BLOOMBERG, MURDOCH, AND EDUCATION

Joel Klein, the New York City schools chancellor, is not a popular man among those who have spent their careers working in the school system–but, to judge by the reaction in the edu-blogosphere, any joy engendered by the announcement of his resignation was quickly extinguished when the identity of his successor became known. She is Cathie Black, a career magazine-industry executive with no work experience in education; in appointing her, Mayor Michael Bloomberg is showing that he doesn’t trust educators, even those with reformist reputations, to run the school system. So the toxicity surrounding school reform isn’t likely to disappear.
How Mayor Bloomberg feels about the school system isn’t news anymore. What’s most interesting about yesterday’s announcement was not that Klein is leaving or that Black is replacing him, but that Klein is going to work for Rupert Murdoch’s News Corp. to explore possibilities in education. Recently, two famous Wall Street short sellers, James Chanos and Steve Eisman, announced that they see a crash coming in the for-profit education sector, which is heavily dependent on online degrees paid for through federally guaranteed student loans. (For details, see the very viral PowerPoint and speech that Eisman delivered at an investment conference last May, called “Subprime Goes to College.”) The shorts, and the Obama Administration, which is tightening student-loan eligibility, have driven down the prices of education stocks–including that of the Washington Post Company, which depends economically on Kaplan Inc., one of the leading for-profit education companies (and until recently the employer of Joel Klein’s predecessor as New York schools chancellor, Harold Levy).