They’re Running the Children Through Public Schools like Cattle: an interview with Tim Draper

Published September 1, 2000

With vouchers, schools are accountable to the people who matter the most: They’re accountable to parents. It’s no surprise that all the powers that be in public education are not in favor of vouchers because vouchers make schools less accountable to them.

Two years ago, a group of Silicon Valley businesses took on the California Teachers Association by organizing a ballot initiative to remove the union-supported cap that was preventing any further growth of charter schools in California. Rather than face an expensive initiative campaign, the union backed down and agreed to endorse a charter school expansion law.

Now, Silicon Valley businessman Tim Draper has produced a universal school voucher initiative, Proposition 38, that would drain even more power from the teacher union and give that power to parents. This time, the union isn’t backing down. By the time the votes are counted in November, total spending by both sides may reach as much as $50 million: the most expensive battle ever over who should control public education.

Tim Draper is no stranger to change and to the roiling effects that change can bring to a marketplace. As an early-stage venture capitalist, Draper has backed more than 40 companies since inception, including Parametric Technology,, Tumbleweed Communications, and Preview Travel. His original suggestion to use “viral marketing” in Web-based email to effect the geometric spread of an Internet product to its market was instrumental to the successes of Hotmail and Four11.

Draper is founder and managing director of Draper Fisher Jurvetson, one of the leading startup venture capital firms in Silicon Valley. In most cases, Draper’s firm is the lead investor for a company’s first round of financing; the firm has supported over 150 high-tech companies. With a focus on information technology businesses with very large market potential, the firm views its role as helping entrepreneurs achieve their maximum potential not only by providing investment funding, but also through team building, partnerships, advice, and support.

Draper received a B.S. in Electrical Engineering from Stanford University and an M.B.A. from Harvard Business School. He worked as a marketing engineer for Hewlett-Packard and was assistant to the president of Apollo Computer. Before founding Draper Associates, which subsequently became Draper Fisher Jurvetson, he worked in high-technology corporate finance at Alex. Brown & Sons.

A strong advocate of entrepreneurship, Draper’s free-market views have been published in many major newspapers, including The Wall Street Journal. He is the creator of Tim Draper’s BizWorld, a course to train young entrepreneurs, and he served on the California State Board of Education during the term of Governor Pete Wilson. Draper recently spoke with School Reform News Managing Editor George Clowes.

Clowes: How did you become interested in education reform?

Draper: One day, about 10 years ago, my daughter asked me, “What do you do?” She was in third grade in public school, and I arranged to go into her classroom and teach kids about business for a morning. To do that, I created a simulation of the business world called BizWorld. It was a big success. Ultimately I created a nonprofit around it, and now some 10 to 15 thousand kids have been taught about business with BizWorld.

When Gail Wilson–Governor Pete Wilson’s wife–saw what I’d done, she gave me the nudge and I got appointed to the state board of education.

I was on the state board for a year, and during that time I realized a few things. One was that education in California had gone from first to fiftieth in 20 years. California is forty-ninth in math and forty-ninth in reading. The schools are starting to exclude a lot of children from the testing so the results will look better, and the system has a dropout rate of 33 percent, which rivals that of Third World countries. I was horrified.

I started to get very interested in charter schools as a way of improving education in California and then, part way through my service on the board, a staff paper appeared on my desk about regulating charter schools. It said, “Here are all the ways that we regulate public schools today, and here are all the ways that we’re going to regulate charter schools.” They started to draw the lines around charter schools–saying, “Well, of course, charter schools are going to have to have accredited teachers, they’re going to have to have the same text books, they’re going to have to have this, they’re going to have to have that”–and I realized they wanted to make charter schools look exactly like public schools. They would set charter schools up to fail.

That’s when I became very concerned. I already had noticed some things that I was concerned about in my daughter’s public school, just by being in there for a few days with BizWorld. I decided that any changes, any reforms, had to take place outside the system because the public schools had no natural competition. The public schools have 90 percent of the children, and it seems they want the children all to be the same. In fact, it seems they’re going to make them all the same, instead of giving every child a fair chance to get a great education. They’re running the children through the schools like cattle.

That’s when I became very interested in vouchers. I realized vouchers would give every parent the opportunity to leave the public school system. That’s when I decided it really had to happen.

Also, after a year or two, we moved all our children out of public school and into private school. I had that choice, and I made it, but I realized not everybody has that choice. That again led me to vouchers, because vouchers give parents a choice and allow them to get their child out of a bad public school and into the kind of school that makes sense for their child.

Clowes: How did you develop the voucher proposal that’s on the November ballot? It sounds similar to an idea Matthew Miller put forward last year in an article in The Atlantic Monthly. He proposed both increased spending on public schools and vouchers, just like your initiative.

Draper: We started to collect input from citizens on the drafting of a voucher initiative back in November of 1998, when we set up the Local Choice 2000 Web site. The idea of Local Choice was to bring people in, and it did. We got a thousand people from all over the state who came to the Web site and left comments and suggestions to help us think about how we should draft the initiative. We also got the help of a lot of people in the education world, in the legal world, and in the business world. We brought them all together and got their feedback on how this initiative should be crafted. As a result, we crafted what we think is a long but very well-written initiative.

That was how we came to the conclusion that it should be a universal voucher. People said everyone should be treated the same across the board and so everybody would get a voucher. People just want it to be fair. They don’t feel that special treatment for special groups is helpful. We did some polling on different approaches, too. We tested it based on means, we tested it based on being in schools that are failing academically, we tested it based on a number of approaches. And we found that the idea of a universal voucher polled higher by a huge margin. When you think about it, it’s really only fair.

The other thing about vouchers that people glommed on to is that they make schools accountable to parents instead of being accountable to some nebulous group in Sacramento. Schools have to be responsive to parents’ needs.

Clowes: But one of the main criticisms of your proposal by opponents like the teacher unions is that schools would not be accountable under a voucher system. How do you respond to that?

Draper: With vouchers, schools are accountable to the people who matter the most: They’re accountable to parents. It’s no surprise that all the powers that be in public education are not in favor of vouchers because vouchers make schools less accountable to them. They’re not talking about anybody but themselves. They see that they’re going to lose power, and they’re very concerned about it. That’s why they’re pulling out all the stops to try to make sure that this initiative doesn’t pass.

But this voucher initiative has grassroots appeal. I was in the Compton area, which is one of the poorest districts in the state, and people there were telling me this is the civil rights movement of the twenty-first century. They said it is so important for people to be able to have control over their education dollars. It’s going to make a huge difference.

The parents I talked to were so anxious to get their children out of the public schools and into a private school or some other kind of school. They were absolutely thrilled that we were putting this kind of opportunity on the ballot and it gave me renewed verve to continue what I was doing. It showed me clearly just how badly vouchers are needed across the state.

Clowes: Could you summarize the main features of the voucher initiative and how it’s structured?

Draper: The Proposition 38 initiative provides every student with a $4,000 voucher that would be accepted at a public, private, or parochial school of choice. That puts control of a child’s education in the hands of the parents.

It costs about $7,400 a year for the basics to put a child through school in California. Taking out $4,000 for each child that goes to a voucher school would leave $3,400 in the system.

With that $3,400 remaining in the public schools, we can move the state per-pupil spending up to the national average without increasing taxes. That’s the other purpose of the initiative: To raise the spending per student in California to at least the national average. The voucher gives people the opportunity to get out of the system for $4,000 and actually save the school money.

So we actually do two things at once with no tax increase: We can give people a voucher and increase the per-pupil spending. Parents who use the voucher will bring the state per-pupil spending up to the national average without a tax increase.

Initially, parents with children already in private schools won’t get the voucher. That was so that the budget was somewhat neutral, and also to counter the argument that this program is just for the rich. But the initiative rolls out the vouchers over four years to include the parents of children currently in private schools.

There’s another thing the initiative does which is very good for home schoolers, and that’s to roll back all regulation of private schools to January 1, 1999. What we were worried about was that the bureaucrats in Sacramento would use the initiative to start to regulate private schools just like they wanted to do with charter schools.

We wanted to provide protection from any additional regulation of the voucher schools, and so we rolled all the regulations back to January 1, 1999. We made it so that the rules that applied to private schools would apply to schools that accepted vouchers. So a home school or a private school would actually be more thoroughly protected than they are now.

The voucher money goes to the parents, and then the parents choose what school their child will attend. It’s the parents who choose where the child should go. The issue over the separation of church and state is clearer that way because you send the money specifically to the parents.

Clowes: Previous voucher initiatives, both in California and in other states, have failed. What’s going to make this one succeed?

Draper: You guys all ask the same question! There have been seven more years of failed schools since the last voucher referendum in California. Since then, the education issue has come to a head because many more people now recognize how bad public schools have become.

Those pioneers of 1993 were visionary, but the issue then wasn’t strong enough for people to accept that they needed to change something. Now, we’ve had seven more years of pouring more money into a failing system. Seven years ago, the educators said: “Just give us a little more time and everything will be better. With more money everything will get better.” But what’s happened is that it’s just gotten worse. They’ve had more money and more time, and it’s gotten worse.

We’re also drawing support from communities across the state. Parents are looking for solutions that provide better opportunities for all children but don’t increase taxes. They want the ability to choose the school that’s best for their child, but they also want to improve public schools. That’s what the initiative does.

Another reason this campaign is different is that this time we’ll have the funding we need to get our message out. In 1993, the teacher union was able to get away with putting out misleading information. That won’t happen this time.

Clowes: Finally, is there any one message you want to send to our readers on this issue?

Draper: This initiative will create safer schools, it will alleviate the over-crowding problem, and it’s only fair that every parent should get the opportunity to choose the education that’s best for their child.

As well as increasing spending on public schools, this initiative provides the opportunity for spending our education tax dollars more productively. At present, around 50 percent of all education dollars don’t go anywhere near the classroom. They go to Sacramento and they go up and down the food chain, but they don’t get to the teacher or the classroom. So there are tremendous opportunities to reduce costs and increase spending on the actual delivery of education.

The initiative also is part of a national movement. Dick DeVos is doing the same thing in Michigan, Governor Gary Johnson is pressing for vouchers in New Mexico, and we have Governor Jeb Bush who’s working very hard on it in Florida. I’ve talked to a number of people who have said they would take on their state if this initiative passes in California. Then we’ll be able to roll it out across the country.