February 01, 2001 News » Cover Story

Citizen Schuck 

Developer Steve Schuck and his war on teachers unions, anti-sprawl elitists and the ugly side of politics.

Steve Schuck has made and lost fortunes, and then made them back again.

The Colorado Springs developer looks outside the window of his 12th- story corner office in the Holly Sugar building downtown, and when he sees residential neighborhoods and strip malls marching across the landscape, he smiles.

Fourteen years ago, Schuck spent two years and millions of his own money running for governor of Colorado and lost the Republican primary. It still bothers him.

He served as chairman of the Independence Institute, a Golden-based group of free-market wonks who perceive the government as bloated and inherantly inefficient. In 1996, Schuck resigned the chair to pursue his latest obsession: vouchers. Schuck's initial attraction to the school choice movement was based on his fundamental philosophy and ideology opposing government-run programs. But that argument now, he believes, is irrelevant. Instead, Schuck says, it's about children.

Schuck believes that most of the social pathologies that plague us today are the result of the self-indulgent, narcissistic, hedonistic influence of the '60s and '70s. He's a self-described "straight square" who doesn't drink, has never touched a joint, and exercises like a wild man.

More importantly, he's a keen storyteller, and when he starts talking, you can bet that famous names will start to drop. For instance, on the 10th anniversary of the Berlin Wall coming down, then-president George Bush joined the leaders of the free world at The Broadmoor hotel to commemorate the occasion. Gorbechev was there, so was Thatcher and Schmidt and Mulrooney and Mitterand.

After the event, the president and Barbara stopped over at Steve and Joyce Schuck's place for a couple of hours and they had a little fund-raiser for Sen. Ben Nighthorse Campbell. Schuck doesn't know the new president, George W., very well but he's known the family for years, all the way back to Neil Bush's involvement in Silverado Savings & Loan, which, for Bush, ended in scandal. And actually, Schuck knows the old man better than either of the sons.

But none of that really matters.

"My point is," Schuck closes the story, "I've spent enough time with celebrities and so-called important people, but I've never been as inspired as the time I have spent with the people in the school choice movement. They are the most selfless, dedicated, concerned, caring people I've ever encountered."

In an effort to win over influential skeptics, many of them minority leaders, Schuck and other school choicers sponsor field trips to the Milwaukee school system, which has become the poster child of the voucher movement. There, they show off the benefits of how the voucher program works in that community.

Last year, Schuck converted Nita Gonzales, an influential Chicano activist in Denver who runs an alternative school. When he took Gonzales on the 36-hour whirlwind tour he knew she would be a tough sell, and before they left, she practically accosted him in the terminal at Denver International Airport for attempting to sway her strong opinions opposing vouchers.

Schuck just asked her to keep an open mind.

While in Milwaukee, Schuck watched as Gonzales went through the drill, complete with 10 stops to visit schools and talk to the people who were teaching and learning in them.

He knew he had her when Gonzales asked one of the facilitators, a welfare mother and grandmother, how she became a supporter. The woman responded, "I may be black and I may be poor, but I ain't stupid. Why would I send my kid to [a substandard] school?"

Gonzales' entire body language changed. When they got back to DIA, Schuck said, "Nita just puts her arms around me, gives me a big kiss and says, 'You know, you're a pretty nice guy.' And I said, 'Nita, why is that such an epiphany?' and she said, 'Well, you're from Colorado Springs.'"

Schuck knew what Gonzales was implying, the typical assumption that having a Colorado Springs zip code means you're a religious right wacko. So, he told her where he worships.

"I said I go to temple, I'm Jewish." And Gonzales could hardly believe it. Now, Schuck and Gonzales are friends. And she is a voucher convert. "She's an apostle, and it had nothing to do with me; it had nothing to do with what I said; it had to do with what she experienced when she was there," Schuck said.

The revolution

Indy:Voters in Colorado have overwhelmingly rejected vouchers, most recently four years ago when they canned Amendment 17. So why do you keep pushing them?

Schuck: They won't reject it when we're done. The very people who have been absent, AWOL, during these battles are the beneficiaries and they will be increasingly engaged. The next voucher battle in Colorado will not be led by Steve Schuck or [wealthy pro-voucher Denver businessmen] Ed McVaney or John Saeman. It's going to be led by some poor single mother whose kid is stuck in some god-awful school in DPS or District 11 or District 2, where nine percent of the kids are functioning at grade level.

Indy: Will that woman be hand-selected by you?

Schuck: No, that will be someone who will emerge from this army as a leader.

Indy: So why are you so obsessed with vouchers? Your kids are out of school; you don't really have anything to personally gain.

Schuck: It has nothing to do with myself. I mean, it has everything to do with myself. I am an unabashed patriot. I believe that there is something special about America, that we are blessed and that it is divine, that we are the beneficiaries of divine intervention and that we have an absolute obligation to protect what is so unique about this country and its values.

Indy: But why vouchers?

Schuck: Because Thomas Jefferson told us, and he was right 200 years ago, an educated populace is absolutely essential for the survival of our Republic. When half our kids can't read or write and are essentially dysfunctional, there is no chance for a democracy to survive, no chance at all. Red China, the Soviet Union, North Korea, the rogue nations, don't have to bother with nuclear weapons -- all they have to do is allow our public education system to continue serving us as poorly for the next 20 to 30 to 40 years as it has for the last 10 to 20 to 30 years.

Indy: What about the argument that what we need to do is roll up our sleeves and get to work and improve the system that is already in place?

Schuck: That is empty, shallow rhetoric that has no action component to it at all. That is the same commentary that we've heard for the last 20 to 30 to 40 years and nothing has happened and nothing will happen or get any better absent pressure from the outside. I don't care about the system; the system isn't why we're in business. It's the kids who come first, and I don't care how those kids are educated as long as it is done well.

Off to school

Schuck does not question teachers' dedication, but he blames teachers' unions for the breakdown of the educational system across the country. "The minute unionization became the predominant interest of the teachers, the minute they became organized, they became part of a process that was not focused on education but rather focused on self-interest," he said.

Schuck is also a vocal critic of District 11, and opposed the hiring of Superintendent Norm Ritter last year for the sole reason that Ritter was an academic, not a businessman. Schuck says that he would tackle the job himself, and do it for a dollar a year, but only if the school board would give him the authority to establish an entire new culture in the enterprise. But that won't happen, in District 11 or anywhere, he says.

In December, Schuck announced a plan to personally pick up the tab to send students from one of the lowest-achieving and poorest elementary schools in District 11, Adams Elementary, to a private school of their choice. Schuck will pay up to 90 percent of tuition cost at private schools, up to $2,500 a year. Parents must be willing to accept the requirements, including that they be involved in their child's education. In addition, Schuck will pay for tutoring help to those kids who remain at Adams Elementary, but their progress must be measurable or the funding stops.

Indy: How many Adams parents have accepted your offer?

Schuck: We have no formal process worked out yet; we don't have all the mechanics defined. On the basis of two newspaper articles we've had contacts from parents representing 130 kids, roughly half of those from Adams, roughly half [from] other schools, including District 2. I suspect that the word will spread.

Indy: Is there a cap on how much you're going to spend on the Adams voucher program? Where are you getting all this money? Is it falling out of the sky?

Schuck: As a practical matter there's no limit. There's a limit to the amount of money I have, but I have foundations that have agreed to pick up whatever I can't so there's plenty of backup.

Indy: Your own voluntary Adams program also requires that parents and students comply with tough standards. So how would you ensure all kids have the same access to excellent education?

Schuck: The whole point of this is to save the kids at Adams, not to push vouchers. I trust parents a hell of a lot more than the bureaucrats. And for those parents who don't want to take advantage of private school tuition, they too will benefit because the school, in its attempt to survive, will fight to keep its customers. It will fight even harder to keep its prized clientele. There is nothing complicated about it, there is no hidden agenda, there is no mystery to this thing -- it is the marketplace at work pure and simple.

Indy: You have become a huge fan of what Milwaukee has done and one of their major assertions is that it was modeled to best suit Milwaukee. With that in mind, what kind of special program do you envision in Colorado?

Schuck: That is the right question to ask but you're not going to like the answer. I don't have a clue and I'm not supposed to have a clue. I'm not a professional educator and don't profess to be one or know anything about how to deliver education. There are people, however, who are qualified, who are the experts, who are running our school system now who will figure it out when they have to.

Indy: What do your wife and children think of about your passion for vouchers? Does it drive them nuts?

Schuck: I'm an obsessive-compulsive. Everything I do, I do to the extreme, so the extent of my commitment is of no surprise and hardly anything new. Joyce was never in favor of my running for office; she felt there were better and more effective ways I could accomplish my efforts than being in elected office. I felt otherwise, and time has proven her to be right and me to be wrong. I can do more of consequence for more people in need in a shorter period of time, that will have longer and more lasting benefits, as a private citizen than I could even have as an elected official.

It still hurts

In 1986, Schuck ran against then-Senate Majority Leader Ted Strickland, who went on to lose the general election to Democrat Roy Romer. After spending millions of dollars of his own money and campaigning for two years, Schuck, who owned most of the Otero Savings & Loan buildings in the state, returned home to Colorado Springs and learned that he had lost his fortune as well. He and his wife Joyce were literally evicted from their Broadmoor mansion. They went out, rented a house, and Schuck started over.

Indy: Do you ever intend to run for another office?

Schuck: Nah.

Indy: Are you still sore about your defeat?

Schuck: Does it still hurt? Yes. Any time you're rejected in public ... . Let me put it a little differently. Unlike the typical candidate for office who is part of the political process and does this for a living and who has politics as a profession, I approached politics as a way to serve, to truly serve in the sense of a clergyman or a physician. I approached it in sort of a pure sense, which to most cynics in the system was laughable, and I have come to accept that I was nave and terribly idealistic, which made my defeat that much more painful.

Indy: And then you lost your fortune.

Schuck: The confluence of timing couldn't have been worse. It was almost as if someone designed it so that I would get the worst of everything. I lose the election, the 1986 federal Tax Reform Act gets passed, and I didn't even know what it was at the time, but it devalued every piece of real estate in America 30, 40, 50 percent. I come back to find out every piece of real estate that I owned was worth less then the debt we had against it, and in some cases I had signed that debt personally. I was insolvent. I was broke, I was as it's been described in the paper, $10 million below broke. I had to make $10 million just to get broke.

Indy: So a decade later you're back on top. How'd you do it?

Schuck: There's an old adage on Wall Street that the greatest fortunes are made during bad times, not during good times. I'd done it and lost it twice before so I knew I could do it. We went for approximately 10 years, from 1986 to 1996, without a vacation. We never went anywhere, nowhere. I worked seven days a week and was totally focused on rebuilding. [The late Denver Cable magnate] Bill Daniels provided the resources, and frankly some moral support when I needed it desperately. There were some fine people here who stuck with me even when they couldn't get their paychecks covered. I'm deeply indebted to a whole lot of people for allowing me the opportunity to truly live the American Dream -- to make it, to lose it, to make it back, lose it again, and make it back. Only in America.

Dream houses for all

When Schuck was running for governor, he was criticized for accepting and spending millions on his campaign -- at the time breaking records for the amount spent on a gubernatorial race in Colorado. Much of that money came from developer and real estate special interests, and though Colorado was in the midst of an economic downturn, the Democratic then-Gov. Dick Lamm told Schuck that a developer could never get elected governor of Colorado. Schuck was also as blunt-talking a politician as he is a citizen, which got him into trouble.

Indy: You called Grand Junction ugly. And politicians aren't supposed to use that word, period.

Schuck: I never said Grand Junction was ugly. What I said was the situation in Grand Junction was ugly. I said if you want ugly come with me to Grand Junction because the people are losing their homesteads.

Here's how the Grand Junction situation came about: Dennis Champine was the mayor of Aurora at the time and endorsed my candidacy. [Then- Denver Post reporter] Neil Westergaard suggested the reason Dennis supported my candidacy was because he was the mayor of a city that developed the same kind of ugly houses as did Colorado Springs, and that somehow, by implication, we were soul mates for that reason. I asked the reporter why he used the term ugly, and he referred to the fact that the governor, Dick Lamm, had described Colorado Springs and Aurora as being ugly, with monopoly board-type houses and ticky-tack houses and what today is called sprawl. My response was, how dare anybody call that ugly! The people living in those houses don't consider those ugly -- it's their dream.

I would say the same thing again, and if I went down on my sword again, so be it. It was the right thing to say and the right point to make. With some rare exceptions, I don't think that the political system has any appetite for candor and directness and for honesty.

Indy: During the campaign you insisted that you were a politician who couldn't be bought. As a developer, are there any politicians that you can buy?

Schuck: The answer to your question is, absolutely yes. But the better question to ask is, would I buy them? The answer to that question is, absolutely no. I don't want to buy anyone who can be bought. I don't want good personal favors; I want good public policy.

Controlling City Hall

At the time Schuck made his "ugly" reference about Grand Junction, he also said that there is nothing wrong with a little sprawl. Colorado, 14 years later, has got a lot of sprawl.

During his unsuccessful effort to pass his 1996 voucher proposal, Amendment 17, Schuck co-authored an opinion piece on Judaism and school choice, and warned that proponents were in a David vs. Goliath battle with teachers' unions and administrators who would spend millions of dollars to fight substantive reform. The measure went down in flames.

Last year, Schuck joined developers across the state and switched roles to become Goliath: They raised more than $6 million to defeat Amendment 24, which would have forced communities to plan for growth. Schuck and others called the proposal draconian and "too extreme for Colorado."

Indy: Do you think sprawl is ever ugly?

Schuck: It doesn't matter. If I think it's ugly then I don't have to live there, but the people who do move there don't think it's ugly, so who in the hell am I to decide for other people what is and is not ugly?

Indy: Shouldn't people who live in Colorado be able to, if they are offended by cookie-cutter houses as far as the eye can see, have a say in the aesthetics of the surroundings?

Schuck: Is this Lake Wobegon? You are imposing your values and your aesthetics on those who can only afford something that doesn't meet your standards. So what are we going to do, are we going to outlaw the poor? If you want us to be able to do more with the same number of dollars, then go pound on City Hall for adding so much cost to the ultimate end product. We can't afford to put in the trees and other aesthetic amenities and still develop a product that people can afford to buy.

Indy: The dearth of affordable housing in Colorado Springs has been identified as a massive problem for eight years now. What should the city be doing to enable developers to build houses that are affordable for the poor and working class?

Schuck: That is hypocrisy at its zenith for those same elected officials that continue to permit bureaucracy to grow, and rules and regulations to proliferate, that add nothing to the health, safety and welfare of the community, to also claim that they want affordable housing.

It's hypocritical of the so-called environmentalists who want so-called smart growth to criticize the new subdivisions that are the most affordable and say they are representing the interests of the people. They are representing their own middle- and upper middle-class tastes and they have no interest in the poor and meeting the needs of the poor. They talk about strip malls and big boxes on top of each other and my guess is that [nature photographer and Amendment 24 proponent] John Fielder doesn't spend a whole lot of time inside Wal-Mart. But the people who live in Woodmen Hills and Springs Ranch do, so what would you have us do, build Cherry Creek Mall and put Lord & Taylor and Bergdorf Goodman and Neiman-Marcus in the middle of Springs Ranch? I don't think so.

Indy: What, if anything, should our elected officials do to address this affordable housing problem?

Schuck: Talking to [developers] about it is a red herring. We can't create affordable housing. It's the exact same principle as public education: If you want affordable housing, give housing vouchers to the poor who you want to help. One is, you disperse the housing instead of congregating it. Two, you give dignity to the recipients instead of stigmatizing them, and three, you don't create tomorrow's slums.

Indy: Why isn't it happening here?

Schuck: It's not happening anywhere. A politician is not going to respond to the dispersed interests of poor consumers when, in the alternative, they can enrich wealthy capitalists who will reward them with generous financial contributions. If I as a builder of subsidized housing am going to make millions of dollars and get the people elected who support that kind of thing, I'm going to be helpful to the elected official. If I am a poor, single mother looking for reasonable housing and I get a $500 housing voucher, I'm not going to make a very generous contribution to the politician. And so the answer to your question is, it's pure politics.

Indy: Is there such a thing as smart growth?

Schuck: Honestly, it's a political buzzword that means something different to every person who hears it or says it. I don't attempt to define it because it's a nebulous, meaningless term.

Indy: But isn't there at least the need for a vision to shape how our community should grow?

Schuck: Sure, and if the city's new comprehensive plan was a vision statement there would be a hell of a lot less concern about it. But in every respect it's a regulatory document. It stopped being an exercise in vision a long time ago.

Indy: I thought you developers had better control over City Hall.

Schuck: I love that! I love that! You guys control them! Spend a day with me trying to deal with City Hall. Control them? Hah. I wish. Actually I'd be incredibly disappointed if I could, and I'm proud of the fact that nobody can. I come from the middle of New York City and if one of my buddies with whom I grew up listened to this discussion they'd be laughing uncontrollably because they're all a bunch of cynics. We've had great leadership in this community, but I do fear, however, that we are gravitating more and more toward the Denver model of having politicians instead of public servants. I can remember when they were self-deprecating and I wish desperately I could turn the clock back.

Indy: Isn't that a result of all this fabulous growth? Colorado Springs is not a small town any more.

Schuck: Yes, I think that's a negative, unfortunate result of growth. I would concede that, but I think we should resist it and fight it for as long and hard as we can. I would hope that we could be larger in population numbers and geography and still retain the special character, almost the purity that we had for so long.

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