The commission, which is being led by the former Citigroup chairman
Richard D. Parsons, has also gained two more well-known names from Wall
Street: Sanford I. Weill, another former Citigroup chairman, and Stanley
F. Druckenmiller, a billionaire hedge fund manager.
Naturally, one can't establish an education panel without a billionaire hedge fund manager. That's key if you want to discover the opinions of people who wouldn't send their kids to public school on a bet. The other Wall Street folks will surely reinforce that important point of view.
Governor Cuomo has added a few people who might be closer to education:
The new appointees include a parent advocate from Rochester, a newly
elected school board member from the Adirondacks and a district
superintendent from Central New York — three constituencies that the
governor was criticized for not including on the panel when he announced
it in April.
Fortunately, Governor Cuomo has not one single working teacher on the panel. To really round out the voices heard, it's important that not one single person who will be personally affected by the choices it makes have any voice whatsoever on it. There will be some retired teachers, who don't have to worry about Governor Andy's newly established Tier 6, or spending their twilight years eating cat food. Surely there will be gala luncheons for them in Albany, even as NYC teachers face their fifth year without a raise in salary.
The important thing for Governor Andrew Cuomo is to gauge the opinions of those upon whom his "reforms" will have no effect at all. For example, it won't be them with their junk science ratings on the front page of the New York Post after concerned parents leak them. And it won't be them with long lines of parents outside their offices demanding transfers to 100% rated Miss Eyre's class from abysmally rated Mr. Educator's class. That will be the working principals, who surely have nothing better to do than ward of hordes of parents angry about ratings that are essentially meaningless.
But if the editorial pages of the local newspapers say they have value, that should be good enough for anyone. In this modern age of the New York Post, Fox News, and "Democrats" like Andrew Cuomo, reality just won't do.
This is the second post in a series devoted to giving hedge fund managers advice from teachers. It's only fitting, since they offer so much advice on education.
Since so many hedge fund managers have entered the education reform business and begun giving policy advice to mayors, governors and presidents on how to operate a school system, run schools and educate children, NYC Educator thought it would be a good idea for educators to give hedge fund managers and other Wall Streeters investing and financial advice.
When he asked me to offer a post in the series, I knew EXACTLY what advice I wanted to offer the hedge fund managers/education reformers.
My advice is less financial and more educational.
Keep bringing those hedge fund business ethics and values to public education.
That's right - more of those please.
Take the way you guys rig your pay so that you take a 2% management fee, 20% of the profits, but none of the losses of all those risky bets you make.
A "heads you win, tails you don't lose" pay strategy - that is BRILLIANT!
That means you can make all kinds of short-sighted, get rich quick bets and investments and care less whether there is any long-term downside risk.
Then take the way you get taxed.
Why pay federal income tax rates on the money you make when you can pay lower capital gains tax rates instead?
These investment advisors and hedge fund managers can take advantage of this tax structure because they are often compensated through a scheme that, in part, pays them according to the returns on the fund. The industry standard for hedge fund managers is “two and twenty,” which is shorthand for an “overhead” fee of 2% of capital under management plus carried interest (often called a “carry”) of 20% of the returns on the fund. Thus a $100 million fund earning 20% would pay its fund manager $2 million for overhead and $4 million in carry. The carry portion of their compensation is treated under the tax code as capital gains for the fund manager and is taxable at the much lower capital gains tax rate of 15%.
That too is simply BRILLIANT!
I mean, why pay taxes like ordinary Americans when you can rig your pay to a win-win and scam taxpayers to boot?
Even better, you can declare yourself a "non-profit" and try to skirt tax rules (to be fair, Imagine Schools, a "non-profit" education management organization, has already tried this, but why not try it too?)
Then you can pay yourself a huge salary to run the schools, maybe even more money than the mayor and the chancellor, even though all you're managing is three or four charter schools.
And when anybody looks at you askance over the pay, you can say "We've let the market dictate the pay scale."
But of course you do NOT pay your teachers much of anything and you work them 60+ hours a week.
After all, these people went into education and everybody knows you can't make a good living in that racket - not unless you're running a couple of charter schools, of course.
So your teachers deserve to be exploited and abused.
The pricing of a specific investment position or portfolio based on internal assumptions or financial models. This contrasts with traditional mark-to-market valuations, in which market prices are used to calculate values as well as the losses or gains on positions. Assets that must be marked-to-model either don't have a regular market that provides accurate pricing, or valuations rely on a complex set of reference variables and time frames. This creates a situation in which guesswork and assumptions must be used to assign value to an asset.
These assets are typically derivative contracts or securitized cash flow instruments, and most do not have liquid trading markets.
Now where I grew up, we used to call "Mark-To-Model" by a different term.
We called it "Making It Shit Up!"
But on Wall Street they have delicate ears and so they call it by the more family-friendly Mark-To- Model term.
Regardless of what you call it, the results are the same.
You can give whatever value you want to the stuff your giving value to - whether it is crap mortgages bundled into CDO's or test scores you have to report to the state.
And then voila - the actual test score results get marked to model and suddenly look a whole lot better.
This is what Joel Klein and Michael Bloomberg, two big fans of hedge fund manager ethics, have done with their own test scores now that the state has revealed them as "inflated."
That's the nice thing about taking business ethics and hedge fund practices and bringing them to education.
They open up a whole new world of possibilities and profits for hedge fund managers and you guys get to act all selfless and and community-oriented to boot,just like these guys.
But as you do in your day jobs at the hedge funds, you can continue to steal, cheat, deceive, mislead and exploit to your heart's content.
I've always loved this Far Side cartoon. When I was a kid, I used to watch Lassie. Timmy would look at that collie, and say, "What's that, Lassie? Mr. Wilson is stuck in the well? Get help?"
It never really made sense to me. I grew up around dogs, and could they really all be that stupid compared to the dog on TV? It just didn't seem possible. I mean, sure, they spent their days looking for the sunniest place in the house, finding a nice comfortable position and sleeping, but really, didn't that indicate they were smarter than we were?
Of course, in those days, the guy who lived across the street from me worked at the Taystee Bread factory, and managed to support himself, his wife, and five children on his salary. And he owned a home on that salary alone.
Now he'd be living in a tree, and doubtless a tree in an undesirable neighborhood. You can barely get by on a blue-collar job nowadays, and with one income, forget about owning your own home or spending any time with your family. And now the hedge-fund managers, the ones who contribute nothing whatsoever to society but live off those who produce something, want to bring their magic touch, the same touch that left our economy in the toilet, to education.
Honestly, I can't figure why people are saying, "Let's make things worse for teachers," instead of, "Let's make things better for ourselves and our children." But with billionaires declaring themselves education experts for no special reason, and with voices of support ranging from Barack Obama's to Randi Weingarten's chiming in with cheers, it looks like interesting times ahead for working Americans. When you look at the crap that passes for news in this country, it makes a little sense. Here are some doctored clips Fox saw fit to broadcast. Frankly, and particularly on education, I don't think the rest of MSM represents a substantive improvement.
When a candidate tells you about all the things that aren't possible, about how political calculations come first...they're telling you something very important--they are telling you they will not fight for you.
Top Ten Edublogs 2007 Edutopia.org
"It may be the Daily Show of education blogs, combining parody, retro images, and a skeptical sensibility in service of a true concern for our educational future."
Views expressed herein are solely those of the author or authors, and do not reflect views of my employers, the United Federation of Teachers, or any UFT union caucus.
Stories herein containing unnamed or invented characters are works of fiction. Names, characters, businesses, places, events and incidents are either the products of the author’s imagination or used in a fictitious manner. Any resemblance to actual persons, living or dead, or actual events is purely coincidental.
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