This is from Bill Moyers:
…the real enormity of America’s annual hedge fund jackpots only comes into focus when we contrast these windfalls with the rewards that go to ordinary Americans. Kindergarten teachers, for instance.
The 157,800 teachers of America’s little people, the Bureau of Labor Statistics tells us, together make about $8.34 billion a year. Hedge fund America’s top four earners alone last year grabbed $10.4 billion.
Cheerleaders for hedge fund America consider such comparisons unfair. Hedge fund titans, they trumpet, are making a huge contribution to education. They’re investing, for instance, millions upon millions in the charter school cause.
True enough. Hedge fund billionaires are indeed investing colossal millions in charters, educational entities — often tied closely to for-profits — that take in public tax dollars but operate independently of local school board oversight.
Hedge fund manager cash has gone both to individual charter schools directly and into political war chests to support candidates who want to see charter networks expanded. Thanks to this cash, charters have become a major fact of American educational life, with a “market share” that rivals traditional public schools in many big cities.
Hedge fund flacks hail this growing charter presence as a new window of opportunity for underprivileged kids in failing traditional schools. But many educators consider charters a diversion of badly needed public tax dollars into unaccountable private entities that cream off top students and refuse to take in the most challenged.
Plenty of research reinforces this perspective. One survey of recent studies, released last week, sees a charter school landscape full of “bad education, ridiculous hype, wasted resources and widespread corruption.”
Also in that landscape: plenty of high-return investment opportunities for hedge fund managers. A federal tax break known as the “New Markets” tax credit lets hedge funds that invest in charters double their money in seven years. Charters have become, notes one education analyst, “just another investor playground for easy money passed from taxpayers to the wealthy.”
The final indignity? The families of those kindergarten teachers who make less in a year than the average top 25 hedge fund manager makes in 15 minutes pay a greater share of their incomes in taxes than hedge fund moguls pay on theirs, thanks largely to a notorious tax code loophole — known as carried interest — that Congress has not yet seen fit to plug.