How CEOs Shouldn't Help Education.

The real hurdle in the road to education reform isn't lack of money - it's the educrats' inability to manage resources in an increasingly dysfunctional systems.

Through the popular "Principal for a Day" program, chief executives of major U.S. companies headquartered in New York, such as NBC, Primedia, and HBO, have poured millions of dollars worth of goods and services into the city's public schools. As a parent of two public school children, I am told that ought to be grateful for such tangible aid from the private sector. After all, the incessant message from President Clinton and the public education establishment, and reverberating loudly in the media, is that if our nation's urban schools are performing poorly it's only because they are "starved of resources."

I will stipulate that my own kids' schools - two of the best in the city - are often short of the computers, books, qualified teachers, and decent athletic facilities that most private schools and suburban public schools seem to take for granted. Yet the fact is that New York City now spends close to $10,000 per student on its schools. That's a few thousand dollars less than our wealthiest suburbs, but it's considerably higher than the average per-pupil spending for every state in the union, as well as every other industrialized nation in the world. Clearly, $10,000 per pupil should be more than enough to create minimally effective schools. So the really salient question about the performance of our urban schools shouldn't be about the allegedly missing resources they suffer, but rather why the schools can't seem to manage the funds they do receive in more innovative and productive ways.

Unfortunately, as I found out after participating in "Principal for a Day" last spring, the chief executives associated with the program are wasting a golden opportunity to help our society answer that question and thus begin the process of reforming the schools. The CEOs came to their adopted schools with the best of intentions and bearing generous gifts, yet unwittingly conspired in propping up an indefensible, dysfunctional system.

The school I was assigned to as a "Principal for a Day" was I.S. 59, in a predominantly black neighborhood in Queens. I.S. 59 has an allocated budget of about $9 million per year, but the school's own CEO, Principal Antonio K'Tori, has very little discretion in how that money is spent. Instead, it's the city's central Board of Education that allocates those dollars to the various school functions, making our public school system one of the last examples of a command-and-control economy since the fall of the Berlin Wall. Board bureaucrats, not Mr. K'Tori, get to decide how many teacher and assistant-principal positions, cafeteria workers, clerks, and custodial workers I.S. 59 will have. Moreover, because of union contract rules and civil service regulations, Mr. K'Tori can't hire or fire his own staff. The principal can't even ask the teachers to come into school a few days early to plan for the school year.

You would think that any businessman visiting a city school would immediately notice the Soviet-style workplace practices in effect and conclude that this likely is one of the reasons so many schools perform at less than their potential. But the CEOs involved in Principal for a Day, seem to leave their managerial smarts at the office. Instead of pressing for reform, they allow themselves to be co-opted into a program with a political agenda of public school boosterism. At a public meeting of the organization, one after another of the Principals for a Day endorsed the idea that the proverbial "lack of resources" was the only thing keeping our public schools from reaching even higher levels of performance.

Strauss Zelnick, the CEO of B.M.G Entertainment, told his fellow honorary principals of his visit to Midwood High School and of the difficulties the real principal was having maintaining the school's historic old building. "We used to build beautiful schools in this city," Zelnick said as he announced his company was contributing $25,000 to Midwood. "It's time to say to the federal government and the state: 'Why don't you start putting up some money?'" This elicited a huge ovation from the other CEOs. Everyone in the room seemed to have forgotten that hundreds of millions of dollars of school construction money had disappeared into a dark hole because of the featherbedding work rules and rank incompetence at the Board of Education. Instead of trying to figure out how to eliminate the operatically flamboyant waste that virtually defines the public school system, the assembled business executives, despite their M.B.A.s and years of real world experience, were applauding a proposal to keep bestowing more and more money on the very people responsible for the debacle.

At the meeting, other CEOs stood up and heaped praise on the "hardworking" and "dedicated" teachers who were doing such a great job educating our children despite the financial shortfall. I wondered whether they were really talking about the same school system that I had gotten to know so well as a parent and a journalist? The system that virtually guarantees lifetime jobs for all its teachers and principals, regardless of how little or how much they work? The system in which fewer than half the children who enter high school manage to graduate in four years? The system in which two-thirds of all fourth graders can't pass a very basic reading test administered by the state?

I was dumbfounded that these shrewd, talented business people, some of whom manage the most entrepreneurial and competitive companies in the world and rightly boast that they can manage anything efficiently, would willingly draw down an iron curtain of denial 'when it came to the enterprise of public education. Few of the CEOs who were gushing about the schools they visited would actually consider sending their own children there. Instead, they seemed to be saying that the public schools were doing an excellent job for other people's children.

As one of those other people, I resented being told that the quality of the education my children received is good enough - when it is nowhere near good enough. I also knew that the fault in my children's education had nothing to do with a shortage of computers, dilapidated buildings, or the lack of funds. After all, the city is now spending a staggering $10.5 billion on its schools and a good part of that will surely be wasted.

I don't begrudge the chief executives the extra money they spend on their own children's private school education. What I do want for my children's schools has little to do with money. I want a system based on the fundamental idea that the interests of schoolchildren come first, ahead of the interests of the system's employees, with their lifetime job security. For the sake of my children and all the other children in the public school system, I hope the leaders of the business community begin to figure this one out. After all, who more than a successful chief executive has the authority to say that no enterprise can prosper that doesn't hold individuals accountable, reward merit and punish failure, keep everyone's attention focused on results, and give managers (school principals) the authority and responsibility for making their operations succeed?

Sol Stern is a contributing editor of City Journal, published by the Manhattan Institute. A longer version of this article appeared in City Journal.