Fast 4 Interest Rates
In May 2004, 50 education activists including students, teachers, and parents marched 70 miles from San Pablo, CA to Sacramento. They wanted justice for their school district's funding. The governor refused to meet with them and they escalated. A month later they did a hunger strike, refusing all food except water for more than two weeks until their demands were met.
They wanted lower interest rates on school district loans. Through their organizing they got those rates down exponentially.
At the time, they focused on a district called the Richmond Unified School District. Now it's the West Contra Costa--renamed due to severe credit rating decreases. In the late 80s, the district had bad budget issues due to declining enrollments. When people move out of your district--which can happen for a variety of reasons, few of which schools can control--your schools lose money since funding relies on student numbers. In 1991, the district went bankrupt.
From IBM to the state
The bankruptcy changed everything, including the district's ability to pay back a $5m loan from IBM. The company had given the schools a ton of (outdated!) computers with the expectation that they'd be paid back for them. In a fascinating direct struggle between a school district and a major corporation, the district asked IBM to forgive this loan in the early 2000s. You'd think that a massive company would help out a struggling school district. At the time, IBM made $5 million every five hours. But no, they wanted their money--it's the principle of the thing, they said. The district was able to get a few concessions on time, amount, and interest rate, but the company wouldn't forgive the loan.
The district's budget issues had other big effects. Richmond Unified was the first school district to be put in a state receivership, which means having the state assume responsibility for its finance. It's a relatively common practice now (Philly was under receivership for almost 20 years, Harrisburg is now). Begun in 1991, part of the receivership California provided a loan to the district for $28.5m to fund its budgets. The interest rate was a high 5.7%.
The last straw
By 2004, RUSD still had $16.5m to go on this high-interest loan from the state. It couldn't keep up its buildings, ended it sports programs, and couldn't open many of its schools. At the same time, Republican governor Arnold Schwarzenegger had cut state funding for schools in half from $4 billion to $2 billion in the budget allocation for Proposition 98.
The pressure of the loan on Richmond's school budget combined with the cut in state aid was the last straw. That's when parents, teachers, and organizers said enough is enough. They marched to the capitol from Richmond. Schwarzennegger refused to meet with them. So a smaller core group decided to gather in a public space and go on a hunger strike that would last 26 days.
And they won. Long-time farmworker organizer Dolores Huerta and state legislator Jackie Goldberg worked in solidarity with the movement, getting 42 signatures from elected officials demanding the governor meet with them and act on their demands. Goldberg and others wrote a piece of legislation called the Daucher Bill, which reduced interest rates for the school district's loans from 5.7% to 1.7%. It also said that any indebted district would not have to make loan payments until changes to Prop 98 came through. Schwarzenegger met with the fasters as well.
Nine people had started the hunger strike, including teachers and activists like Fred Jackson. Two of them, Cesar Cruz and Israel Haros-Lopez, were pushed in wheel chairs to a celebratory rally. Haros-Lopez cried as he spoke at the rally. The blog IndyBay followed the movement posting videos, photos, and updates. The posts are still available and it's inspiring to see the evidence of this struggle.
A kind of relief
The organizers won a lower interest rate from the state through these actions, but it wasn't huge. The district didn't pay off the loan until 2012. Wendy Gonzalez was a first year elementary school teacher who marched and fasted with the group. Interviewed in 2012, when the district paid this debt off, she said it was "kind of a relief." I can imagine it was bittersweet. So much effort for a change in the interest rate, when the loan itself and the underlying system of property taxation that created its necessity remained.
Indeed, even now, the district has significant budgetary issues. As recently as this year, it was facing possible insolvency.
But the story is one we should learn from. School finance is hard to understand. It's even harder to understand as a socialist, since most everything written about it is from a technocratic-liberal perspective. The best way I've found to approach the issue is through organizing and movements. There have been amazing school finance struggles in our history. Socialists can learn about how this stuff works by learning about how people have organized to change it.
I've written about some cool stories before. There's the time a leader in the Durham KKK became an accomplice with a working class Black civil rights organizer in the 1970s in a school segregation fight. And the time when two districts in eastern Pennsylvania, Tredyffrin and Easttown (yes it's actually a place) came together to issue a bond in 1907, creating an intentionally integrated high school, which set the stage for a two year school strike in the 1930s to combat segregation. I've talked up my own organizing and gave a presentation about other movements, from Chicago to Cleveland to Philadelphia. This story from California is another great example.