The business model is overrated [Commentary]

On behalf of Baltimore's stakeholders, I want to express my thanks to Gregory E. Thornton, the new chief executive officer of Baltimore City Public Schools, for his inspiring words ("Much work to be done," Aug. 25). In case you're wondering, the stake I hold is a house I recently bought in East Baltimore. It's a big row house, built in 1875, so I don't exactly hold it — really it holds me — but I guess that part isn't so important.

Let me get to the point: CEO Thornton tells us he will run the city schools like a business. "Our district must operate like a $1.3 billion business," he writes, "because that's what it is. We are in the business of education, and we must be held to the same standards of fiscal stability and return on investment."


This certainly sounds reassuring. But I cannot help wonder what kind of business will serve as a model for Baltimore's schools.

Will they operate like Comcast? Mr. Furstenberg, this is a recorded announcement from the Baltimore school department of Human Capital to let you know that a math technician will be in tomorrow sometime between the hours of 8 a.m. and 4 p.m. to teach algebra to little Johnny. Press 1 to confirm. Press 2 if you need to reschedule.

Or perhaps like Bernard Madoff's investment company? Now those were some returns on investment! Once upon a time, Madoff was a respected CEO. Businessmen looked up to him. Chancellors vowed they would run their schools like he ran his funds. Until, that is, his business turned out to be built on lies and broken promises.

No, probably the schools will be run like Apple. There's a business that inspires: It was named America's most admired company four years straight! We love Apple so much that soon our students will all have iPads in their classrooms.

Of course Apple makes some of its eye-popping profits by exploiting Chinese labor. And its return on investment is so impressive in part because it keeps its gargantuan profits overseas and pays practically no taxes in the United States.

That doesn't sound much like the schoolteachers I know, the ones who dig into their own salaries to buy school supplies for their students and stay late to tutor the ones who fall behind. Maybe if Apple paid its taxes American teachers wouldn't have to buy their own pencils. Why is it that we always want to run things like businesses these days?

Except that we don't, really. Every day we hear about how we are going to hold teachers accountable. Out with tenure! Down with teachers' unions! Fire the ones who don't deliver results, and promote the ones who do!

Meanwhile, Attorney General Eric Holder announced billions of dollars of fines against America's biggest businesses for their illegal activity. Citibank has paid $7 billion in fines, JP Morgan Chase paid $13 billion, and Bank of America will pay a whopping $16 billion to $17 billion. A federal judge may soon go even further and fine British Petroleum $18 billion for despoiling the Gulf of Mexico. As for the people who broke the law: They're held accountable by making their shareholders pay the fines, while they keep their bonuses.

So we hold teachers accountable and let CEOs off the hook. Maybe we should consider running businesses the way we run our schools.

What is it about business that makes it such a model for everything else? After all, it was the businesses that fled Baltimore to make bigger profits that caused the city's decline in the first place. When middle-class workers stopped making steel at Sparrow's Point and impoverished workers started making it in India, the city's fate was sealed.

(Of course if this was bad news for Baltimore, it was good news for the shareholders of the private equity firms that shipped all those jobs overseas. Maybe if stakeholders acted more like shareholders? Oh forget it.)

Soon neighborhoods fell into poverty, crime exploded, the social fabric began to decay and all forms of societal ills set in. Now we expect our teachers to fix every one these problems with their magic teaching skills. And when they don't, we hold them accountable.

Good luck, Mr. Thornton, CEO. Your heart seems to be in the right place. But on behalf of my fellow Baltimore stakeholders, let me make a plea: For pity's sake, please don't run the schools like a business.

François Furstenberg teaches history at Johns Hopkins University, where he runs classes to the ethical and financial standards of the country's greatest CEOs. His email is


To respond to this commentary, send an email to Please include your name and contact information.