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Volume I, Number 7, Summer, 2003

Cooking the Education Books?
Works of Mass Deception? (WMD)


If you cook the books and hide the true number of drop outs in your high schools, it turns out you can inflate the bottom line much like Enron and some other corporations - especially if those students are your worst performers.

Eliminate the bottom of a class and test scores soar like any good Dotcom stock IPO.

The statistics are simple. The appearance of improvement is deceptive. The abandonment of children is apparent.

This is hardly a recipe for healthy educational reform, but the Superintendent of Schools in charge of the Houston ISD at the time of these accounting errors is now the education Czar - the Secretary of Education in Washington - the one calling for accountability and scientifically proven strategies.

While Enron and Arthur Anderson were busy on the corporate front . . .

The New York Times reported on July 11, 2003 that "An audit recommended lowering the ranking of 14 schools in Houston from the best to the worst, dealing a blow to the city's school system." (See article at

The article, "Questions on Data Cloud Luster of Houston Schools," reports that hundreds of drop-outs were incorrectly listed as transfers. Enrollment at so-called miracle high schools dropped dramatically during this time.

Some have claimed that poor students were shoved out the door.

"No child left behind?"

"No poor readers left in school?"

Read the TEA (Texas Educational Agency) audit report in PDF format (click here).

Read a Houston Chronicle report of how Houston ISD has tried to explain the accounting problems (click here).

"TEA, after auditing student records at 16 schools and finding scads of errors in Rod Paige-era dropout data, recommended June 13 the district's rating be dropped from acceptable to academically unacceptable . The response comes just in time to prevent a default decision by the agency." Quoting from the Chronicle, June 27, 2003.

Stay tuned for the TEA's final ruling some time in August.

Houston ISD Board Adopts Sanctions to End Poor Accounting

In a move intended to prevent poor accounting practices when tracking dropouts, the Houston ISD Board announced it would begin limiting the pay of administrators in the district who failed to track dropouts. reported on July 10, 2003, that "Under the policy, a district superintendent could lose up to $20,000 in performance pay if a school under that district superintendent's watch fails to meet data reporting standards. A school principal could lose up to $5,000." (Click here for full article)

Previously, administrators were rewarded for low drop out rates with bonus pay. The new policy would take away the bonus but would not actually not penalize the administrators by reducing their base pay.

What messages were expressed by top management previously about pay for performance?

What kind of climate was created?

How did that climate influence record keeping and the handling of children?

Where are the lost children?

Thousands of lost children.

Children left out.

Children left behind.

Educational Fraud?

When does the misreporting of educational data cross the line from incompetence, accident and misrepresentation into actual criminal fraud?

According to a representative of the TEA, there have been cases when misreporting has been turned over to the State Attorney General's office to explore the possibility of criminal conduct.

So far the Houston ISD situation has cast blame on the clerical staff rather than the leadership, but the original investigation was limited primarily to the discovery of gaps between the number of transfers reported and the number of students for whom records could validate such coding.

Given the TEA claim that misreporting occurred systematically across many schools, perhaps a different kind of investigation is needed - one that would establish just what messages were delivered to leaders by leaders and to clerical staff by principals.

If all of the attendance staff were interviewed under oath by the AG's office, it would be interesting to learn how they were trained, what they were told and how and why they managed to depress dropout statistics to make their schools' performance data look better than it really was.

School leaders were paid substantial bonuses to keep dropout rates low, but those bonuses should have been paid to keep the real dropout rate low.

When corporations fudge their numbers to make profits seem better than they are, it is considered fraud.

Should it be any different if school leaders do the same?

Related Articles

Education Secretary Defends School System He Once Led
July 26, 2003
New York Times

Dr. Paige said: `'This system in Houston is still standing, it's vertical and it has been reviewed by some of the best. And the data can take it because it is earnest, it is open, it is objective, and it is there."

Houston's School Dropout Debacle
July 21, 2003
New York Times

It turns out the Houston schools have not lived up to their billing. Their amazingly low high school dropout rate was literally unbelievable -- the educational equivalent of Enron's accounting results. The school district has found that more than half of the 5,500 students who left in the 2000-1 school year should have been declared dropouts but were not.

To Cut Failure Rate, Schools Shed Students
July 30, 2003
New York Times

Growing numbers of students — most of them struggling academically — are being pushed out of New York City's school system and classified under bureaucratic categories that hide their failure to graduate.

State to Monitor Houston Schools to Ensure Reporting of Dropouts
August 8, 2993
New York Times

The Texas Education Agency said today that it would closely monitor the Houston Independent School District, where an audit showed schools were vastly undercounting their dropouts, but that for now it would not accept an auditor's recommendation to rank the district's performance as unacceptable.

HISD granted 6 months to improve record keeping
State agency lowers ratings at 15 schools
Copyright 2003 Houston Chronicle

The 'Zero Dropout' Miracle: Alas! Alack! A Texas Tall Tale
New York Times
August 13, 2003

Houston Punishes Former Principal in Undercount of Dropouts
New York Times
August 13, 2003
The school district will dock the salary of the former principal and a computer technician at Sharpstown High School, where false claims of no dropouts led to a state audit.

More Information on Secretary Paige

The Rod Paige Page from Steve Kirsch. Steve Kirsch is a philanthropist and successful entrepreneur from the technology sector who has paid special attention to the activities of Rod Paige in Houston and now in Washington. This page chronicles dozens of disturbing aspects of the former superintendent's tenure in Houston.

© 2003, Jamie McKenzie, all rights reserved. This article may be e-mailed to individuals by individuals, but all other duplication, distribution, publication and use is prohibited without first receiving explicit permission. Contact for information.
What can you do to change this law before it does great damage to the schools and children in your state and town?
  1. Subscribe to "No Child Left" to stay informed about efforts to repeal NCLB. Click here.
  2. Speak with the school board members, administrators and teachers in your community to learn how NCLB will change schools and learning in your town.
  3. Start communicating with your Senators and Representatives to let them know you want this law changed to put more emphasis on capacity building and support rather than testing and punishment.
  4. Write letters to the editor of your local newspaper expressing your concerns. Illustrate the dangers of this law with specific and compelling examples.
  5. Emphasize concrete alternatives that would do more to improve the futures of disadvantaged children.

A List of ESEA (NCLB) Amendments

1. Fund social programs that impact school readiness so that all children actually enter school ready to learn as the first President Bush promised long ago.

2. Fund capacity building (enhanced teaching and learning) in districts and districts for several years before engaging in punishing labels and reckless choice provisions. Capacity building might mean providing hundreds of hours of training in effective reading strategies, for example. But it does not mean training everybody in a single highly scripted program endorsed by the administration for pseudo-scientific reasons.

3. Devote public money to truly public schools. Be careful not to divert funds to reckless experiments or diploma mills.

4. Fund enough construction of new schools within public systems so parental choice is real.

5. Support informed school choice within public systems.

6. Emphasize rewards and incentives rather than sanctions.

7. Hold all publicly funded schools to standards for performance and quality, whether actually private, charter or truly public. Be careful about simplistic notions of high stakes testing.

8. Fund recruitment and preparation of effective teachers and aides from all racial and economic groups to close the gap between current staffing levels and what is desirable.

9. End the insulting, broad brush assaults on teachers and administrators struggling against difficult challenges.

10. Capitalize on the good research conducted to discover what works best in schools and avoid simplistic panaceas and platitudes imported from the world of business and medicine.

11. Enrich the options available to all children. Forswear tightly scripted, robotic programs and the fast food approaches to school improvement.

12. Build school improvement on a richly defined foundation of alternatives and strategies.

13. Eliminate Trojan horses, hidden agendas and shameful politics from ESEA.

14. Stop using Madison Avenue techniques to hide the harsh realities of so-called compassionate conservatism.