Charter School Protests Target Hedge Fund Billionaires

Dec 3 2014 | 9:18am ET

A small group of protesters gathered on the steps of the Tweed Court house in New York on Tuesday to decry the influence of hedge fund billionaires on New York State's educational system.

Parents and activists led by Zephyr Teachout—who ran against Andrew Cuomo in the recent New York governor's race on an anti-corruption platform—held placards emblazoned with the faces of well-known hedge fund managers including Daniel Loeb, Paul Singer and Paul Tudor Jones. Beneath the pictures were numbers indicating their campaign contributions in New York, mostly to pro-charter candidates, reports Buzzfeed.

The spark for the recent demo was a special session of the New York legislature, rumored to be happening next week, during which Cuomo is expected to raise the cap on the maximum number of charter schools allowed by the state.

Loeb chairs the board of directors of Success Academy, a charter school group poised to expand throughout the city, while Tudor Jones, Singer and even Carl Icahn have backed other charter schools and legislation.

Critics say the hedge fund managers' support for charter schools may have less to do with education and more to do with economics—investing in charter schools is good for their bottom line.

Alan Singer, a social studies educator at Hofstra University, writing in the Huffington Post, explained it this way:

“As a result of this change to the tax code, banks and equity funds that invest in charter schools in underserved areas can take advantage of a very generous tax credit. They are permitted to combine this tax credit with other tax breaks while they also collect interest on any money they lend out. According to one analyst, the credit allows them to double the money they invested in seven years.”

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