Retirement reform advances compelled by fact, logic

You have to hand it to the obstructers of beneficial change in Louisiana, they don’t go down without throwing everything they can into the fight. But with arguments the quality of which is like bringing a knife to a gun fight, it’s no accident that they lose.

Such was the case with objections to HB 61 by state Rep. Kevin Pearson, which would have state employees hired after this year have their retirement benefits, contributed from their salaries and an employing agency proportion, put into a cash balance plan. This would allow the state to invest money for these plans and essentially have any losses covered by the state. Current employees could opt in. For the employee such a plan may allow for greater periodic payments after retirement and is portable; for the taxpayer-funded employer, it means less future strain on retirement benefit payments that have already lead to a nearly $19 billion gap in unfunded accrued liabilities that will cost the citizenry about $1 billion extra this year alone to cover.

Legislative opponents supporting special interests invested in the current system tried to disparage the reform, without success. In part, this was due to the conceptual weaknesses of their argumentation.

Legislators gripe about system they made, refuse to fix

We hear the same complaints again and again from legislators who talk a great game but when it comes to action are gutless wonders when it comes to budgeting and spending in Louisiana. If they’d just get it together, the public could revel in their silence with the problem solved.

That problem is, in times of fiscal stress as now, the state’s propensity is to conduct “funds sweeps” for “one-time money” in order to balance the budget. The state has hundreds of dedications of revenues and fees-for-service tucked into law and the Constitution, making for mostly hands off concerning about three-quarters of all monies coming into the treasury from state sources. Unencumbered funds go essentially only to three areas, with the majority to higher education and health care, so if forecast deficits for next year’s budget fall, the money only comes out of this quarter of the funding, disproportionately affecting these areas.

To soften the blow of further reductions on these areas, one strategy is to pass a bill that raids some of the hundreds of separate funds, which accumulate surpluses they probably never would use. That happens because the dedication set up for them is indiscriminate, by definition making their purposes equally as important as all others similarly situated but more important than areas without dedications, even if in the real world some state functions clearly should have much higher priority and need more funding than others subject to dedication. Thus the vacuuming procedure, a rebalancing of sorts to correct imbalances created by budgeting by autopilot.

LSU System must hire with changed environment in mind

It’s a wonder my former uber-boss, ex-Louisiana State University System President John Lombardi, lasted as long as he did, both in his job and in good health, as no doubt his case of athlete’s mouth from sticking his foot in it so many times was severe. But it’s good riddance because, in the final analysis, he did not have the best interests of higher education of Louisiana in mind – not the kind of person needed going forward.

On some issues, Lombardi was on target. Early in his reign, he sent around to the campuses a reprint of a column exhorting the increase of standards in instruction, definitely swimming against the currents in higher education as indicated by grade inflation and with a general weariness by faculty members to hold the line on quality when so many pressures, some external to them, some internal and part of the faculty culture, exist to let things slide.

He also correctly noted the intuitively obvious that students, who by far are the biggest beneficiaries of their educations, ought to pay more of that and relieve taxpayers of that burden to some degree (Louisiana still is well below the national average in average tuition and fees charged, despite having one of the higher per capita costs of higher education). The inherent redistributionist mentality only slowly disappearing from the consciousness of the state’s political culture that lies behind the low tuition concept fundamentally is at odds with increasing student achievement, because students who invest more of their own resources into education are more likely to work harder at it, and this discourages marginal students whose lack of ability or work ethic for it from wasting taxpayer dollars.

If dotty at times, LA GOP still better off than Democrats

Dysfunctional behavior, while more costly to Louisiana’s Democrats, is not its sole province. At the same time their rivals gave us a demonstration of this, Louisiana’s Republicans proved they could do the same.

Recently, the rapidly-declining Democrats met to choose new quadrennial leaders. As the compelling nature of conservatism has gained greater awareness among Louisiana’s population, which has led to the party’s increasingly-impoverished electoral status, rather than to try to select someone willing to co-opt some conservative ideas, instead they chose as a leader an even shriller, more doctrinaire liberal, guaranteeing the party difficulty in halting a slide towards policy-making irrelevancy.

Minority parties have a much reduced margin for error when they try to exercise power. Majority parties have much greater latitude in this regard, able to afford more mistakes or embarrassment coming from those associated with it. The machinations regarding, results of, and reactions to this past weekend’s Republican caucuses will provide a tiny test of this proposition.