Newark Mayor Cory Booker, left, and Mark Zuckerberg, center, founder and CEO of Facebook, listen as New Jersey Gov. Chris Christie talks about the state’s schools during a 2010 press conference at the Robert Treat Hotel in Newark, N.J. Zuckerberg spoke about his donation of $100 million to help Newark public schools. (Rich Schultz/AP)

Dale Russakoff is a former Washington Post reporter and the author of a new book called “The Prize: Who’s in Charge of America’s Schools?” It is an in-depth look at what happened when Facebook founder Mark Zuckerberg in 2010 made a $100 million matching gift to reform the long-troubled school system in Newark, New Jersey. The announcement was made not to Newark residents but, rather, on an episode of Oprah Winfrey’s former talk show, with Newark’s then-mayor, Democrat Cory Booker, and Republican New Jersey Gov. Chris Christie sitting with Zuckerberg and Winfrey.

theprize

Russakoff details what happened with the money and how, in the end, students wound up the big losers in the school reform philanthropy game. The following portion of the book reveals the behind-the-scene maneuvering surrounding the announcement of Zuckerberg’s gift to Newark schools (which has long been under state control). The excerpt starts with Booker alerting Christie to the coming gift.

(Excerpted from THE PRIZE: Who’s in Charge of America’s Schools? by Dale Russakoff. Copyright © 2015 by Dale Russakoff. Reprinted by permission of Houghton Mifflin Harcourt Publishing Company. All rights reserved.)

[The ugly reform mess in Newark public schools]

Here’s the excerpt:

In late summer 2010, [Cory] Booker called [Chris] Christie with the $100 million news. “I didn’t believe it,” Christie recalled. “I said, ‘Come on, really?’ he said, ‘Governor, I believe I can close this deal. I really do. I need you, though.’”

Booker asked Christie to grant him control of the schools by fiat, but the governor demurred, offering him instead a role as unoffi­cial partner in all decisions and policies, beginning with their joint selection of a “superstar” superintendent to lead the charge. Book­er’s first choice was John King, then deputy New York State educa­tion commissioner, who had led some of the top-performing char­ter schools in New York City and Boston and who credited public school teachers with inspiring him to persevere after he was orphaned as a young boy in Brooklyn. [Mark] Zuckerberg and [his wife Priscilla] Chan flew King to Palo Alto for a weekend with them and [Facebook executive Sheryl] Sandberg; Christie hosted him at the governor’s beach retreat on the Jersey Shore; and Booker led King and his wife, Melissa, on a tour of Newark, with stops at parks and businesses that hadn’t existed before his mayoralty. But after much thought, King turned them down. Zuckerberg, Christie, and Booker expected to arrive at their national model within five years. King be­lieved it could take almost that long to change the system’s fundamen­tal procedures and to raise expectations across the city for children and schools. “John’s view was that no one has achieved what they’re trying to achieve: build an urban school district serving high-poverty kids that gets uniformly strong outcomes,” said an acquaintance who talked with King about the offer. “You’d have to invest not only a long period of time but tremendous political capital to get it done.” King had questions about a five-year plan overseen by politicians who were likely to seek higher office.

Zuckerberg had questions, too, about politics — particularly about the power-sharing plan between Booker and Christie. He asked to meet Christie face to face. He and Chan flew to Newark in August 2010 and met the governor and mayor in a secluded area of the air­port’s Continental Airlines Presidents Club. The couple was struck by the personal chemistry between two prominent politicians of differ­ent parties. It dated to Booker’s unsuccessful 2002 mayoral campaign, when Christie, as United States attorney in Newark, deployed volun­teers from his office to act as election-day monitors following reports of violence and intimidation against Booker’s supporters. (He found none.) Another important moment in their relationship occurred in 2006, when aides to the newly elected mayor came upon suspicious-looking records from a credit card account registered to the police de­partment but used by Booker’s five-term predecessor, Sharpe James. Booker delivered the records to Christie, who found in them the gift of a lifetime — the break in a case that sent James to jail, one of the biggest convictions of Christie’s career as a prosecutor.

A rising Republican star after only nine months as governor, Chris­tie was now waging political war on the state teachers’ union as he slashed his way through a bloated budget. More than 1 million people had watched him on YouTube as he shamed — critics said “bullied” — a teacher for attacking him and his education cuts at a town hall meeting. This knack for playing a Republican everyman aggrieved by protections of public sector workers was winning him mentions as GOP presidential material.

Given the polarized state of national politics, Zuckerberg was im­pressed that a Democrat and a Republican were uniting in the inter­est of New Jersey’s poorest children. But would this last? He asked Booker and Christie what would happen if they ran against each other for governor in three years. Both men said they were in complete agreement on education and would not allow politics to interfere, ac­cording to participants. John King had raised the question also, ask­ing Christie how the superintendent would be affected if Booker ran against him in 2013. “In that case,” Christie responded, “the superin­tendent would spend the year hiding under his desk.”

A maestro at leveraging publicity, Booker wanted to announce the $100 million gift on The Oprah Winfrey Show, timed to coincide with the Sept. 24 debut of the movie Waiting for Superman. The film, whose marketing campaign was aided by a $2 million grant from the Gates Foundation, focused on five families who desperately wanted their children to attend a charter school. The charters featured in the movie each had a dedicated team of teachers and leaders, along with a record of putting the poorest children on a path to college. Four of the five families lived in inner cities, and their children’s only other op­tion was to attend a dysfunctional public school that was little more than a dropout factory. There was a mention in a voice-over that only one in five charters then outperformed traditional public schools, but overall, the film belted out a thunderous cheer for charter schools as the answer to the crisis in urban education.

There was a complication, however. Another movie was scheduled to debut the same weekend: The Social Network, Aaron Sorkin’s fic­tionalized account of the founding of Facebook in which, it was al­ready well known, Zuckerberg came off as an arrogant boy genius who betrayed a trusting friend on his way to fame and fortune. There was plenty of anxiety at Facebook headquarters about the potential of the movie, sure to be a box office blowout, to tarnish the compa­ny’s brand. Facebook’s communications team flatly advised Zuckerberg not to make such an attention-grabbing gesture of generosity just when The Social Network hit theaters. It would probably be criticized as a $100 million damage-control stunt, not seen as a bold and selfless commitment to a better tomorrow for children, senior advisers told him. Zuckerberg asked Booker, Christie, and Winfrey for a postpone­ment, but they were determined to go ahead, largely because Booker wanted to use the marketing campaign for Waiting for Superman as a catalyst for raising the second $100 million. Zuckerberg said he then proposed making the gift anonymously. But again Booker, Christie, and Winfrey pushed back, saying they needed his name and cachet to attract donors. Zuckerberg said he did a rough calculation in his head and concluded that the number of people likely to see The Social Network was about two percent of the number who then logged on to Facebook every day. Let’s go ahead, he said.

Although Facebook insisted the gift was unrelated to the movie, there was no question that it would create a splashy and favorable nar­rative about the young billionaire at the very moment he was being bludgeoned on the big screen. Christie and Booker also had much to gain from the timing. Booker faced an epic fiscal crisis and was pre­paring to lay off almost a quarter of the city’s workforce. And Christie was under heavy fire for a botched state bid for $400 million in Race to the Top funds.

As the day of the announcement approached — with Newark resi­dents still in the dark about the revolution coming to their schools — teams around Booker and Zuckerberg anticipated it would trig­ger a nationwide flood of matching contributions from the richest as well as ordinary Americans. “A national provocation, really provoking people to get involved, to get engaged,” as Booker put it. Sandberg e-mailed updates to Booker’s chief fundraiser, Bari Mattes, regarding billionaires she and Zuckerberg were soliciting: “Mark is following up with Gates this week. I will call David Einhorn (my cousin). Mark is scheduling dinner with Broad . . . AMAZING if Oprah will donate herself? Will she? I am following up with John Doerr/NewSchools Venture Fund.” The references were to Bill Gates, hedge fund man­ager David Einhorn, real estate and insurance magnate Eli Broad, and Silicon Valley venture capitalist John Doerr. Einhorn and Winfrey did not contribute, and Sandberg reported that Broad first wanted to know who would be named superintendent. Gates gave $3 million through his and his wife’s foundation — Zuckerberg had hoped for between $10 and $15 million — and Doerr’s fund gave $10 million, to be used to expand networks of high-quality charter schools.

Ray Chambers, a Newark native who had made a fortune in pri­vate equity and for decades had donated generously to education and the city’s children, offered to coordinate a $1 million gift from local philanthropies as a show of community support. But Mattes was un­impressed. “I think that commitment is way too small and I wouldn’t bother,” she wrote the mayor in an e-mail, concluding: “$1 million as a collective gift over five years is just too insignificant for this group.”

Because the reforms would focus on systemic changes, Mattes wrote in one e-mail, “Mark’s money is not going into classrooms.” This aspect of the gift alone was sure to pose a public relations challenge in a city where teachers and schools desperately needed support for children who were years behind their grade level. But it was Sandberg, not Booker or his fundraiser Mattes, who expressed concern about the reaction in Newark, whose residents would soon learn from national television that there was a grand design to transform their schools. She asked in an e-mail about plans for a “community awareness piece,” deeming it “so critical.” Sandberg also critiqued Booker’s proposed press release for placing too much emphasis on the initiative’s national import, rather than on what was in it for Newark. “My one question is whether for local purposes there is too much ‘national’ language in here,” she wrote. “I wonder if we should basically make this focused on Newark with just a touch of ‘and this will be a national model.’ ”

Calling from the flight to Chicago for the Oprah show, Booker so­licited one of his most loyal supporters, New York City hedge fund manager and billionaire philanthropist William Ackman. The two had met when Booker was a city councilman running for mayor, and a decade later, Ackman still vividly recalled his stunned reaction. “It was the first time I ever met a politician where I had this moving, unbelievable life experience: This guy can change the world. I want be part of what he’s doing,” Ackman said. Over the years, he helped Booker raise millions of dollars in political and philanthropic cam­paigns and personally donated $1 million to update Newark’s police equipment. This time, the mayor’s ask was steeper: $50 million. Ack­man offered $25 million, and Booker accepted. It was more than he intended to give — more than he had ever given to a single philan­thropic cause — but when Booker set the bar so high, Ackman said he felt sheepish about holding back. “It’s a good fundraising strategy — ask for a really, really big number,” he said with a laugh.

Earlier that month, Booker had presented the board of Ackman’s Pershing Square Foundation with his six-point proposal to Zuckerberg for reforming the Newark schools. Unlike most venture philan­thropists, Ackman said he didn’t grill Booker on exactly how he would spend his money or dictate timetables and metrics for measuring re­sults. “The idea was to fix education,” he said. “How they were going to do it, that was just the detail. I was just confident he’d approve the best team, the best people, and it would end up in the right place.”

It was just as Booker’s law school pal Ed Nicoll had said all those years ago. Investors bet on people, not on business plans.

On Sept. 24, 2010, Zuckerberg, Booker and Christie ended up in matching black leather chairs on the stage of The Oprah Winfrey Show. Christie recalled that Zuckerberg, who until that point had kept a low public profile, confided to him as they walked onstage that he was nervous. Christie said he promised the young magnate that it was actually going to be fun. With the cameras rolling, Booker and Christie went first, describing their bipartisan pact to transform the Newark schools.

“So, Mr. Zuckerberg, what role are you playing in all of this?” Win­frey asked, feigning cluelessness.

“I’ve committed to starting the Startup: Education Foundation,” he said. “The first project will be a $100 million challenge grant —”

He was not able to complete the sentence, as Winfrey exclaimed, slowly, as if in amazement, “ONE. HUNDRED. MILLION. DOLLARS?” The audience broke into applause. “YO! YO! YO! YO! YO!” Winfrey whooped, and she, Booker, Christie and the studio audience gave Zuckerberg an explosive standing ovation. The world’s youngest billionaire philanthropist remained seated, blushing, appearing un­comfortable amid the adulation.

Asked by Winfrey why he picked Newark, out of all the cities in the country, the T-shirted entrepreneur in open blazer and running shoes gestured toward the dark-suited politicians and said, “Newark is re­ally just because I believe in these guys. Running a company, the main thing that I have to do is find people who are going to be really great leaders and invest in them, and that’s what we’re doing here. We’re setting up a $100 million challenge grant so that Mayor Booker and Governor Christie can have the flexibility they need to . . . turn New­ark into a symbol of educational excellence for the whole nation.”

 

Excerpted from THE PRIZE: Who’s in Charge of America’s Schools? by Dale Russakoff. Copyright © 2015 by Dale Russakoff. Reprinted by permission of Houghton Mifflin Harcourt Publishing Company. All rights reserved.