Financial Linkages Between the Pro-School Choice Movement and the State Policy Network

Larry Toenjes*





Enrollments in charter schools nationally have been increasing fourteen percent annually since 2001.  Vouchers, in some form, are now available to families in 13 states and the District of Columbia.[1] State legislatures often seem more focused on expanding “choice options” than in looking for measures that could make traditional public schools more effective. Yet the evidence does not show that charter schools and voucher programs result in better student performance overall.  So what is driving the frenzy to expand school choice options?


It is argued in this paper that the forces that lie behind the push for expanding charter schools and providing state-funded vouchers that could be used to pay tuition at private and parochial schools are substantially the same forces that are promoting such diverse measures as “stand your ground” laws, voter suppression laws, laws that reduce taxes on the wealthy, anti-climate change laws, and laws which would privatize the social security system. The goal of these allied conservative forces seems to be to skew the U.S. education system to one that produces smart consumers and better workers at the expense of producing well-informed, critical thinking citizens.[2]


The methodology used below is to identify two non-overlapping sets of organizations.  One of these consists of members of a large network that is actively promoting a pro-corporate agenda both nationally and locally.  The other consists of a group of organizations that promote expansion of pro-choice educational options, particularly charter schools.


Using data from Foundation Center Online, it is demonstrated that the preponderance of funding from non-profit foundations to both of these groups comes from the same subset of those foundations, 248 in total.  Among those that make donations to both groups are the Walton Family Foundation, the Lynde and Harry Bradley Foundation, the Bill & Melinda Gates Foundation, the Eli & Edythe Broad Foundation, and the Searle Freedom Trust.


While non-profit foundations are not the only source of revenues for the pro-corporate and pro-school choice organizations, it is argued that these data are broadly representative of the resources and influences that drive both.


The beginning of the corporate network: the Powell Memorandum


Powerful conservative interests have financed, and continue to finance, a concerted effort to reverse cultural and economic trends that began in the 1960s and to move the United States more to the right.[3]  Many observers argue that this coordinated effort began with the dissemination of the famous memorandum that was written by corporate attorney and eventual member of the U.S. Supreme Court, Lewis Powell, in 1971.[4]


The Powell Memo, written for Eugene Sydnor, Jr., the Director of the U.S. Chamber of Commerce, focused especially on the influence of America’s college campuses in cultivating anti-American and anti-corporate feelings.  In that memo Powell quoted Stewart Alsop:


“Yale like every other major college, is graduating scores of bright young men who are practitioners of ‘the politics of despair.’ These young men despise the American political and economic system...(their) minds seem to be wholly closed.  They live, not by rational discussion, but by mindless slogans.”[5] A recent poll of students on 12 representative campuses reported that: ‘Almost half the students favored socialization of basic U.S. industries.’ “[6]


The Powell Memo included a list of actions that business leaders should take to change what he viewed as the unsatisfactory condition of college campuses:


·        “The Chamber should consider establishing a staff of highly qualified scholars in the social sciences who do believe in the system.”

·        “There also should be a staff of speakers of the highest competency...who speak for the Chamber.”

·        “In addition to full-time staff personnel, the Chamber should have a Speaker’s Bureau which should include the ablest and most effective advocates from the top echelons of American business.”

·        “The staff of scholars...should evaluate social science textbooks, especially in economics, political science and sociology.  This should be a continuing program.”

·        With regard to having speakers on campuses who would express the Chamber’s viewpoint: “The two essential ingredients are (i) to have attractive, articulate and well-informed speakers; and (ii) to exert whatever degree of pressure—publicly and privately—may be necessary to assure opportunities to speak.”[7]


Public high schools specifically received attention from Powell:


“…the trends mentioned above are increasingly evidenced in the high schools.  Action programs, tailored to the high schools and similar to those mentioned, should be considered.  The implementation thereof could become a major program for local chambers of commerce, although the control and direction—especially the quality control—should be retained by the National Chamber.”[8]


Typical of many of those who place great significance on the importance of Powell’s memo, Charlie Cray remarked as follows:


“In fact, Powell’s Memo is widely credited for having helped catalyze a new business activist movement, with numerous conservative family and corporate foundations (e.g. Coors, Olin, Bradley, Scaife, Koch and others) thereafter creating and sustaining powerful new voices to help push the corporate agenda, including the Business Roundtable (1972), the American Legislative Exchange Council (ALEC – 1973), Heritage Foundation (1973), the Cato Institute (1977), the Manhattan Institute (1978), Citizens for a Sound Economy (1984 – now Americans for Prosperity), Accuracy in Academe (1985), and others.”[9]


 These foundations, and the many think tanks they established and supported, have had enormous impact on public policy, especially at the national level. That influence began with President Ronald Reagan’s transition team’s adoption of the Heritage Foundation’s 1,100 page “Mandate for Leadership” in 1980.[10]


The Heritage Foundation later became a model for policy centers at the state level.


“Among the founding members of SPN [State Policy Network] was Thomas Roe, a successful South Carolina businessman who played an active role in the Heritage Foundation in the eighties.  Impressed by the success of Heritage in influencing national policy through the Reagan administration, Roe gathered a group of businessmen to found a state-based clone of Heritage in his home state, the South Carolina Policy Council. Staffers for the South Carolina Policy Council took policy recommendations, such as public school privatization and the elimination of environmental regulations from Heritage and modified them to recommend to legislators in the state capital.” [11]


Roe and others later supported the concept of a mini-Heritage in every state, where policies developed in the national conservative thinks tanks could be tailored and promoted in every state capitol.[12] These state-level operations, coordinated by membership in the State Policy Network (SPN), and further complemented by model legislation developed within the American Legislative Exchange Council (ALEC), have had major impacts on policy making at the state level.


“While SPN continues to serve as a bridge between state governments and a variety of national right-wing groups, Heritage continues to provide monitoring and guidance as the dominant organization overseeing SPN’s activities.  Heritage officials sit on the SPN board and Heritage helps manage the flow of ideas and experts to each SPN affiliate through its “Resource Bank” and “Insider Online” initiatives.”[13]




Given the widely acclaimed influence the Powell memo has had on the coordination of corporate and foundation activities with respect to developing and disseminating pro-business policies at all levels of government, and given the amount of attention that Powell gave to the situation, as he saw it, on college campuses and even on secondary school campuses, it is not surprising that some of the response was directed towards elementary and secondary education.


Indeed, included among the members and associate members of the SPN are several whose interests are clearly focused on education issues.  These include:


·        Alliance for School Choice

·        Center for Education Reform

·        Education Action Group

·        Foundation for Economic Education

·        Foundation for Education Reform and Accountability

·        Foundation for Excellence in Education

·        Intercollegiate Studies Institute


One of the early enlistees in response to Powell’s views was the Lynde and Harry Bradley Foundation. Under the guidance of Michael Joyce, who earlier had given focus and energy to the philanthropy of the John M. Olin Foundation, the Bradley Foundation became a major force in the new conservative movement. The Bradley Foundation is a good example of how conservative money engaged the battle plan laid out by Powell:


“At least two-thirds of its grants, according to one analysis, financed conservative intellectual activity.  It paid for some six hundred graduate and postgraduate fellowships, right-wing think tanks, conservative journals, activists fighting Communism abroad and its own publishing house, Encounter Books.  Continuing the strategic emphasis on prestigious schools, the foundation gave both Harvard and Yale $5.5 million during its first decade under Joyce’s management.  It was an activist force on the secondary-school level, too.  The Bradley Foundation virtually drove the early national “school choice” movement, waging an all-out assault on teachers’ unions and traditional public schools.  In an effort to “wean” Americans from government, the foundation militated for parents to be able to use public funds to send their children to private and parochial schools.” [14]


The activities described in the previous excerpt from Mayer, undertaken by the Bradley Foundation, were for the 15-year period beginning approximately in 1985.  That description shows, in a nutshell, several of the threads of the current school reform movement—school choice, anti-teachers’ unions, assault on public (“government”) schools, and vouchers.


The battle for control of elementary and secondary education in the United States is increasing in intensity each year.  The stakes are getting bigger, the lines more clearly drawn.  Often billed as reform versus the status quo, the reformers are pushing for more and more charter schools and for their ultimate goal, publicly provided vouchers that would allow parents to send their children to any school--public, charter, or private-- including religious schools.[15]  In Texas, voucher bills, introduced each legislative session have not yet passed, but charter schools, and their enrollments, have continued their rapid growth since first authorized in 1995.   Texas charter school enrollments have been growing at some 15 percent annually. This year there are approximately 232 thousand students enrolled in Texas charter schools, which will receive some $2 billion in state funds.[16] Continued annual growth at even 13 percent would result in upwards of 1.5 million students in Texas open enrollment charter schools by the year 2031.


The educational effects on public schools due to the growing charter enrollments are still uncertain (see below), but the financial impact is becoming real. Using another example from Texas, sometime before the end of the current school year Houston Independent School District, the largest in the State of Texas, is destined to remit to the state some $162 million in excess property tax revenue, due to its spurt in property wealth per pupil.  If the estimated 35,000 charter school students who live within Houston ISD’s boundaries still attended Houston ISD, rather than charter schools, Houston ISD’s property wealth per pupil would not yet have exceeded the value that triggered the $162 million recapture payment.


Charter schools and their enrollments have been growing rapidly nationwide, not just in Texas.  In 2001, national charter school enrollments were about 448 thousand.  By 2014 they reached over 2.5 million. This reflects an annual average growth rate of 14.2 percent.[17]  At this rate of increase, charter enrollments double every 5.2 years.  This expansion has been promoted and facilitated by a national network of corporations and associated private non-profit foundations, conservative think tanks, and educational and political leaders who have taken up the cause. The overall movement is sometimes referred to as the “pro-school choice movement”. The word “choice” has the effect of including school choice within the broader goal of expanding consumer and citizen choice in many realms.  For example, reducing or eliminating regulation of public utilities has resulted in homeowners being able to choose between several electricity providers, or among multiple cable or satellite television content providers. The notion of choice is also related to notions of increased competition, with the expectation that costs or prices will be reduced as a result. When the concept of charter schools was first being promoted, it was sometimes proclaimed that they would be able to “do more with less” because of the beneficial effects of competition and expected innovation. In fact, the “more with less” phrase is still often used, but is received with growing skepticism.[18] [19] [20]


Since charter schools in many states are permitted to contract out their operations to for-profit management operators, and voucher proponents envision that vouchers could be spent at for-profit private schools, the school reform movement is sometimes characterized as having the goal of privatizing elementary and secondary education. The fact that many of the proponents of charter schools also happen to be hedge fund managers, or are among those who have otherwise accumulated large fortunes in the private sector, contributes to suspicions that the voucher-charter school-privatization movement in actuality has more to do with a desire to reap potential profits than it does with an interest in actually improving elementary and secondary public education. This possibility is given credence by numerous academic studies that are able to demonstrate little, if any, improvement in performance on the part of students enrolled in charter schools, compared with similar students in the parent districts.[21] [22]


It is therefore possible that the primary motivation of the proponents of the voucher-charter school-privatization movement may be something other than, or at least in addition to, improved public education. This seems particularly possible in view of the fact that many of the major funding sources of the reform movement are also involved in promoting self-serving policies in other areas, which are purely economic in nature, such as low taxes, reduced government regulations, and increased privatization whether in the military, for-profit prisons, or in education itself.


The thesis developed here is that what is broadly referred to as the school reform movement also grew out of those same concerns expressed by Powell, and that the school reform movement is part and parcel of the broader movement to reverse the social and economic trends described by him.  This thesis will be examined by analyzing non-profit foundation grants.  In particular, it will be demonstrated that a large majority of such grants to members of the pro-school choice/school reform movement come from donors who also provide grants to members of the SPN. 


The school reform network, as defined here for subsequent use, will consist of two-dozen organizations that are closely involved in the pro-school choice movement.  This will be called the Pro-Choice Network, or PCN. Thus, “school reform movement (or network)” will be used interchangeably with “Pro-Choice Network.”  It is assumed that the promotion of vouchers, to be used by parents at any school they might choose, is part of the agenda of this network.


The other network will include a larger set of organizations that are either classified as members, or associate members, of the State Policy Network. This network will be abbreviated as SPN+, with the plus sign indicating that organizations designated as associate members of the SPN are also included. Many of the associate members are among the largest and most prominent national think tanks, such as the Heritage Foundation, the American Institute for Public Policy Research, the Cato Institute, and the Manhattan Institute for Policy Research.


The overlap in funding sources for the PCN, on the one hand, and the corporate-aligned SPN+, on the other hand, will be demonstrated by comparing the amounts of support provided to the two groups from those non-profit foundations that make grants to both sets.  Because non-profit foundations are required to file annual tax returns (IRS form 990) and must report the recipients and amounts for the grants they make, it is possible to determine the grants to any non-profit foundation that come from other non-profit foundations. These data are collected, from the publicly available tax returns of non-profit organizations, by, among others, the Foundation Center.  A service provided by the Foundation Center, Foundation Center Online, is the source of the data that will be summarized and presented below.


State Policy Network


The State Policy Network (SPN) was established in 1992 to serve as an “umbrella organization” over the myriad Heritage clones established in virtually every state.[23]


The website of the SPN includes a list of its member organizations.[24]  A perusal of that website, and its membership list, substantially describes the intended scope of its influence, which is, in short, nationwide.  The SPN intentionally worked to establish what it refers to as policy think tanks in every state within the U.S. It has largely succeeded in achieving that goal, with some states hosting more than one such member.


One particular member within the SPN is extremely important, namely the American Legislative Exchange Council, or ALEC.  The purpose of ALEC is to coordinate the drafting of state-level model legislation by holding meetings that include state legislators and corporate representatives.  ALEC has divided the total scope of corporate interests into the following subject areas:[25]

·        Civil Justice

·        Commerce, Insurance and Economic Development

·        Communications and Technology

·        Education

·        Energy, Environment, and Agriculture

·        Health and Human Services

·        International Relations

·        Justice Performance Project

·        Tax and Fiscal Policy


Until recently ALEC also had a Public Safety and Elections Task Force.  The Florida law, which was related to the death of Trayvon Martin, brought intense criticism to ALEC.[26] According to Wikipedia:


“ALEC's Public Safety and Elections Task Force, which promoted stand your ground gun laws and voter identification requirements, was disbanded in April 2012. Thereafter, the National Center for Public Policy Research announced the creation of a voter ID task force to replace the one discontinued by ALEC.”[27]



Corporate representatives are invited to purchase membership in the ALEC sections that interest them.  At ALECS’s meetings, held several times each year, the corporate representatives meet with state legislators from the various states, and together they draft possible statutes they would like to see enacted in multiple states.  It turns out, as reported by Sourcewatch, that the motivations of state legislators’ to get ALEC’s model laws enacted are reinforced, in many cases, by campaign contributions to them from the corporate representatives with whom they met while drafting the proposed laws. For example, Texas Representative Tom Craddick, who at one time was the Chairman of ALEC Board of Directors, “received $878,000 in campaign contributions from ALEC corporate members from 2004-2011.”[28] The same source also stated that former Governor Rick Perry received over “$2 million in campaign contributions from ALEC corporate members from 2004-2011.”[29]


In addition to the list of members that is exhibited on SPN’s website, there is also a list of associate members.[30] Many of the associate members are think tanks that are located in or near Washington, D.C. or New York City.  These associate members focus on many of the same topics as do the regular members, although the associate members are primarily concerned with matters of national policy, including national security.  But there is a substantial overlap of interests between the two groups and on most issues they are mutually supportive. To repeat, the network consisting both of SPN’s regular members and associate members will be referred to below as SPN+.


The methodology used in establishing the SPN+ network is now described.


State Policy Network, regular and associate members (SPN+)


As mentioned previously, the names of the regular and associate members of the SPN were, at least in 2013, listed on SPN’s own website.  Listed were 64 regular members and 99 associate members. The name of each of these was used in searching for grants received using Foundation Center Online.  In each case the list of foundations that made grants to one of the members of SPN+, and the amount of each grant, were downloaded as an Excel file.  When many grants were found for a single member they had to be downloaded in chunks limited to 100 rows. Of the total of 163 regular and associate members, non-profit foundation grants were located for 129 of them. There were over 11,000 individual grants identified as going to the 129 members from 963 distinct foundations.  The data base covered the years 2003 to 2013, although it appeared, based on the totals, that the last two years were only partially complete. 


The individual grant amounts were aggregated across years, by grantor by recipient (member).  This resulted in 3,288 grant totals from one of the grantor foundations to a network member recipient.  These amounts, in effect, are the links between the set of grantor foundations and the recipient members or associate members of the SPN, and form what is called a bi-variate network graph.[31] [32]


Pro-choice Network (PCN)


The PCN was established by starting from a small number of major donors to charter schools and related organizations.  Specifically, in 2012 the Bill & Melinda Gates Foundation announced a partnership between it and the Broad, Walton and the Lynde and Harry Bradley foundations, in partnership with the Charter School Growth Fund, to “provide high performing charter schools with facility financing.”[33]  This nucleus was expanded by identifying individuals on the boards of directors of these five organizations, and noting other relevant organizations on which those same board members also served.  This resulted in several additions to the initial network, such as the KIPP Foundation, Teach for America, Philanthropy Roundtable, Alliance for School Choice, and Leadership for Educational Equity.  Listings of the members of the board of KIPP Foundation and Teach for America indicated additional linkages to the Foundation for Excellence in Education, and the National Alliance for Public Charter Schools.  Based on a desire to make this network particularly relevant to the State of Texas, connections from Mike Feinberg, a member of the KIPP Foundation board and director of KIPP Inc (Houston), established links to the Texas Charter Schools Association and Families Empowered, which was founded by Mr. Feinberg’s spouse, Patricia Colleen Dippel. Through board member linkages from these latter two organizations the Texas Institute for Education Reform and the Center for Reform of School Systems were added.[34]


In addition to the recipients listed above the network was augmented with The New Teacher Project, five regional KIPP clusters, including Houston’s, four regional Teach for American (TFA) centers, the Newark Charter School Fund, and Communities in Schools ouHHhhhHouston.


Excluding the Broad, Gates, Walton Family, and the Bradley foundations from those listed above, there remain 24 charter school related recipient organizations. These 24 are proponents of or active participants in the charter school movement.  The procedure, once again, was to utilize the Foundation Center Online to search for non-profit foundations that made grants to these 24 non-profit donor foundations during the years 2003 to 2015.  This information was assembled into a single file that showed individual grants from the identified 1,198 non-profit donor organizations to one or more of the 24 charter-related organizations.  These individual grants were aggregated across all years, by grantor by recipient. This resulted in 1,632 linkages between the grantor non-profits and the 24 recipient non-profit organizations, forming another bi-variate network graph.


Summary of data for both networks—Pro-Choice Network (PCN) and State Policy Network Plus (SPN+)


When the sources and magnitudes of the support flowing to members of the SPN+ are compared to the sources of support specifically to the education reform organizations included in the Pro-Choice Network, it becomes clear that the education reform movement is substantially a sub-component of the more comprehensive conservative agenda. Both the PCN and the SPN+ promote legislation and policies that support conservatives’ approach to governing, which is to say, the corporate interests of those providing the financial support to the network.



One of the goals here is to quantify the degree to which the two networks overlap, based on the pattern of foundation grants.  Many analyses of the pro-choice movement have focused primarily on the institutions and sources of funding for the pro-choice education network itself, largely in isolation.  The larger network, SPN+, which encompasses many issue areas beyond those relating strictly to education, is most often ignored or not explicitly included  and taken into consideration when the focus is on educational issues.  However, when one looks at the funding sources for the Pro-Choice Network and the State Policy Network, with the latter including the SPN’s associate members, it is



Table 1.  Grants from non-profit foundations to the Pro-Choice Network and to

               the State Policy Network including Associate Members



Number of


Number of





Grants ($Millions)

Grants from

Single Grantors

To Recipients

In both Networks ($Millions)



From Common Grantors (%)






State Policy Network plus Associate Members



$783 mil

$472 mil




Pro-Choice Network



$1,406 mil

$1,102 mil




Both Networks



$2,189 mil

$1,574 mil






apparent that many of the donors contribute to organizations in both of these networks.  The data developed for the two networks described above are examined with an eye toward determining the degree to which such common funding of members of both networks occurs.  Table 1 summarizes these data.


Comments on Table 1:

·        The data for the SPN+ network were extracted approximately 3 years before those for the PCN were obtained, therefore the difference in the “Years Included” for the two networks.

·        The number of unique grantor foundations shown for both networks (1,913) is 248 less than the sum of the grantors for the two networks (963 + 1198), as 248 grantors made grants to one or more organizations in both networks.

·        The 248 donor foundations which made grants to members of both networks comprised just 13 percent of the 1,913 total donors, but those 248 donors made 60 percent of all grants received by the SPN+ network and 78 percent of the grants received by the PCN. 

·        To the extent that influence follows money, those 248 donors might be expected to have considerable influence on both networks.

·        To the extent that the goals of recipient organizations are, or become, consonant with the values of the donors, it seems safe to assume that in the eyes of the donors the goals of the two networks would also be viewed as being consonant and supportive of the major goals of the members of both networks.



The information presented in Table 1 can also be usefully displayed with the aid of the diagram shown in Figure 1.



Figure 1


The shaded area in Figure 1 represents the grants made to both networks by the 248 foundations that contributed to members of both. If the four distinct grant totals shown in Figure 1 are added together the sum is $2,189 million, the grand total of all grants captured.  The sum of the grants to both networks made by the 248 foundations in the shaded regions is $1,574 million, which is approximately 72 percent of the total $2,189 million.  Put another way, the average grant amount contributed by the 248 donors is $1,574 million divided by 248 or $6.3 million each.  In contrast, the average grant amount contributed by the other 1,665 donor foundations, which totaled $616 million, is just $0.37 million each, on average.


Looking at contributions to each network separately, the 248 donors which contributed to both networks gave, on average $4.4 million to members of the PCN, while the other 950 donors to the PCN contributed only $0.32 million, on average.  Similarly, those 248 donors provided grants to the SPN+ network averaging $1.9 million, while the contributions of the other 715 contributors to the SPN+ averaged just $0.43 million.


The conclusion, based on these data and observations, is that those 248 donors that made grants to member organizations in both networks were dominant within each network.  They provided 78 percent of the total grants made by all 1,198 contributors to the PCN network, and 60 percent of the total grants made by all 963 contributors to the SPN+ network. By virtue of their influence in each, the major donors were positioned to align and coordinate the activities and goals of both networks.


This large and concentrated overlap between donor foundations that extend significant amounts to members of the Pro-Choice Network and also to the State Policy Network Plus gives strong support to the hypothesis that the school reform/pro-choice agenda is part and parcel of the larger agenda embodied in the over-arching network of national and state level think tanks and the many organizations that support them and make use of their policy research studies and papers.


Those foundations that would be expected to influence policies in both the Pro-Choice Network as well as the State Policy Network Plus would be among the largest donors to each network, but not necessarily the largest in both. An index was created in an attempt to order the major donors on the basis of their probable influence in coordinating the two networks.  Shown in the following table, the index was created by multiplying the percentage of donations by each donor in each network by one another, and then taking the square root of the product.  The square root function was intended to capture an assumed diminishing return related to their grants. This also has the effect of compressing the range of the index. The donors are ranked on this index, called the Coordination Index, in Table 2.  The corresponding rank of each based upon their individual total amounts of grants to each network is shown as “Rank in PCN” and “Rank in SPN+”.


To explicate, the Walton Family Foundation is ranked first based on this index.  It was number 1 by far based on donations to members of the PCN, and was also the 6th greatest contributor to members of the SPN+ network.


The Bill & Melinda Gates Foundation is ranked number 2 based on the Coordination Index. Its contributions were far below those of the Lynde and Harry Bradley Foundation to members of the SPN+ network, but much greater than Bradley’s to members of the PCN network.


The Eli & Edythe Broad Foundation placed just 6th on the Coordination Index.  While it ranked 5th on the basis of contributions to members of the PCN, its contributions of less than $1 million to members of the SPN+ network gave it a rank of 113th in that case.  The combined effect, based on the product of its percentages of contributions to each network, however, left it with an over-all rank higher than the other 243 foundations that made contributions to members of both networks


Table 2


Major Donor Foundations to the PCN and the SPN+ Networks Ranked by Mutual Influence

Rank Order

Grantmaker Name

Rank in PCN

Grants to PCN

Rank in SPN+

Grants to SPN+

Coordination Index


Walton Family Foundation, Inc.







Bill & Melinda Gates Foundation







The Lynde and Harry Bradley Foundation, Inc.







The Kern Family Foundation, Inc.







Robertson Foundation







Eli & Edythe Broad Foundation







William E. Simon Foundation, Inc.







John Templeton Foundation







Carnegie Corporation of New York







Ewing Marion Kauffman Foundation







The Anschutz Foundation







Searle Freedom Trust







The Kovner Foundation







Silicon Valley Community Foundation







Laura and John Arnold Foundation







ExxonMobil Foundation







The Louis Calder Foundation







Daniels Fund







The Richard and Helen DeVos Foundation







William K. Bowes, Jr. Foundation







Charles and Helen Schwab Foundation







Jaquelin Hume Foundation







Lilly Endowment Inc.







Community Foundation of Greater Memphis







The Starr Foundation







John S. and James L. Knight Foundation







The Joyce Foundation







Brady Education Foundation, Inc.







Doris & Donald Fisher Fund







Gleason Family Foundation







F. M. Kirby Foundation, Inc.







Communities Foundation of Texas, Inc.







The Brown Foundation, Inc.







Bill and Susan Oberndorf Foundation







M. J. Murdock Charitable Trust







The Marcus Foundation, Inc.







The San Francisco Foundation







Charles Koch Foundation







            Data source: Foundation Center Online


While many of the 248 donors that contributed to members of both networks made much larger contributions to one network than to the other, many others, such as the Bradley, Simon, and Kauffman Foundations made substantial contributions to both networks.[35]  It is thus argued that the rankings of the major foundations, shown in Table 2, reinforces the conclusions drawn previously, based upon the proportions of contributions by the entire 248 major donors to each network. It is argued that these foundations, collectively and individually, extended their influence to both the PCN and SPN+ networks in such amounts that the values and goals of these foundations would influence the values and goals of members of both networks.



ALEC and ALEC-sponsored legislation in conflict with Pro-Charter School Movement’s claimed concern for the education and welfare of economically disadvantaged and minority students


Model legislation produced under the auspices of ALEC reflects goals of members of the SPN+. Some of the areas toward which ALEC model statutes have been directed are presented below.  Potential impacts that these model statutes might have upon economically disadvantaged school children, if adopted, are pointed out.


In many of the nation’s major cities the vast majority of school age children come from poor families.  In Houston, for example, the percentage of economically disadvantaged students is approximately 75 percent. The percentages of such students in the major charter schools in Houston are also at that level or higher. Proponents of charter schools claim that these schools are most concerned with helping poor students close the achievement gap relative to children of middle class families.


But much of the legislation developed and promoted by ALEC by way of legislator-corporate retreats does not benefit poor families, the families of those economically disadvantaged students.


ALEC opposition to tax increases—Super-Majority Act[36]


Reducing taxes or preventing tax increases often translates into reduced support for public education. Reducing taxes does not provide the additional resources needed in inner city schools, such as lower class sizes, summer school, more councilors, or refurbished buildings.


ALEC’s Living Wage Mandate Preemption Act[37]


Opposition to higher minimum wages does not contribute to higher household earnings among poor families and their children. This proposed ALEC bill would also deprive local governments of exercising local authority on the minimum wage.


ALEC’s Minimum-Mandatory Sentencing Act[38]


Legislation requiring stricter sentencing for relatively minor offenses makes it more difficult for those incarcerated to help support their families, especially if the incarceration takes place in ALEC-promoted private prisons which have been shown to supply fewer opportunities for training and remediation.[39]


ALEC’s Resolution Against U.S. Participation in International Agreement in Copenhagen[40]


Laws that attempt to undermine the science of global warming conflict with the stated goals of ALEC supporters that they are interested in promoting quality science education in regular public schools, as well as in charter schools.


ALEC’s Great Schools Tax Credit Program Act (Scholarship Tax Credits)[41]


School vouchers that could be used in many less-than-exemplary charter schools and private schools, with reduced state oversight of their curricula, will likely result in science classes that promote skepticism about such topics as global warming, evolution, and geology. Encouraging doubt in the face of scientific consensus has the effect of undermining respect for fact-based discourse beyond the field of science, promoting that old tradition of the “know-nothing” approach to politics.


ALEC’s Voter ID Act[42]


Legislation that makes it more difficult to vote depresses voting especially among the poor and minority populations.  This erodes civic participation among families of poor and minority children, making them less likely to participate in civic affairs when they reach adulthood.


ALEC’s Right to Work Act[43]


ALEC has promoted numerous model bills that are anti-union.  The anti-union bias of ALEC is consistent with the built-in bias against teachers’ unions, at least in Texas.  One of SPN’s member organizations is the National Right to Work Legal Defense and Educational Foundation. This foundation has received substantial funding from the following foundations that appear in Table 2, donors both to the SPN+ and to the Pro-Choice Network:  Gleason, Simon, Walton, Anschutz, Bradley, F.M. Kirby, Hume and Templeton.


All of the above laws and resolutions were drafted and promoted by ALEC and its members. All receive implicit if not explicit support of the broader SPN+. All are directly or indirectly detrimental to public education, and are inconsistent with the PCN’s claims of looking out first-and-foremost for the well being of minority children and children of poverty.[44]


If goals other than those directly associated with educational improvement for all students are held by the donors to the SPN+ and the PCN, then pursuit of those educational goals is diminished.  For example, if some public policy were feasible that would have the effect of significantly improving the performance of the existing public education system, would the supporters of the PCN and the SPN+ support that policy?  There is at least one example from California for which the answer was “No”. 


In an on-line piece entitled “Distorting Our Democracy”, the following incident was reported:


“The Waltons contributed to the defeat of one of the largest early childhood education initiatives in state history.  In 2006, Greg Penner, Walmart board member and son-in-law of S. Robson Walton, contributed $250,000 to “No on 82.” The so-called “Reiner Initiative”—named after its sponsor, actor and director Rob Reiner—sought to establish a universal preschool system in California for four-year-olds by placing an additional income tax on individuals making more than $400,000 a year, and couples making in excess of $800,000.”[45]


This would seem to be a clear case of a wealthy individual, representing the family foremost in promoting an alternative to the public school system, using his wealth and influence to prevent the public education system from achieving a very likely improvement.   The measure Penner helped defeat would have adversely affected only the extremely wealthy, but it would have benefited many thousands of economically disadvantaged children.


Pro-choice advocates frequently criticize teachers’ unions and K-12 administrators for negatively affecting the quality of public schools.  But when faced with a clear choice to support public education they chose the opposite.  


A brief internet search was conducted to find any statements by Mr. Penner that attempted to justify this action.  None were found. However, a recommendation by a Los Angeles Times editorial to vote ”No” did come up. The points raised in that editorial, however valid, might well have been addressed before the proposition was finalized.[46]



Final Comments


The question was asked, “What is driving the frenzy to expand school choice options?” The short answer, based on evidence provided above, seems to be that the promotion of school choice options is consonant with the goals of many of the corporations and wealthy individuals that are funding the movement. It is argued that the corporate pushback against changing values began in the early 1970’s.  The sentiment was captured in Ronald Reagan’s famous phrase, “Government is not the solution to our problem.  Government is the problem.”[47]


Fast-forward to the present time. Conservative members of state legislatures routinely refer to traditional public schools as “government” schools, using the word government as a smear, indicting devoted teachers and administrators as not worthy of their respect. Here in Texas it often seems that many legislators are more concerned with charter school funding than with the well being of the public education system as a whole. A recent article in the Houston Chronicle contained the following:


“However, getting lawmakers to agree to changes to education funding is typically an uphill battle.  The state budget is expected to be tight this year, and [Lt. Governor Dan] Patrick has been focused on voucher-like programs that would help finance private school or home-school education.”[48] [49]




The purpose of this paper was not to supply solutions to the plight of public education.  Rather, the purpose was limited to demonstrating that many of the forces and voices behind what is commonly called the school reform movement have goals that are at best only tangentially related to education improvement. The unfortunate effect of this movement may well be a prolonged delay in seriously addressing the needs of public education in the U.S.


End notes

* Dr. Toenjes is retired and lives in Clear Lake Shores, Texas.  He previously worked for the State of Illinois and the Texas School Board Association analyzing issues in state and school finance.  More recently he was a member of the Department of Sociology at the University of Houston, focusing on issues in school accountability.

[1] National Conference of Statue Legislatures, “School Voucher Laws: State-by-State Comparison,” at , accessed 10-24-2016.

[2] There is a large and growing body of work that is critical of the voucher-charter school movement.  One of the most prominent voices is that of Diane Ravitch.  Dr. Ravitch at one time supported the charter movement but has since become a strong opponent of it.  She is the author of “The Death and Life of the Great American School System:  How Testing and Choice Are Undermining Education, (Basic Books, New York: 2010), and Reign of Error: The Hoax of the Privatization Movement and the Danger to America’s Public Schools, (Alfred A. Knopf, New York: 2013).


More recently, AlterNet, an on-line news service that is part of Independent Media Institute, published an extensive review of issues related to the charter school movement.  Written by Don Hazen, Elizabeth Hines, Steven Rosenfeld and Stan Salett, it is titled Who Controls Our Schools? How Billionaire-Sponsored Privatization Is Destroying Democracy and Enriching the Charter School Industry. It can be accessed and downloaded at .


On October 15, 2016 the NAACP released its “Statement Regarding the NAACP’s Resolution on a Moratorium on Charter Schools” which is available at  .

[3] Some observers contend that the goal of “movement conservatism” is to reverse and dismantle the New Deal itself.  For example, see Paul Krugman, The Conscience of a Liberal, (New York: W. W. Norton & Company, 2007,2009), p. 10.

[4] The Powell Memo (also known as the Powell Manifesto), accessed 10-20-2016 at .

[5] Stewart Alsop, Yale and the Deadly Danger, Newsweek, May 18, 1970.

[6] Editorial, Richmond Times-Dispatch, July 7, 1971.

[7] The Powell Memo, ibid.

[8] Ibid.

[9] Cray, Charlie, The Lewis Powell Memo: Corporate Blueprint to Dominate Democracy”, August 23, 2011, accessed 10-20-1916 at .

[10]The partnership began in 1980, when Heritage provided the president-elect's transition team with detailed policy prescriptions on everything from taxes and regulation to trade and national defense. The published version of these recommendations, the 1,100-page "Mandate for Leadership," was described by United Press International back then as "a blueprint for grabbing the government by its frayed New Deal lapels and shaking out 48 years of liberal policy." “ Blasko, Andrew, Reagan and Heritage: A Unique Partnership”, 6-7-2004, accessed 10-20-2016 at .

[11] Lee Fang, The Machine: A Field Guide to the Resurgent Right, (New York: The New Press, 2013), p. 199.

[12] During the years 2003-2013 the Roe Foundation made grants totaling at least $5.5 million to more than 70 members of the State Policy Network.

[13] Fang, p 203.

[14] Jane Mayer, Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right, (New York: Doubleday, 2016), p. 113. Mayer describes the history of several of the first major foundations that directed and funded the early years of “movement philanthropy.”

[15] Meghan Mangrum, “Religious schooling is the top reason parents use vouchers, survey finds,” Chalkbeat, 6-28-2016, at , accessed 10-23-2016.

[16] Texas Education Agency, Statewide Charter School Summary of Finances (line 40), Run ID 18561 dated 10/11/2016, , accessed 10-22-2016.

[17] Charter enrollment data found at , accessed on 10-21-2016.

[18] National Center for Policy Analysis, “Charter Schools: Doing More with Less Money,” 1-29-2015, accessed 10-20-2016 at .

[19] Pasi Sahlberg, “Myth: You can do more with less,” Alberta Teachers’ Association Magazine, 6-1-2015, accessed 10-20-2016 at .

[20] John Savage, “New Report Challenges Claims Charters Do More With Less,” Texas Observer, 12-7-2015, accessed 9-20-2016 at  .

[21] National Center for Education Evaluation and Regional Assistance (U.S. Dept. of Education), The Evaluation of Charter School Impacts, 2010, available at . This report was billed as “a large-scale randomized trial of the effectiveness of charter schools funded by the Institute of Education Sciences and conducted by Mathematica Policy Research and its partners.” (p. xvii)


The unique aspect of the Mathematica study is described as follows:

“The evaluation, which we conducted in 36 charter middle schools across 15 states, compares outcomes of students who applied and were admitted to these schools through randomized admissions lotteries (lottery winners) with the outcomes of students who also applied to these schools and participated in the lotteries but were not admitted (lottery losers). This analytic approach produces the most reliable impact estimates. But because the study could only include charter middle schools that held lotteries, the results do not necessarily apply to the full set of charter middle schools in the U.S.” (p. xvii)


Two of the findings were:

“On average, study charter schools did not have a statistically significant impact on student achievement.”

“Study charter schools positively affected parent and student satisfaction with and perceptions of school.”


The unique nature of the students in the sample permitted a finding that seems to confirm the criticism that students that attend charter schools are not representative of students in traditional public schools, but attend charter schools because they benefit from having more pro-active parents, namely:


“By comparing the characteristics of the students not offered admission to study charter schools (that is, the lottery losers) with the full populations of students at the schools they attended during the follow-up period, we were able to examine how applicants to the charter schools in the study differed from other students living in the area who did not apply to the charter schools. The charter school applicants were more likely to have achieved proficiency on their state reading tests (73 versus 57 percent) as well as their state math test (58 versus 45 percent).” (p. xx)


A new report from the Education Law Center documents improper admission procedures by California charter schools.  See “Unequal Access: How Some California Charter Schools Illegally Restrict Enrollments,” available at .

[22] Center for Research on Education Outcomes, National Charter School Study: 2013, (Stanford University:  2013).  While the report contains a great deal of detail and nuance, the over-all findings are summarized in Table 20, p. 86, reproduced below:


Worse Growth Than


Growth No Different

From Comparison

Better Growth Than











The conclusion is that charters might do slightly better in reading, no better in math.

The authors give the following as one of the implications of their findings:


“2. What do the current findings portend for continued advances in the quality of the charter sector? The results show WYSIWYG among existing schools (“What You See Is What You Get”). That academic performance in schools does not change much over time implies two things. First, while the actual degree of autonomy that charter schools enjoy differs from place to place, they typically have more freedom than local TPS [traditional public schools] to structure their operations and allocate resources to address the needs of their students. Even with this decentralized degree of control, we do not see dramatic improvement among existing charter schools over time. In other words, the charter sector is getting better on average, but not because existing schools are getting dramatically better; it is largely driven by the closure of bad schools.”( p. 87)


This finding is unsettling.  The possibility that the only way to improve average performance among charters is to let them start up willy-nilly, then weed out the ineffective ones. The students from those with poor performance would likely revert to the public schools, which would then be faced with problem of dealing with students who had been negatively affected by their years spent in the failed charters.

[23] “State Policy Network,” SourceWatch, accessed on 5-3-2014 at

[24] Unfortunately, the SPN website apparently no longer contains comprehensive lists of its members and associate members.  Rather, member organizations are presented on a state-by-state basis by clicking on a map of the states.  A comprehensive list of SPN members, associate members, and “Other Organizations” was downloaded November, 2013, from , but this link is no longer effective.

[25] The list of ALEC’s subject areas was taken from a description of ALEC that may be found at

[26] Juan Williams, “Trayvon killing puts American Legislative Exchange Council in the spotlight,” (The Hill: 4-23-2012), accessed on 10-2-2016.

[27] Quotation taken from, accessed on 10-21-2016. It is noteworthy that “Voter ID Laws,” also promoted by ALEC, have been overturned in several states by federal courts, including the one passed in Texas. 

[28] Taken from “Texas ALEC Politicians,” Sourcewatch, , accessed on 10-21-2016.

[29] Ibid.

[30]See footnote 24 above.

[31] Although this paper deals with two networks—PCN and SPN+--little of the terminology or techniques which form the field of social network analysis are used.  However, the point of mentioning that both of the networks dealt with are of the bi-variate type is to call attention to the fact that one of the primary ways in which the members are related is through the patterns of financial grants from the non-profit foundations to the more operative members, whether Teach for America, the Texas Charter School Association, or the Heritage Institute. Similarly, the donor foundations are “related” by the organizations to which they donate in common.  This is in contrast to uni-variate networks, such as familial relationships among a group of people, or friendship relationships.  Wayne Au and Joseh J. Ferrare provide a very brief overview of elements of graph theory in their “Introduction: Neoliberalism, Social Networks, and the New Governance of Education,” which comprises Chapter 1 of Mapping Corporate Education Reform: Power and Policy Networks in the Neoliberal State, (New York and London: Rutledge), of which they are the editors, pp. 10-15.

[32] An interactive version of the resulting network is at .  Instructions can be found by clicking on the “Help” button beneath the diagram.

[33] Bill & Melinda Gates Foundation, “How We Work: Charter School Growth Fund,” at , accessed 10-22-2016.

[34] Apart from the decision to include several relatively small Texas actors, the majority of the organizations included resulted in a network consisting of some of the major sources of funding for the PCN, but also some of those most involved in promoting the rapid growth of charter schools, such as Teach for America and the KIPP Foundation.  Many other organizations could have been included, but it was felt that the PCN identified for the purpose of this task was sufficiently representative of the school reform movement as a whole, and certainly includes some of the most influential actors in that movement.

[35] The Michael and Susan Dell Foundation made grants totaling $72 million to members of the PCN, putting it in fifth place among such donors.  But no Dell Foundation grants to members of the SPN+ were identified.

[36], accessed 10-22-2016.

[37] , accessed 10-22-2016.

[38] , accessed 10-22-2016.

[39] According to U.S. Deputy Attorney General Sally Yates: “Private facilities don’t save substantially on costs, don’t provide the same level of safety and security, and are lacking when it comes to educational and job training programs that reduce the likelihood of a person returning to prison,” Dane Schiller, “Closing private prisons could be costly,” Houston Chronicle, 9-6-2016.

[40] , accessed 10-22-2016.

[41] , accessed 10-22-2016.

[42] , accessed 10-22-2016.

[43] , accessed 10-22-2016.

[44] For an extensive description of the American Legislative Exchange Council (ALEC) and how it operates a good place to start is “American Legislative Exchange Council,” Wikipedia, at , accessed 10-23-2016.

[45] Peter Dreier,“Why Are Walmart Billionaires Bankrolling Phony School ‘Reform’ In LA?”, March 2, 2013, at , accessed 10-22-2016.


[46] “No on Proposition 82,” Los Angeles Times, May 21, 2006, at , accessed 10-22-2016.

[47] From President Ronald Reagan’s first inaugural address, Jan. 20, 1981, available at , accessed 10-24-2016.

[48] Ericka Mellon, “’No’ on HISD ballot measure urged,” Houston Chronicle, 10-24-2016, p. A3.

[49] In a document dated October 12, 2015 Lt. Governor of Texas Dan Patrick issued his “Interim Charges” to various senate committees, indicating his priority listing of areas to be studied before the next legislative session in January 2017. His top two priority topics for study were:

School Choice: Study school choice programs enacted in states across the nation, examining education savings account and tax credit scholarship programs in particular. Examine the implementation process used in other states and what impact these programs have had on student academics and state and local district budgets. Make recommendations on which choice plan could best serve Texas students. 


Charter School Approval, Expansion, Revocation: Study the approval, expansion, and revocation of public charter schools in Texas, including the implementation of SB 2 (83R) and other legislation... In addition, make recommendations if needed to clarify policies regarding expansion of existing high-quality charter schools in Texas. Additionally, examine facility funding for charter schools in other states and make recommendations on facility funding assistance for charter schools in Texas.


In short, Lt. Governor Patrick’s highest priorities for the next legislative session are to consider vouchers, aka “education savings account and tax credit scholarship programs,” and charter school expansion.