Chances are that Arne Duncan doesn’t mind appearances at the NBA All-Star Weekend and getting shout-outs from celebrities such as LeBron James. But the U.S. Secretary of Education faces some daunting challenges over the next two years in keeping President Barack Obama’s school reform agenda. He must make headway in spite of such hotspots as the sparring in Congress and among education players over the reauthorization of the No Child Left Behind Act, and questions about getting new funding for such initiatives as Race to the Top and I3. Then there’s that pesky debate over abolishing collective bargaining that puts centrist Democrats such as Duncan on the hot seat just as their own initiatives would also weaken the National Education Association and the American Federation of Teachers. All as the President is gearing up for a re-election campaign that will require all activist hands on deck, including two of the biggest players in Democratic party politics.

In this interview Duncan held with Dropout Nation and other media and policy players this morning, he discussed the U.S. Department of Education’s efforts to help states realize that there is flexibility in Title 1 funding and offered thoughts on Wisconsin and other major education issues. (Michelle McNeil of EdWeek has a roundup of the pow-wow.) More from the session, including about standardized testing and No Child — including comments from Carmel Martin, Duncan’s point-person on reauthorization– will be forthcoming this evening.

You have been critical of efforts in Wisconsin and elsewhere to abolish collective bargaining. How does efforts to abolish collective bargaining go against fostering collaboration?

You need budget concessions on wages and benefits [in Wisconsin]. As you know, the [NEA’s Wisconsin affiliate] said they would make them… You have a union that is making moves toward the kinds of reforms we want. The president of the union even had push-back internally…You had a union that had been historically more intransigent, but was moving. You don’t want to hit them with a hammer… I think collective bargaining can and will be a tool for improving student achievement.

But isn’t ending collective bargaining critical to forcing the NEA, the AFT and their respective presidents, Dennis Van Roekel and Randi Weingarten to actually make concessions and embrace reform? Especially given the presence of Baby Boomers who want those benefits.

The leadership is changing. We have to get there faster. But you see union leaders such as Randi saying it should be easier to dismiss teachers, you’ve never heard that. You are hearing things that you’ve never heard before.

If you talk to good young teachers, they aren’t as interested in pensions. They want more pay. Give them a 401K plan and they will be happy. You have the Baby Boomers going into retirement. You have the new teachers who are coming in… I think [change] is happening.

But what about the reality that teachers unions have so many ways of advocating on their own behalf? In most school districts and even in states, there are few countering forces against unions, few ways for any sort of realistic collaboration.

Let’s have this conversation about parent engagement, countervailing pressures. We need that. We need the business community engaged.

No one’s talking about school boards. No one’s talking about superintendents. Everyone needs to move.

I’m not about collaboration for collaboration’s sake. Collaboration around the status quo, I’m not about that. I’m not about kumbaya. It’s about doing things to get better results for kids.”

So unions make concessions on teacher compensation and benefits right now? What if they push to roll things back when the fiscal conditions get better?

“Sometimes, when you cross the Rubicon on these issues, we crossed it… I think people are working in different ways. The countervailing pressure [against returning to the past] is that we need to get better results educationally. I think people are facing more pressure.

One of those pressures is fiscal. And in some cases, states are cutting funds for early childhood education initiatives. In your mind, is this smart cost-cutting?

I know these times are hard. But I don’t think that’s the smart way to cut. Kids are entering kindergarten without opportunity to succeed. If we want to close achievement gaps, we have to start at two and three, not four and five.

There’s the matter of class sizes, which is a particular concern for middle-class parents. Considering that fiscal belt-tightening inevitably will involve fewer teachers and increases class sizes, how can school districts reconcile this with parents?

Class size has been a sacred cow. We have to [put it on the table]. I have two kids. Given the choice between giving them a great teacher working with 28 kids or a mediocre teacher with 23, I’ll take the 28. Why not give the great teacher with 28 kids, $20,000, $25,000 more and give the rest [of the savings] to the district? Parents haven’t been given the choice. We need to have that conversation. Why don’t we have that conversation?

With some question about whether the No Child Left Behind Act will be reauthorized, there has been talk about providing school districts with waivers so they can avoid the penalties from the provision that all kids must be proficient in reading and math by 2014. What is the Department of Education’s roadmap on that?

Our focus is on getting it reauthorized… We are doing our job in passing that bill.

But what about the matter of getting congressional Republicans such as House Education and the Workforce Committee John Kline [who opposes No Child’s accountability provisions] to move on reauthorization or even talk about what should be part of the reauthorized law?

No one’s saying ‘we won’t engage, we won’t talk’. Frankly the talks have been better than I expected.

Then there is Race to the Top, which will likely get less funding than in the past couple of years. For the states that competed for the program and didn’t get funding, are they really winners?

When you have 41 states adopting standards, they are winners… Forty-one states have reform plans. There are six districts in California that are working to implement these plans. We’re doing calls with these states and with funders so that they can implement those plans.