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4.10.08

Fourth District Democrat runoff to please Republicans

Entering the party primary elections, the big questions were whether a Second District runoff for Democrats would include incumbent Rep. Bill Jefferson, and which two of the three Republicans vying for the open seat in the Fourth District would advance to the runoff while the Democrat nomination was sewed up by former First Judicial District Attorney Paul Carmouche.

Jefferson’s only chance to win in December was to get into a runoff with former media reporter Helena Moreno, because with a majority black registration in the district and the high past propensity of blacks to vote for black candidates, as the only non-black candidate in the contest despite his legal troubles Jefferson could use this racial bloc voting to win. Any other candidate would negate this advantage and almost surely send Jefferson to defeat. At the same time, being up against Jefferson probably is Moreno’s best chance to win because his woes would be the most likely catalyst to break up black bloc voting.

As it was, the scenario worked out this way, with Jefferson coming home first with just 25 percent of the vote and Moreno around 22 percent. The interesting question now becomes whether the defeated candidates actually endorse Moreno, or do they sit back and stay uninvolved in the hopes that Jefferson incredibly wins the runoff and the seat only to be expelled from the House after what appears to be an almost-certain conviction for federal influence peddling crimes, reopening the seat for their efforts. If regardless Moreno pulled it out, however, they risk losing any influence at all with her by their silence, so there is political risk.

Polls in the Fourth showed Minden physician Dr. John Fleming and Shreveport trucking executive Chris Gorman consistently the top two candidates in the race over Bossier City lawyer Jeff Thompson. Seen as the most establishmentarian candidate and last in the race, Thompson’s candidacy never caught fire in a year where it was better to be seen as an outsider and he finished just a little behind the other two.

Made clear during the campaign, however, was that Thompson’s preference if he did not make the runoff was for Fleming. If he makes that any clearer with an endorsement, this probably gives Fleming, who finished slightly ahead of Gorman, the nomination.

Neither of these outcomes was a real surprise given the dynamics of the contests. But a shocker was the fact that Carmouche got forced into a runoff and against military retiree Willie Banks despite (from the latest reports) outspending the entire field almost double and eight times the amount Banks spent, that Carmouche is well known in Caddo and Bossier Parishes where the majority of district voters live with Banks being from rural Leesville, and that the entire national Democrat Party apparatus had lined up behind Carmouche.

The significance is not so much that Banks can win on Nov. 4 even with a big turnout in the district for Sen. Barack Obama, being that Carmouche got 48 percent of the primary vote, but that Carmouche now must spend extra money on winning the nomination and there must be concern about how independent voters, who could participate in this primary but not the Republican, will go in December. The fact that Carmouche could not finish off a weak field itself shows Carmouche is a soft candidate for the general election which must please Republicans.

3.10.08

GOP candidates, activists worry about Gorman weakness

It’s unusual that Republican candidates attack one another prior to a party primary, particularly when the eventual nominee will face a competitive Democrat in a conservative district. It is unprecedented when two of them jointly make disparaging remarks about another, but that’s the situation with the 4th Congressional District contest.

Minden physician Dr. John Fleming and Bossier City lawyer Jeff Thompson separately have issued similar statements expressing dismay with Shreveport trucking executive Chris Gorman’s campaign, in essence calling it misleading. Some background is in order.

Fleming and Gorman long ago contemplated a run for the office and began the groundwork for it. As they politicked Republicans after incumbent Republican Rep. Jim McCrery announced his retirement, some were not taken by either – Fleming because of some actually well-reasoned but, at least to the Louisiana voter, controversial issues (such as minor privatization of Social Security) that might detract from his candidacy in the general election, and Gorman because some aspects of his background were judged to make him largely unelectable in this district.

After some recruitment by these folks, Thompson finally came onto the scene, really nothing much more than a new alternative since on 90 percent of the issues all three agree. But his late entry, the waning influence of the main force behind his candidacy, McCrery and his allies, and that he is perceived as the “establishment’s” anointed candidate in an election cycle where that may not go over too well have not translated into as much support as they would like. Only a few polls’ numbers have been released that since the middle of June most often show Fleming leads, Gorman behind, and Thompson trailing.

What must be understood here is that personality and the ability to define oneself as a candidate, given the similar issue preferences on which all would be acceptable to Republicans, therefore is the primary concern of Republicans to put up the best candidate possible in terms of image against former First Judicial District Attorney Paul Carmouche, the prohibitive favorite for the Democrat nomination.

Carmouche has little going for him – a largely undistinguished tenure in office with some grumbling about its quality – except that he’s a familiar face and can credibly sound conservative on a limited range of issues in order to inoculate himself from the fact that he will support most of a very liberal agenda in Washington, an ideology profoundly out of step with the district’s majority. Further, he already is polling in a way that indicates he plans on running an extremely negative general election campaign, as a distraction from this reality.

Therefore, the GOP nominee must be a solid conservative who won’t give ammunition to a negative campaign about themselves that will throw them off the message tying Carmouche to his liberal Washington masters. It’s with Gorman that district Republicans are concerned Carmouche could do the most damage.

Simply, it will be an easy contrast for Carmouche to make, his long service in office with Gorman’s leaving the area for many years apparently having little to do with his present position, itself seeming to all the world to be a coming home gift from his family. Worse, the solid conservative credentials he needs seem undermined by the fact he was not a Republican for many years, donated in recent years to a Democrat’s congressional campaign in Oklahoma, and only reregistered to vote as a Republican in 2005. Even his integrity could be under fire for his claim he had obtained an executive M.B.A. at Harvard because the school does not verify this, and it is a stretch to say he created hundreds of jobs at the family’s trucking firm, making Gorman look unprincipled by saying whatever he needs to get elected.

(Gorman now claims he never said he received this degree. However, the revelation that he was fined $200 for trespassing as a teenager Fleming argues would reflect poorly if his opponent was ex-DA Carmouche.)

These things no doubt were noticed long ago by Democrats strategists and they would greatly incapacitate Gorman’s ability to draw issue-laden differences with Carmouche who has a war chest as ample as any candidate in the contest that could obscure this tactic. One could write off the Thompson campaign’s criticism as strategy of a trailing candidate (Thompson’s camp claims that he’s close to the others, but never has released results to support that contention), but that front-runner Fleming’s has joined in shows a number of GOP activists are worried that a Gorman nomination forwards a politician too vulnerable to win.

At this point, it appears a tactical, tacit alliance has been made between Fleming and Thompson in the hopes they can ace Gorman out of the runoff. Should they fail, it will be no surprise at all if the loser endorsers the other. Plaguing GOP minds particularly is a runoff with Gorman would be primarily a negative campaign – not what is needed with Carmouche sharpening his knives all the while.

2.10.08

Same overregulation folly as federal govt looms for LA

It’s unfortunate to hear that recent hurricanes will cause thousands of dollars of out-of-pocket expenses for some Louisianans who sustained damage to their homes. But tinker with this situation too much and you’ll get the same government intervention and overregulation that caused the present liquidity crisis in the mortgage industry.

We got the same old populist sentiments at a House Insurance Committee meeting with tirades about the “named storm” deductible now growing more common with homeowners insurance in the state. Some consumers complained that the policy of having a deductible at a percentage of the home’s value meant even with damage in the thousands of dollars they would receive no proceeds from insurance companies. Some legislators seemed all too eager to regulate the practice.

But once again this turns into a story about people wanting others to subsidize risk for them, to gain benefits others pay for. Currently (although this may change given a new law), if a company writes a policy in Louisiana, it has to charge the same deductible everywhere. Thus, this artificial requirement would cause people where I live to pay more on policies for their level of risk than those around the coast where a named storm is much more likely to cause damage for their level of risk.

I’m happy to do this, because I recognize that is the concept of insurance – you pay to mitigate a potential calamity, knowing it may never happen to the extent that you receive more than you put in. However, you from around here and I should be unhappy if it’s not largely the free market setting these rates, because then political considerations courtesy of state over-interference artificially raise our rates in favor of others.

Further, nobody put a gun to the head of people who bought policies with the named storm deductibles. If they chose not to read their documents of listen to their agents when that part came up, it’s nobody’s fault but their own. And if they were gambling that in getting this kind of policy they could secure a lower rate without suffering a storm, too bad; they could have paid a higher rate for a lower deductible. And if that extra cost would have priced them out of the market, there is such a concept as renting.

The problem is, as Insurance Commissioner Jim Donelon pointed out, regulation such as forcing lower deductibles no matter how calculated likely will drive insurers out of the state, because neither can you point a gun at insurers and make then write policies that lose them the revenues to keep them operating. (One change Donelon supports does make sense – just a single named storm deductible incident per year; after all, if a storm damages property, chances are that property will not be repaired by the time another named storm strikes not long off in the future.) And if that happens, then everybody will start piling into the state’s insurer Citizens Property Insurance Corporation whose coffers if emptied as was the case with the 2005 hurricane disasters then calls upon all state ratepayers or even taxpayers to make up the difference.

Which creates the same situation now being faced in Washington. Heavy-handed federal laws forced private lenders and the government corporation that backed mortgages to lend money to riskier individuals than the market would have afforded. Now that risk will have to be subsidized by taxpayers, perhaps to the tune of hundreds of billions of dollars, unless future markets bring a lot of luck. Anything but a light hand on the insurance issue in Louisiana might please grandstanding politicians, but would cost the citizenry plenty.

1.10.08

Real change, not new positions, needed in LA schools

Louisiana’s Department of Education passed out another golden parachute to a state legislator, the beneficiary this time being former state Rep. Don Trahan who becomes the second glad-hander in a new position with responsibility to communicate to business and public interest groups. Earlier this year, former House Speaker Joe Salter got a similar gig at similar six-figure salary to press the flesh with policy-makers as the organization’s chief lobbyist.

This is not to question Trahan’s acceptance of the job as offered as his legislative record indicates he is knowledgeable and sensible concerning the field of elementary and secondary education. (And whether a vetoed pay raise for legislators would have kept him in the elective job is questionable – to his credit Trahan voted against it.) He appears to be a good communicator as well, as those who observed his running of House Education Committee meetings in his sole year of serving as it chairman would have noted.

What is questionable is the personnel and spending on them priorities of the Superintendant of the Department, Paul Pastorek, who has a penchant for throwing around big salaries for him and others on the political inside. He basically gave the Legislature’s joint budget committee the Bronx salute when he said if they did not give him a huge pay increase (which he already had been getting prior to legislative approval) over his predecessor that he’d take a hike. (Pastorek had served eight years on the Board of Elementary and Secondary Education, his employer, on whom four members still sit who served with him, and was hired without any kind of national or public search.)

Trahan’s new job sounds like exactly the kind of thing that Pastorek himself should be doing. Of course, one of Pastorek’s justifications for compensation that could reach nearly $450,000 annually by 2011 (for example, nearly 250 percent higher than his Texas counterpart who controls a budget over six times Louisiana’s and over four times the number of schools) was that he was overstretched in his job, so perhaps now his salary should be reduced since he’s got this new help. (Actually, there’s already a Director of Communications in Pastorek’s executive office, so why is the new position even needed?)

Meanwhile, state test scores continue to muddle along with, after a period of no improvement, elementary scores as a whole slightly increasing but secondary scores declining. (Part of Trahan’s new job is to act as liaison with business and public interests on the High School ReDesign project which is purported to address lack of progress in high school improvement defined as fewer dropouts and more-learned graduates.) And neither Pastorek nor Trahan, both of whom have supported throwing money at teachers in the odd belief that a higher salary suddenly will make them better, ever have advocated the single most effective tool that would improve educational quality in the state, periodic and rigorous testing of teachers for their subject knowledge with those who fail after remediation losing their reaching licenses in the state.

Why is it with generally fewer students and schools yet higher education spending per capita that Louisiana education is near the bottom in achievement? Hiring more state legislators who presided over this dubious era isn’t going to change this situation.

30.9.08

Saving bonanza, redeeming debt puts LA on solid ground

Testimony taken by Louisiana’s Revenue Estimating Conference for its official forecast due in a couple of months confirms the recovery bubble nearly is over, and should warn that now is the time to put state finances in the position to survive the long-term effects of natural disasters and decades of inferior state fiscal policy.

With Louisiana recovery spending financed by the American taxpayer approaching $150 billion as a consequence of the 2005 hurricane disasters (and potentially a couple dozen more billions that could be thrown on to the amount courtesy of the 2008 storms) pumping an unprecedented bonanza into state coffers, the flip side of course is that the state lost economic productivity from the storms that now is getting translated into drops in both personal and corporate income totals. Another short-term factor will be the income tax cut kicking in next year.

While oil prices will continue to provide some cushion, by fiscal year 2009-10 deficits will loom at current revenue levels. Further, time must be bought for the economic benefits of the tax cuts to kick in and to accomplish other restorative tasks like health care spending restructuring in the state. Finally, national forces such as an economic slowdown due to consequences of government overregulation of the mortgage industry and future potential pitfalls such as bad policy that could come from Democrat Party control of the White House and Congress need factoring in Louisiana budgeting decisions.

With that in mind, a budget surplus on the order of at least $500 million appears likely for the concluded fiscal year, and maybe a higher amount for this fiscal year. If so, given current levels, most of the 2007-08 fiscal year surplus should be pumped into the Budget Stabilization Fund to ward off a 2009-10 deficit (one third of the fund could be used to fund current recurring expenditures, which would be close to that $500 million figure, every two years). Perhaps the remainder could be used for a very few vital capital projects around the state, but any surplus for this the 2008-09 fiscal year should be first deposited into the fund, then used to pay off debt, freeing interest payments for future use.

Stopgap measures such as these can buy the necessary time by cushioning the budget for tax cuts engineered and/or eventually supported by Gov. Bobby Jindal to kickstart the economy and bring in more revenue to government. As long as the state saves this bonanza and doesn’t go on a spending spree for capital and other nonrecurring items any looming crisis can be avoided.

29.9.08

Recusal reform, not public financing, best for judicial races

As has been argued previously, Louisiana would do well to move away from elected state judges to a system where executive appointments with legislative oversight occur, similar to the federal system. But that’s not going to happen anytime soon, if at all. Therefore, one problem that would remain is the campaign finance apparatus that some argue can influence a judge’s decisions. Yet one proposed solution would make the situation even worse.

One issue that has cropped up in the 1st Supreme Court district contest is whether some system of public financing of judicial candidacies should be enacted. While a study that argued there was association between contributions received by the state’s Supreme Court justices and their decision-making was hampered by methodological problems, the theory that this could happen certainly is valid. A study issued by one of the leading legal professional association recommended public funding as an alternative.

One potential model for public financing would be North Carolina’s, where with initial demonstration of some ability to raise funds, after that threshold public financing would take over for the general election. Small donations have risen while overall totals spent have dropped in half, and it enjoys public support.

But regardless of procedure, the basic fundamental error in public financing is it uses government dollars to fund speech and abrogates the right of free speech when limits are placed upon how much can be spent if imposed on candidates. At the federal level this past term the U.S. Supreme Court made that very statement, although state elections can be governed differently and Louisiana could amend its Constitution to permit it.

Yet even this aside, regulating political speech in this way harms the process and creates a solution more intrusive than need be. Judicial contests in particular are the lowest-information races that make it difficult on voters to understand candidate preferences and differences. Artificially determining the amount of money that may be spent by candidates prevents fuller amounts of data about candidates from being dispersed by campaigns, cheapening the process and disserving voters.

Better, there is a solution that permits dissemination of greater amounts of information without treading on free speech rights – recusal requirements. The law could be changed to mandate that if a case has any connection of a donor (of at least a certain amount in a certain time span) to a sitting member of the judiciary – the donor himself, his family, or any business in which he has a significant ownership – either as a party or acting on behalf of a party, for constitutional and certain civil and criminal matters that judge must recuse himself from the case.

This would dramatically decrease donations coming from legal firms whose hopes in donations could be favorable treatment for their clients. It also would do the same for interests who think their cases my end up in front of a judge. As a result, the influence of those who think they can “buy” a decision will be reduced to a minimal level, while donors who give not with any expectation of a payback through the legal system will not be discouraged to express political speech through their contribution choices.

By all means get rid of the elective system of judges first, but if that’s not possible, changing recusal rules brings a scalpel to deal with the problem rather than a chainsaw taken to constitutional rights.

28.9.08

Why does identified unneeded health spending continue

Surely there is something more to the Joint Legislative Committee on the Budget’s not approving cost reductions deemed necessary by Louisiana’s Department of Health and Hospitals, potentially leaving a deficit in the state’s budget that only will grow without state action.

Secretary Alan Levine as required by law noted the Medicaid account deficit and reported it to the Committee, along with suggestions to deal with it. His recommendations to reduce the deficit by $79 million of the $81 million shortfall were to forgo starting a pilot program to revamp service delivery to the indigent, end duplicate payments to nursing home patients with hospice care (because hospice care largely duplicates the care in the nursing homes), end duplicate payments to hospitals, end overpayment on some services to hospitals (because of current rules allowing payment for services not clinically indicated by national criteria), and to rearrange rural hospital funding.

Senators on the panel thought it unwise to alter financing for rural hospitals, arguing that their uncompensated care dollars would be inappropriately cut. But on this and other items, state Rep. Jim Fannin, chairman of the House Appropriations Committee (this joint committee is made up of key individuals from legislative leadership and money committee members), wanted no action because he wasn’t sure the deficit figure was correct.