From time to time the issue of judicial selection comes up, and it surfaced again with a speech by Louisiana Supreme Court Chief Justice Pascal Calogero threw some cold water on the idea of at least partial appointment of Louisiana state jurists. Of course, Calogero, having been elected four separate times to the Court might be forgiven for not advocating the system that got him there which, in fact, is one of the rarest used in our states for the Supreme Court, fixed election by district.
Basically, there are three ways to select judges among the states, with variations to each. First, there is election, either partisan or (as in Louisiana) nonpartisan in nature. Second, there is appointment, either by a majoritarian branch of government or a combination of both, with or without a nonpartisan panel to vet appointments to forward to the appointing institution. Third, there is the combination of appointment/retention (the “Missouri Plan,” named after the first state to implement it), which generally features an appointment followed up with a retention election some years in the future, essentially a referendum on the candidate.
The group to which Calogero spoke, the Louisiana Organization for Judicial Excellence, basically supports a form of the Missouri Plan. There are arguments both ways on the election and appointment methods that this form tries to take from both their best aspects. Elections promote greater citizen control over judges, while appointing reduces the possibility that judges and candidates would allow themselves to be swayed on the bench by special interests, possibly in a corrupt fashion, and may improve the quality of judges relative to those who get there by only having to win enough votes.
Politically and structurally, Louisiana may seem particularly susceptible to an uneven quality of judges. With such a politicized environment as is Louisiana’s, the fact that judges may hear cases involving campaign supporters and donors to his surrogate campaign (by law, judges cannot raise money or ask for explicit support for campaign purposes, so supporters will form their own independent committees to do it on the judicial candidate’s behalf) may interfere with judicial impartiality (one reason perhaps why both the Louisiana Trial Lawyers’ Association opposes this, because it would lose undue influence over the composition and decisions of the state judiciary).
The LOJE plan would have certain interest groups and representatives of the bar select three names to forward to the governor who would pick one, with choices made mindful of demographic representativeness. Subsequently, a retention election would occur – a plan similar to the model plan set forward by the American Judicature Society.
Specifying the groups, as the LOJE has done, probably is not the most flexible way of doing things. Rather, a commission could be set up with gubernatorial appointees requiring Senate confirmation, with members staggered serving short, non-recurring terms. The amendment specifying this could mandate some members being sitting jurists, and the remainder evenly divided between Republican and Democrats, with perhaps a political independent or two thrown in for good measure. This would assure for a good mix of interests without any one having great influence.
While those against any appointive component to judicial selection might argue the sacrifice of democracy is more than the assurance that an appointive system would produce higher quality judges, it should be obviously that such a system still reduces the chances of inferior judges being elected, where the only qualification for service is how many votes you can win (and citizens will get their chance to vote in a retention election). In a state such as this with its checkered political history, we need all the assurance of quality we can get.
16.3.05
Unwitting Blanco gets rolled by Castro
Either Gov. Kathleen Blanco is having fun with us, or she’s absurdly politically naïve.
I think it’s got to be the second, or else she never would have been in the position to make us think it was the first. That’s the only conclusion that can be drawn from the moment she decided to take her quixotic trip to Cuba to pitch Louisiana products even as she neglected to go on business trips to other less-mysterious foreign locales with much larger potential contracts.
Let me count the ways in which Blanco showed a stunning ignorance about the trip (and why did she have to have some state legislators in tow with her – don’t they have a budget to balance back home?)
I think it’s got to be the second, or else she never would have been in the position to make us think it was the first. That’s the only conclusion that can be drawn from the moment she decided to take her quixotic trip to Cuba to pitch Louisiana products even as she neglected to go on business trips to other less-mysterious foreign locales with much larger potential contracts.
Let me count the ways in which Blanco showed a stunning ignorance about the trip (and why did she have to have some state legislators in tow with her – don’t they have a budget to balance back home?)
15.3.05
SB 7 is a start toward retirement fund fiscal sanity
The Public Affairs Research Council often comes across as a nagging grandmother because it keeps harping on the same things -- because the state doesn't act on so many of its usually-sensible prescriptions. So if you’ve read this before, don’t tune it out – because as of now, the problem is worth $12 billion.
It’s most recent report again highlights the fact that, as of now, the state’s 13 retirement systems have $37 billion in liabilities but only $25 billion funded. A constitutional amendment passed in 1989 was supposed to solve the problem but did not mandate a schedule on which payments towards the proper level of funding would be made. As such, as the target date of 2029 approaches payments get increasingly onerous: last year, the payment was $560 million (three years of this and I-49 easily could have been finished without even spending any federal dollars) – and it was all interest without any reduction of the short principal.
PAR makes several suggestions but two are particularly noteworthy:
Consolidating administration (the four state systems initially and ultimately all systems) and creating a consolidated system board with public members in the majority
Creating a new, less costly defined benefit pension plan for new state employees and educational personnel that would encourage longer career service
And it emphasizes the latter by noting:
Liberal eligibility requirements encourage early retirement and result in the use of DROP programs and rehiring of retirees to keep people on the job. Efforts to create a rational new system for future employees have floundered.
Since it is a foundation and not an advocacy group it cannot lobby specific legislation, but surely SB 7 would meet with its and others who support these measures approval. State Sen. Walter Boasso’s bill would exactly discourage early retirement, reduce financial incentives to do so, and bring some rationality to the two largest funds, the Teachers State Retirement of Louisiana and Louisiana State Employees’ Retirement System.
Predictably the TRSL opposes the bill because it changes the governing structure and argues that an overly-generous retirement system is compensation for “low” pay. Simply, the separate systems, one for educators, and the other for state employees, are having the same threatened future underfunding problems as several other public employee retirement systems in the state because they are too generous. The current system allows people as young as their early 50's to draw retirement for most at 75% of the average of their highest three years of salary (and then many of these people go right back to work full-time elsewhere). You could be in your early 60's and draw 100 percent. I don't know of many, if any, pension systems in the private sector that are so generous.
The bill would clamp down on future employees only. It would raise slightly the contribution level and essentially force everybody at least to work until 60 for full vesting in the system (leaving earlier would cause a refund of contributions compounded at a low rate of return). It also will probably slightly lower the level at which benefits are computed by spreading out the average over five years. This will put the systems on more solid ground.
But perhaps the major reason why the TRSL has come out against the bill is that it drastically changes the governance of it. Instead of a board selected mainly by the members/retirees, the majority on the new board (which would combine both TRSL and LASERS) will be comprised of elected officials or their designees and nominees from the for-profit and non-for-profit sectors, taking control out of the hands of the organizations.
Because of the huge stash in the funds these two boards administer, and their inherent inefficiencies and past records in managing them, it's probably best that there be more popular oversight of them. While there may some trepidation at giving politicians a small increase in representation on the board, the fact that over a third of the new board will be of investment professionals more than offsets this concern. This is a necessary reform to ensure solvency of the funds and increasing the chances of professional management of them.
This bill will deal with the problem now, and reduce the future liabilities of state taxpayers. At least it’s a start and deserves passage.
It’s most recent report again highlights the fact that, as of now, the state’s 13 retirement systems have $37 billion in liabilities but only $25 billion funded. A constitutional amendment passed in 1989 was supposed to solve the problem but did not mandate a schedule on which payments towards the proper level of funding would be made. As such, as the target date of 2029 approaches payments get increasingly onerous: last year, the payment was $560 million (three years of this and I-49 easily could have been finished without even spending any federal dollars) – and it was all interest without any reduction of the short principal.
PAR makes several suggestions but two are particularly noteworthy:
Consolidating administration (the four state systems initially and ultimately all systems) and creating a consolidated system board with public members in the majority
Creating a new, less costly defined benefit pension plan for new state employees and educational personnel that would encourage longer career service
And it emphasizes the latter by noting:
Liberal eligibility requirements encourage early retirement and result in the use of DROP programs and rehiring of retirees to keep people on the job. Efforts to create a rational new system for future employees have floundered.
Since it is a foundation and not an advocacy group it cannot lobby specific legislation, but surely SB 7 would meet with its and others who support these measures approval. State Sen. Walter Boasso’s bill would exactly discourage early retirement, reduce financial incentives to do so, and bring some rationality to the two largest funds, the Teachers State Retirement of Louisiana and Louisiana State Employees’ Retirement System.
Predictably the TRSL opposes the bill because it changes the governing structure and argues that an overly-generous retirement system is compensation for “low” pay. Simply, the separate systems, one for educators, and the other for state employees, are having the same threatened future underfunding problems as several other public employee retirement systems in the state because they are too generous. The current system allows people as young as their early 50's to draw retirement for most at 75% of the average of their highest three years of salary (and then many of these people go right back to work full-time elsewhere). You could be in your early 60's and draw 100 percent. I don't know of many, if any, pension systems in the private sector that are so generous.
The bill would clamp down on future employees only. It would raise slightly the contribution level and essentially force everybody at least to work until 60 for full vesting in the system (leaving earlier would cause a refund of contributions compounded at a low rate of return). It also will probably slightly lower the level at which benefits are computed by spreading out the average over five years. This will put the systems on more solid ground.
But perhaps the major reason why the TRSL has come out against the bill is that it drastically changes the governance of it. Instead of a board selected mainly by the members/retirees, the majority on the new board (which would combine both TRSL and LASERS) will be comprised of elected officials or their designees and nominees from the for-profit and non-for-profit sectors, taking control out of the hands of the organizations.
Because of the huge stash in the funds these two boards administer, and their inherent inefficiencies and past records in managing them, it's probably best that there be more popular oversight of them. While there may some trepidation at giving politicians a small increase in representation on the board, the fact that over a third of the new board will be of investment professionals more than offsets this concern. This is a necessary reform to ensure solvency of the funds and increasing the chances of professional management of them.
This bill will deal with the problem now, and reduce the future liabilities of state taxpayers. At least it’s a start and deserves passage.
14.3.05
Some electoral system changes for the better
Election calendar changes are in the air, and that’s mostly a good thing.
Recently, the state Republican Party executive committee approved a change to move up by a month the party’s presidential preference primary for 2008 (which means almost certainly its Central Committee will approve). It would take legislative action for this to become reality (which means Democrats also would have to approve of moving theirs), unless the GOP wanted to go with a caucus on that date instead.
The impetus for this is that as the dynamics of nomination races continue to grant greater rewards to early delegate winners, states that award delegates later find their contests increasingly meaningless. Thus, more and more states are rushing to front-load their delegate selections in the process. Last week, the national Democrats took on this issue themselves.
Recently, the state Republican Party executive committee approved a change to move up by a month the party’s presidential preference primary for 2008 (which means almost certainly its Central Committee will approve). It would take legislative action for this to become reality (which means Democrats also would have to approve of moving theirs), unless the GOP wanted to go with a caucus on that date instead.
The impetus for this is that as the dynamics of nomination races continue to grant greater rewards to early delegate winners, states that award delegates later find their contests increasingly meaningless. Thus, more and more states are rushing to front-load their delegate selections in the process. Last week, the national Democrats took on this issue themselves.
13.3.05
Bush needs to address straw man opponents on Social Security reform
Pres. George W. Bush comes and goes from Shreveport, leaving a number of newly-persuaded supporters of his plans to reform Social Security. As long as he stays on message, detractors should fail in their attempts to stop progress.
Even though the president hasn’t submitted a formal plan, his opponents concerning his trip to Louisiana have begun the wholesale manufacture of straw man arguments to try to distract and deflect the public intellect from understanding the problem as his plan. Presented here are several of them, and why they fail.
Here we have two for one. Although the main purpose of this author’s appeal, from the leftist Economic Policy Institute, is to argue that Social Security now as constituted does not discriminate racially against blacks, he also introduces two specious arguments against the plan. First, he notes that the chunk of Social Security spending that goes to the disabled portion of payments makes up a considerable portion of payouts and implies reforms put this at risk. Second, he applies the same argument to survivor benefits.
Regarding the first, the president has not suggested that the disabled portion of benefits be altered in any way. Note that the only conceptual difference between the disabled and the retiree portions of Social Security is that the disabled part can be triggered at a much earlier age (however, one must qualify with a sufficient 10-year work history and get medical proof that disability prevents one from working on a basis that could support oneself financially). The same trends will buffet this portion of Social Security as for retirees, but the same philosophical solution as for the other (transitional costs to make up the trust deficit plus voluntary shifting of funds to privatized accounts that in the aggregate will earn more, meaning greater funds left over to spread among those not shifting some of theirs to keep the system solvent).
While there is no change scheduled for the disabled, survivors actually will benefit more under the president’s plan. The dirty secret the author doesn’t reveal is that now, unless the recipient already is receiving payments, survivors don’t get them. Further, the 10-year qualifying work history requirement means someone could pay in for nine years, nine months, then dies, and all that contribution is swallowed into the system with the survivors never seeing a penny of it back. Under the president’s plan, from the moment any money is put into a privatized account, the survivors can get it back at any time.
Then there are these criticisms (interspersed among these letters), both parroting the Democrat mantra that there’s not really a problem. One argues the trust fund will not be “depleted” sometime around 2042, but only that prior to then any excess in the fund (presuming it has all been put back; see below) will have been drained and by this time outflows will be larger than inflows into the program, with the latter only about 80 percent of the former.
All true, but the author conveniently fails to point out that when this point is reached, the several hundred million dollars per year deficit being run cannot be allowed to exist. So, one or all of several things must happen, (1) cut overall benefits by raising the retirement age, (2) cut monthly benefits, (3) raise taxes on those working to support retirees, or (4) raise taxes on everybody (realistically, only the middle class and above), in order to make up the deficit.
(This gives us insight into the liberal Democrat mentality. To them, Social Security is not a crisis, but an opportunity, using the deficit as a method to justify even greater confiscation of the people’s wealth into the hands of the government. Never forget the liberal mentality is to control the people’s resources, thus their liberty, so they can control the people.)
The other asserts an easy solution to the problem, simply to remove the $90,000 cap on earning taxable to Social Security. The way the system works now, eventual benefits (assuming one puts in 10 years and makes it to retirement age; fails on both of these and you get nothing back) come in proportion to wages, but capped at $90,000. By getting rid of this ceiling, from some people much higher amounts will get paid into the system, reducing the looming deficit.
But then these advocates fail to take the next logical step, by raising also the eventual benefits received by these higher payers in proportion to the additional resources they put into the system, an alteration which will not do anything to change the system’s monetary problems. In proposing only increased payroll taxes but not increased benefits for those contributors, they perform a neat trick: they turn a system designed as insurance into one of wealth redistribution (once again exposing the liberal mind’s true agenda here). For that reason, this “solution” is unacceptable.
Then we have the comments of the brilliant Sen. Mary Landrieu, who has complained elsewhere that the transitional costs are not included by the president in his plan and here that an unspecified past “bipartisan” solution proved to work while the president’s ideas won’t.
Well, let me specify what she meant by the bipartisan plan in 1983 which she was afraid to put in print: that was a payroll tax increase, the last hike of 20 since the system’s inception. Once again, Landrieu would rather raise your taxes so she can get her hands on your money than support a system that empowers you as a citizen.
And, of all these straw man arguments, perhaps the biggest is that the president’s plan does not address transitional costs. The costs are those to pay back the amounts borrowed out of the Social Security trust fund by the government and will runs in the hundreds of billions of dollars. But the fact is whether the president’s ideas about Social Security reform ever make it into law, the transitional costs will have to be paid. They have nothing uniquely to do with his plan.
Bush need not concern himself with these flimsy critiques. He just needs to emphasize a plan with the following:
With well over half the public now having their resources invested in ways just like Bush is proposing, if he stays on message, the public will see the disingenuous nature of these critiques and give majority support to his ideas.
10.3.05
Mrs. Blanco goes to Havana, gets snookered
Question: Gov. Kathleen Blanco signs a trade agreement with Cuba. Louisiana producers are promised $15 million in business, Cuba gets the goods. Who loses?
Answer: Kathleen Blanco.
And maybe the Louisiana people and AnPro Trading LLC and Louisiana Rice Mill. This is because the U.S. Department of the Treasury’s Office of Foreign Assets Controls declared last month that all purchases from Cuba must be cash in advance, which was not promised by the Cubans. As the department has clarified, this payment policy conforms to common understandings of international trade finance, and that it strikes a balance between administering sanctions against Cuba and ensuring that the island can continue to receive food and medicine shipments. The exception for food and medicine was granted in 2000.
In other words, this agreement may be worthless, unless Cuba changes its practice and supplies cash up front (if it even has the cash, debatable given its wretched economy – the typical Cuban makes $12 a month). On the other hand, Blanco has earned the undying enmity of ethnic Cubans in Louisiana for striking a deal that they believe will perpetuate the totalitarian dictatorship of Fidel Castro.
Answer: Kathleen Blanco.
And maybe the Louisiana people and AnPro Trading LLC and Louisiana Rice Mill. This is because the U.S. Department of the Treasury’s Office of Foreign Assets Controls declared last month that all purchases from Cuba must be cash in advance, which was not promised by the Cubans. As the department has clarified, this payment policy conforms to common understandings of international trade finance, and that it strikes a balance between administering sanctions against Cuba and ensuring that the island can continue to receive food and medicine shipments. The exception for food and medicine was granted in 2000.
In other words, this agreement may be worthless, unless Cuba changes its practice and supplies cash up front (if it even has the cash, debatable given its wretched economy – the typical Cuban makes $12 a month). On the other hand, Blanco has earned the undying enmity of ethnic Cubans in Louisiana for striking a deal that they believe will perpetuate the totalitarian dictatorship of Fidel Castro.
9.3.05
Blanco's "sin" taxes are convenient, not right
Is the Blanco Administration trying to perfect the art of mixed, disingenuous messages that have caused part of the lack of economic development in the state?
Last year, Gov. Kathleen Blanco got applause for not trying to hold certain programs “hostage” over budget deficits. That is, compared to past administrations (and also the Clinton presidential administration), her forces wouldn’t declare a popular and/or vital program in state government would be cut unless taxes got raised or some other drastic measure occurred.
But on the eve of the legal requirement of budget submission to the Joint Legislative Committee on the Budget 45 days ahead of the beginning of the legislative session, Blanco served notice that certain budget cuts would be “draconian.” Chief of Staff (and Foster Administration holdover) Andy Kopplin suggested the cuts merely are to be “severe.”
This may constitute one part of a campaign to pave more acceptance for “sin” taxes to which the governor continues to grant credibility. Given that perhaps not even half of Louisianans may do any of gambling, or smoking,or boozing (let’s get real here, this is Louisiana) perhaps this tax might even appeal to a majority. Nevertheless, a tax is still a tax, no matter what activity it is on.
In large part, it betrays a mentality akin to former Sen. Russell Long’s favorite aphorism, “don’t tax you, don’t tax me, tax the fellow behind the tree,” without taking into account the consequences of that tax. The largest portion potentially of it would come from gambling, already the activity with the highest tax burden in the state (the only thing perhaps as much being the 66 cents per liter on retail alcohol). As costs of this activity increase, to casinos for example, other pastures begin to look greener and greener.
In addition, money gets diverted out of the private sector (consider the impact a rise in the state’s video draw poker take on small, three-machine businesses some of whom argue they stay afloat only because of the machines) and if there’s any one thing anybody should know about economic development, it’s that money left in the private sector will do a better job of doing this than confiscating these resources and putting them at the disposal of the public sector (although some people still don’t seem to get it).
The other part of this campaign is to try to create linkage between the increased taxes and a perceived popular and/or vital need of the state. Blanco has done so with her statement that enough could be raised from them to give teachers a $1,000 salary boost.
Yet we need to question the assumptions behind this logic. For one, given that there are roughly 50,000 teachers in the state, this would cost $50 million. A review of forecasts for fiscal year 2003-04 totals predicted that tobacco and alcohol taxes combined would bring in only about $117 million not already allocated somewhere else. The bulk of this increase would have to come from the forecasted $680 million from all sources of gambling (assuming all sources are on the table, although the land-based New Orleans casino likely is not). Taking out the casino, we’re talking about an 8 percent increase across the board on all these taxes (and this is using static analysis, assuming the demand for these kinds of behavior do not decrease as a result of higher taxation). Is the Legislature really ready to go as high as a probable 10 percent increase across the “sinful” board?
The other questionable assumption is whether teachers really do need a pay increase. In fact, in a report prepared for the Board of Elementary and Secondary Education, under one scenario the authors questioned the need for a teachers’ salary raise given the objectives of increasing accountability and performance of schools and students (but in this and all other scenarios they noted a minimum hundreds of millions of dollars would be needed for any reform). In another, they did see a need for increasing teachers’ salaries; in both, they saw the real need as additional hiring of teachers.
However, both of these scenarios argued that Louisiana schools were overstaffed in some areas, principally in guidance counselors. Not including benefits, one scenario predicted the elimination of some guidance counselor positions would save $34.5 million, and the other saw savings of $55.8 million.
Given Blanco’s keenness on giving raises, why not restructure first to save and transfer savings into teachers’ salaries, instead of keeping things the way they are and asking for people to cough up more money to government? While the fiscally prudent thing to do, no doubt Blanco and legislators (and hundreds of school board members) would feel intimidated by irate ex-guidance counselors seeking retribution at the ballot box.
Which is why Louisiana has such a tax-and-spend history. Instead of doing the right thing, its leaders do the convenient thing. Which is what Blanco is doing by proposing these new taxes.
Last year, Gov. Kathleen Blanco got applause for not trying to hold certain programs “hostage” over budget deficits. That is, compared to past administrations (and also the Clinton presidential administration), her forces wouldn’t declare a popular and/or vital program in state government would be cut unless taxes got raised or some other drastic measure occurred.
But on the eve of the legal requirement of budget submission to the Joint Legislative Committee on the Budget 45 days ahead of the beginning of the legislative session, Blanco served notice that certain budget cuts would be “draconian.” Chief of Staff (and Foster Administration holdover) Andy Kopplin suggested the cuts merely are to be “severe.”
This may constitute one part of a campaign to pave more acceptance for “sin” taxes to which the governor continues to grant credibility. Given that perhaps not even half of Louisianans may do any of gambling, or smoking,
In large part, it betrays a mentality akin to former Sen. Russell Long’s favorite aphorism, “don’t tax you, don’t tax me, tax the fellow behind the tree,” without taking into account the consequences of that tax. The largest portion potentially of it would come from gambling, already the activity with the highest tax burden in the state (the only thing perhaps as much being the 66 cents per liter on retail alcohol). As costs of this activity increase, to casinos for example, other pastures begin to look greener and greener.
In addition, money gets diverted out of the private sector (consider the impact a rise in the state’s video draw poker take on small, three-machine businesses some of whom argue they stay afloat only because of the machines) and if there’s any one thing anybody should know about economic development, it’s that money left in the private sector will do a better job of doing this than confiscating these resources and putting them at the disposal of the public sector (although some people still don’t seem to get it).
The other part of this campaign is to try to create linkage between the increased taxes and a perceived popular and/or vital need of the state. Blanco has done so with her statement that enough could be raised from them to give teachers a $1,000 salary boost.
Yet we need to question the assumptions behind this logic. For one, given that there are roughly 50,000 teachers in the state, this would cost $50 million. A review of forecasts for fiscal year 2003-04 totals predicted that tobacco and alcohol taxes combined would bring in only about $117 million not already allocated somewhere else. The bulk of this increase would have to come from the forecasted $680 million from all sources of gambling (assuming all sources are on the table, although the land-based New Orleans casino likely is not). Taking out the casino, we’re talking about an 8 percent increase across the board on all these taxes (and this is using static analysis, assuming the demand for these kinds of behavior do not decrease as a result of higher taxation). Is the Legislature really ready to go as high as a probable 10 percent increase across the “sinful” board?
The other questionable assumption is whether teachers really do need a pay increase. In fact, in a report prepared for the Board of Elementary and Secondary Education, under one scenario the authors questioned the need for a teachers’ salary raise given the objectives of increasing accountability and performance of schools and students (but in this and all other scenarios they noted a minimum hundreds of millions of dollars would be needed for any reform). In another, they did see a need for increasing teachers’ salaries; in both, they saw the real need as additional hiring of teachers.
However, both of these scenarios argued that Louisiana schools were overstaffed in some areas, principally in guidance counselors. Not including benefits, one scenario predicted the elimination of some guidance counselor positions would save $34.5 million, and the other saw savings of $55.8 million.
Given Blanco’s keenness on giving raises, why not restructure first to save and transfer savings into teachers’ salaries, instead of keeping things the way they are and asking for people to cough up more money to government? While the fiscally prudent thing to do, no doubt Blanco and legislators (and hundreds of school board members) would feel intimidated by irate ex-guidance counselors seeking retribution at the ballot box.
Which is why Louisiana has such a tax-and-spend history. Instead of doing the right thing, its leaders do the convenient thing. Which is what Blanco is doing by proposing these new taxes.
8.3.05
Keith Hightower, Bill Clinton's younger brother
Appropriate to yesterday's posting, a little musing is in order.
Keith Hightower rose to Shreveport political prominence as Bill Clinton geared up his run for the White House, leading many observers then and since to remark upon a physical similarity between the two. That’s not all they share: they approach political conflict in a way which make both very divisive individuals in government.
Within a couple of years as president, Clinton got into real trouble, presiding over a disastrous 1994 midterm election as he let his liberal, big government instincts get the better of his natural inclination to acquire power. In order to resurrect himself to win reelection, he did two things, submit to the Republican Congress on some issues (tax cuts, balanced budget, welfare reform) but on others to call them names and disparage them every chance possible even if the criticisms had no truth to them. Thus, when the GOP tried to curtail the rate of growth of government spending, Clinton and the Democrats, aided by a willing media, called these “cuts” in government spending. As a result, the Republicans were said to want to starve people, to throw old people out on the street, to despoil the environment, etc., when none of it had any basis in reality whatsoever.
It appears that Mayor Hightower takes a similar tack when it comes to opponents of his administration’s actions. The obvious example is on the convention center hotel issue. In a recent interview, he called opponents either bitter about being unemployed in city government (an apparent jibe at Fax-Net Update editor and former official in the previous mayoral administration Lou Burnett), or opposing only for partisan purposes (seemingly insulting the three Shreveport City Council Republicans), and the rest because they have “miserable” lives. A related explanation he often has given for opposition is that those against it are against “progress.” Still another is that opponents are “desperate” because they have private business interests at heart.
None of these psychoanalytic explanations acknowledges the real and compelling reasons why not to put taxpayers on the hook for $52 million or thereabouts:
Keith Hightower rose to Shreveport political prominence as Bill Clinton geared up his run for the White House, leading many observers then and since to remark upon a physical similarity between the two. That’s not all they share: they approach political conflict in a way which make both very divisive individuals in government.
Within a couple of years as president, Clinton got into real trouble, presiding over a disastrous 1994 midterm election as he let his liberal, big government instincts get the better of his natural inclination to acquire power. In order to resurrect himself to win reelection, he did two things, submit to the Republican Congress on some issues (tax cuts, balanced budget, welfare reform) but on others to call them names and disparage them every chance possible even if the criticisms had no truth to them. Thus, when the GOP tried to curtail the rate of growth of government spending, Clinton and the Democrats, aided by a willing media, called these “cuts” in government spending. As a result, the Republicans were said to want to starve people, to throw old people out on the street, to despoil the environment, etc., when none of it had any basis in reality whatsoever.
It appears that Mayor Hightower takes a similar tack when it comes to opponents of his administration’s actions. The obvious example is on the convention center hotel issue. In a recent interview, he called opponents either bitter about being unemployed in city government (an apparent jibe at Fax-Net Update editor and former official in the previous mayoral administration Lou Burnett), or opposing only for partisan purposes (seemingly insulting the three Shreveport City Council Republicans), and the rest because they have “miserable” lives. A related explanation he often has given for opposition is that those against it are against “progress.” Still another is that opponents are “desperate” because they have private business interests at heart.
None of these psychoanalytic explanations acknowledges the real and compelling reasons why not to put taxpayers on the hook for $52 million or thereabouts:
- No private firm believed the project feasible enough to risk its own capital. At first, Hightower explained this away by saying a Tax Incremental Financing district would bring costs low enough to make it profitable. When state lawmakers were so skeptical of the idea that they refused to create legislation to enable the TIF, Hightower said government still could do it profitably because of taxes not needing to be paid on it. Since Caddo Assessor Charles Hennington questioned whether the property would be exempt, Hightower has said nothing on the matter.
- No feasibility study ever has shown the venture to be profitable. The closest thing to one, by the Louisiana Tech College of Administration and Business Economic Research Division, explicitly showed it would not be. But for his presentation to the state’s Bond Commission to get bonds issued for the project, Hightower took this study and on the fly changed numbers around in a way its authors did not endorse, in order to win approval.
- Riverboat gambling (oops, “gaming”; the state is supposed to suppress gambling) revenues have fallen by over 10 percent this January compared to January, 2004, in this area as a direct result of competition to the west, and Texas continues to make noises about legalizing even more gambling. This aspect would be the linchpin of attracting convention business to Shreveport.
- The convention industry itself is in decline as cost and travel concerns plus a rapidly-growing glut of facilities leave supply growing much faster than demand.
- As a still-pending lawsuit points out, there is a genuine legal question whether the $12 million the state has thrown in can be used for building a hotel.
Despite being unable to satisfactorily address any of these concerns, check out the rhetoric used by Hightower referring to these in the latest newsletter he released:
MORE GOOD NEWS: We will be moving forward with the Convention Center Hotel project and begin selling the bonds within the next month in order to start construction in the spring.
The Louisiana State Bond Commission rejected Senator Max Malone’s request to rescind its approval of the sale of $40 million in revenue bonds and once again overwhelmingly affirmed the construction of our Convention Center Hotel with an 11 – 2 vote. Representatives Mike Powell and Wayne Waddell joined Senator Malone is his opposition, but their testimony was unconvincing to State Treasurer John Kennedy and the Bond Commission. You can rest assured that as your mayor I will be in Baton Rouge again if necessary, to fight any attempt by Senator Malone or Representative Powell to take away any money from Shreveport.
Our goal with the convention center project has been to further enhance the economic development of Shreveport by increasing its marketability, thereby creating jobs and a better quality of life for its citizens. This administration has survived a desperate barrage of negative attacks and rumors that have been found over and over again to be baseless and without fact. There really were no surprises with the Naysayers, who were at first against the funding mechanism before they had ever seen what it was. Then after that hurdle they did not trust the study of the project and so they spent more tax-payer money to fund another study with their own chosen consultants. Their study came back with more positive numbers than the original study, again substantiating an even a greater reason for funding the hotel project.
With all of their claims being proven false, they now demand that revenue bonds be voted on by the public. You might find it interesting to know that these same Naysayers vote on Revenue Bonds for the funding of projects on a regular basis without the approval of the citizens.
One might conclude that these Naysayers find it more comfortable and politically less risky to play it safe rather than to have the courage and fortitude to creatively nurture economic plans and see them turn into a reality. We could celebrate this victory over those who sit back offering only criticism and roadblocks, with no real answers or positive solutions to the economic problems that we face. However harboring negative attitudes toward one another is not in the best interest of our city and we all have much to gain by moving our city forward and working together to solve the problems that we face.
Why doesn’t Hightower admit to the very obvious legitimacy of these, instead seeking to denigrate the messengers who cast doubt on his plans? Logically, the only reason could be that Hightower himself cannot defend his own proposal, and therefore he must have other motives for trying to force this through over public opposition (as captured in a poll a couple of months ago) – motives it has been suggested that lie in his desire for higher elective office and to provide preferments and patronage to his supporters. Which is nothing close to the enlightened governance that Shreveport deserves.
7.3.05
Shreveporters expect service while Hightower grabs headlines
One frequent complaint raised about Shreveport mayor Keith Hightower in reference to the building of a publicly-financed hotel for the in-construction convention center (and some bring in the center itself as part of the criticism) is that he prefers to pursue grand, expensive schemes that probably won’t even accomplish their stated purposes while ignoring the little things in governing that makes a city work well.
Turns out more evidence supporting this view of Hightower was revealed today in two separate incidences. The Times ran a story on the long-standing problem of the city’s inability to get code violators on property standards to pay fines which multiplies when the city then uses taxpayers’ dollars to clean up the properties itself. It turns out the city is as much to blame for sloppy record-keeping as the intransigence and selfishness of the violators. How hard would it be to correct that? Let me put it this way, if the mayor cared to have discovered all of this and dealt with it, the problem would have been solved by now. But he seems disinterested in such unglamorous service to the citizenry.
More seriously, it seems that the reason why water rate increases, which have occurred to schedule nearly a 50 percent rise over five years by 2007, were phased in more quickly than planned, came as a result of an accounting error. This adds insult to injury: the rapid increase had to happen because of the quickly-deteriorating water infrastructure neglected over a series of years that could have been dealt with long ago.
While the problem predates the Hightower Administration, the fact is had Hightower acted immediately upon being elected six years ago, the problem would not have been as bad. Rate increases would have been smaller; indeed, they may have been minimal had the city tried a bonding strategy right then and there. Instead, it kept its powder dry, waiting to spend almost as much as could have solved the problem then years later on building a convention center and a hotel ….
But it’s not just bad decision-making evident here but lack of willingness to take responsibility for this. Operational Services blames Finance and vice-versa. It would be so refreshing to have Hightower just step up and say this problem happened and festered on his watch, and that he was to blame.
Don’t count on it; this administration has made the evasion of responsibility an art form. When it was discovered that sloppiness in accounting apparently was permitting individuals with connections to Hightower to receive extremely favorable treatment regarding a city lending program, the only reaction that came from Hightower was a week later to suspend the program and whine that most of the problem loans allegedly didn’t come during his watch as mayor.
It would be so refreshing when these happen, and they seem to be happening with increasing frequency, for Hightower to say that the buck stops with him, that he should have known of these things (which had gone on for years during his terms; for example, why weren’t red flags raised when borrowers stopped repaying their loans and the borrowers immediately pursued for payments?), and that he’ll do his best to rectify them quickly and to be more vigilant in the future. But that never has happened, and don’t hold your breath on it happening this or any of time in the future (because such problems seem likely to pop up time and time again with this administration’s track record).
Why does he seem to ignore overseeing (or overseeing properly those who oversee) the dull, mundane, unexciting, but absolutely necessary things of city government, and instead concentrate on the headline-grabbing, big-ticket expenditures that allow the city to award huge contracts creating lots of City Hall-dependent jobs? Does it, despite his being term-limited as mayor, have something to do with his future plans?
Turns out more evidence supporting this view of Hightower was revealed today in two separate incidences. The Times ran a story on the long-standing problem of the city’s inability to get code violators on property standards to pay fines which multiplies when the city then uses taxpayers’ dollars to clean up the properties itself. It turns out the city is as much to blame for sloppy record-keeping as the intransigence and selfishness of the violators. How hard would it be to correct that? Let me put it this way, if the mayor cared to have discovered all of this and dealt with it, the problem would have been solved by now. But he seems disinterested in such unglamorous service to the citizenry.
More seriously, it seems that the reason why water rate increases, which have occurred to schedule nearly a 50 percent rise over five years by 2007, were phased in more quickly than planned, came as a result of an accounting error. This adds insult to injury: the rapid increase had to happen because of the quickly-deteriorating water infrastructure neglected over a series of years that could have been dealt with long ago.
While the problem predates the Hightower Administration, the fact is had Hightower acted immediately upon being elected six years ago, the problem would not have been as bad. Rate increases would have been smaller; indeed, they may have been minimal had the city tried a bonding strategy right then and there. Instead, it kept its powder dry, waiting to spend almost as much as could have solved the problem then years later on building a convention center and a hotel ….
But it’s not just bad decision-making evident here but lack of willingness to take responsibility for this. Operational Services blames Finance and vice-versa. It would be so refreshing to have Hightower just step up and say this problem happened and festered on his watch, and that he was to blame.
Don’t count on it; this administration has made the evasion of responsibility an art form. When it was discovered that sloppiness in accounting apparently was permitting individuals with connections to Hightower to receive extremely favorable treatment regarding a city lending program, the only reaction that came from Hightower was a week later to suspend the program and whine that most of the problem loans allegedly didn’t come during his watch as mayor.
It would be so refreshing when these happen, and they seem to be happening with increasing frequency, for Hightower to say that the buck stops with him, that he should have known of these things (which had gone on for years during his terms; for example, why weren’t red flags raised when borrowers stopped repaying their loans and the borrowers immediately pursued for payments?), and that he’ll do his best to rectify them quickly and to be more vigilant in the future. But that never has happened, and don’t hold your breath on it happening this or any of time in the future (because such problems seem likely to pop up time and time again with this administration’s track record).
Why does he seem to ignore overseeing (or overseeing properly those who oversee) the dull, mundane, unexciting, but absolutely necessary things of city government, and instead concentrate on the headline-grabbing, big-ticket expenditures that allow the city to award huge contracts creating lots of City Hall-dependent jobs? Does it, despite his being term-limited as mayor, have something to do with his future plans?
6.3.05
The joke is florist licensing, the punchline is ...?
This is so perfect. I joke with my State and Local Politics and Louisiana Government classes as an example of how state regulation has run riot and how a small interest can protect and enrich itself at the expense of the state is Louisiana’s incredibly backwards florist licensing (both retail and wholesale!).
Unfortunately, taxpayers, consumers and those wishing to get into the business are the butts of the joke. Taxpayers are one, because they have to pay to support the activities of the Horticulture Commission in regards to setting up and administering the procedures. True, there’s a fee associated with taking the test which probably in the end generates more revenue than cost but just the bureaucracy and state control involved in an intangible sense probably outweighs any pecuniary benefit.
Consumers are another, because what this regime does is creates an artificial barrier to entry to the profession. By limiting supply, demand held constant, prices are pushed up with excess profits (which can be created only when governments permits or assists in creating monopsonistic conditions) going to the “licensed” florists. For the same reason, petitioners into the industry are discriminated against because they are not permitted to practice the profession (who entry would increase supply and would enable prices to come down).
If we allow government to regulate anything, there must be a high burden of proof. It should take place only when some unmistakable, nontrivial threat to public health or safety may occur as a result of negligent actions. If you want the definition of an absurd argument, check out the supporters’ view of the licensing requirement, that people might get stuck with inferior floral arrangements. Is this a matter of public health or safety? And who says the licensing would prevent that? Most tellingly, the marketplace is smart enough to drive inferior florists out of business in short order. Don’t these nannies think the public is smart enough to spot better and worse arrangement, and force their operators to price accordingly (actually, probably most of them benefit from the excess profits generated by the licensing).
While I sympathize with the Institute for Justice’s position on this issue (an organization, by the way, which often has performed invaluable service in the courts in safeguarding people’s liberties), unfortunately the courts in this country expanded government’s power to interfere in the economy ways beyond its moral boundaries back in the 1930s. It will take state legislative action to solve for this.
That was tried last year and, despite heavy House support, the Senate Agriculture Committee spiked the idea. Which is why I wrote at the beginning of this posting this was just so perfect, because in recent months this and all else that is wrong about Louisiana’s good-old-boy network, business-as-usual government have become symbolized in one person. His department technically oversees the Horticulture Commission, he sits on it, and he rides herd over the Agriculture Commission (that’s its short name). He’s the perfect punchline for this sorry escapade.
Unfortunately, taxpayers, consumers and those wishing to get into the business are the butts of the joke. Taxpayers are one, because they have to pay to support the activities of the Horticulture Commission in regards to setting up and administering the procedures. True, there’s a fee associated with taking the test which probably in the end generates more revenue than cost but just the bureaucracy and state control involved in an intangible sense probably outweighs any pecuniary benefit.
Consumers are another, because what this regime does is creates an artificial barrier to entry to the profession. By limiting supply, demand held constant, prices are pushed up with excess profits (which can be created only when governments permits or assists in creating monopsonistic conditions) going to the “licensed” florists. For the same reason, petitioners into the industry are discriminated against because they are not permitted to practice the profession (who entry would increase supply and would enable prices to come down).
If we allow government to regulate anything, there must be a high burden of proof. It should take place only when some unmistakable, nontrivial threat to public health or safety may occur as a result of negligent actions. If you want the definition of an absurd argument, check out the supporters’ view of the licensing requirement, that people might get stuck with inferior floral arrangements. Is this a matter of public health or safety? And who says the licensing would prevent that? Most tellingly, the marketplace is smart enough to drive inferior florists out of business in short order. Don’t these nannies think the public is smart enough to spot better and worse arrangement, and force their operators to price accordingly (actually, probably most of them benefit from the excess profits generated by the licensing).
While I sympathize with the Institute for Justice’s position on this issue (an organization, by the way, which often has performed invaluable service in the courts in safeguarding people’s liberties), unfortunately the courts in this country expanded government’s power to interfere in the economy ways beyond its moral boundaries back in the 1930s. It will take state legislative action to solve for this.
That was tried last year and, despite heavy House support, the Senate Agriculture Committee spiked the idea. Which is why I wrote at the beginning of this posting this was just so perfect, because in recent months this and all else that is wrong about Louisiana’s good-old-boy network, business-as-usual government have become symbolized in one person. His department technically oversees the Horticulture Commission, he sits on it, and he rides herd over the Agriculture Commission (that’s its short name). He’s the perfect punchline for this sorry escapade.
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