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Archive for February, 2012

Don’t say we didn’t warn you.

As recently as Jan. 31—less than a week ago—we told you that Gov. Bobby Jindal is following the playbook of the American Legislative Exchange Council (ALEC) almost to the letter.

That playbook includes a section entitled “Tools to Control Costs and Improve Government Efficiency.” Among the “tools” it recommended were:

• Adopt a state hiring freeze;

• Reform state pensions;

• Delay automatic pay increases (we wondered where legislators came up with the term “automatic” in freezing merit increases a couple of years back);

• Embrace the expanded use of privatization and competitive contracting.

Each of these has already been done or is in the process of being done.

Next Thursday, the administration will present the governor’s Executive Budget for Fiscal Year 2012-2013. Included in the budget will be the proposed sale of the Office of Group Benefits (OGB) for $189 million, to become effective Jan. 1, 2013.

The committee meeting is scheduled to be held at 9:30 a.m. in House Committee Room 5.

The $189 million apparently is the price tag derived by Morgan Keegan, the Memphis banking firm that stands to reap a $750,000 bonus over and above the $150,000 for assessing OGB’s value if it is successful in negotiating the OGB sale at the $189 million price.

Morgan Keegan was itself only recently sold after being fined $210 million nearly two years ago by the Securities and Exchange Commission for misrepresenting critical information to investors.

Whoever ultimately purchases OGB will take with them the $500 million surplus now carried on the OGB books which the new operators will use to pay claims.

LouisianaVoice has also learned that once the sale of OGB is successfully negotiated and the agency is taken over by private industry, premiums will rise by approximately 10 percent.

There are other proposed changes coming that we can tell you about next week.

We can tell you this much, though: It ain’t gonna be pretty.

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“We are going to create a system that pays teachers for doing a good job instead of for the length of time they have been breathing.”

Gov. Bobby Jindal, unveiling his education reform package before the annual meeting of the Louisiana Association of Business and Industry on Jan. 17.

“It’s a Biblical principle: if you double a teacher’s pay scale, you’ll attract people who aren’t called to teach.”

–Alabama State Senator Shadrack McGill (R-Woodville), speaking at a prayer breakfast in Fort Payne, Alabama, earlier this week. At the same time, he defended a 62 percent legislative pay increase as a deterrent to lobbyist influence.

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Ron White of the Blue Collar Comedy Tour, arguably one of the funniest standup comics in America, once uttered the classic line, “You can’t fix stupid.”

The same might well be said of arrogance.

Case in point: Mitt Romney saying he was “not concerned about the very poor.” Even if true (which it probably is), it is arrogant to say it even privately, much less publicly.

Case in point: Gov. Bobby Jindal’s calling Louisiana Association of Educators Executive Director Michael Walker-Jones “arrogant” for Jones’s saying that some parents in poverty may not have the time or information to make a decision on their child’s education and suggesting that Walker-Jones resign.

That addressing poverty should be the key in seeking a solution to failing schools is a no-brainer to everyone except those who would gain political capital by bashing public education.

Walker-Jones made his comments in response to Jindal’s education reform plans that the governor unveiled before the annual meeting of the Jindal-friendly Louisiana Association of Business and Industry (LABI) as opposed to the more appropriate audience of those most affected by the proposed changes: teachers.

And therein, as Willie Shakespeare said, lies the rub.

Unveiling his plan at that particular venue was a touch of arrogance in itself, a breach of protocol. But look here for the real arrogance of this governor: http://gov.louisiana.gov/index.cfm?md=newsroom&tmp=detail&articleID=3197.

Here are some excerpts:

“…We are going to give (local school) districts more flexibility over their federal dollars….(and) We are going to reduce federal reporting requirements….”

One has to wonder if he has run this by the feds yet. It was Earl Long who asked civil rights opponent Leander Perez in the heat of the state’s battle over desegregation more than 50 years ago, “What’re you gonna do now, Leander? The feds got the A-bomb!”

Jindal, in attempting to apply the principle of teacher tenure to a hypothetical company in the private sector, said there is no accountability for job performance and “after three years of this, if they have survived, they are given lifetime job protection. Short of selling drugs in the workplace or beating up one of the business’s clients, they can never be fired.”

Implying that teachers can only be fired for selling drugs at school is arrogance in its purest form—and stupid beyond belief. By his standards, it must be fair to say that now that he has been re-elected, he can only be removed if he sells drugs in the House or Senate chambers. Certainly, that is a far-fetched and most unreasonable analogy—but no more so than his own remarks.

Case in point: “We are going to create a system that pays teachers for doing a good job instead of for the length of time they have been breathing.”

Does anyone know of a single instance in the history of mankind where someone has been paid for the length of time he or she has been breathing? Anyone? Anyone? Bueller? Bueller? Anyone?

We’re talking sheer arrogance here.

Perhaps Jindal should resign after making such an ass of himself.

In fairness, he did make one accurate comment to LABI: “Our system today often crushes talented teachers and it makes their jobs harder, not easier.”

At least he’s spot-on with that assessment.

Of course Jindal’s education reform proposals are drawn almost exclusively from the American Legislative Exchange Council’s sweeping agenda but it no doubt also draws heavily on a study done by Raj Chetty and John Friedman of Harvard and Jonah Rockoff of Columbia University.

Without going into too much detail, that study concludes that good teachers cause students to get higher test scores, which in turn lead to higher lifetime earnings.

Well, duh. How much was that grant? Bet we could’ve arrived at that conclusion for less.

But wait. Let’s look a bit more closely at the specifics of that study that has become the mantra of reform-minded governors like our own.

“Replacing a poor teacher with an average one would raise a single classroom’s lifetime earnings by about $266,000,” the New York Times quoted the study as saying.

Wow. $266,000? Really?

But let’s break that down a little further. Let’s say for simplicity that the average classroom has 26.6 kids and on average, those kids will become adults who will work, say, from age 25 to age 65. Forty years. So, we have $266,000 divided by 26.6, divided by 40 years. That comes to a whopping….$250 per year per student, about $20 per month or $4.81 per week.

But for all of Jindal’s disdain for teachers—Public Service Commission Chairman Foster Campbell recently opined that someone must have broken Jindal’s pencils when he was in school—and public education, nothing can quite compare to the arrogance, ignorance and convoluted logic of one Alabama state senator.

State Sen. Shadrack McGill (R-Woodville) recently spoke to a prayer breakfast in Fort Payne at which he justified a 62 percent pay raise for legislators while at the same time saying raising teacher pay could lead to less-qualified educators, according to the Fort Payne Times-Journal.

On the face of it, given his Biblical first name and the asinine statement, most readers might reasonably conclude that the story was straight out of the Onion, an on-line parody of news events. But the story is real and the speaker’s remarks were sincere if misinformed, misguided, and laced with idiocy.

The legislative increase, to be fair to McGill, was passed in 2007, before his election. It was approved by voice vote and later in an override of then-Gov. Bob Riley’s veto.

McGill said the pay raise—from $30,710 to $49,500 for legislators’ part time positions—better rewards lawmakers and makes them less susceptible to lobbyist influence.

“That (the old salary) played into the corruption, guys, big time,” he said. “You had your higher-ranking legislators that were connected with the lobbyists making up in the millions of dollars. They weren’t worried about that $30,000 salary they were getting,” he said, adding that legislators have to pay for their expenses out of pocket.

Legislators need “to make enough that (they) can say no, in regards to temptation,” he said.

Well, Mr. McGill, it may come as a surprise to you to know that members of Congress pull in about $180,000 per year and they are still very much susceptible to being swayed by lobbyists. Only a fool would argue that a salary of $49,500 would keep lobbyists at bay.

It may also come as a shock to you to know that we all pay expenses out of pocket—especially teachers, who regularly spend their own money for classroom resources.

For pure audacity, McGill, who home-schools his children, went on to say, “If you double what you’re paying (teachers), you know what’s going to happen? It’s a Biblical principle. If you double a teacher’s pay scale, you’ll attract people who aren’t called to teach.

“And these teachers that are called to teach, regardless of the pay scale, they would teach. It’s just in them to do. It’s the ability that God give ‘em. And there are also some teachers, it wouldn’t matter how much you would pay them, they would still perform to the same capacity.

“If you don’t keep that in balance, you’re going to attract people who are not called, who don’t need to be teaching our children. So, everything has a balance.”

First, of all, Mr. McGill, please direct us to the scripture in the Bible that admonishes us not to increase teacher pay. Please provide us with the specific chapter and verse.

And taking your logic to its ultimate conclusion, preachers should not be paid; it’s a calling. Instead of paying attorneys $250 per hour, they should accept $25 per hour since it’s a calling. And why pay firemen at all? Let ‘em volunteer. Same thing for police officers, judges and social workers.

Oh, and let’s not overlook legislators. It’s a calling, so let them forfeit all pay in exchange for the privilege of serving.

There you have it, folks. The contempt for teachers and public education, simply because they’re easy targets, is the most current and most popular trend in America. So, c’mon, jump on the bandwagon. The kids? They’re just an afterthought. It’s political hay and the harvest is ripe.

But one last thought: if you can read this, don’t forget to thank a teacher.

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“We have significant concerns that premature disclosure of the report will prejudice the (solicitation for offers) and negotiations process. This is not a matter of secrecy, but a basic component of our ability to make decisions that are within our purview, to direct the integrity of a successful procurement.”

–Commissioner of Administration Paul Rainwater, in a letter to Senate President Joel Chaisson last June 8 in which he attempted to justify the admininstration’s refusal to provide a copy of the Chaffe & Associates report on the Office of Group Benefits to legislators. Likewise, Rainwater is now withholding the contents of the state’s contract with Morgan Keegan from the OGB Policy and Planning Board.

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Here’s a can’t-miss formula for success that Gov. Bobby Jindal is asking us to accept with no questions asked:

First, hire a consultant who was hit with a major fine for misleading clients—we’ll call him Shady—to find employment for a second consultant—we’ll call him Sneaky—who was also fined for misrepresentation.

Then a third party enters the picture to contract with Sneaky to broker the sale of a major asset even as Shady continues to negotiate for full time employment for Sneaky.

Set the contract at $150,000 just for Sneaky to show up to make a determination of the asset’s financial worth.

Then, if the asset sells, well, let’s give Sneaky a nice fat bonus of say, $750,000 for providing “unbiased advice” on the bidding process and contract negotiations.

We will repeat that last part: Sneaky is expected to give “unbiased advice” in its efforts to collect an additional $750,000.

Remember, too, that Sneaky has already been fined $210 million for misrepresenting critical information “exactly when investors needed it most.”

That is precisely the scenario that currently exists with the contract between Morgan Keegan brokerage and the Louisiana Division of Administration regarding the proposed sale of the Office of Group Benefits (OGB) and its $500 million surplus.

After the state’s attempt to engage Goldman Sachs at a cost of $6 million to market OGB to private investors—you may remember that Goldman Sachs helped write the request for proposals (RFP) for the OGB sale and then submitted the only proposal—fell through over demands by Goldman Sachs that it be indemnified from any potential litigation.

A new RFP was then issued and Morgan Keegan was the low bidder last July.

But Morgan Keegan had recently agreed to pay $210 million to settle allegations that it had fraudulently marketed mutual funds filled with subprime mortgages and artificially inflated the funds’ prices.

So Regions Financial Corp., Morgan Keegan’s parent company, decided to divest itself of the troublesome brokerage firm.

So, who did Regions retain to explore “strategic alternatives” for Morgan Keegan?

None other than Goldman Sachs which, less than an year earlier, was fined $587 million over claims that it had misled investors in collateralized debt obligations linked to subprime mortgages.

Morgan Keegan eventually sold, but at a price that was less than the value it had recorded on its financial books.

Now comes word that if Morgan Keegan, which is being paid $150,000 to determine the financial value of OGB, will rake in a bonus of up to $750,000 more if OGB is subsequently privatized.

Commissioner of Administration Paul Rainwater promised that Morgan Keegan, which contributed $1,000 to Jindal’s 2007 election campaign, will provide “unbiased advice” in its efforts to help market OGB.

In what is becoming an all-too-familiar refrain, OGB board Chairman James H. Lee attempted to obtain a copy of the Morgan Keegan contract from the administration in November but was told it was not finalized.

The contract, however, was signed by Morgan Keegan’s managing director on Oct. 31 and an OGB representative on Nov. 2.

Something’s a little rotten here. It’s a lot like efforts to obtain the infamous Chaffe & Associates report last year. Jindal hired Chaffe to make a quickie determination of OGB’s book value but then Rainwater refused to make copies of the report available to legislators and the media.

When a copy of the report was finally “leaked,” it had dates that were inconsistent with receipt dates provided LouisianaVoice by Rainwater and the contract was not date-stamped as are all documents received by the Division of Administration (DOA).

Lee said he has been trying since August to obtain a quorum of the OGB board of directors but at least one of the governor’s three appointed members is absent for each meeting. Normally, there are five members appointed by the governor, but two of the appointive positions are currently vacant.

“It is my opinion that they (the Jindal administration) have the full intention of selling off OGB as quietly as possible before anyone realizes what is going on,” Lee said. “Should this happen, the active and retired employees of the state will see reduced benefits and the taxpayers will see increased costs,” he added.

Former State Sen. Butch Gautreaux (D-Morgan City), a former member of the OGB board, said he is unclear as to why Jindal insists on privatizing a state agency that saves the state money. He opined that the governor may want to dismantle OGB and its $500 million surplus in order to more easily criticize President Barack Obama’s national health-care program.

“He needs to destroy it (OGB) for his personal ambitions,” Gautreaux said.

That should come as no surprise to anyone who has watched this governor.

His first agency to privatize was the Office of Risk Management (ORM). The state paid F.A. Richard & Associates (FARA) of Mandeville $68 million to take over ORM. In less than a year, the FARA contract was amended by $6.8 million. Two weeks later, the contract was transferred—without the prior written consent of the state, as required by the contract—to a second firm and months later it was transferred to a third firm, again without the legally required written consent.

ORM was the first of a succession of agencies that Jindal has either tried to privatized or announced intentions to do so. They include state prisons, the state’s Medicaid program, OGB, and education.

The one thing that Jindal has never once explained to the voters of Louisiana is this:

If things are so badly run in this state, if things are so screwed up, if state employees are so stupid and lazy and teachers so pitifully inept and impossible to fire “short of selling drugs in the workplace,” (Jindal’s words, by the way) how did we ever make it this far?

How is it that one day we woke up as a state and realized that only one man had been anointed with the answers to all our ills, just one man who could solve the problems of state retirement, prison costs, Medicaid administration, public education, higher education, employee health benefits, and state agency risk exposure?

How is it that one man is so incredibly blessed with such vision, such gifts of perception, insight, understanding and infinite wisdom? How indeed?

We will probably never know the source of all his wonderful attributes. After all, as the Shreveport Times recently observed, Jindal has spent four years “limiting or avoiding extended interviews about his programs with journalists outside Baton Rouge, not to mention fighting efforts to open his administration’s records to public view.”

Considering the fact that the Times has consistently carried the water for the Republican ideology, those critical words are especially surprising—and harsh. The paper further observed that Jindal made dozens of trips to northwest Louisiana but most of those were controlled settings, so access was limited. “Fortunate is the hometown journalist who can ask a follow-up question before a governor’s aide whisks away his boss,” the paper said.

Earlier this week, the Baton Rouge Advocate noted that the Zachary and West Feliciana Parish school systems, two of the better performing systems in the state, are facing financial disaster because of Jindal’s refusal to increase funding through the Minimum Foundation Program for public education. It’s no secret that public education is subordinate to his obsession with funding charter schools, vouchers and virtual schools.

Only weeks after it was announced last March that ORM would be privatized, an ORM employee was in a restaurant in downtown Baton Rouge around 4:30 p.m. when Jindal aides strode in and informed her that she would have to leave because Jindal had a fund raiser scheduled at the restaurant at 5 p.m.

“I paid for my food and my drink and I’m going to stay right here until I finish,” the defiant employee said.

She did, and on her way out, she met Jindal as he was entering the establishment. Jindal approached her with his hand extended and asked, “How are you today?”

“Not well at all,” was her curt reply. “You just privatized my agency and put some good people out of work.”

Jindal blinked and mumbled, “I’m sorry” before moving past her.

Sorry, Guv, we aren’t buying it. To be truly sorry, one must first be compassionate and one must be sincere. It also helps to have a little class.

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