Edison's Report Card

Private management of public education has been a cornerstone of the "choice" movement for years, along with magnet and charter schools, vouchers, and home schooling. But it's a stone with some cracks of late. That's primarily because of the perils of Edison Schools Inc., the largest US private company running public classrooms.

Recent news has shaken Edison's once-solid prospects. It was given a disappointingly small role in managing Philadelphia's failing schools, and it has just lost a prominent charter-school client in Boston to a federal probe of its revenue-reporting practices.

Especially jarring is the company's plummeting stock value, which threatens to undermine its ability to accumulate funds to run even the 20 Philadelphia schools assigned to it by state officials, who have taken charge of the city's schools. Edison had hoped to run 45 schools there. Ten years after its founding, the company has yet to show a profit.

Could this mean the end of the whole idea of company-run public education? That would please the teachers' unions and other groups that have seen this idea as a threat from its inception, while they hardly face the same level of accountability themselves in the marketplace – or even, all too often, from government.

But cheers from those quarters are probably premature.

Edison's optimistic founder and chief executive, H. Christopher Whittle, hopes to raise the $50 million or so needed for the Philadelphia operation this fall. Even without that city's schools, Edison educates an impressive 75,000 students in 22 states.

And it has a better record than the public administration of Philly's schools up to now. The company says that if the test scores of the students in all its schools are compared with those from districts of similar size, Edison's average gain of 4.2 percent a year is superior. Critics, however, point to eighth-graders at Renaissance Charter School in Boston, until recently run by Edison, who scored lower on state tests than eighth-graders in other Boston schools.

Edison is doubtless learning some lessons as the "choice" movement finds its place in American education. Troubled schools turn around only gradually, and performance depends above all on highly motivated teachers, principals, and parents – often in short supply. Because they're relatively free from bureaucratic constraints and able to innovate more creatively, private school managers, theoretically, have an edge in putting together needed elements for success.

Edison's experience as a highly visible leader in school reform shows that market competition has a place alongside government in education. If companies like Edison can weather financial storms and stay in business, another few years should provide a better measure of their worth.