Who Benefits from the Public Schools?
What if we look at public schools as profit-making ventures?
August 13, 2013 - 1:48 am
So let’s look a little further. New York teachers’ salaries, according to their website, start out at about $45,000 a year ($52,000 with a master’s degree) and max out at just over $100,000 a year. If we assume that these one-room schools attract the highest-paid teachers, that leaves between approximately $200,000 and $400,000 in net income per classroom per year, or $8,000 to $17,000 dollars per student per year.
Which is to say, the gross profit percentage is near 50 percent.
As an aside, if New York wants to start one of these schools, I’ll volunteer to run it. I’ll throw in an annual two-week summer tour of Europe for all the students and six adults as chaperones. Back of the envelope, that’s about a $30,000 expense, and I get a tour of Europe in the bargain — and still make $350,000 a year!
Cui bono? –Lucius Cassius Longinus Ravilla
Imagine, if you will, that we were running a for-profit company in the same environment as a public school system: providing an essential service, with a near-total monopoly, in that even potential customers who choose not to buy are still charged full price. It would be massively profitable, until they caught us; the stockholders would make a real killing. Even more so if the quality of the product could be reduced with little impact on revenues.
A for-profit company would also be expected to distribute any profits that aren’t retained to the stockholders. As we know, the New York City schools aren’t awash in excess cash, so like a for-profit company, they must be distributing the profits somehow. If we find out who is getting the profits, we know who the effective stockholders are.
“When school children start paying union dues, that’s when I’ll start representing the interests of school children.” — Attributed to Albert Shanker, former president of the American Federation of Teachers
Okay, I admit it: I’m giving away the punchline. Who benefits? It’s not New York City schoolteachers: remember that a teacher with a 20 student class is still bringing in more that $400,000 in revenue for a nine-month semester, whether they’re paid $45,000 a year or the maximum, and they basically don’t get any more (or any less) based on anything but seniority. Numbers for New York City schools have been hard to find, but in New York state, school spending has increased, teachers’ pay has increased, but non-teaching professionals’ pay has increased faster. In Nassau County, just outside New York City, the first 30 school employees listed on the RocDocs site make more that $250,000 a year, with the highest salary being that of the superintendent, at $567,248.00. (And I’d love to show you actual New York City statistics, but they are hard to find. Curiously so.)
I’ve got one more rule that serves me well. I assume that every human institution optimizes its behavior to maximize rewards, and while money isn’t everything, when you’re looking at reward it’s the way to bet. I think we must conclude that New York schools — and this analysis can be replicated in nearly every big-city school system — are being run to benefit not the teachers and, with 80 percent near-illiteracy rates, not the students. The school systems are a very successful, profit-making institution that distributes their profits to the “stockholders” — the non-teaching professional staff.