I-884, Hanauer and TeachFirst

I recently mentioned that Nick Hanauer, the major campaign donor for I-884 (a ballot initiative to raise the sales tax to fund public education), is a director/investor in an education services firm that stands to benefit from I-884.

An executive of Hanauer's firm, TeachFirst, contacted me after reading the blog post and graciously offered to answer any questions I had about the company and Hanauer's involvement. From our conversation I learned the following:

* Hanauer was an early investor in the company, brought in both for his extensive business experience and interest in education issues. The source was not aware of the size of Hanauer's investment, but said he was not one of the largest investors.

* The company creates online and video training programs for teachers, which are more efficient and convenient than traditional seminar-type programs. The biggest source of revenue is training teachers to work with English-learners, as mandated by "No Child Left Behind".

In short, I learned nothing either sinister or inconsistent with what I gathered from reading the company's website.

The language of I-884 specifically mentions that the measure would fund:

Training in effective instructional strategies for certificated instructional staff and classified staff who have instructional responsibilities for special education students or students whose first language is not English;

So it does appear likely that TeachFirst would benefit directly from the initiative.

There's not necessarily anything wrong with that. The product, as described to me, sounds like it performs a valuable service. Helping more English learners learn more English is important. I have no objection to for-profit companies serving public educators as long as vendors are selected on the basis of quality and price and they deliver on their promises. There should probably be a lot more privatization throughout the educational system than there is today.

Nevertheless, it is remarkable that a person with a financial stake in a company creates and bankrolls a ballot initiative that is likely to benefit one of his portfolio companies (and, it's fair to assume, other educational business ventures he might have now and in the future). That doesn't necessarily mean his main interest in I-884 is his own financial interest. More likely than not he got involved in both ventures primarily because of his passion for education.

Still. This is the sort of inside relationship that should properly be reported and discussed, just as any other case when somebody with a commercial interest bankrolls a campaign. As the Seattle Times wrote in a recent editorial about a different race

this is Washington, where voters place great value on campaign transparency. Reporting donors' occupations and employers helps voters make an informed decision about which candidate they would like to become governor.

The P-I concurs:

Voters deserve to know how much money political candidates are getting and from whom.

The same holds true about donors to initiative campaigns and those donors' major investments. Will the Times and P-I report on Hanauer's investments in educational service firms that stand to benefit from I-884? I hope so.

Posted by Stefan Sharkansky at June 24, 2004 07:01 AM