NAB’d by the Market

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In the February 1998 issue of Workplace Economics, the D.C.-based National Alliance of Business (NAB) asked: “Education Reform: Where have we been? Where are we going?” For the 34-year-old offspring of the U.S. Department of Labor (DOL), the answer to the second question is simple: NAB is headed for organizational Siberia – or at least to Austin, Texas, to be absorbed by the National Center for Educational Accountability (NCEA).

The nonprofit was set up at the behest of President Lyndon B. Johnson and auto baron Henry Ford II to gin up support in the business world for LBJ’s War on Poverty, particularly to encourage job training for disadvantaged urban youth.

NAB was an early supporter of the youth summer job programs, Job Corps and other federal ventures aimed at noncollege-bound youth. In exchange for operating as “the marketing arm of DOL to business,” recalls Fred Wentzel, who joined NAB in 1970 and left in 1999, it received virtually its entire budget from DOL.

In its heyday, the NAB had a budget of up to $20 million, and 70 offices in cities throughout the United States. It was led by a part-time business volunteer from a major corporation.

In 1980, Bill Kolberg, an assistant secretary of DOL’s Employment and Training Administration during the Nixon and Ford administrations, became the first full-time CEO. He retired in 1995 and was replaced by Bob Jones, who rose through the ranks to Kolberg’s job – overseeing youth employment and other programs at DOL during Bush I.

For more than one-third of a century, its fortunes and effectiveness ebbed and flowed (with more ebbing than flowing). Despite its expansive self-promotion of a “vast constituency,” NAB’s membership claims, notes an insider, “were as phony as a $3 bill.” The NAB had the trappings of power befitting a group that aspired to play in the same league as the U.S. Chamber of Commerce and the AFL-CIO.

It once maintained an office in the White House complex which ran a “rent-a-business-audience” operation for the powers of the day. Even as the NAB’s fortunes waned, it continued to spend lavishly on lobbying. In 1999 alone the tab came to $656,019, including $ 111,862 to pay Tom Lindsey (long regarded by outsiders as NAB’s leading staff asset).

In 1998, William Clay Ford, chairman of the Ford Motor Company and nephew of the NAB’s founding Ford, wrote of NAB’s 30-year legacy of achievement: “I am pleased to see that [NAB] has moved in stride with the realities of an ever-changing workplace.” In reality, however, the NAB had become the Edsel of its field – big pitch, few sales.

In 1995, NAB hired Milton Goldberg, former executive director of the group that produced the 1983 “A Nation at Risk” report that shocked the moribund education reform field back to life. A decade later, though, Goldberg wrote a real clunker, “Prisoners of Time,” for the National Education Commission on Time and Learning. It advocated all-day, year-round K-12 education.

With Goldberg at the education-reform steering wheel, the NAB abandoned the decidedly blue collar world of employment and training for a higher class of chatter with the growing battalions of education reformers. The move came, says one NAB watcher, because “that’s where the money was.”

Increasingly, DOL was where the money wasn’t. By the time DOL cut off national staffing grants to NAB in September 2000 (as it did with many others, such as the National Governors’ Association, the National Association of Counties and the Denver-based National Conference of State Legislatures), the group was getting only 10 percent to 12 percent of its shrinking budget from DOL. In May 2000, field offices closed in Atlanta; Hudson, Mass.; Dallas; Long Beach, Calif.; and Chicago.

Naked in the marketplace of private competitive support, NAB’s ties to other groups were frayed by a series of inside-the-Beltway in-fighting over welfare-to-work and school-to-work, which CEO Jones “hated,” says a leader in that field. The NAB also never quite made the grade with the educational establishment (known as “the Blob” by some critics).

While NAB was neglecting it, work force development became, says one player, “a crowded field” – a field that now includes the National Association of Workforce Investment Boards. But education reform is crowded as well, to Malthusian proportions, and is even more competitive.

Ironically, when President George W. Bush took office, the always GOP-tinged NAB seemed to have a new life. But the passage of the No Child Left Behind Act last December signaled, says Wentzel, “the death knell for NAB.” Educational accountability, the NAB’s latest pet issue, is now the law of the land – and NAB’s mission became constricted as its budget was squeezed.

A final shift of its business strategy into higher education issues proved a financial dud, and completed NAB’s migration from its focus on aiding America’s poorest youth to focusing on relatively elite college students.

NAB’s overhead was considerable, with CEO Jones topping off his federal retirement benefits with a $350,466 salary in 1999. Its profligate spending was legendary, including once paying a consultant $30,000 to draw up an agenda for a meeting.

For much of its history, say several of its many critics, NAB operated mostly on behalf of business interests, not the disadvantaged.

Goldberg left the NAB last year for greener pastures. By fall, the NAB was down to a skeleton staff, sold off its furniture, gave up its posh offices – and officially ceased doing business on Oct. 4.

A few former NAB staffers, including Vice President Aimee Guidera, will run the D.C. office for the National Center of Educational Accountability, a $2.5 million operation with 24 staffers in Austin. The NCEA is a joint venture of the University of Texas, the Denver-based Education Commission of the States and Just for the Kids – founded by Tom Luce “to raise academic standards and increase student achievement.” Luce chairs NCEA’s board, but the group is officially part of the University of Texas.

Other NCEA board members include the NAB’s last chair, Ed Rust Jr., CEO of State Farm Insurance Companies, and Jones. Jones will become a consultant to NCEA. In a fleeting telephone interview, Jones rebuffed questions on NAB’s future saying, “I’m not going to answer that” – at least not then.

Agreeing to talk in the coming weeks, Jones neglected to mention he’d be in China on a final NAB fling. He didn’t gain a reputation as a Machiavellian for nothing.

Will the NAB be missed? Wentzel, an employee for 29 years, says, “Who’s going to miss it after a year passes ... except me?”
But Peter Creticos, former vice president the NAB’s Midwest Regional office, says, “There’s going to be a void.” All other business groups, such as the U.S. Chamber of Commerce’s Center for Workforce Preparation, “have some other agenda,” he says, and are not primarily focused on the disadvantaged.

Coming down in the middle is a former staffer who laments that throughout its history, NAB’s “whole was less than the sum of its parts.” With or without NAB, says Joan Wills, director of the Center for Workforce Development at the Institute for Educational Leadership, “there is still the challenge of how we engage the employer community in preparing youth for the world of work.” Contact: (512) 471-3434.