That brings us to the current decade, where the very term “education reform” has shifted definitions. Elements of choice, competition, test-driven curricula, and incentive-based pay had been in the hopper for decades. What is new is the vast wealth and power of the dominant voices pushing those things, and their sharp focus on publicly funded and privately run charter schools, which currently educate about 3 percent of the nation’s students.

At a recent Robin Hood Foundation gala, the Wall Street charity pulled in $88 million in one evening from its hedge fund participants, much of the money targeted for New York City charter schools. Democrats for Education Reform, a pro-charter political action committee with hedge-fund ties, has expanded its reach to ten states, including Rhode Island, Michigan, and Colorado. By far the most influential of all are the Big-Three venture philanthropies, The Bill & Melinda Gates Foundation, The Walton Family Foundation, and Eli Broad’s Broad Foundation, which often work in concert on issues like school choice and teacher effectiveness.

Stephanie Banchero, a longtime education reporter now at The Wall Street Journal, calls this group of people and organizations the “non-traditionals,” and welcomes their relatively combative presence on the beat. “It keeps us on our toes,” she says. Caroline Hendrie, executive director of the Education Writers Association, calls them an “alternative establishment,” noting their influence in raising the level of urgency and attention to public education. Diane Ravitch, the education historian, a former assistant secretary of education under George H. W. Bush, and a past advocate of school choice and accountability, calls them “bastions of unaccountable power.”

An important story in the Winter 2011 edition of Dissent magazine by Joanne Barkan detailed their influence—amplified by the media—over urban school policy. In it, she quotes conservative education expert Frederick Hess, the nation’s most vocal critic of the media’s “gentle treatment” of the foundations. In the 2005 book, With the Best of Intentions: How Philanthropy Is Reshaping K-12 Education, he describes a credulous press that treats philanthropies like royalty.

What draws these venture philanthropists and Wall Street financiers to urban school reform, and to top-flight charter schools like Uncommon Schools and the Knowledge is Power Program (KIPP) network? One is the businesslike way the schools in those systems are run. They value standardized curricula and measures, incentives, as well as a young, flexible, nonunion teaching force. As a group, these reformers tend to believe that America’s growing child-poverty rate and shrinking social services are used as excuses by educators. Results in schools like those in the KIPP network, they say, prove that poverty does not have to be an obstacle. They see themselves as warriors against the status quo, with leverage. “It’s the most important cause in the nation, obviously,” the manager of hedge fund T2 Partners, Whitney Tilson, told The New York Times in December 2009. “And with the state providing so much of the money, outside contributions are insanely well leveraged.”

Money managers and economists share a common philosophy. Douglas Harris, an economist from the University of Wisconsin, described it best in a January 2011 Education Week column:

Economists tend to think like well-meaning business people. They focus more on bottom-line results than processes and pedagogy, care more about preparing students for the workplace than the ballot box or art museum, and worry more about U.S. economic competitiveness. Economists also focus on the role financial incentives play in organizations, more so than the other myriad factors affecting human behavior. From this perspective, if we can get rid of ineffective teachers and provide financial incentives for the remainder to improve, then the students will have higher test scores yielding more productive workers and a more competitive U.S. economy.

The critics see this as a soulless vision of American education, in which children are filled up with facts, tested “until they beg for mercy,” as educator Theodore Sizer used to say, and moved into college ill-prepared to analyze problems and think creatively. They say the new reformers value statistics but ignore research—a recent Vanderbilt University study on merit pay that concluded that it does not work to raise student test scores, for example, or a 2009 Stanford University study that found that 83 percent of current charter schools were either worse than or equal to traditional public schools.

Seasoned educators with long track records of alternative ideas to inspire school leaders to get the most out of their schools and teachers tend to be off the media grid; the late Theodore Sizer’s Coalition of Essential Schools is one example. New York’s Performance Standards Consortium is another; the consortium includes dozens of urban public schools with high graduation rates that use sophisticated classroom-based teacher assessments and a curriculum that mirrors those in our best colleges.

LynNell Hancock is the H. Gordon Garbedian Professor of Journalism at Columbia, and director of the school's Spencer Fellowship in Education Journalism.