07/22/2010 12:16 am ET Updated May 25, 2011

Is Obama's EdReform in Trouble?

The economy stinks, the job market is weak, most investors are on the sidelines, and state revenues are in the tank. Environmentalists are sprouting up in Louisiana, Alabama and Mississippi. Health care was an unhealthy compromise and financial reform is barely signed and the big banks are rolling in the dough. No surprise that a November backlash is coming soon to the ballot box. As for education, it is off the radar. Rick Hess, AEI, suggests that it "Looks like the administration is hurting for friends and that its reform agenda could be whipsawed by fiscal pressures, Congressional frustration, and disgruntled liberals."

Good thing President Obama (and philanthropic and edreform groups) already chalked up big victories early with the Race to the Top (RttT) and Invest in Innovation (i3) grant programs and Common Core standards. That trio puts Obama's first term at the head of the class when it comes to edreform.

Hat's off to Obama and Duncan for adopting John Schnur's brilliant strategy of competitive grants to incentivize state reforms. The application process for RttT resulted in important reforms and the semblance of a strategy in most states. The i3 program will kick out about 100 grants this summer with some benefit. (The benefit would be greater if private sector innovators had been given the opportunity to compete.) The grand daddy of Obam's edreforms will prove to be Common Core which, as the NY Times reported, has been adopted by a majority of states.

Next year won't be as fruitful inside the Beltway. The reauthorization of federal education policy will be a retreat from No Child Left Behind's national school accountability framework. This will only fuel the growth of low-income and minority families who opt for public charters as the best available means to close the achievement and college preparation gap. NCLB's successor is likely to be a forgettable hodgepodge of compromise. There will be a reversion to tighter state control but with a much larger percentage of the federal contribution doled out in competitive grants (despite the 'right not a race' mantra from employee groups).

NCLB framed the last decade of education in American. The coming decade will be framed by common assessments around the Common Core. Of the $100 billion of stimulus spending on education, the most enduring aspect will be two or three grants totaling $350 million that will fund two consortia representing most of the states.

Common tests around college and career ready standards create a tough but appropriate goal. We're raising standards at a time when almost one third of US kids drop out and another third leave high school unprepared to earn college credit. It will take double the current dropout prevention efforts just to prevent the dropout crisis from getting worse.

Common tests around college and career ready standards create an invitation to innovate. The new common frameworks will unleash energy and investment (a little like the iPhone app frenzy) with content and services sharable across state lines.

One exception will be in states where bureaucrats protect the status quo. Massachusetts is considering what could become the worse online learning law in the country -- limiting virtual schools to 500 students and limiting their boundaries and operation to school districts.

We face two very difficult challenges simultaneously -- high standards and a fiscal crisis. Protecting old ways of doing business is exactly the wrong thing to do. States should be encouraging innovation and investment particularly in areas likely to reach disengaged students. Rather than getting trapped in a death spiral of budget cuts, we need to think and act creatively to produce positive cycles of innovation.

Things are changing fast: anyone can learn anything, anytime, anywhere -- except where bureaucrats get in the way. But learning online, whether at school or at home, is an unstoppable force. Just as the Internet revolutionized music, television entertainment, shopping, communications, and civic life, so too will it revolutionize education. It is already happening in states that welcome the opportunity. Common tests around common standards will produce some uncommon learning experiences and outcomes where leaders are willing to think in uncommon ways.