Don’t Trust Jeff Bezos’s Preschool Philanthropy Scheme

Originally published in In These Times on September 19, 2018.
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The CEO of Amazon and the world’s richest man declared this month that he’ll be wading into the waters of philanthropy. In a high-profile announcement, Jeff Bezos described his vision for a “Day One Fund”—a $2 billion investment in organizations that provide homelessness assistance, and a new network of nonprofit preschools in low-income communities. This charitable gift will amount to just 1.2 percent of his net worth.

Bezos joins fellow tech billionaires Mark Zuckerberg, Bill Gates and Reed Hastings in championing corporate-style reform of American education. “We’ll use the same set of principles that have driven Amazon,” Bezos said of his future preschool chain. “Most important among those will be genuine, intense customer obsession. The child will be the customer.”

Preschool is a particularly appealing area for those who like conceptualizing problems in terms of market potential. Several years ago, a U.S. Chamber of Commerce affiliate reported that every dollar invested in high-quality early childhood education yields savings “from $2.50 to as much as $17 in the years ahead.” University of Chicago economist and Nobel Prize winner James Heckman published research in 2009 finding high-quality preschool can yield a 7-to-10 percent annual return.

Preschool is also one of the most popular target-areas for champions of “Pay for Success”—a branch of so-called impact investing which took off under the Obama administration. Under Pay for Success, private funders front money for social programs, and the government pays the investors back with interest if certain predetermined goals are met. Chicago launched a Pay for Success preschool program in 2014, funded by Goldman Sachs, Northern Trust and the J.B. and M.K. Pritzker Family Foundation. These private groups aim to roughly double their investment over the next 18 years.

It’s not clear at this point how Bezos’s Day One Fund will be structured; whether it will be a traditional family foundation like the Gates Foundation, some sort of limited-liability company like the Chan Zuckerberg Initiative, or perhaps one of the increasingly controversial “donor-advised funds” that other tech titans have embraced. CNBC reports that between thirty to fifty percent of Bezos’s gift could be tax-deductible.

It’s also not clear why exactly he chose this month to announce his plans, but it’s possible that Bezos is trying to improve his image, which has taken a public beating over the past year. This past June, the Seattle City Council rolled back its so-called “Amazon tax” which councilmembers had passed unanimously four weeks earlier. The tax, meant to generate new revenue to address the region’s growing homeless crisis, would have required Amazon to pay about $12 million per year in new taxes. The company helped fund an aggressive, unpopular, and ultimately successful campaign to repeal it.

Vermont Sen. Bernie Sanders has also been targeting Bezos, specifically on the gulf between the CEO’s ever-increasing wealth and the low-wages of Amazon’s many thousands of employees, who rely on all sorts of government aid to supplement their income. This month, just days before Bezos made his philanthropic announcement, Sen. Sanders and California Rep. Ro Khanna introduced new federal legislation to force large companies to help shoulder the cost of social services for low-paid staff. More than anything, though, the bill is understood as a vehicle to spotlight the issue of inequality between rich owners and their workers. It’s unsubtly named the Stop Bad Employers by Zeroing Out Subsidies Act, or “Stop BEZOS” for short.

While he’s offered little detail as to how he’d treat the educators in his forthcoming preschool network, Bezos’s other businesses offer some hints. The median compensation of Amazon’s more than 566,000 global employees at the end of 2017 was $28,446. Thousands of Amazon workers in Europe launched a strike this past summer to protest their working conditions, following an exposé of a journalist who had toiled undercover at an Amazon warehouse. Workers in Minnesota also demanded safer Amazon conditions this past summer, alleging dehydration, injuries and exhaustion on the job. A spokesperson for the company dismissed the employees’ complaints, calling theirs a “positive and accommodating” workplace.

The national median income for preschool teachers in 2016 was $28,570. While a growing number of education policy experts have called for increasing salaries as a way to attract and retain better teaching talent, there’s no guarantee that Bezos’s “customer” focused-model will prioritize competitive wages.

And to put Bezos’s gift in perspective, Head Start, the federal government’s high-quality early-childhood education program which serves nearly one million low-income children every year, runs on a strained budget of more than $9 billion annually. Bezos’s Day One Fund, meanwhile, is $2 billion, to be divided amongst both pre-K and homelessness.

Let’s be clear about the scale of the problem. In 2016, just 42 percent of 3-year-olds and 66 percent of 4-year-olds in the United States were enrolled in preschool programs, and these figures were not measurably different from the percentages enrolled in 2000. Demand for early childhood education far exceeds existing capacity in this country, and the cost to change that will require significantly more than what Bezos has so far offered to contribute.

The world’s richest man may sincerely view his new philanthropic project as a way to positively impact the world, but what we know is that Bezos has built up his company and personal fortune by aggressively avoiding taxes for years. In 2017 alone, Amazon paid literally nothing in federal income tax, while reporting $5.6 billion in U.S. profits.

Instead of creating his own new private network, which might run in direct competition with Head Start and other existing state programs, Bezos could help the government expand its proven models: A combination of higher taxes and philanthropy could help early childhood educators cover the cost of school supplies, help program providers extend their school days, construct and refurbish school buildings, supplement teacher salaries, and improve teacher training programs. There are even Montessori-inspired Head Start programs, the progressive pedagogical model Bezos seems most interested in expanding on his own.

Giving more kids access to good schools can be an uncomfortable thing to criticize. But we have to be able to recognize when something even seemingly generous is nowhere near enough. Last year Bezos said he wants his philanthropy to help “people in the here and now.” This month he said he wants to ensure our great-grandchildren have “lives better than ours.” Whether he means it or not, it’s on all of us to push for more.

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The Politics of Pre-K in the Pennsylvania Governor Race

Originally published in The American Prospect on September 22, 2014.
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In Pennsylvania’s gubernatorial race, education has emerged as one of the most heated issues. A Quinnipiac University poll released this month found education ranked as the most important issue for voters, after jobs and the economy. Despite contentious politics surrounding reform of public education from kindergarten through twelfth grade, Republican incumbent Tom Corbett and Democratic challenger Tom Wolf have discovered that plugging expansion of pre-kindergarten programs wins them political points without treading into treacherous waters. That is, as long as they don’t mention the mothers who will inevitably benefit, too.

The governor’s record is haunted by his 2011 budget, from which he cut nearly $900 million in public education funds—a decrease of more than 10 percent. The severe cuts have garnered national attention, particularly for Philadelphia—the state’s largest school district—which wrestled with a $304 million cut this past school year. Last year, a GOP research firm conducted a secret poll and found 69 percent of Pennsylvanians felt the state’s public education system is on the “wrong track;” 64 percent blamed Corbett.

Corbett, in turn, is trying to blame his predecessor, Democrat Ed Rendell, who infused temporary economic stimulus money into the education budget. But many voters don’t have patience for these defenses: They understand that class sizes have increased, that art, music and advanced placement offerings have been reduced, and that thousands of teachers—not to mention many counselors, nurses, librarians, and administrative staffers—have lost their jobs on Corbett’s watch.

Given education’s importance to Pennsylvania voters, the Corbett campaign has released ads lauding the governor for having “increased spending in the education department by $1.5 billion.” But this increase really came about because Pennsylvania is now paying more toward employee retirement plans, an obligationset by the state legislature.

While education debates typically center on polarizing issues such as charter schools, standardized tests and teacher unions, both candidates have found modest political respite by promoting a seemingly innocuous preschool agenda. Each campaign has created TV ads and sent direct mailings to voters about its candidate’s commitment to early-childhood education. Wolf’s platform includes the creation of a universal program, and Corbett has advertised the $10 million budget increase he oversaw to expand pre-K access.

None of this would have been possible without the launch of the Pre-K for PA campaign, a well-organized nonpartisan effort designed to educate the Pennsylvania public, policymakers, and those running for public office about the benefits of early-childhood education. According to Donna Cooper, executive director of Public Citizens for Children and Youth, none of the candidates running in the gubernatorial primaries were taking up this issue at all until the Pre-K for PA campaign started to organize at campaign stops and hold their own public events in areas of high voter concentration.

“By the time we reached the Democratic primaries, [the candidates] all started falling all over each other in support of pre-K,” said Cooper. “And then Corbett did it, too, because it was seen as a safe issue.”

Although President Barack Obama has called for the creation of a universal pre-K program, the influx of business groups that support early childhood education on the grounds of workforce preparation has turned it into a relatively bipartisan aim. Some of the most highly regarded models of quality preschool in the nation, in fact, are in two red states: Oklahoma and Alabama. In April, the president and CEO of the Business Council of Alabama came to Philadelphia to discuss the ways in which Alabama’s business community worked to develop his state’s pre-K system.

Although President Barack Obama has called for the creation of a universal pre-K program, the influx of business groups that support early childhood education on the grounds of workforce preparation has turned it into a relatively bipartisan aim. Some of the most highly regarded models of quality preschool in the nation, in fact, are in two red states: Oklahoma and Alabama. In April, the president and CEO of the Business Council of Alabama came to Philadelphia to discuss the ways in which Alabama’s business community worked to develop his state’s pre-K system.

Pre-K for PA has also employed economic rhetoric. In an open letter sent to both candidates in May, the campaign stressed:

Pre-K for PA has the support of many business leaders throughout the commonwealth. Among those leaders we are proud that [Comcast Executive Vice President] David L. Cohen penned an op-ed published last month in The Philadelphia Inquirer that stated: “Early-childhood education is not just a ‘nice to have’—it is an educational, moral and societal imperative essential to building the workforce of the future.”

But advocates know that early childhood education would impact far more than just our future labor market. While studies have documented the role pre-K can play in aiding the intellectual development of children, research has also shown how a pre-K expansion would significantly benefit low-income families, particularly poor women.

Mothers who have regular childcare are far more likely to stay employed. Moreover, a continuous work history correlates with better pay and benefits, but women often have to interrupt their careers because of a lack of steady childcare. An expansion of high quality pre-K would mean women would not only be more likely to keep their jobs, but also advance their careers.

Yet the candidates generally avoid these talking points. Even Wolf, with a 24-point lead, is quick to tell audiences that pre-K is “not just about social welfare.” In policy papers, leaders of the Pre-K for PA campaign have acknowledged that early childhood education is a boon to needier families, but they, too, seek to frame their public messaging to encompass all families, not just those that are low-income or headed by single parents.

“We don’t want to create a class conflict around this,” said Cooper, who points out that it’s a “broad coalition” that goes to the polls. Citing the pre-K model of New York City mayor Bill de Blasio, which aimed to make pre-K available to everyone, Cooper said that universal pre-K “makes every family a stakeholder.”

No doubt, given the Keystone State’s education budget crisis, enacting a major pre-K plan would be politically challenging. One could reasonably argue that ignoring mothers on the campaign trail, in a state with a large conservative contingent, is perhaps the only way to build critical support for early childhood education.

But this shouldn’t be taken at face value; the terms in which pre-K is framed, and the justifications provided for it, will inevitably affect the substance of the policy. Early childhood education has garnered tremendous political momentum, but it may have come at a price.

“I wish candidates would make that connection between women’s need to work and families’ need to have access to quality early childhood education, because it’s critical,” said Tam St. Claire, the president of the Bucks County Women’s Advocacy Coalition, a Pennsylvania coalition of non-profits and individuals that serve women and girls. “If we are expecting women to be economically self-sufficient, then we have to have systems and institutions that support the demands women have on themselves now.”

Debasri Ghosh, the director of education and communications at Women’s Way, a Philadelphia-based women’s and girls’ advocacy organization, points out that not only is pre-K important for children but “it’s also an incredibly stabilizing force for women and their families.” And a lack of accessible and affordable childcare, Ghosh explains, “can perpetuate the existing wage gap between men and women.”

Looking beyond Corbett and Wolf, the Pre-K for PA campaign is working to move big political donors, as well as candidates for the Senate and House of Representatives in Pennsylvania and nearby states. And a new survey reveals that 64 percent of voters support increased funding for pre-K programs in Pennsylvania. The stakes are high: In a state where only 18 percent of three- and four-year-olds currently have access to high quality early-childhood education—and where 13.6 percent of single mothers with minor children are unemployed—the campaign’s outcome could dramatically impact not only those in Pennsylvania, but children, families and women across the country.