Archive for May, 2007

Freakonomics Review

May 31, 2007


We received a nice review from Steven Levitt of Freakonomics fame today.

Steven writes:

If you wanted to get elected President of the United States, which of these would you least like to be? (At least, according to the fraction of those surveyed who said they wouldn’t vote for a candidate with this characteristic):

a) Black

b) Catholic

c) Homosexual

d) Jewish

e) Female

f) Atheist

The answer is here at, an interesting site for finding, sharing, and presenting data.

While you’re browsing it you can see which colleges have the largest endowment per student (there is one in the top five that will shock you), homicide rates by country (guess where the United States ranks before looking), and much, much more.

Hats off to Tom Paper for creating such a great site.

My hats off to Jamie, Andrey, Alex, Stephanie, Andrew, Marshall, Lori, Brook and Eleanor for all their efforts in putting Data360 together.

Click here to see Levitt’s full post.

Commentary May 30, 2007

May 30, 2007

May 30, 2007

Dear Friends and Colleagues,

Following is an update on two topics:  First, the status and latest improvements to Data360; second, my perspective on interesting facts and graphs.

#1) Last month we launched a major set of improvements to Data360.  The key new features were “slideshows” and “easy upload.”  We think Data360 ( is a great tool for any organization that wants to track and present data in a logical, secure, collaborative and recurring manner.   Data360 is already being used (or will shortly be used) in the following ways:

o      As a private business reporting tool.  Several of Webster Pacific’s business clients have a private platform (i.e. and are using that platform to report on their internal performance with slideshow graphs for key business metrics.   To see a fictional company slideshow, click here.

  • Benefits of Data360:
    • Can be set up very quickly…a matter of minutes to get started
    • Provides clear and regular perspective on important issues
    • Internet accessible
    • Data on private platforms is secure
    • As a collaborative community tracking tool. Data360 has formed a partnership, called “Energy Positive,” that will allow teams of families to track and compete with other families regarding their energy usage.
    • As a tool for creating metrics and indices. This includes:
  • As a Business Intelligence Database.
  • As an index measuring human capital and performance.
  • As a regular report on customer surveying data, along the lines of Bain & Company’s Net Promoter® Score system.
    • As a repository of perspective on issues of importance such as education, housing, interest rates, exchange rates, politics and the US economy. See below #2).

I am writing to ask you to re-visit the site ( and tell us what you think.  The main business at Webster Pacific is strategic and financial consulting for entrepreneurs.  We are actively growing our practice and interested in opportunities to serve.  Data360 is a tool that Webster Pacific is using to be of greater service to any organization that wants clear data-driven perspective on vital issues.  We also have some great new features in the works which should be released by the end of summer.

#2) My perspective on various issues:

o      US Presidential Voting Likelihoods.  Click here.

o      US Interest Rates.  Click here.

o      US Exchange Rates.  Click here.

o      US Housing Overview.  Click here.

o      Sustainability.  Click here or visit Sustainlane’s site here.

o      Global Water Usage.  Click here.

o      Education.  Webster Pacific has had a chance over the past several months to work in the educational field and, in particular, in primary and secondary charter schools.  We have toured numerous schools and studied the industry in some depth.  I have the following takeaways:

  • First, the current system is not working. Over the past 35 years, the US has a) spent considerably more per pupil on primary and secondary education (Slide 1 of 6), and b) reduced student-teacher ratios significantly (Slide 1 of 6). There are over 3 million teachers today in the US. However, the average standardized test scores have not improved. We may have done better in math for 9 and 13-year olds, but for 17-year olds, the end product of our efforts, results are no better (Slide 2 of 6). In Slide 3 of 6, there are over 125 thousand schools in the US, about 95 thousand of which are public schools and 30 thousand are private. Of the 95 thousand public schools, about 4 thousand are public charter schools. Charter schools are where most of the brightness of future lies for American education. There are over 1.2 million kids in public charter schools today, out of roughly 55 million in all of primary and secondary education. Slide 4 of 6 is one outcome of our ineffectiveness at educating our youth: between 1985 and 2000, spending on corrections has grown by between 50% and 150% in almost every state while spending on higher education has grown between 0% and 50%. Slide 5 of 6 shows that in the three biggest states, California, Texas and New York, the ratio of spending on corrections to spending on higher education has grown from about 20 to 30% to about 60 to 95%.
  • Slide 6 of 6 shows more brightness of future. KIPP (click here for the KIPP homepage) is considered by many to be the leader today in educational performance amongst the charter school management organizations. In 7th grade math tests in 2006 for every KIPP school that has a 7th grade, the KIPP school beat the district in 26 out of 27 schools (click here for details). How does KIPP do it? As their motto says, “Be nice. Work hard.” Another of their sayings is, “There are no shortcuts to success.” That may seem like a platitude, but they mean, believe it and are showing that a belief system, used every day, affects the results you get. KIPP also uses its name as a lever, by taking the KIPP name and leadership support away from schools that are not performing. (The worst two schools in slide 6 of 6 have lost the use of the KIPP name since finishing the 2006 school year. To see details click here and here.) While KIPP has reached “brand” status in both the press and the field of philanthropy, there are many other organizations, both non-profit and for-profit, that are doing a terrific job of educating kids.
  • Second, the greatest single deficiency in the public school system today is the lack of choice that school boards and principals have in making changes about underperforming principals and teachers. This lack of choice is zealously protected by the AFT, which represents teachers. On the one hand, the new charter schools are by and large non-unionized; even Green Dot’s union leaves the schools with choice about making changes. On the other hand, the public district school system is the single most heavily unionized space in the American economy today. In “US Union Overview,” slide 1 of 5 shows that there are almost 5 million public sector local government union employees across our country. My estimate is that about half of those employees, or 2.5 million, are employed by local school districts as teachers. Local public employees, as a group, are about 45% unionized. Slide 2 of 5 indicates that there are about 3.3 million unionized education workers in the US, representing about 40% of all those employed in all levels of education, including public and private education, pre-school all the way through post graduate; this 40% is the highest rate of unionization in any large category today. However, if you ask anyone who knows public district schools, they would say that virtually all public and primary school teachers are unionized. I’d bet the rate of unionization is over 95%. Slide 3 of 5 says that in our country, overall union membership has dropped since 1973 from 18 million to about 15.5 million in 2006, on a base of about 150 million in the workforce. As a percent of all workers, unionized employees have dropped from 24% to 12%. Slide 4 of 5 shows that the private sector has dramatically shrunk in terms of number and percent of unionized employees, but, in the public sector, the number and percentage of unionized employees has grown dramatically, from 3 million to almost 7.5 million and from 23% to about 36%.
  • Third, the educational space in America is a nascent field. I liken it to the auto industry in the 1970’s. It is hard to believe, but a fair national measurement system for education does not exist. Technically, responsibility for education lies with the states and that has caused every state to have its own unique system for measuring educational performance. This lack of system is both shocking and a great opportunity. I have worked in many mature industries, including bolts and nuts, timber, coffee, grain and janitorial products. In every one of these industries, there are clear and national, if not international, systems for measurement of the quality of products and services. The challenge for charter schools (and I put the challenge to them, because traditional district schools will not do this) is to come up with clear national standards for educational performance. The nuance that is not immediately apparent is that an educational measurement system does not just mean measuring educational performance, the absolute score that a child gets on a test. An educational measurement system must also measure growth. Imagine a child entering fifth grade whose performance is at a third grade level: getting that child to simply perform at a fifth grade level by the end of fifth grade would be an incredible achievement. That is GROWTH. So any fair measurement system must look at both proficiency and growth.
  • Finally, there is one story in education that I have found fascinating. The story is about Locke High School and Green Dot, a charter management organization run by an educational entrepreneur named Steve Barr. Green Dot has focused exclusively on Los Angeles, where the public school system, like those in most big cities in the US, has produced horrifying results. The tenured union teachers at one school run by the Los Angeles Unified School District, Locke High School, have petitioned to become a part of Green Dot. This is kind of like the players for the Boston Red Sox voting to become part of the Yankees. It’s a big deal and just doesn’t happen unless a group of people are fundamentally unhappy and discouraged with their present leadership. To see more of the story, click here. (In the past days, the teachers from two more schools in Los Angeles have had talks with Steve Barr. We could be witnessing a veritable tipping point.) Also, to read more about the charter school movement, I would check out the National Alliance for Public Charter Schools where Andy Smarick and Nelson Smith publish a terrific daily summary of the most relevant happenings in the charter “movement.” One other source of information and commentary is Whitney Tilson, whose blog can be found here. Whitney’s blog posts are passionate, readable and relevant. To sign up for Whitney’s school reform email list, click here and send him a request.

Thanks for your interest.  I look forward to hearing from you!


Tom Paper