Brown contacted Tom Henry, CEO of the Fiscal Crisis and Management Team (FCMAT), a firm located in Sacramento and staffed by lobbyists and political hacks. Brown used Henry’s services, on occasion, when he was governor. FCMAT did “hit” jobs for anyone willing to pay. Brown paid Tom Henry to prevent Oakland from solving its fiscal problem. FCMAT lobbied the State Attorney General, Bill Lockyer, the former Democratic Assemblyman from Alameda, to rule that Oakland’s plan to borrow construction funds was a violation of state and local law. Then Henry worked with Don Perata, the State Senator for Alameda County, to lobby a bill through the state legislature that forced the Oakland school district to accept a $100 million loan to cover its $37 million shortfall. In addition, the bill put the Oakland school district under the control of a state administrator to be appointed by Jack O’Connell, the State Superintendent of Public Education. When Jack O’Connell campaigned for state superintendent, he received financial support from Eli Broad’s billionaire cabal. Reed Hastings contributed $250,000, John Doerr $205,000 and Eli Broad, himself, contributed $100,000 to O’Connell’s campaign. With the state takeover of Oakland’s schools, O’Connell agreed to appoint anyone “Boss” Brown wanted. Thus Eli Broad and his cronies got complete control over the $63 million slush fund forced on the Alameda County tax payers. Jerry Brown described the state takeover as a “total win” for Oakland’s schools. In reality, the state takeover was a total win for Eli Broad and his billionaire cronies. For the tax payers forced to repay the loan and for the Oakland school children whose schools were plundered by malicious billionaires, the state takeover was a disaster.

The Table Was Set And The Feasting Began

The Democratic state superintendent of education, Jack O’Connell, appointed Randolph Ward, a graduate of Broad’s superintendent academy, as Oakland’s state administrator. Ward appointed Arnold Carter, another Broad academy graduate, to serve as his chief of staff. Both state administrators appointed a bevy of Broadies to fill the Oakland school district’s top management positions. Then Ward implemented Broad’s privatization agenda. He closed public schools and opened charter schools. He created additional management positions for Broad academy graduates and issued multi-million dollar consultation and construction contracts to private corporations. Randolph Ward gave Broad’s billionaire cronies complete access to the $63 million slush fund created by top Democrats, Jerry Brown, Bill Lockyer, Don Perata, Jack O’Connell, Tom Henry as well as other members of “Boss” Brown’s Democratic machine.

When the state took over the Oakland schools in 2002, Randolph Ward fired the superintendent, Dennis Chaconas. When Ward resigned in 2006, Broadie Kimberly Statham replaced him. A year later, Statham left and her chief of staff, Vincent Matthews, another Broadie, took her place.

In 2008, Oakland Assemblyman Sandre Swanson broke with “Boss” Brown and introduced a bill to force the state to relinquish its control over Oakland schools. Eli Broad gave a Sacramento lobbyist $350,000 to oppose Swanson’s legislation, but Swanson’s bill passed and local control was returned to the Oakland School Board. In July 2009, the school board hired Anthony "Tony" Smith as the district's superintendent.

Smith was not associated with Eli Broad. However, even though local school board resumed control over the schools, Eli Broad was not finished, He funded a front group, Greater Oakland [GO], which financed the election of five Broadies to the Oakland school board. In 2014, the Broadie school board forced school superintendent Tony Smith to resign and appointed another graduate from Broad’s academy, Antwan Wilson, Oakland’s next school superintendent, resuming Broad’s decade-long privatization scheme.

A Decade of Corruption

Under Randolph Ward, Oakland Schools struggled with the overwhelming debt imposed by the Democratic Party machine. When Ward left Oakland, millions of dollars went missing with him. Though FCMAT received a multi-year contract to help manage the debt, Tom Henry provided little substantive support, financial or operational. In 2007, Jerry Brown left Oakland for his cattle ranch in Northern California. In its 2007-08 report, an Alameda County grand jury investigation found that the Oakland Unified School District had been looted.

Between 2003 and 2006, Ward shut down 14 public schools and opened 13 charter schools. He increased the district’s shortfall by nearly $15 million. Ward’s successor, Kimberly Statham, another Broadie, opened 4 charter schools and Broadie Vincent Matthews, who followed Stratham as state administrator, opened 9 charter schools. Under state control, the district’s debt ballooned from $37 million to $89 million while school enrollment, the district’s primary source of funding, dropped from 55,000 in 2002 to 38,000 in 2009. When Assemblyman Sandré Swanson forced the state to return local control, Oakland’s schools had $5.6 million less than what was reported and a total of $9 million unaccounted for and completely missing. But with the return of local control, the district’s fiscal mismanagement problems only worsened. Eli Broad now directed his Broadie school board to support his schemes.

Antwan Wilson: The Most Corrupt Broadie Of Them All

When the Broadie school board replaced Tony Smith with Antwan Wilson, it hired a thoroughly corrupt, incompetent and morally reprehensible superintendent to run the Oakland Unified School District. Ignoring all budgetary, ethical and legal constraints, Wilson zealously implemented Broad’sprivatization plan. Wilson overspent the school district budget by overpaying Broadie administrators and conniving with Broadie consultants. In 2015, though the school board authorized only $10.4 million, Wilson paid consultants $22.6 million. The board approved only $7.1 million for administrators and supervisors, but Wilson spent $22.3 million. From July 2014 to January 2015, Wilson spent $22.3 million on district office managers while Smith spent only $13.1 million the entire previous year. From 2013-2014, Tony Smith spent $10 million on classified managers, but in 2015-2016, Antwan Wilson spent $22.3 million. Under Wilson, the number of students shrunk, but spending for administrators and supervisors with teaching certificates grew from $13.9 million in 2013-2014 to $20 million in 2015-2016. Wilson increased spending on outside consultants from $22.7 million in 2013-2014 to $28.3 million in 2016-2017. In Wilson’s last year with Oakland schools, he exceeded the budget for consultants by 32 percent.

These revelations galvanized Tom Henry’s FCMAT into action. Henry immediately lobbied for another state take over even as he collaborated with the Broadie school board to close even more schools and make even more valuable real estate available to billionaire-owned charter schools. But without Boss Brown’s backing, Henry was unsuccessful in getting Governor Gavin Newson’s support for another state takeover.

Do Not Teach Them To Read

Historians point out that during slavery, blacks were prevented from learning to read. Jerry Brown. Eli Broad and Antwan Wilson continued this policy in the Oakland Schools. Though Antwan Wilson exceeded his budget, overpaying Broadie managers and Broadie consultants by millions of dollars, he never came close to meeting the school district budget for student learning tools, school supplies and books. Broad and his cronies were uninterested in student achievement or teaching students to read. In 2015-2016, the school board gave Antwan Wilson $18.6 million for books but he spent only $12 million. In his last year, the board budgeted $20 million for books and student supplies, but Wilson spent only $6.8 million. Broad-trained managers privatized education resources and make public monies available to billionaires; they did not educate students nor assist them in becoming successful, productive citizens.

A Closer Look At Broadie Corruption

In March 2015, Antwan Wilson hired Lance Jackson to fill the interim position of facilities department director. Wilson paid Jackson $30,000 a month, $360,00 a year. But, Lance Jackson was already a full time employee of SGI, the consultant firm that Antwan Wilson used to manage Oakland’s bond construction projects. The contract required that SGI provide Oakland schools with a full time contracts manager to guarantee that all the requirements set forth in its school bonds expenditures were met. Lance Jackson’s full time responsibility was managing the Oakland school’s contract process. Nevertheless, Wilson paid Jackson an additional $30,000 per month. In addition, Antwan Wilson paid David Edu, of Magdave Associates, $252,000 a year to review change orders related to Oakland’s bond construction projects. Guaranteeing the accuracy of these changes was also the responsibility of Lance Jackson under the SGI contract \ The School Board Vice President, Jody London, whose election was financed by Eli Broad, defended this blatant theft of public funds in the press. Antwan Wilson’s payments of 30,000 a month to Lance Jackson and $21,000 to David Edu, a total of $612,00 each year, were illegal. The school board never approved the expenditures. In a single year, Oakland Schools paid SGI, a company financed by Broad's SunCorp, $7.5 million.

Wilson Is Gone But Broad’s Work Continues

With Antwan Wilson’s departure, under FCMAT’s direction, the Broadie board of education continued to cut books, learning aids and educational programs for students while forcing school closings and real estate transfers to charter schools owned by billionaires. The Broadie school board forced the removal of the district’s chief financial officer and paid Luz Cazares, a part time consultant, $384,000 per year to serve as the district’s interim chief financial officer. Cazares is paid to focus only on FCMAT’s elimination of 36 more Oakland schools. One part of Cazares salary comes from the Broad foundation and another part comes from the Alameda County Office of Education. The County Board of Education provides state funds to Oakland Schools in exchange for the district’s pledge to cut program costs, books and learning tools. Accepting state funds require that Cazares approve property sales, long-term leases, school closures and consolidations. The state is paying the county to force the Oakland Unified School district to cannibalize itself for the benefit of the private school corporations associated with Eli Broad and his billionaire cronies.

The tax payers of Oakland should be suing Eli Broad, Reed Hastings, John Doerr, and et.al. for scamming millions of tax payer dollars from the Oakland Unified School District and the Alameda County tax payers.

Full Disclosure: In 1995, board member Sylvester Hodges and superintendent Carolyn Getridge brought Dr. Eugene Stovall to the Oakland Unified School District to manage its telecommunications budget. After reducing telecommunication costs by a million dollars a year, Superintendent Carol Quan hired Dr. Stovall as a school district manager to provide district-wide internet access to all its school sites. In 2001, “Boss” Jerry Brown directed the school board to purge Dr. Stovall from his position for opposing his privatization scheme.

Eugene Stovall is an activist, educator, administrator and novelist, born in Oakland, California. Stovall received his PhD in Political Theory from the Political Science Department at the University of California, Berkeley.

This article previously appeared in Multi-Cultural Books.

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