My New Book is Out: The Art of Value Investing

Please forgive the shameless plug, but it’s not every day (in fact, it’s been four years!) that I publish a book.

Nearly a decade ago, I partnered with one of my investors, John Heins, to start a monthly investment newsletter called Value Investor Insight. We’ve now written a book entitled, The Art of Value Investing: How the World's Best Investors Beat the Market, which has just hit bookshelves (you can order it here.

It’s getting rave reviews – here are two:

“I learned the investment business largely from the work and thinking of other investors. The Art of Value Investing is a thoughtfully organized compilation of some of the best investment insights I have ever read. Read this book with care. It will be one of the highest-return investments you will ever make.”

—William A. Ackman, founder, Pershing Square Capital Management

“An outstanding addition to the volumes written on value investing. Not only do the authors offer their own valuable insights but they have provided in one publication invaluable insights from some of the most accomplished professionals in the investment business. I would call this publication a must-read for any serious investor.”

—Leon G. Cooperman, founder, Chairman and CEO, Omega Advisors

The book is essentially a greatest-hits compendium of greatest quotes from Value Investor Insight, organized to match the progression one would follow in defining and executing an investment strategy: from the setting of core philosophy and circle of competence; through idea generation, research and analysis; to buying, selling and portfolio management; and ending up with a chapter on behavioral finance, or lessons learned on how to eradicate those irrational “What was I thinking?” types of mistakes. The insights are rarely ours, but those of the best money managers on the planet who have generously shared their wisdom over the years.

Here is the press release:

The Art of Value Investing

How the World's Best Investors Beat the Market

By John Heins and Whitney Tilson

Based on interviews with the world's most-successful value investors, The Art of Value Investing, by John Heins and Whitney Tilson, offers a comprehensive set of answers to the questions every equity money manager should have thought through clearly before holding himself or herself out as a worthy steward of other people’s money. What market inefficiencies will I try to exploit? How will I generate ideas? What will be my geographic focus? What analytical edge will I hope to have? What valuation methodologies will I use? What time horizon will I typically employ? How many stocks will I own? How specifically will I decide to buy or sell? Will I hedge, and how? How will I keep my emotions from getting the best of me?

Authors Tilson and Heins have delegated the task of providing answers to such questions to the experts: the market-beating money managers to whom they’ve had unparalleled access as the co-founders of leading investment newsletter Value Investor Insight. That includes such hedge fund superstars as Julian Robertson, Seth Klarman, Leon Cooperman, David Einhorn, Bill Ackman and Joel Greenblatt, as well as mutual-fund luminaries including Marty Whitman, Mason Hawkins, Jean-Marie Eveillard, Bill Nygren and Bruce Berkowitz.

Who should read The Art of Value Investing? It is as vital a resource for the just-starting-out investor as for the sophisticated professional one. The former will find a comprehensive guidebook for defining a sound investment strategy from A-to-Z; the latter will find all aspects of his or her existing strategy challenged or reconfirmed by the provocative thinking of their most-successful peers. It also is a must-read for any investor – institutional or individual – charged with choosing the best managers for the money they are allocating to equities. Choosing the right managers requires knowing all the right questions to ask as well as the answers worthy of respect and attention – both of which are delivered in The Art of Value Investing.

Please let me know what you think of it!

New York Moves Forward with Common Core Reforms

I think the widespread adoption and implementation of the Common Core standards is the most significant thing happening in American education – yes, more important than charter schools, vouchers, teacher evaluations, etc. To summarize why, my observation is that big systems are like little children: they will live up to – or down to – whatever expectations you set for them. Look at what Massachusetts has done since it – nearly alone among states – set a high bar 20 years ago when it passed the Massachusetts Education Reform Act of 1993. It’s the only state to be #1 in the NAEP test in 4^th and 8^th grade, reading and math. (Of course favorable demographics play a role – MA has the highest percentage of adults with a bachelor’s degree or higher, but look at the other top states and their progress, or lack thereof, over the past two decades.)

In contrast to MA, nearly every other state has been dumbing down its standards and, as a result, as a nation, I think we’ve been mostly fooling ourselves. I think the middle 80% of students (and their parents) are being lied to – and believe these lies because they look around and everyone else seems to be getting a similar education (which they are) (the top 10% are getting a very good education, and the bottom 10% know their education is inferior). The middle 80% are told that they’re doing well and getting a great education when, in fact, they’re getting mediocrity that isn’t preparing them for real college work – and certainly not preparing them to compete against students from most of our current and future economic competitors (if you want to see students in India and China are doing – basically HUSTLING – see Bob Compton’s 2 Million Minutes series).

Naturally, when the Common Core is introduced and the bar is reset, one would everyone to go into shock: students, parents, teachers, politicians, etc. “What do you mean I’m expected to teach/learn this rigorous material?!”

Sure enough, an enormous hue and cry (or, in plain English, a whole lotta whining) has erupted in New York, which, to its credit, has been among the states that’s most quickly implemented the Common Core standards and tied them to new state tests (see the two articles below in the NYT and WSJ).

Thankfully, the NY Times just ran this editorial STRONGLY supporting the Common Core:

New York City parents are understandably nervous about tough new state tests that were rolled out last week. And some parents whose children have already taken the tests are outraged. They shouldn’t be: the tests, which measure math and English skills, are an essential part of rigorous education reforms known as Common Core that seek to improve reasoning skills and have been adopted by 45 states.

The city says that it provided adequate advance notice of the tests and that last year more than 90 percent of New York teachers said they understood the Common Core material. The outreach program could have been more aggressive. But with that proviso, New York deserves enormous credit for being one of the first states to carry out what is clearly the most important education reform in the country’s history.

The Common Core standards were the product of a heavily researched, bipartisan effort pioneered by the National Governors Association in collaboration with the Council of Chief State School Officers. The effort arose from a broad recognition that the United States was losing ground to many of its competitors abroad because the learning standards as applied in most states were pathetically weak. The problem came to light when students who sailed through weak state tests did significantly worse on the rigorous federally backed test known as the National Assessment of Educational Progress.

The Common Core standards do not call for a specific curriculum, reading list or anything like that. Rather, they lay out an ambitious set of goals for the math, reading and writing skills that children should acquire as they move through school.

The goals are internationally benchmarked, meaning they emulate the expectations found in high-performing systems abroad. The intention is to help students develop strong reasoning skills earlier than is now common.

The specific skills that students will be asked to demonstrate build in complexity from grade to grade. By fifth grade, for example, students will be required to produce essays in which they introduce, support and defend arguments, using specific facts and details. By 12th grade, they will be asked to solve problems and answer questions by conducting focused research projects — using skills that are generally associated today with the first year of college. To get students where they need to be, the states and localities will need to provide stronger teaching and course materials that are aligned with Common Core.

The standards are flexible so that states and localities can implement them in varying ways. But the whole point of the exercise is to replace the mediocre patchwork of learning standards that put American children at a distinct disadvantage when compared with their peers abroad.

The standards are fairly new, and shifting to them will cause some anguish, particularly among parents. Last year, Kentucky, the first state to adopt tests based on the Common Core system, found that the proportion of students who were rated “proficient” or better in math and reading dropped by about a third in both middle and elementary school the first time the new tests were given. That is likely to happen in state after state as weak tests are replaced by stronger ones.

There is a further challenge to Common Core from the political right. The Republican National Committee has attacked the standards, arguing that they usurp state authority. Last week the Alabama Legislature took up a bill that would roll back the standards.

But if the country retreats from the Common Core reforms, it will be surrendering the field to competitors that have already left it behind in math and science education, which are essential to participation in the 21st-century work force.

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Common Core Backlash

Here’s the NYT article about the whining and crying, with a great quote from David Coleman, the new president of the College Board:

Students at the Hostos-Lincoln Academy in the Bronx blamed the English exams for making them anxious and sick. Teachers at Public School 152 in Manhattan said they had never seen so many blank stares. Parents at the Earth School in the East Village were so displeased that they organized a boycott.

As New York this week became one of the first states to unveil a set of exams grounded in new curricular standards, education leaders are finding that rallying the public behind tougher tests may be more difficult than they expected.

Complaints were plentiful: the tests were too long; students were demoralized to the point of tears; teachers were not adequately prepared. Some parents, long skeptical of the emphasis on standardized testing, forbade their children from participating.

…Adopted by 45 states, Common Core aims to foster independent thinking, with an emphasis on relating material to real-world issues. Common Core tests made their debut in Kentucky last year, and scores fell significantly.

New York officials are expecting a similar decline. But officials say leaving the old standards intact would be worse, forcing thousands of students into costly remediation programs in college.

David Coleman, president of the College Board and an architect of the Common Core standards, said he did not understand skepticism about the tests.

“When the alternative is shallower passages and shallower questions, what are we debating here?” he said.

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A similar WSJ article with a good quote from Regents Chancellor Merryl Tisch, who is standing strong, correctly calling this a “healthy problem”. Indeed!

Regents Chancellor Merryl Tisch, who helps set education policy for the state, said she visited several schools this week, and students told her they found the passages interesting and engaging. She said she "only saw one kid crying."

Ms. Tisch said the boy was a "sweet" fourth-grader, and she and his classmates tried to console him. She told the student that many other students were also having trouble completing the exam.

"We have to address that issue about finishing," she said.

But she called it a "healthy problem." It would be worse, she said, if tests were described as unfair or poorly done. Last year, for example, the state had to toss out questions related to a passage that was widely ridiculed for being confusing. "I would be so bold as to say they were better than most people expected them to be," she said.

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Why Don't Conservatives Support Common Core?

Kathleen Porter-Magee of the Fordham Institute and Sol Stern of the Manhattan Institute and contributing editor of City Journal, with a spot-on article entitled, The Truth about Common Core -- Why are prominent conservatives criticizing a set of rigorous educational standards?, which supports the CC and rebuts the “false claims circulated by the most vocal critics of Common Core”. Here’s the beginning:

The new Common Core math and reading standards adopted by 45 states have come under a firestorm of criticism from tea-party activists and commentators such as Glenn Beck and Michelle Malkin. Beck calls the standards a stealth “leftist indoctrination” plot by the Obama administration. Malkin warns that they will “eliminate American children’s core knowledge base in English, language arts and history.” As education scholars at two right-of-center think tanks, we feel compelled to set the record straight.

Here’s what the Common Core State Standards do: They simply delineate what children should know at each grade level and describe the skills that they must acquire to stay on course toward college or career readiness. They are not a curriculum; it’s up to school districts to choose curricula that comply with the standards. The Fordham Institute has carefully examined Common Core and compared it with existing state standards: It found that for most states, Common Core is a great improvement with regard to rigor and cohesiveness.

For decades, students in different states have been taught different material at different rates and held to radically different standards. Several years ago, a small group of governors joined together in an effort to align their states’ standards and assessments. This group expanded through the National Governors Association and the Council of Chief State School Officers. In 2007, curriculum experts began to devise the new Common Core standards. Drafts were circulated among the states, comments received, and the standards adjusted. So far, 45 states and the District of Columbia have signed up to implement these new expectations.

Now let’s address the false claims circulated by the most vocal critics of Common Core…

And here’s the conclusion:

The Common Core standards are not a panacea; much depends on the curricula that states and districts select to implement them. Some critics suggest that we are enshrining mediocre standards for eternity. But the Common Core standards are a floor, not a ceiling. Students can still be accelerated and offered supplemental learning, the standards can be improved over time, and states are free to devise something better.

Common Core offers American students the opportunity for a far more rigorous, content-rich, cohesive K–12 education than most of them have had. Conservatives used to be in favor of holding students to high standards and an academic curriculum based on great works of Western civilization and the American republic. Aren’t they still?

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Here’s RiShawn Biddle along the same lines with a column entitled, Conservative Reformers Must Challenge Movement Conservatives on Opposing Common Core. It begins:

One of the biggest challenges facing Common Core supporters — especially conservative reformers who helped develop the standards in the first place — lies in the opposition from movement conservatives who should be the first to embrace providing all children with strong, college-preparatory curricula. Thanks in part to the efforts of otherwise-thoughtful folks such as Hoover Institution scholar Williamson Evers, Jim Stergios of the Pioneer Institute, and University of Arkansas’ Jay P. Greene, movement conservatives have been whipped up into a frenzy of almost-fanatical opposition to the standards, sometimes to the point of spouting conspiracy theories that they themselves would find laughable when progressives do the same thing when it comes to anything involving the role of billionaire natural resources players David and Charles Koch in Wisconsin politics. Yet conservative reformers have silently stood by as their fellow-travelers engage in even more-fanciful thinking. It is time for conservative reformers to step up their defense of the standards, and strongly challenge the faulty thinking of movement conservatives who don’t think about either their underlying reasons for opposing standards or the consequences of their opposition on the other reforms they fully support.

And concludes:

It is time for conservative reformers to have strong, forceful arguments with movement conservative allies about the senselessness of their opposition to Common Core standards. This includes pointing out the reality that what passes for curricula in American public education today doesn’t work for anyone’s children, including their own. It also includes refuting arguments and conspiracy theories that movement conservative offer as evidence against the standards — and demanding that they stop embracing the kind of shoddy thinking that no respectable movement conservative icon — especially Kirk and Reagan — would even find acceptable in a conversation. It doesn’t mean that movement conservatives opposed to the standards will be less reflexive in their opposition; after all, there are reasonable qualms that can be had about the efficacy of common curricula standards. But it would force them to actually argue against the standards based on some semblance of the facts and their interpretation of conservative first principles.

Certainly conservative reformers challenging movement conservative thinking may be akin to ideological civil war. But given the conservative movement’s other problems (including, as Washington Examiner columnist Noemie Emery notes, a sense of entitlement and embrace of a victim mentality unfitting of itself), the importance of the movement playing a strong role in shaping systemic reform, and the need for the movement to update how it applies first principles to today’s issues, it is a much-needed fight that conservative reformers can win.

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New Reforms in Science Education

Speaking of setting high standards, this is great to see:

Educators unveiled new guidelines on Tuesday that call for sweeping changes in the way science is taught in the United States — including, for the first time, a recommendation that climate change be taught as early as middle school.

The guidelines also take a firm stand that children must learn about evolution, the central organizing idea in the biological sciences for more than a century, but one that still provokes a backlash among some religious conservatives.

The guidelines, known as the Next Generation Science Standards, are the first broad national recommendations for science instruction since 1996. They were developed by a consortium of 26 state governments and several groups representing scientists and teachers.

States are not required to adopt them, but 26 states have committed to seriously considering the guidelines. They include Arizona, Arkansas, California, Iowa, Kansas and New York. Other states could also adopt the standards.

Educators involved in drawing them up said the guidelines were intended to combat widespread scientific ignorance, to standardize teaching among states, and to raise the number of high school graduates who choose scientific and technical majors in college, a critical issue for the country’s economic future.

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Good Education Schools

I blast ed schools in general, but there are a few good programs – the one with which I’m most familiar is the Relay Graduate School of Education. Here’s one of my readers on another program:

I wanted to respond to your following comment:

"An op ed in the NYT calling (as I have for years) for a VASTLY different and better system for hiring, training (our ed schools are beyond abysmal), mentoring, and evaluating teachers. We do this so well for other professions, so why not teaching?!?!"

NYU Steinhardt and the Great Oaks Foundation have developed a unique collaboration to develop a teacher residency program aimed at developing a new human capital pipeline for the City of Newark's public schools - district and charter.  While Steinhardt continues to operate some traditional teacher training programs, there are a few residency-based programs that, I think, will improve the quality and effectiveness of the teachers who graduate from the program.  Much of the debate focuses on teacher evaluations, and there seems to be little discussion about what happens prior to that - teacher development.  

As an initial gateway into our program, residents in the NYU-GO Teacher Residency must first be accepted into the Great Oaks Charter School Tutor Corps, modeled after the MATCH School in Boston.  This gateway to entry ensures that our teacher residents have gone through a rigorous and selective vetting process, in addition to having to meet the academic requirements of NYU.  The residents receive their practical training at the Great Oaks Charter School in Newark by working as tutors five days a week.  They are responsible for a small group of students with whom they build relationships, monitor academic progress, analyze assessment data, facilitate enrichment activities, and complete a number of other tasks.  As the residency director and their professor of record, I am imbedded in the school where I am able to mentor and coach the residents daily, and also work closely with the teachers and administration to support their instructional and curricular needs.  This year-long  tutor corps experience is a powerful opportunity to provide these aspiring teachers with a year of intensive and practical experience.  After they successfully complete the first year of the residency, which includes successful completion of their tutoring experience, we provide job placement support in Newark.  Their coaching and mentoring support continues during Year 1 of teaching with a full-year of weekly in-class support from me, or another coach, along with coursework aimed at helping them master practical teacher moves and skills.  You can read more about this residency program here: http://steinhardt.nyu.edu/teachlearn/english/residency/teacher_residency. 

Because of my TFA, North Star Academy, Teacher U/Relay experiences, what I am doing with this residency probably looks very different from a typical ed school program.  The Steinhardt Dean, the faculty, and other administrators have embraced this program and are invested in its success.  So, I wanted you to know that at least one ed school has acknowledged that we need to do something different about developing teachers and is attempting change.

Ayanna Taylor

Master Teacher/NYU-Great Oaks Teacher Residency Director

Department of Teaching and Learning

East Building

239 Greene Street, Room 4011

New York, New York 1003

at1006@nyu.edu

Democrats Vote Down Gun Control Laws

I’m usually very critical of the teachers unions, but it’s important to remember that we Democrats agree with the unions on most issues outside of ed reform. For example, I noticed this line in Joe Nocera’s column about the complete, total and utter disgrace of the Senate voting down even the most obvious, sensible, tepid gun control:

On Wednesday, 14 years later, I met Katie Lyles in the Dirksen Senate Office Building. Now 30 and married, Katie is a grade-school art teacher in Littleton, Colo., the same town where she became, in the sad vernacular of our age, “a Columbine survivor.” She was in Washington as part of a lobbying effort by the National Education Association, the big teachers’ union, to back the handful of simple, common-sense gun bills, starting with universal background checks, that the Senate would be voting on later that day.

Until the shootings in Newtown, Conn., Katie had never spoken publicly about her experience. She is still affected by what happened that day. But after Newtown, Katie realized that the school where she now teaches was as vulnerable to gun violence as Columbine had been in 1999. And she couldn’t stay silent. “I realize that my life has led me to this moment,” she says.

We talked for maybe 20 minutes before Katie and the N.E.A. lobbyists went off to their next appointment. And, of course, a few hours later, the Senate voted down every single gun proposal that was on the table.

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Weingarten Tries to Dissuade Investors from Reform

OK, back to my blasting the unions as usual… Last week, the AFT published a report, Ranking Asset Managers, in an attempt to bully investment managers who support school reform. It’s sort of comical. I know a lot of the managers on it and they view it as a badge of honor. Here’s the WSJ editorial on it:

Public pension funds are frantically chasing higher yields to reduce their roughly $3 trillion in unfunded liabilities. But don't tell that to Randi Weingarten, the teachers union el supremo, who is trying to strong-arm pension trustees not to invest in hedge funds or private-equity funds that support education reform.

That's the remarkable story that emerged this week as the American Federation of Teachers president tried to sandbag hedge fund investor Dan Loeb at a conference sponsored by the Council of Institutional Investors. CII had invited Mr. Loeb, who runs Third Point LLC, to talk about investment opportunities and corporate governance. Ms. Weingarten is an officer and board member of CII.

But Ms. Weingarten's real concern is that Mr. Loeb puts his own money behind school reform and charter schools. In particular, Mr. Loeb is on the board of the New York chapter of StudentsFirst. That's the education outfit founded by former Washington, D.C., schools chief Michelle Rhee that is pushing for more charters and teacher accountability, among other desperately needed reforms.

…The report goes on to list StudentsFirst, the Show Me Institute and the Manhattan Institute as special bêtes noires that promote school and pension reform. And it helpfully lists no fewer than 34 funds whose "directors, managers, advisors and executives" have dared to support reform organizations. The funds on the blackball list include such well-known names as Appaloosa Management, Elliott Management, Khronos, KKR KKR -2.18% and Tudor Investment.

Mr. Loeb is cited for being "a director of StudentsFirst New York" who "has funded the organization's New York political activities." David Tepper of Appaloosa is described as "a known funder of StudentsFirst," with "known funder" underlined, as if he were on the FBI's Most Wanted list. You gotta love the implication that it is sinister to support the idea that poor kids should be able to attend schools that are better than the failure factories that Ms. Weingarten wants to condemn them to.

…And this is the real source of Ms. Weingarten's union fury. She knows unions are losing the moral and political debate over reform, as more Americans conclude that her policies are consigning millions of children to a life of diminished opportunity.

So now she stoops to bullying pension trustees to bully hedge funds to cut off funding for poor kids in Harlem. Every time we wonder if we're too cynical about unions, they remind us that we're not nearly cynical enough.

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Here’s RiShawn Biddle’s take:

The reality is that donors to StudentsFirst account for 13 of the 33 names on the list; Manhattan Institute donors accounts for another 17. It seems like Randi has been keeping a handwritten list of longstanding enemies on her desk since her days heading up the AFT’s Big Apple Affiliate, then handed off to one of the AFTs public relations staffers when she thought it was time to get revenge. Lovely. You have to thank the Wall Street Journal for making this entire list publicly available. At the very least, reformers looking for more cash now have a list of potential donors to hit up. Among other things.

The AFT’s effort to advise (or, more appropriately, give marching orders to) pension board members — especially those who report directly to the union’s state affiliates — would be useful if it at least attempted to serve as a warning to pension systems about the consequences of using inflated rates of returns on their investments of as much as eight percent when actual rates of return of the Standard & Poor’s 500 index was only around four percent during the last decade (and often, even lower for many pensions). It would have also been somewhat useful if it attempted to steer pensions away from risky hedge fund investments whose risks can prove to be too great for either taxpayers or teachers to bear. The report could have at least mentioned the new formula developed by Moody’s Investors Service for uncovering the true level of teachers pension (and other defined-benefit pension) underfunding — which Dropout Nation has used to reveal that pensions such as those of Chicago are in worse shape than admitted. [The board of Chicago's teachers' pension, by the way, is dominated by the AFT; the pension's board president, Jay Rehak and number two Lois Ashford are members of the C.O.R.E coalition led by Chicago AFT boss Karen Lewis.] The union could have even suggested that states move toward a defined-contribution system with states and districts paying a guaranteed rate of contribution so that younger teachers, who now make up the majority of teachers in its rank-and-file, are no longer taking the proverbial hit because they may not stay in the profession long enough to reap the full retirement benefits for which they have worked.

Given that the AFT, along with the NEA, have been complicit in perpetuating pension deficits, both through the roles played by their leaders in running pensions as well as in negotiating deals with states and districts that led to teachers not paying enough toward their own retirements (and have allowed states and districts to offer overly generous benefits they couldn’t ever fully fund), one can’t expect the union to do anything that actually does well by the teachers they claim to represent and by children for which the union proclaims its care. But at least Weingarten could been a little more clever in developing her enemies list. But she has given reformers more reason to continue pushing for the overhaul of traditional teacher compensation systems that no longer work for anyone other than Weingarten and her fellow union leaders.

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Teacher Turnover Decrease in NYC

The WSJ’s Lisa Fleisher with a good piece of reporting, showing that teacher turnover has dropped significantly in NYC:

A host of internal efforts and a tough economy have pushed New York City schools considerably closer to a long-sought goal: Teachers are staying in the job longer.

More than 80% of public schoolteachers now have at least five years experience, up from less than two-thirds when Mayor Michael Bloomberg took office in 2002, according to a Wall Street Journal analysis of city data.

The jump comes after years of attempts by the Bloomberg administration to keep teachers around. The city launched an ad campaign and offered substantial raises, a housing subsidy, a $36 million mentoring program, fellowships and awards. The numbers improved.

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Cami Anderson Newark Education Reform

A nice profile of Newark super Cami Anderson in Fast Company:

Even though it's not in my nature, you have to just, like, take a minute, because it's a big deal." We're in Cami Anderson's private office. The Newark, New Jersey, school superintendent has just held a joint press conference with the head of the teachers' union to announce a historic contract. Half of a $100 million donation made by Facebook founder Mark Zuckerberg to the Newark Public School system in 2010 will sweeten a new agreement with teachers, who have been working without a contract for two and a half years. There will be a new performance-evaluation system, incorporating peer review, as well as bonuses for teachers who opt out of the old seniority rules--carrots alongside sticks. The agreement is already being hailed nationwide as groundbreaking.

Anderson--41, tall, broad-shouldered, blue-eyed--sits back in her chair, pulling her hair into a ponytail. The cinder-block walls and dead-fish fluorescent lighting contribute to the vibe of a locker room after a big win. The challenge in Newark is intense: Nearly half the students drop out, and 90% of graduates who do go to college need remedial classes. For Anderson, who counts among her supporters Democratic Newark mayor Cory Booker and Republican New Jersey governor Chris Christie, the scrutiny is equally intense; Booker has announced a Senate run, and Christie is widely expected to run for President, with both likely to tout her achievements on the campaign trail. As Joel Klein, Anderson's boss when he was chancellor of the New York City Department of Education, says, "Nobody gives you $100 million and says, 'Have a happy life.'"

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Christie's Camden Education Reform

Speaking of NJ, the Manhattan Institute’s Charles Sahm with Gov. Chris Christie’s first takeover, of the disastrous Camden schools. Kudos to KIPP and Democracy Prep for expanding there!

NJ Gov. Chris Christie announced last week that the state will take over Camden’s long-troubled school system. The courageous move, the latest piece of Christie’s impressive education-reform agenda, could signal a turnaround for one of the country’s most dangerous and depressed cities.

Camden needs help: Of its 26 schools, 23 are in the lowest-performing 5 percent in the state. Less than 20 percent of fourth-graders are proficient in language arts; just 28 percent of 11th-graders are proficient in math. Its four-year high-school graduation rate was 49 percent in 2012, 37 points below the state average.

The return on investment is particularly poor because the district spends $23,709 per pupil — more than $5,700 above the state average.

To her credit, Camden Mayor Dana Redd welcomes the state’s “partnership” in improving the city’s schools: Since the status quo “is failing our kids,” she said, “We cannot wait any longer.” Redd is a pragmatic Democrat: last year, she joined Christie for the signing the Urban Hope Act, giving private nonprofits authority to build a dozen “renaissance” schools in Newark, Camden and Trenton.

These schools will be charter-like public schools with more flexibility in administration and finances; those in Camden will be operated by two top-performing charter networks: KIPP and Democracy Prep.

The state’s plans for Camden aren’t yet developed. Christie and Education Commissioner Chris Cerf declared that the state would work with the local school board, but choice and charters will be key components. “Renaissance [and] charter schools will certainly be a part of this mix, as they have . . . already,” Christie said. “I don’t see it as my job to keep students in the district against their will.”

Of course, New Jersey took control of school districts in Newark (1995), Paterson (1991) and Jersey City (1989) — and not much improved. But Derrell Bradford, director of the reform advocacy group Better Education for Kids, notes, “This is Christie’s first takeover. Not all takeovers are equal. And given the recent positive developments in the other state-led districts, I am cautiously optimistic about Camden.”

Positive changes are afoot in Jersey’s troubled cities, especially in Newark, where a new performance-based teachers’ contract — aided by $100 million from Facebook’s Mark Zuckerberg — is hailed as a national model.

Newark’s dynamic superintendent, Cami Anderson, is closing bad schools, hiring new principals and giving them greater autonomy and establishing a high school choice system. A new $150 million “Teachers Village” complex, with three new charters and rental apartments for teachers, is rising.

Stanford University’s research team recently found that New Jersey charter schools posted “some of the largest learning gains we have seen to date.” This, when Stanford had found disappointing results for charters elsewhere.

Newark’s charter students stood out — posting gains roughly equivalent to spending an extra seven to nine months in school each year. Newark’s successful charters include KIPP’s TEAM schools, Uncommon Schools’ North Star Academy, Robert Treat Academy and Gray Charter School.

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