Saturday, July 22, 2006

Market Forces Sully White Hat

Time to check in with Akron’s best-connected concerned citizen, David Brennan, and his government-funded empire. Yes, this is that White Hat post I mentioned earlier this week.

Last summer a storefront cropped up in the new Wallhaven strip mall. It was called Brilliant and, according to a blurb in Akron Family Magazine, was a White Hat venture. I suspected that the business plan centered providing school-funded tutoring help mandated under No Child Left Behind. Under NCLB if a school fails to meet Adequate Yearly Progress for three straight years, the “remedies” include tutoring help for any kids in failing schools on the district’s dime.

NCLB tutoring has some serious potential for scammage. I’ve reported before that some firms in other states are setting up shop here rather than their home states, raising the suspicion that Ohio’s standards for tutoring firms are unusually low.

Anyway, I thought that’s what Brilliant was up to and twice started writing posts on it (working title: "Just Fucking Brilliant"), both times junking them because I didn’t have the goods. Part of Brilliant's operation was “NCLB Tutoring,” but also has a number of programs that actual people pay for with their own money. So it looked like maybe this was an actual business venture as opposed to another of Brennan’s belly-to-the-trough deals. I only recently found this article which attempted to lay out the business plan.

Recently I went to the Caribou in that same plaza and noticed that the Brilliant store looked oddly dark. With a sign on the window.

I immediately went into irony shock: The man who professes that all of life should follow the dictates of the market unable to compete. Not terribly surprising; Brilliant’s tutoring arm tried to flex in an awfully crowded market. In the Akron area we have at least three different storefront tutoring operations – Kumon on Smith Road, Knowledge-something by White Pond and the grandfather of the market segment, Sylvan Learning Centers. I saw one TV ad for Brilliant marketing it as a low-cost alternative. Funny that people didn’t flock to the cheapest place to educate their kids.

In a story about Life Skills expanding into Florida, a White Hat flak bravefaces the Brilliant failure, saying that it was all about NCLB tutoring and the demand wasn’t there and White Hat is stronger without it. In fact the demand wasn’t there because APS has been successful of late. The district is poised to meet AYP for the second straight year, meaning it will go back to Year 0. That would mean at least another three years before the district would have to pay for tutoring district-wide.

So I don’t know which is worse: That Brennan has failed at the one business in the White Hat education empire that was subjected to market forces, then tried to spin it as a positive. Or that Brennan, who seems determined to have every landmark in Akron named after him, was short-selling the city’s school district. I don’t know what school system he actually has in mind for Pottersville – er – Akron, but it doesn’t sound like one I want my kids to go to.

Meanwhile, White Hat is losing Life Skills Centers in Columbus – they have severed ties and are looking for new management. And White Hat is expanding Life Skills into Florida. “Expanding” for White Hat means lobbying the state legislature to change the rules Life Skills fits under them. This is just me, but if you need to lobby to make your business legal, it probably isn’t a very good business to be in.

White Hat touts its 20% success rate as 20% that wouldn’t have any diploma without them. But anecdotally I know that some students are leaving traditional schools because White Hat exists. One has to ask how many of that 20% would have a diploma from a traditional school or would have a GED if there was no White Hat? And how many are attracted to White Hat because it is a cake ride compared to real school?

And finally, how many of the 80% who wash out are just biding time and keeping a parent and/or probation officer off their backs until they can split? Biding time and, by the way, wasting money that should be educating my kids.


Anonymous said...

The Brilliant Learning place has been closed for quite some time. At least for a good few months. Sometime during March or April, I went to the Quizno's next door and the Brilliant place was closed. Given when the plaza itself opened, the Brilliant place could not have operated for very long at all.

I always find amazing with the hyprocrisy of conservatives who tout free market, less government involvement, entrepreneurship (taking a risk), dog-eat-dog world, etc. However, when they're the dog that's being eaten, they cry to the government (more specifically the Republicans, the so-called party of business and free market capitalism) to bail their asses out.

Whatever happened to taking a risk and losing? Isn't that what taking an entrepreneur's risk is all about? That some people actually lose?

When conservatives are on the losing end, they can't handle it. Free market capitalism only applies to them as long as they are the ones on top and making money.

Look at GM and Ford. They have made some really blunderous business decisions that have allowed Honda and Toyota to eat them alive here in the US. Now the once mighty auto giants are crying out to the Honda and Toyota not to compete so much!!

Given the vast amount of corporate welfare and giants such as Wal-Mart, we have an economy that is something other than free market capitalism. With free markets, isn't one supposed to be able to enter and leave the market freely? We are nowhere close to that.

I would not mind trying a true free market where we don't have corporate welfare and we don't have corporate giants dictating the show. I think a true free market could work if our government would actually serve everyday people instead of the well connected elite.

Our anti-trust laws badly need to be reformed to go after the Wal-Marts who may not actually be vertically integrated, but their bullying of suppliers effectively amounts to that.

Anonymous said...

Another item on capitalism...

Adam Smith, the guy who conservatives love so much for his thoughts on free markets, was actually a liberal moralist.

Smith strongly believed that if you were successful, you had a duty and obligation to give back to society for what society bestowed to you for your hard work. By giving back to society, the fuel for capitalism keeps feeding itself because ordinary people can have money to buy things.

Smith understood very well that when markets boom, wealth flows upward. He understood that a concentration of wealth in the hands of a few ultimately destroys free market capitalism.

It is just utterly amazing to see conservatives who flaunt their supposed business smarts ignore the other half of Adam Smith.

TBMD said...

Agreed that Brilliant could not have been in business for more than a couple of months.

To Joebu's point, I'm not sure that I heard any loud cries for a government bailout of 'brilliant', or much whining about it. (Though if it had been my business, I certainly would have done enough whining to drive family and friends to distraction). I'm not sure that Brennan has done much public carping on the subject.

Response to the other Joebu points - the issue of corporatism v capitalism, and the misreading of Adam Smith, are beyond the scope of blog comments. If'n I gits up the motiviation, I may post about them on BMD.

On a personal note, having kids in the Firestone system, I can tell you that there are plenty of kids who are just waiting it out, consumning system time, resources, and money, who will be no more educated after they graduate than when they went in.

Also, it's not exactly an implausible play to sell short on government schools. It's a system designed to fail, and that propensity only increases as federal mandates increase.

Anonymous said...

I'll tell you what the bottom line really is, if you'll listen.

The people making decisions about what happens to the institutions, economy and people of NE Ohio...aren't from NE Ohio.

I'm in Southern California, and that interesting little tidbit of news came from a high ranking corporate executive whose wife is originally from Ohio.

No one really gives a shit about what Brennan does, and no one will. Yes...the "progressives" will keep droning on about this, that and the other but the real action is in the Sunbelt and everyone knows it.

In 2010, there will be another census. At that time, the population of North Carolina will exceed that of New Jersey. If it suddenly becomes more important for a presidential candidate to win North Carolina than to win New Jersey, there will be yet another set of messy demographic issues for Democrats and progressives to deal with...and they've shown us many times recently that they can't effectively deal with the ones they already have.

Also, Ohio and Pennsylvania will lose either one or two Electoral votes each. New York state could lose as many as three. Texas and Florida are projected to pick up three votes each.

Bob Novak says that, had these numbers been in effect in 2000 and 2004, George W. Bush could have been elected without carrying Ohio!

What does it mean? Well...I'd say that libs are likely to be out of power for some years to come unless the liberal party in this country undergoes some kind of realignment. Normally that would mean the hard left gets shot in the head and tossed out on the sidewalk.

May I offer you a cigarette and blindfold, sir?

NEO said...

Anonymous (in SoCal), Brennan can be dealt with on a strictly state level. When the Progressive Dems reclaim a majority in the Ohio State Legislature, charter schooling becomes an entirely different ballgame. Brennan's operations could be brought under investigation and face repercussions for wrongdoings exposed.

As for your permanent "conservative" majority, that assumes you can freeze time in the here and now, forever prior to this November's elections. Your president just vetoed a stem cell research bill that a majority (70%) of Americans support. What kind of president imposes his will over that of the popular majority? The same conservative embarrassing dolt who utters obscenities and unsolicitedly gropes the female German head of state at the G8, while his conservative party in Congress self-servingly votes itself raises, conservatively spends the country into generations of debt and conservatively presses politically marginal issues like gay marriage and flag-burning for amendmends, instead of progressively investigating Big Oil profiteering and liberally pursuing critical alternative energy initiatives and true conservation efforts?

Conservatives presently hold the reigns in all three branches of the federal government. Yet even with total control of the government for 5 straight years, the US is in more debt, more Americans are struggling economically, and the world is far more politically unstable today than it was 5 years ago, when Bush first entered office.

Five years. I'd say that conservatism has not just failed the United States, the American people and the world, but failed and f*cked them all over royally. But then, considering that conservatives hate government, how could they have possibly served well working within it? Why would they even bother to produce a truly prosperous vision for the US and the world?

Anonymous said...

Great piece, Pho. I'd noticed it was dark in there recently too, but assumed they had restricted hours in the summer months. Appears not.

Can't say I'm either surprised or saddened by Brilliant's fate.

John Ettorre said...

Brilliant piece of reporting here, Scott.

Anonymous said...

Nice info...Brennan needs to go. His intent is to ruin public schools, the backbone of this nation! We need to improve the public schools, not put money into the pockets of Dave Brennan who doesn't care about kids, just making more money and stealing it from the public schools because he doesn't like them!

Anonymous said...

Its time to get both corporate greed and No Child Left Behind out of our educational process. Our teachers know what students need, and they know they don't need David Brennan.
Dave Kovacs