When they were competing for the Republican presidential nomination in 1980, George Bush referred to Ronald Reagan’s economic platform as “voodoo economics.” When he lost to the Gipper and was named as Reagan’s running mate, Bush called himself a convert.
Well, we at LouisianaVoice are far from converted and the first wave of savings for state government rolled out by Alvarez and Marsal (A&M) can only be called doo-doo economics. In fact, the laundry list of so-called “savings” waved under the noses of the media by Minister of Propaganda Kristy Nichols leaves us even more skeptical of the now $5 million A&M contract than before.
That’s right. A&M has done such a wonderful job that its contract has been amended from the original $4.2 million to $5 million.
And Nichols’ dog and pony show is not only a clumsy effort to make an ill-advised contract look attractive, it’s downright insulting to taxpayers’ intelligence. It’s also an embarrassing admission that the Jindal team simply is not up to the task of running the state.
When she was caught “misspeaking” when she told legislators that the contract guaranteed a $500 million savings in four months—the $500 million was mentioned in the firm’s cover letter but not in the contract—she said the contract would be amended to say that. Well, apparently that little correction cost an additional $800,000. That wasn’t the way we interpreted “amended.”
Let’s face it: if she truly “misspoke” in proclaiming the contract guaranteed a $500 million savings, she should never have been given the responsibility of holding the state’s purse strings; she’s utterly and completely unqualified to hold her job. If, on the other hand, she simply lied to legislators, she should be summarily fired. What’s next, blocking the access ramp to the Sunshine Bridge so Troy Landry can’t get to Pierre Parte?
Compared to this administration, New Jersey Gov. Chris Christie is an unimaginative moron when it comes to creative ways to fool some of the people even some of the time.
In releasing the list, Nichols bubbled that the contract has already paid for itself in its first month in finding more than $4 million in savings. But, realistically speaking, we should expect nothing else from this administration. Gov. Bobby Jindal is so adept at misdirection, that should his presidential bid fall short, he can fall back on a second career as a stage magician. Let’s compare the “news” releases on the governor’s web page against the facts: http://www.gov.louisiana.gov/index.cfm?md=newsroom&tmp=home&navID=3&cpID=0&catID=2
- Guv: “Louisiana marks sixth consecutive year of population in-migration.”
- Fact: Our friend Elliott Stonecipher provided figures from the U.S. Census Bureau that show the state’s out-migration from July 1, 2012 to July 1, 2013 resulted in a loss of 2,492 people. If we have had, as Jindal insists, six straight years of gains, how is it that the state has gone from eight congressional districts to seven and more recently, to six congressional districts?
- Guv: “Governor Jindal announces funding hike for higher education and new workforce incentive fund.”
- Fact: While Jindal trumpets a $141.5 million funding increase for higher ed, Bob Mann correctly points out that $88 million of that is in the form of increased tuition. “Jindal will generously allow students and their parents to pay more to attend college and will magnanimously permit those schools to keep the money,” Mann said. http://bobmannblog.com/
- Guv: Everything in Louisiana is either great or on the upswing (from various news releases).
- Fact: Just examine the contents of this link. http://710keel.com/louisiana-and-arkansas-among-worst-states-in-america/
So you see the trend here and it’s certainly no surprise that the Kristy Nichols “fact sheet” more closely resembles bull sheet. It seems, from the calculations provided, that Louisiana may have already joined the states of Colorado and Washington in legalizing pot. Somebody in charge seems to be smoking something.
The first month’s A&M submissions and the projected savings and our observations (in parentheses) include:
- Electronic visit verification of at-home visits—$500,000. (First of all, what agency is this for? Second, how is this “savings” quantified? Just tossing figures out there doesn’t cut it.);
- Curtail unnecessary spending on high cost pharmaceuticals through case management—$154,000. (Where is the Secretary of the Department of Health and Hospitals (DHH) Kathy Kliebert? Shouldn’t she have been doing this already?);
- Cut duplication in health care treatment through elimination of preprocessing claims—$750,000. (See previous if A&M is directing this at DHH. If it’s the Office of Group Benefits, more on that momentarily.);
- New rate structure for patients requiring less attention than acute care but more than nursing home patients—$300,000. (Translation: cut medical benefits to the poor.);
- Holding pediatric day care facility owners and operators accountable for management—$154,000. (You mean we weren’t doing that already either? And please explain how this constitutes a savings.);
- Increasing occupancy bed rates—$2.5 million. (Say what? First of all, bed rates for what facilities? Second, we thought A&M was looking for savings, not increased revenue. Doesn’t that constitute a tax increase? And isn’t Jindal opposed to tax increases, even renewal of cigarette taxes? No, wait, this would be like the tuition increases, wouldn’t it? Not a tax increase, a fee increase. Different, right? Right. Got it.
We’re guessing the pea is under shell number two.
As the finale of her show and tell, Nichols proclaimed that A&M will work with the Office of Group Benefits (OGB) to find ways to make the agency more efficient.
Way to go, guys. You elbow your way in to take over what was very possibly the most efficient, well-run agency in the state to set up a revolving door of CEOs, a disappearing reserve fund balance and for the first time in many years, delays in paying claims. So now you bring in A&M to make things better—the same A&M that said the state should fire 7,500 New Orleans public school teachers following Hurricane Katrina. The state did, the teachers sued and the teachers won and now the state owes $1.5 billion as a result.
We took the four-year $5 million contract, subtracted 464 days for weekends and holidays and came up with a cost of something slightly north of $63,600 per day for A&M’s contract. At that rate, they better not be taking coffee and lunch breaks.
In unveiling his FY15 budget last week, Jindal released a nifty little PowerPoint presentation that showed the number of authorized positions in state government that had been cut during FY14. Not all the cuts resulted in layoffs, of course, because some positions that were eliminated were already vacant and there were also retirements that were not filled.
The figures show that 10,088 positions have been eliminated during the current fiscal year. Of that number 946 were in DHH, 5,998 in the Health Care Services Division, and another 2,209 were in higher education.
But wait. That same PowerPoint shows that the Executive Department (that would be the governor’s office) added 60 positions. Wait. What? Added 60 positions? So much for Jindal’s demand of state employees to do more with less.
Civil Service records show that within the Division of Administration (DOA) alone, there are 64 positions that pay $100,000 or more—a total of more than $6.8 million. Nine more, including Jindal, who work in the governor’s office, earn in excess of $100,000 per year for a total of another $1.3 million. The two highest paid are Chief of Staff Paul Rainwater ($204,400) and Ray Stockstill, listed as Director for Planning and Budget ($180,000).
Stockstill previously worked in DOA as State Director for Planning and Budget before being named Assistant Commissioner in February of 2010. He retired from that $180,000 position, effective Christmas Day of 2010 and returned to his previous position as a re-hire two days later, thus allowing him to draw retirement in addition to the $180,000 he is being paid.
Those lofty numbers do not include other employees listed in the governor’s office but who work in such areas as the Governor’s Office of Homeland Security and Emergency Preparedness (GOHSEP) or the Office of Financial Institutions.
So, in the spirit of economy, here’s a rock-solid suggestion that is certain to save the state a boatload of money:
Bring the A&M suits into the governor’s office and DOA, give them a mandate to cut 50 percent of that $8.1 million—not necessarily layoffs but just tell those 73 people, including the governor, to do more with less—less salary, that is. Let those administrators who are so eager to throw the rank and file employees to the curb learn firsthand what sacrifice is all about. We’re certain that with the teeming civic spirit that oozes from the fourth floor of the State Capitol, there would be unanimous consent.
That, Ms. Nichols, really would make the A&M contract pay for itself.
Now just sit back and hold your breath until that happens.