It may be just as easy to argue that privatization will ruin schools as it is to endorse it as the free-market savior of public education—it is simply a matter of which side of the fence you are on. That is why some high-profile privatization efforts have collapsed in a blaze of controversy.

Our argument is not that privatization is good or bad. Rather, we believe privatization is something to consider but only with a skeptic’s eye and an understanding that no matter how you sell it to your community, any privatization effort is going to be controversial. So, if you are considering privatization, whether it be for your transportation program or for instruction, you’d better plan ahead and involve the community in the decision or you could be facing a political nightmare.

One District’s Story

One of us (Samuel Flam), a former school superintendent who had just started an educational consulting firm, had the unusual opportunity to see firsthand the political perils of privatization. Hired in 1994 by a school district in Michigan to serve as interim superintendent with a contract renewable in two-week increments, Flam was not in office two days when he learned that the school board had invited a well-known privatization company to town.

The Minnesota company, Educational Alternatives Inc. (EAI, now known as the Tesseract Group), was visiting the district to sell the board on why it should take over most district services. As events unfolded, the district’s flirtation with privatization became a case study for examining the political, economic, and community relations issues embedded in a decision to privatize.

A political nightmare was caused, to a large degree, because school officials invited EAI to town without first notifying employees or community leaders that they were seriously considering hiring a private company to run some school services.

The controversy became particularly ugly when attacks on school board members became more personal. Board members who voted to permit the investigation of contracting found themselves and their families bombarded by verbal and written attacks bordering on psychological warfare. The children of a few board members were lectured by teachers about the evils of privatization, and board meetings were suddenly packed with up to 500 people.


As should be expected, different constituent groups reacted differently to the board's consideration of privatization. The following is a look at how four major constituencies- parents, teachers, taxpayers, and students -reacted to the prospect of privatization.


Four Key Constituencies

As should be expected, different constituent groups reacted differently to the board’s consideration of privatization. The following is a look at how four major constituencies—parents, teachers, taxpayers, and students—reacted to the prospect of privatization.

  • Parents: Usually concerned about shared or community control over schools with an eye toward advising board members, parents were initially uncertain about their position on contracting; but were polarized by subsequent lobbying efforts by privatization proponents and antagonists.

  • Teachers: The board’s consideration of privatization provided an example of the powerful influence that groups outside the community can have on such a debate. Although local teachers expressed abundant and loud concern about privatizing, the board’s conflict with the district teachers’ union was intensified by outside forces. The state teachers’ association made it known that the district’s resistance to privatization was important to teachers in other districts.

  • Taxpayers: Although the incentive for privatizing district services was to save money, campaigns against privatization resulted in a general disbelief in this rationale. In news stories, board members were accused of trying to undermine the teachers’ union, and a few particularly inflammatory stories alleged that board members would receive personal financial gains by hiring EAI.

  • Students: Written and verbal appeals were made jointly by the superintendent and the president of the local teachers’ union asking teachers to refrain from expressing their personal opinions about privatization to students. Despite these appeals, several teachers told students that a contract with EAI could mean they would be laid off. Such proclamations contributed to a walkout by middle school students, who left their school early one afternoon and refused to return for a few hours. It was their show of solidarity against privatization.


Several teachers told students that a contract with EAI could mean they would be laid off.


Be Prepared

You might assume that the smaller the privatization initiative, the less controversy is likely to ensue. But there is no certainty of that. Following are a few common sense steps to keep in mind:

  1. Create a policy context. The local school board made a grave mistake by leaping to the conclusion that contracting out district services was an excellent idea and assuming that EAI was the right company to get the job done without involving stakeholders (parents, staff, other residents) in a careful study process.

  2. Identify the specific needs that give rise to considering privatization. The school board and administration must identify clearly and specifically the problems they are trying to solve. There are many reasons a school district might want to privatize a service including need to improve quality, reduce costs, upgrade technology, create internal competition, improve flexibility to change program offerings (for example, offer a nontraditional foreign language). Knowing and clearly articulating the reasons for privatizing will build community support.

  3. Visit a district that has privatized the service you are considering privatizing. We cannot emphasize enough how important it is to see a privatization experiment with your own eyes. But seeing it is only part of your responsibility. You also need to ask tough questions to be sure that your situation is comparable to the one you are visiting.

  4. Set up a study group. Establish a group that is representative of the community to evaluate the district’s productivity levels and other needs that might lead to privatization.

  5. Involve the news media. At the beginning of the debate, this board did not have a plan for dealing with the media. EAI, on the other hand, had hired a public relations firm to project its initial image to the community.

  6. Don’t promise a miracle. It’s tempting to oversell privatization, but if you promise too much and privatization fails to reach your lofty predictions, you will have put yourself in an embarrassing situation. Nobody will ever truly trust your judgment again.

Privatizing school services can be a high-stakes undertaking. The politics are risky and complicated, but they are not unmanageable. With any significant change in the way schools operate, it takes time to show results, and buying that time requires considerable community support.

In the end, the Michigan district decided not to privatize. Clearly, lack of foresight about the controversial nature of privatization affected that decision. It’s possible that if school officials had planned better how to handle this politically sensitive issue, the district might still have decided not to privatize. But without careful planning the opportunity for informed and respectful debate was lost. Thoughtful planning on your board’s part can keep that from happening in your district.

This article was excerpted with permission from the April 1998 edition of American School Board Journal.

Drs. Keane and Flam are the authors of Public Schools/Private Enterprise: What You Should Know and Do About Privatization, (Technomic Publishing, 1997). Dr. Keane can be reached at keane@oakland.edu and Dr. Flam can be reached at samf@annis.com.