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Originally published at caesarrodney.org

The cost of healthcare in Delaware is again rising rapidly.  It is looming as a major budgetary issue for the State of Delaware current employees and pensioners. Delaware’s Medicaid budget is increasingly strained. There is a steady flow of articles in the News Journal about the rising cost of health insurance, the rising cost of pharmaceuticals, and the rapid rise in both co-pays and deductibles for patients. There are, however, a few elements in play that have been overlooked, and may have significant effects in the short-term on the overall costs of both insurance and actual healthcare delivery.
While it is abundantly obvious to everyone that utilizes healthcare services that both co-pays and deductibles have risen in an effort supposedly to keep the cost of the overall premium down, the complaint has been made that this discourages the use of health insurance for routine care because of the high out of pocket cost. This is only a part of the problem.
While it is true that discouraging the use of healthcare services saves money for the insurance carrier, there is another side to this disincentive. I am referring to a phenomenon that we see frequently in medicine. Patients, who are usually quite economically aware of the deductible are also very aware that once the deductible has been met, all further healthcare is essentially free for the rest of the year until their deductible resets.
As a consequence, those who have had some healthcare incident recently often then seek out other elective healthcare treatments, medications, and surgery they might otherwise postpone. “I might as well get it done now under this year’s deductible.” Whenever there is an uptick in elective medical services, there is also an uptick in the sheer number of expensive adverse outcomes, although the percentage still may be very small.
Thus costs to the insurer go up. We are seeing this more frequently in our office this year and it is very common toward the end of the year that our services for elective surgeries become highly demanded. In common terms, the patients want to get the elective surgery done before the end of the year when their deductible resets. This is a strong economic motivation.
Quite obviously this will cause a substantial increase in overall costs to Medicare, Medicaid, and the health insurance industry.  All three of these entities have responded to the increasing costs of expanded coverage of the population by increasing the scrutiny over authorized services and increasing the frequency of denials of authorization, in short, rationing services.
The former of these two phenomena, elective utilization of health services after meeting the deductible, tends to raise overall spending on healthcare. The latter, rationing, of course, does the opposite and tends to lower overall expenditure. The question of which will be the dominant effect will be answered by the insurance actuaries when the next year rates are published. Most anticipate substantial rate increases.
There is, however, another phenomenon that we are seeing increasingly. This is the absolute lack of access to physicians. Increasingly, fairly young physicians are retiring from practice for a host of reasons. Dr. Ezekial Emanuel, one of Obamacare’s chief architects, famously said last year on television when asked about this phenomenon that “They will have to work. We will make them”. It turns out not to be true. What turns out to be reality is that doctors will not work under those circumstances and it further turns out that many doctors, especially those who are older and more experienced, easily have the wherewithal to retire.
In addition to this there is the phenomenon of “Community Care Plans”. These are Medicaid plans offered through the Obamacare exchange. In our office we have been getting dozens of phone calls from people asking whether we participate in these plans and if we know anybody who does participate in these plans. The truth is there is a very thin panel of doctors. By my count, looking at the Delaware panel of doctors for United Healthcare “Community Care”, fully one third of the listed entities were either not doctors, were duplicate listings, or were the names of facilities. Most of the family practices on the list are closed to new patients.
In my specialty, Orthopaedics, there are six surgeons listed who are all based at Crozier Chester Hospital in Pennsylvania. In short, there is very limited access to contracted physicians and surgeons. The net result is that the patient’s have a heavily subsidized health insurance card which is not capable of giving them access to healthcare except under convoluted circumstances, usually the Emergency Room. This is of course a very effective mechanism for United Healthcare to control its costs and continue to receive subsidies from both the federal government and the State of Delaware who offers these plans. The State can then say it has expanded the pool of people with health insurance even though that insurance is unusable.
The actual number of previously uninsured people now receiving preventative care is surprisingly small. As the Oregon experiment demonstrated with over a decade of data, the addition of Medicaid insurance to the uninsured population does not change their pattern of choice of the emergency room for their care. In fact, the net result was quite the opposite, emergency room utilization increased. It is not yet clear if that is happening or will happen in Delaware but similar efforts in both Massachusetts and Vermont have had identical outcomes to Oregon.
The news is not bad for everyone. Large hospital systems are suddenly thriving because their previously uninsured patients are now covered by Medicaid. The insurance industry is consolidating and the large carriers are reaping windfall profits from subsidies. For the moment, Delaware continues to have its state Medicaid insurance program subsidized by the federal government.
Soon enough though, federal Medicaid subsidies to Delaware will cease and the full burden of cost will return to the Delaware budget. The insurance industries will be squeezed by the “Death Spiral” as healthy patients decline to purchase the ever more expensive policies and only the expensive chronically ill remain in the insurance pool. In 2018 penalties, fees, and taxes are set to essentially end the health insurance industry as we know it.  Medicare has not yet been reformed and its insolvency has been accelerated by almost a decade. Small hospital systems will consolidate into large systems but will become de facto accountable care organizations, responsible for all community health, but presumably with highly restricted budgets based upon an insolvent single payor. Hospital care is costly and limited access to care is inevitable.
The “Affordable Care Act”, clearly misnamed, appears to be yet another example of “The Uncannily Predictable Law of Unintended Consequences”. Acronym TUPLUC.
C.D. Casscells, MD
Director, Center for Healthcare Policy
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pictured: Milton and Rose Friedman. photo: Friedman Foundation for Educational Choice

Today CRI celebrates the 103rd birthday of Dr. Milton Friedman, a man who was ahead of his time in recognizing the need for school choice to be available to all children, so that more children would be able to obtain a quality education, suited to their needs, and not be forced to live in poverty merely because of how they were raised.

Dr. Friedman wrote about school choice in his book Free to Choose in 1980, and dedicated a full chapter to the idea that parents should be allowed to choose schools for their children. It was based on the market idea of economics- schools should not be seen as sacred government buildings dedicated to protecting adult’s jobs, but as forces which should strive to provide the best services to its “customers” (students), and if they fail to do this, then the school either needs to be reformed, or the students should be allowed to go to another school which better serves their needs. This choice should be allowed irregardless of the parents’ income, or residential zip code which too often constrains students, particularly poor students, in poorly performing schools with no way out.

Advocates of public education for all will insist that education should not be  “privatized” and left to the evils of “capitalism.” Yet notice how upper-middle class and upper-class families handle their children’s’ education- private schools, charter schools such as the Charter School of Wilmington, home school, boarding school (for the very wealthy), or top-performing public schools. Notice how wealthier families do not feel the need to be constrained by zip code? There is a reason for this. Despite bluster by opponents of parental choice about how “privatization” is evil, rich parents will choose that option because the school must compete for the parent’s tuition dollars. If the school performs poorly, or does not serve the child’s needs, the child will be removed from the school.

When a similar situation happens in public school, teacher’s union leaders, superintendents, and local politicians wax poetic about the need for more “investment.” Never mind that Delaware spends $23,000 a year per student. But, teachers in Delaware earn roughly $59,000 a year minus benefits. Clearly, most of the money spent per pupil doesn’t pay teachers, even as debates over raising teacher’s pay are played out in districts around the country. Where is this money going? Wherever it is, expect those getting this extra funding to fight back against any efforts to take their money away, no matter how weak their justification for more “investment” is.

The poor performance of too many public schools causes parents with the means to do so to pull their kids out of public school. The kids who are left are usually poor, come from dysfunctional homes or impoverished neighborhoods, and are not offered a clear pathway to success. Combined with the influx of new students coming from recently arriving immigrant families, many of whom live in homes where English is not the first language, and an endless number of “Visions”, mandates, and standardized tests, these schools are not going to be in position to best help the children.

The goal of school choice is not, as our opponents allege, to “dismantle” public education or somehow sell it to multinational corporations. The goal is to merely go back to basic principles of greed, ambition, and what motivates us. Monopolies, by definition (which is how a lot of public school districts are operated, especially in low-income areas), nearly always provide poor quality, high prices, and poor customer service, because the human need to do better falls flat when there is no reward for doing so. We do not suggest people intentionally fail or desire to see kids suffer, because we know the vast majority of teachers, counselors, principals, and other building staff sincerely want to see children do well. In fact, teachers and counselors, especially in private schools, make very little money because teaching is their passion. They know they will never get rich teaching or advising.

The problem is, there is a system in place which has made too many people too comfortable, too dependent on the system to continue, and too unwilling to consider alternatives out of fear of what might happen if there are serious changes to the status quo.

We point out that teens and young adults around the country choose colleges or learning institutions right for them. If the school is not a match, the student leaves and goes elsewhere, or goes to work or to the military. Federal student loans are offered to students who go to private colleges which compete with public ones. Yet public schools are still very much around. Clearly school choice for college has not destroyed public education, and it will not destroy public education in K-12. All that will happen is, some people who believe they have a guaranteed job might lose it unless they are pressured into the marketplace of ideas.

All this was Dr. Friedman’s vision: great schools for all, and a vision of the best, most competitive education system serving student’s needs, the way colleges compete. Today we honor a man whose foresight has inspired the rest of us to see nothing less than a great system of education, improving the economic opportunities of all students no matter their household income, neighborhood, or learning challenges.

Here’s to you, Dr. Friedman.

His quotes:

“Our goal is to have a system in which every family in the U.S. will be able to choose for itself the school to which its children go. We are far from that ultimate result. If we had that — a system of free choice — we would also have a system of competition, innovation, which would change the character of education.”
— CNBC Interview Transcript, March 2003

“It is only the tyranny of the status quo that leads us to take it for granted that in schooling, government monopoly is the best way for the government to achieve its objective.”
— “The School Choice Advocate,” January 2004

“Improved education is offering a hope of narrowing the gap between the less and more skilled workers, of fending off the prior prospect of a society divided between the “haves” and “have nots,” of a class society in which an educated elite provided welfare for a permanent class of unemployables.”
— “The School Choice Advocate,” July 1998

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This week is National School Choice Week, a week where we draw attention to the need for parents and families to have School Choice as an option for all students.

No doubt this week is under fire from school choice opponents who worry school choice is a corporate, Koch-brother funded project to destroy public schools and, more importantly, public teacher’s unions,but those of us who believe in “free to choose” ask just one question:

1. “Who is more likely to make a better decision about a child’s future: That child’s legal guardian, or elected and unelected officials in state capitals and Washington D.C.?”

If you believe government officials, union leaders, school boards, superintendents, Department of Education employees, and politicians can all make a better decision about your child than you can, school choice is not something you will support. But if you believe schools should be run at the local level, with fewer mandates from above and more support for those who are there day-to-day, and if you believe students are unique human beings who should not be forced into “one-size-fits-all” based on their parents’ financial ability to find another school, then school choice week is for you.

If you believe there should be accountability for performance in our education system, without automatically blaming teachers and parents for poor performance, instead of the system which has been created, school choice is for you.

If you believe public schools who wish to have your child attend should have to work hard for your tax dollars, like every non-monopolized market in the private sector (i.e. sectors where companies use government to give themselves business or hurt competition), instead of requiring children whose parents aren’t rich to go to a school based only by their zip code, school choice is for you.

If the thought of stagnating academic performance, the rising number of students who enter college needing to take remedial classes, and the high drop-out rate for both high school and college bothers you, school choice is for you.

If you believe money spent on education, where Delaware spends to the tune of $13,000 per student per year and $16,500 if you include capital spending (refurbishing or building schools, source: DE DOE), ought to be spent efficiently and with the student’s best interest at heart, school choice is for you.

If you feel genuinely heartbroken every time you hear about another shooting in places like Wilmington, and know most of those young people get involved in drugs and gangs because they don’t have hope for a better future, school choice is for you.

If you are concerned about the values being spread in society at large, and would like to see your child(ren) be placed in a school setting which is closer to the values you wish the child to learn, school choice is for you.

If you believe America is a great nation with a lot of untapped talent among our youth, and want to see students use their talents in the best way possible, school choice is for you.

And lastly, If you believe a high-quality education is a fundamental right for each child to have, then school choice is for you.

If you believe school choice is something we can all work for together, then join the Caesar Rodney Institute in celebration of National School Choice Week, and let’s support #SchoolChoice!

Why do you support school choice?

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Legislative Hall in Dover, Delaware

This article originally appeared at the Watchdog.org website on January 20, 2015. Read the original at http://watchdog.org/193657/legislative-priorities-2015-delaware-way/

Last week was the first week the state Legislature was in session, but they will soon adjourn for budget and finance hearings before getting back to lawmaking in mid-March. Five new representatives and one new senator took their oaths of office for the first time, but this Legislature looks almost identical to the last one: the Democrats control the governor’s mansion, the House of Representatives 25-16, down from 27-14 last year, and the Senate 12-9, down from 13-8.

Notably absent from the last General Assembly were bills to make Delaware’s economy more free as the state—well-known as the “Switzerland of America” for its easy incorporation process and fair Court of Chancery—faces competition from Nevada and North Dakota for corporate business and from the Sun Belt for jobs. This year the Caesar Rodney Institute hopes to see legislation to address the following issues:

1. Education Savings Accounts: Delaware has “school choice”-IF your idea of school choice is to allow a child to transfer from one public school district to another (provided that district has room).While that’s better than nothing, that’s not really school choice.

CRI supported a bill last year called the “Parent Empowerment Education Savings Account Act” (PEESAA) which would have introduced Education Savings Accounts as an option for low-income and special-needs students who are the most likely to need additional services not being offered by the traditional public schools. This bill was tabled in the House Education Committee but we hope ESA’s and other bills encouraging school choice are brought up this year.

2. Prevailing Wage (PW): Delaware has an insanely wide range of wages a that business who wants a public construction contract has to pay its employees to get the contract.

Every January the state Department of Labor mails out its PW survey to union-friendly contractors and conveniently “forgets” to remind non-union-friendly construction companies to ask for, and return, the survey. This results in wage variance like $14.51 per hour for a bricklayer in Sussex County, but $48.08 per hour for the same job in Kent and New Castle Counties. Not to be outdone, boilermakers get $71.87 an hour in New Castle County, but “only” $30.73 in Kent County.

These high rates prevent many construction projects from being started and make those which are done more expensive for taxpayers. If the PW won’t be eliminated, we hope the state will instead use the U.S. Occupational Employment Statistics survey. This would reduce rates by almost 40 percent on average and free up nearly $63 million of spending from the State’s FY15 capital budget, including almost $18 million for more school capital improvements.

3. Make Delaware the next right-to-work state: Delaware is not a right-to-work (RTW) state and, between that and our inconsistent-as-applied PW law, many businesses outside the state choose not to move here. Incorporating and buying office space in Wilmington for some high-paying executive jobs is one thing. But Moody’s Analytics in late 2013 said Delaware was the only state at immediate risk of falling back into a recession and a lot of this is due to more businesses closing than opening in Delaware. Pass legislation to end forced unionization and support pro-job growth policies instead.

4. Tax and regulatory reform: Only five states have a Gross Receipts Tax, which is a tax on revenue generated before profit and loss is factored in. Three of those states have no further taxes on corporate earnings and the only other state (Virginia) that does has lower tax rates. Between this tax, high personal and corporate income taxes, franchise taxes, and overall over-regulation by state agencies, Delaware is increasingly threatening its “Incorporation Golden Goose” as Nevada and North Dakota work to take business from the state. This needs to be addressed.

5. Work to lower energy prices: Delaware has electric rates 25 percent higher than the states we compete with for jobs like nearby Virginia. We import close to one-third of our electricity from out of state, the highest rate in the nation. Some of this is due to our geography, but a lot of it is due to the state’s failure to build a network of natural gas pipelines from the Marcellus Shale to Delaware.

Coupled with the state’s participation in the Regional Greenhouse Gas Initiative (RGGI) carbon tax scheme and taxpayer subsidizing of “green” companies like Bluewater Wind (gone), Fisker Automotive (didn’t build cars in Delaware), and Bloom Energy (still has not brought the promised 900 high-paying full-time jobs), Delaware cannot grow its economy if energy prices are high. We want the Legislature to pass natural gas pipeline extension and end participation in RGGI and subsidies for “green” companies.

What issues do you think the state Legislature should focus on this year?

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Since 2008 America has seen a greater number of businesses close than open. According to Gallup, roughly 6 million businesses out of 26 legally recognized actually function; the rest are inactive or exist only on paper. Of these 6 million “real” businesses, 3.8 million employ 1-4 employees. Only about 108,000 businesses in America (2% of “real businesses”) employ 100+ people. If we continue to kill off small business with over-regulation and over-taxation, how will the government be able to pay its bills, short of more printing, borrowing, and cancelling debts?

From Gallup: (article truncated for space)

“The U.S. now ranks not first, not second, not third, but 12th among developed nations in terms of business startup activity. Countries such as Hungary, Denmark, Finland, New Zealand, Sweden, Israel and Italy all have higher startup rates than America does.

We are behind in starting new firms per capita, and this is our single most serious economic problem. Yet it seems like a secret. You never see it mentioned in the media, nor hear from a politician that, for the first time in 35 years, American business deaths now outnumber business births.

The U.S. Census Bureau reports that the total number of new business startups and business closures per year — the birth and death rates of American companies — have crossed for the first time since the measurement began. I am referring to employer businesses, those with one or more employees, the real engines of economic growth. Four hundred thousand new businesses are being born annually nationwide, while 470,000 per year are dying.

You may not have seen this graph before.

Until 2008, startups outpaced business failures by about 100,000 per year. But in the past six years, that number suddenly turned upside down. There has been an underground earthquake. As you read this, we are at minus 70,000 in terms of business survival. The data are very slow coming out of the U.S. Department of Census, via the Small Business Administration, so it lags real time by two years.

Here’s why: Entrepreneurship is not systematically built into our culture the way innovation or intellectual development is. You might say, “Well, I see a lot of entrepreneurial activity in the country.” Yes, that’s true, but entrepreneurship is now in decline for the first time since the U.S. government started measuring it.

Because we have misdiagnosed the cause and effect of economic growth, we have misdiagnosed the cause and effect of job creation. To get back on track, we need to quit pinning everything on innovation, and we need to start focusing on the almighty entrepreneurs and business builders. And that means we have to find them.”

No matter how much some people will try to convince you the Roaring Twenties are back, the reality is that we have far too many businesses closing and not enough replacing them.Businesses do open and close all the time, but a lot of business closings are small businesses getting shut down because of government policy via regulation and taxation. A lot of these policies are Cronyist policies pushed by big business to weaken their competition, which is smaller stores. Thus for example, a big chain like Costco can safely come out in favor of the minimum wage increase knowing it will end up hurting the roughly 80 percent of businesses which employ nine or fewer people, while at the same time reaping the benefits of “caring” for their employees (note: we don’t object to Costco paying its employees well; we applaud it. But just because Costco might be able to afford a wage increase doesn’t mean every business can).

Crony business policies, government bureaucrats who make new regulations to justify their jobs, politicians who want to “do something” to get votes, and a well-intentioned but misinformed public which votes for things like minimum wage hikes  all result in a decline in new business startups and jobs lost and never created in the first place. We at CRI support economic policies which make it easier for people to start businesses and create new (hopefully well-paying) job opportunities without sacrificing necessary regulations and basic standards of decency. But unless we fundamentally change the way our country is operating, that 70,000 per year decrease in total businesses operating in America will increase in number.

Help support CRI! Your support allows us to research and provide analysis to the public on policies which will best grow the economy and create jobs. An end to the prevailing wage, Right to Work legislation, an end to Delaware’s gross receipts tax and lower corporate income taxes and personal income taxes, health care reform which encourages innovation from the private sector, and energy policies which would give people more choices would go a long way to helping Delaware, and America, make a sound economic recovery for all. Please consider making a contribution today.

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wallpaperput.com

2015 will soon be upon us and for those who are passionate defenders of freedom and liberty our work just goes on when the clock strikes midnight. Here is CRI in review and our goals for 2015:

  • Dave Stevenson’s lawsuit against DNREC and former DNREC Secretary Collin O’Mara is still ongoing. Dave and the other three plaintiffs, including CRI Director John Moore, won standing to continue their lawsuit. We will refrain from making a prediction on a court ruling less we jinx the lawsuit but we are optimistic the Plaintiffs will win. This is because in order to get standing the Plaintiffs had to prove they had a valid reason to sue in the first place, such as being aggrieved by the Defendants actions. Winning means stopping DNREC from changing the rules on how many carbon permits can be sold at carbon auctions, saving Delaware taxpayers over $100 million a year in increases in utility bills.
  • We testified in favor of HB353, the Parent Empowerment Education Savings Account Act (PEESAA). Jim Hosley, our former CEE Director, spoke in favor as did a dozen Wilmington parents and grandparents (and one student!) and the leaders of Tall Oak Classical Academy. The bill was tabled in the House Education Committee, a move we are unfortunately not surprised by. However, we hope 2015 will be a better year as more and more people realize the need to improve Delaware’s education system, and the only effective way to make the changes our students need to be prepared for the future is to provide parents with school choice options to do what’s best for the child. CRI will always maintain the belief that parents and/or legal guardians can make a better choice about their children’s education than politicians and bureaucrats in the state Department of Education.
  • We brought in Dr. Bartley Danielsen, business and economics professor from North Carolina State University to keynote our Sixth Annual Dinner. Dr. Danielsen has proposed a theory tying in environmental benefits to school choice. The basic theory is, parents moved to the suburbs to flee poorly performing public schools which left a lot of people uneducated and unable to find respectable work, and many turned to crime as a result. His theory is if inner city schools were to improve their quality, many families would move back to the cities from the suburbs and the result would be a reduction in traffic and environmental pollution from people driving from the suburbs to the cities. View is presentation here and here

In addition to these challenges, we still have issues Delaware must resolve in order to improve our economy:

  • End to the prevailing wage which makes public construction costs so expensive many end up getting no work at all. See: Rockwood Museum.
  • A Right to Work law for Delaware. Union leaders are pushing the “scab” theory that somehow union members will drop out and reap all the benefits the union “works” to get. We have responded by noting that a) manufacturing businesses have responded by moving factories elsewhere, depriving Delawareans of job opportunities. See: loss of auto industry, Valero plant, Evraz Steel plant, Georgia Pacific plant. b) as a moral issue, should union bosses have the right to take someone’s money just because someone works at a particular location? What if the union bosses don’t serve their member’s needs, such as organizing or donating to political causes or candidates the members don’t support?

We wrote: “While in the short run unionization may force wages up for those involved, in the long run closed shops reduce capital spending and induce the out-migration of jobs and workers.”

Read HERE and HERE and HERE

  • tax reform. Delaware is one of just five states with a gross receipts tax (tax on sales, even before factoring in profit/loss and expenses). Three of the other four don’t have an income tax and the only state with both like Delaware is Virginia who has lower tax rates. Coupled with high corporate and personal income taxes while Nevada and North Dakota compete with us for corporate business, and without reforms we will see money and jobs leave the state at even higher numbers.

Merry Christmas, Happy Hanukkah, Happy Holidays, and a Happy New Year to all. Let’s be thankful for a good 2014 and hope for better things in 2015.

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This article first appeared in The News Journal on November 15, 2014.
The article can be viewed here: http://delonline.us/11cpWNg
The obstacles to a good Delaware public school education have been many, varied and usually school specific but not so with the attempted solutions. The obstacles have included such things as poverty, student and parent indifference, community turmoil, varying teaching and administrative abilities, etc. Proposed resolutions to overcome the obstacles are often preceded by, “One size doesn’t fit all,” followed by a new law, regulation or procedure that applies across the board usually with a new person or office to oversee it.

Every few years we see new people arrive with new ideas. We gather data, cultivate alliances, get input, design plans and essentially begin anew. After the recent Vision Coalition Conference at the University of Delaware, a respected member of the Department of Education and I agreed that the conference was very good, but we had heard everything many times before (funding, salaries, teacher recognition, student needs, parental involvement, testing, etc.). In addition to the merits of any proposed plan, the challenge has been to fully implement that plan. Currently there is an underlying suspicion that history will continue to repeat itself and completion will remain an illusion.

Charter schools are an example of that implementation history. They were to be small laboratories used to experiment with new ideas that, if successful, would be adopted by the traditional schools. If they failed they would be closed. School autonomy was a major component. The original draft of DOE’s charter regulations (1995) said they would be “free of most state and school district rules and regulations” and “reliance on bureaucratic decisions would be a thing of the past.” Have the traditional schools moved toward greater autonomy, or have the charter schools become more traditional?

A bureaucracy (not a bureaucrat) is concerned with compliance. It enforces the letter of the law. It is not anarchy to suggest that a creative mind can work within the spirit of the law. However, that requires thoughtful and skillful decision-making. Merriam-Webster clarifies the problem with its definition of a bureaucracy: “an unwieldy administrative system burdened with excessive complexity and lack of flexibility.” Many years ago the U.S. Department of Education said we had to “replace rules-based governance (think compliance) with performance-based accountability, thereby stimulating the creativity and commitment of teachers, parents, and citizens.”

The impact of a systemic change has been modeled in computers. First introduced in the late 1940s the new technology did small operations quickly using a binary system. The world demand for the new technology was estimated to be only five units. Today computers are ubiquitous, and yet they are still doing the same thing (small operations quickly). What has changed is how they operate. They went from bulky, inefficient, heat-producing vacuum tubes to today’s microchips. That enabled the system to operate much faster, be more efficient, become smaller and do more. Would changing our current education system produce similar results?

Since combinations of obstacles can be found uniquely in various schools, a “cookie-cutter” approach will fail. Individual schools must be given the authority to design customized plans to address the needs of their students. Such schools, according to DOE’s 1995 draft of charter regulations, would “… empower local communities to try new, unique solutions to problems that are facing their own schools.” The separation of powers among the education entities could be stated, “Powers not delegated to districts or the state are reserved to the local school.” In any event, the properly prepared principal (CEO) should have broad administrative authority including the responsibility to hire, fire and manage the budget. Districts and the state should have oversight responsibilities and an appeals function. They should provide opportunities for the professional growth of school personnel so that the new education system will be one of continuous improvement.

Educating students involves a professional relationship between teachers and students (similar to doctors – patients, and attorneys – clients). Running a school is a business function, and the essence of administration is decision-making. The principal’s (CEO’s) role is to provide teachers with the support they need to get the job done and to create a culture of success that permeates all operations with a goal to “max every child.” Building CEOs must be properly prepared before taking over the helm of the school. The time needed to do this will vary by building administrator so this process will have to be phased in.

The state’s business community, the Vision Coalition, DOE, Rodel, etc. have played a significant role in moving things along. They should continue to support education and to provide a vision of what the future expects of our students so that the education professionals in the buildings can better prepare them. Parents should select the “best fit” school for their child using available choice opportunities. Such choices might include alternatives like Education Savings Accounts that have been successful in Arizona and will soon be considered in Delaware.

Just changing the system can improve student performance. Andreas Scheleicher, a member of Rodel’s International Advisory Group, presented information at Rodel’s April Education Event to show the positive effect of local, front-line autonomy. When that autonomy is coupled with distributive leadership (involving teachers in the decision-making process) student gains were increased even more.

Some assumptions: This plan will be phased in over a period of three to five years; it will use mostly current educators; properly prepared principals (CEOs) are important for its success; teachers are critical assets; 19 school districts are too many (Los Angeles has more students than Delaware but only one district).

Education is a multi-billion dollar business whose purpose is to maximize the abilities of all students. That would have a positive economic effect on all residents. Site-based management may not be a panacea for all of Delaware’s education ills, but it is the right course of action at this time. So let’s put on our old Nikes and “just do it.”
Ron Russo
Senior Fellow

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