Teacher Tenure/Unions/Government/Pensions

[macrockett]

online.wsj.com/article/SB20001424052748704454304575081804053775266.html#printMode
FEBRUARY 23, 2010 opinion

Preaching Choice in Obama's Hometown
By WILLIAM MCGURN

'The voucher movement seems to have been born, or seems to have been started as a Republican idea. That's the way Democrats look at it. That's the way black lawmakers look at it. This is a Republican idea. This is what the Republicans want to push on us. . . . We don't seem to see public schools not working in your area."

The speaker was the Rev. James Meeks, explaining black resistance to vouchers. The venue was a sold-out lunch put on by the Illinois Policy Institute (IPI). The result? Something new in Windy City politics: a powerful black Democrat reaching out to a free-market think tank to force reform on the city's most hidebound institution—the Chicago public schools.

James T. Meeks does not fit the usual stereotype of a voucher advocate. To begin with, he is founder and senior pastor of Salem Baptist Church of Chicago, the largest African-American church in Illinois. He serves as executive vice-president for Jesse Jackson's Rainbow/PUSH Coalition. Oh, yes: He is a Democratic state senator who chairs both his chamber's education committee and the legislature's Black Caucus.

A few years back, Barack Obama named him someone he looked to for "spiritual counsel." Now the man they call "the Reverend Senator" has done the unthinkable: He's introduced a bill to provide vouchers for as many as 42,000 students now languishing in Chicago's worst public schools. He tells me he thinks he can get enough Democrats on his coalition to get it through.

"I'm banking on the difficulty Democrats will have telling these parents, 'No, you're not going to have choice. Your kids are locked into these failing schools.'"

Right now, national attention on Illinois is focused on the possibility that Republicans may take the U.S. Senate seat once held by Mr. Obama. But Collin Hitt, the IPI's director of education, notes Mr. Meeks may have the more far-reaching narrative.

"There is an irony that the highest-profile push for vouchers in America today is in Illinois, while the highest-profile opposition to vouchers is also from Illinois," says Mr. Hitt. The latter reference is to President Obama, Education Secretary Arne Duncan, and Sen. Richard Durbin, Illinois Democrats whose opposition pulled the plug on a popular, bipartisan voucher program in our nation's capital.

As his remarks make clear, Mr. Meeks appreciates the disincentives that make vouchers such a political orphan. Pro-voucher Republicans open themselves to a double whammy: opposition from suburban voters who are happy with their kids' public schools and equate vouchers with bringing blacks into those schools; and only tepid support from African-Americans who are wary of GOP intentions. Meanwhile, any Democrat who dares to back vouchers will immediately find himself at war with the most powerful and unforgiving special interest in his party: the teachers unions.

That's what Mr. Meeks meant when he spoke to IPI of the difficulty of Republicans using "our statistics"—that is, failure rates for inner-city public schools—to promote "a Republican idea" for largely black schools. He's also frank about why he's embraced that idea after years of banging the drum for more money. As he recently told one local TV interviewer, the money isn't there. With Illinois $13 billion in debt, parents do not have "ten years to wait for Democrats to fund schools."

Certainly he's not a man to hold his tongue. He speaks frankly about elected officials "owned by unions." About politicians who send their own kids to private schools—while opposing the choice for the less fortunate. In 2006, he gained notoriety for language in a fiery sermon that appeared directed at Chicago Mayor Richard Daley.

"We don't have slave masters," he said. "We got mayors. But they still the same white people who are presiding over systems where black people are not able . . . to be educated."

Whether this was fair to Mayor Daley, it's hard to contest the point about the school system. Even conceding there was progress during the years Mr. Duncan served as CEO of the Chicago public schools—especially on charters—half the students who make it to ninth grade still won't see a high school diploma. Mr. Meeks invokes an even more dispiriting statistic: Only eight out of 100 Chicago public school students will graduate from a four-year college.

"If the American Dream includes sending your kids to college," he asks, "what is Chicago saying to these parents?" Good question.

In the last presidential campaign, Americans responded to a candidate who spoke of a new politics of hope and promised to reach across the aisle. It hasn't turned out that way in Washington. But back in the city the president and his education secretary left behind, Mr. Meeks believes he has found a reform that will give Chicago school parents change they can believe in.

Write to [e-mail]
Printed in The Wall Street Journal, page A17

Copyright 2009 Dow Jones & Company, Inc.

[macrockett]

www.forbes.com/2010/02/22/public-pension-fund-personal-finance-siedle-underfunding_print.html

Forbes.com


Expert View
Nation's $2.3 Trillion In Public Pensions Run By Dummies
Edward Siedle, 02.22.10, 3:00 PM ET

Here's a scary financial fact: The nation's $2.3 trillion in state and local pension assets are currently a half-trillion dollars short of what they'll need to pay out promised benefits. Here's an even scarier financial fact: These funds are overseen by people who lack basic money management skills, who are frequently swayed by political pressure--and who are counting on hiking your taxes to fill the breach if they come up short.

The massive under-funding was highlighted in a report from the Pew Center on the States last week. It estimated that state governments face a $1.5 trillion gap between the pension, health care and other retirement benefits promised to public employees and the money set aside to pay for them.

The $2.3 trillion in pension assets alone is $500 billion short of what's needed, Pew figures. These estimates of funding gaps are likely on the low side, because they don't account for the massive investment losses pension funds suffered during the second half of 2008.

In Pictures: Eight Steps To A Secure Retirement
www.forbes.com/2010/02/11/401k-fees-match-personal-finance-8-steps-to-secure-retirement_slide_2.html

The Pew report also doesn't address how much is being lost to ill-informed investment choices. Just how ill-informed the nation's public pension overseers are was, oddly, highlighted by someone who set out to educate them three years ago.

"Public Fund Investing for Dummies," a book that is as timely today as ever, is the work of Jim Koetting, a money manager at Public Fund Investment Strategies in St. Charles, Mo. The 44-page work is a no-nonsense member of the well-known Dummies series that purports to educate the nation's public pension officials on the ABCs of sound financial management--a task that the author himself concedes is a chilling reflection of the state of public pension fund management.

"If you polish nails or shampoo dogs in most states you have to be licensed, but there are no licensing or educational requirements whatsoever to manage a $100 million public fund," says Koetting. "It makes no sense."

The book's introduction reminds public fund trustees and employees that they have an important job managing "other people's money."

To think this is self-evident is to misunderstand who's riding roughshod over public pensions. The average public fund trustee, it bears noting, was appointed not because of his financial acumen but because he is a political or public union heavyweight--or because nobody else wanted the job.

"Face it," writes Koetting, "finding better ways to invest your funds might not be at the top of your to-do list." His advice: Write a plan, build a strategy and find competent help in order to maximize opportunities in a public budget as well as picking investments to match that strategy." Among the factors he says prevent public pension officials from finding better ways to invest other people's money:

1. You don't have time
2. You don't have investment education or background
3. You're stuck in a rut
4. Someone else handles "that"
5. Poor habits
6. You procrastinate
7. You're making the wrong assumptions
8. Your investment policy is out of date
9. You have no written investment plan

Ouch. Are people operating on this level the ones you think should be entrusted with other people's money?

Not to worry. The next 40 pages explains some basic investments, like bonds, commercial paper and money market funds. The carnage left behind by dummy public fund investing are legion.

One example came to light last week when a state audit of the North Carolina state treasurer's office found million-dollar and billion-dollar mistakes in reporting investment results for the most recent fiscal year. The audit said the errors occurred "because new staff prepared the information, and their work was not effectively supervised and reviewed." Maybe these dummies should have read the book before going to work on a multi-billion dollar portfolio.

Back in 2007, when Koetting put his book on sale at the Government Financial Officers Association (GFOA) national conference, his booth was inundated with thousands of requests for copies. Perhaps taxpayers should take comfort in the book's popularity. Self-awareness is, after all, a precursor to improvement.

I, for one, still cling to the belief that certain tasks require skill and training. Handling trillions in public funds is one task that, in my opinion, should not ever be left to dummies.

In Kentucky a proposal has been floated that would require two of the three members appointed by the governor to the Kentucky Retirement Systems board to possess 10 years of "investment experience." Defining what constitutes "investment experience" apparently is contentious. If passed, the new requirement would be one of the few of its kind.

If all that weren't bad enough, the neophytes overseeing public pension plans are not subject to comprehensive federal or state regulation or to the strictures that the Securities and Exchange Commission imposes on private sector money managers. Making matters worse still, Wall Street's most talented hucksters regard public pensions as possibly the dumbest institutional investors around and compete fiercely to foist on them the latest in over-priced money management services and toxic assets.

Whoever came up with the idea that trillions of dollars should be handed over to funds managed by political hacks and government employees--with taxpayers on the hook for any deficits--must have been out of their minds. It was a prescription for disaster, and a disaster is what we face.

Edward Siedle is a former SEC attorney and the president of Benchmark Financial Services.

And who is on the hook for any shortfall, under current law?

Have a drink...

[refbasics]

Feb 23, 2010 11:02:14 GMT -6 macrockett said:

www.forbes.com/2010/02/22/public-pension-fund-personal-finance-siedle-underfunding_print.html

Forbes.com


Expert View
Nation's $2.3 Trillion In Public Pensions Run By Dummies
Edward Siedle, 02.22.10, 3:00 PM ET

Here's a scary financial fact: The nation's $2.3 trillion in state and local pension assets are currently a half-trillion dollars short of what they'll need to pay out promised benefits. Here's an even scarier financial fact: These funds are overseen by people who lack basic money management skills, who are frequently swayed by political pressure--and who are counting on hiking your taxes to fill the breach if they come up short.

The massive under-funding was highlighted in a report from the Pew Center on the States last week. It estimated that state governments face a $1.5 trillion gap between the pension, health care and other retirement benefits promised to public employees and the money set aside to pay for them.

The $2.3 trillion in pension assets alone is $500 billion short of what's needed, Pew figures. These estimates of funding gaps are likely on the low side, because they don't account for the massive investment losses pension funds suffered during the second half of 2008.

In Pictures: Eight Steps To A Secure Retirement
www.forbes.com/2010/02/11/401k-fees-match-personal-finance-8-steps-to-secure-retirement_slide_2.html

The Pew report also doesn't address how much is being lost to ill-informed investment choices. Just how ill-informed the nation's public pension overseers are was, oddly, highlighted by someone who set out to educate them three years ago.

"Public Fund Investing for Dummies," a book that is as timely today as ever, is the work of Jim Koetting, a money manager at Public Fund Investment Strategies in St. Charles, Mo. The 44-page work is a no-nonsense member of the well-known Dummies series that purports to educate the nation's public pension officials on the ABCs of sound financial management--a task that the author himself concedes is a chilling reflection of the state of public pension fund management.

"If you polish nails or shampoo dogs in most states you have to be licensed, but there are no licensing or educational requirements whatsoever to manage a $100 million public fund," says Koetting. "It makes no sense."

The book's introduction reminds public fund trustees and employees that they have an important job managing "other people's money."

To think this is self-evident is to misunderstand who's riding roughshod over public pensions. The average public fund trustee, it bears noting, was appointed not because of his financial acumen but because he is a political or public union heavyweight--or because nobody else wanted the job.

"Face it," writes Koetting, "finding better ways to invest your funds might not be at the top of your to-do list." His advice: Write a plan, build a strategy and find competent help in order to maximize opportunities in a public budget as well as picking investments to match that strategy." Among the factors he says prevent public pension officials from finding better ways to invest other people's money:

1. You don't have time
2. You don't have investment education or background
3. You're stuck in a rut
4. Someone else handles "that"
5. Poor habits
6. You procrastinate
7. You're making the wrong assumptions
8. Your investment policy is out of date
9. You have no written investment plan

Ouch. Are people operating on this level the ones you think should be entrusted with other people's money?

Not to worry. The next 40 pages explains some basic investments, like bonds, commercial paper and money market funds. The carnage left behind by dummy public fund investing are legion.

One example came to light last week when a state audit of the North Carolina state treasurer's office found million-dollar and billion-dollar mistakes in reporting investment results for the most recent fiscal year. The audit said the errors occurred "because new staff prepared the information, and their work was not effectively supervised and reviewed." Maybe these dummies should have read the book before going to work on a multi-billion dollar portfolio.

Back in 2007, when Koetting put his book on sale at the Government Financial Officers Association (GFOA) national conference, his booth was inundated with thousands of requests for copies. Perhaps taxpayers should take comfort in the book's popularity. Self-awareness is, after all, a precursor to improvement.

I, for one, still cling to the belief that certain tasks require skill and training. Handling trillions in public funds is one task that, in my opinion, should not ever be left to dummies.

In Kentucky a proposal has been floated that would require two of the three members appointed by the governor to the Kentucky Retirement Systems board to possess 10 years of "investment experience." Defining what constitutes "investment experience" apparently is contentious. If passed, the new requirement would be one of the few of its kind.

If all that weren't bad enough, the neophytes overseeing public pension plans are not subject to comprehensive federal or state regulation or to the strictures that the Securities and Exchange Commission imposes on private sector money managers. Making matters worse still, Wall Street's most talented hucksters regard public pensions as possibly the dumbest institutional investors around and compete fiercely to foist on them the latest in over-priced money management services and toxic assets.

Whoever came up with the idea that trillions of dollars should be handed over to funds managed by political hacks and government employees--with taxpayers on the hook for any deficits--must have been out of their minds. It was a prescription for disaster, and a disaster is what we face.

Edward Siedle is a former SEC attorney and the president of Benchmark Financial Services.

And who is on the hook for any shortfall, under current law?

Have a drink...

-----------------------------------
...."The average public fund trustee, it bears noting, was appointed not because of his financial acumen but because he is a political or public union heavyweight.."

two things come to mind:

1) yes, we know the newly appointed head can be an financial ignoramus... but what about the long term staff.. surely they should be responsible for what is occuring in the department?

2) who from the unions is the 'liaison' or 'watcher' of the investing of the funds to be invested by the state... what were they doing??? just 'crossing their fingers' that it would all work out in the end?

i'd like the NAMES of all these people... and THEY should be FIRED for malfeasance, don't pass GO, and no collecting of a state pension, or union pension.

[macrockett]

Agree with # 1 refbasics (i assume that is referendum basics). Re #2, do they really need to care? We, the taxpayer, have guaranteed their pensions by law! Imagine that.

[refbasics]

Feb 23, 2010 16:21:46 GMT -6 macrockett said:

Agree with # 1 refbasics (i assume that is referendum basics). Re #2, do they really need to care? We, the taxpayer, have guaranteed their pensions by law! Imagine that.

--------------
yes,i agree, do they really need to care?? philosophically, in essence, the pension problem will cause future hardships for all of us.. even the children and grandchildren of pensioners... school districts will hire less teachers(larger classes), we'll have less police, and fire personnel, etc... the pensioners' children & grandchildren will be working at mc donalds instead of in the public sector; and they'll be funding their grandparents' pensions thru their measly wages!
---
ed for spelling... didn't want a teacher or administrator out there to think i couldn't spell 'philosophically'

[macrockett]

Feb 23, 2010 16:51:14 GMT -6 refbasics said:

yes,i agree, do they really need to care?? philosophically, in essence, the pension problem will cause future hardships for all of us.. even the children and grandchildren of pensioners... school districts will hire less teachers(larger classes), we'll have less police, and fire personnel, etc... the pensioners' children & grandchildren will be working at mc donalds instead of in the public sector; and they'll be funding their grandparents' pensions thru their measly wages!

That's the way it works as we all know refbasics, and to add insult to injury we are finally going to be smacked in the face with the lie of social security, that all along it was really just another tax whereby the recipients will be "means tested". Only those who "need" will receive. Compare this with the public sector pension and health benefits for life.

As Obama convenes the "Deficit Reduction Commission", co-chaired by Alan Simpson (career politician), House 64-77, Wyoming Senator from 1979-1997, and Erskine Bowles, (mostly private sector financial work) we will all see what the truth really is.

You can get a taste here, where Simpson seems to have a memory lapse that he participated in the sham for over 30 years.

www.cnbc.com/id/15840232?video=1421510966&play=1

[asmodeus]

That's the way it works as we all know refbasics, and to add insult to injury we are finally going to be smacked in the face with the lie of social security, that all along it was really just another tax whereby the recipients will be "means tested". Only those who "need" will receive. Compare this with the public sector pension and health benefits for life.

Interesting point...if SS benefits will be means tested, then public pension benefits should be as well.

I have a feeling I'll be subject to a triple whammy...little or no SS benefits, no public pension, and a decimated 401k that will earn less than 1% annually (for every million dollars, it'll throw off a whopping $10k per year).

Someone (I think on Bloomberg) made a good comparison between Barack Obama and James Buchanan...our 15th president stood by as our country dissolved into civil war. This time it will be private industry workers vs. union/govt employees.

[macrockett]

Feb 23, 2010 21:04:27 GMT -6 asmodeus said:

That's the way it works as we all know refbasics, and to add insult to injury we are finally going to be smacked in the face with the lie of social security, that all along it was really just another tax whereby the recipients will be "means tested". Only those who "need" will receive. Compare this with the public sector pension and health benefits for life.

Interesting point...if SS benefits will be means tested, then public pension benefits should be as well.

I have a feeling I'll be subject to a triple whammy...little or no SS benefits, no public pension, and a decimated 401k that will earn less than 1% annually (for every million dollars, it'll throw off a whopping $10k per year).

Someone (I think on Bloomberg) made a good comparison between Barack Obama and James Buchanan...our 15th president stood by as our country dissolved into civil war. This time it will be private industry workers vs. union/govt employees.

Re social security asmodeus, it isn't if, it will happen. Ditto for medicare. I suspect in the near future public pensions will be radically altered as well. Seems to me the "smaller government" mantra of the Tea Party people will encapsulate that issue. Bottom line, the numbers don't add up for virtually any of the government program or entitlement.

You comment about Obama comparison to Buchanan came from a blogger named Eric Salzman per Bloomberg www.businessweek.com/news/2010-02-12/man-up-obama-or-make-way-for-president-palin-david-reilly.html

This mess has been brewing for some time now and, imo, Obama just happens to be in the wrong place at the wrong time. Blame should be attributed to our two party system of government, again imo, as ideology was substituted for issues, the later being continually kicked down the road, and the focus being on Republicans and Democrats bickering and self-indulgence.

[Arch]

Feb 23, 2010 22:09:05 GMT -6 macrockett said:

Feb 23, 2010 21:04:27 GMT -6 asmodeus said:

Interesting point...if SS benefits will be means tested, then public pension benefits should be as well.

I have a feeling I'll be subject to a triple whammy...little or no SS benefits, no public pension, and a decimated 401k that will earn less than 1% annually (for every million dollars, it'll throw off a whopping $10k per year).

Someone (I think on Bloomberg) made a good comparison between Barack Obama and James Buchanan...our 15th president stood by as our country dissolved into civil war. This time it will be private industry workers vs. union/govt employees.

Re social security asmodeus, it isn't if, it will happen. Ditto for medicare. I suspect in the near future public pensions will be radically altered as well. Seems to me the "smaller government" mantra of the Tea Party people will encapsulate that issue. Bottom line, the numbers don't add up for virtually any of the government program or entitlement.

You comment about Obama comparison to Buchanan came from a blogger named Eric Salzman per Bloomberg www.businessweek.com/news/2010-02-12/man-up-obama-or-make-way-for-president-palin-david-reilly.html

This mess has been brewing for some time now and, imo, Obama just happens to be in the wrong place at the wrong time. Blame should be attributed to our two party system of government, again imo, as ideology was substituted for issues, the later being continually kicked down the road, and the focus being on Republicans and Democrats bickering and self-indulgence.

The Sneetches became more interested in the Stars upon Thars and lost sight of what the purpose of the elected seat they held was all about.

[southsidesignmaker]

macrockett , You hit the nail on the head, the entitlement programs did not add up 15 years ago, they do not add up now, and if they are not radically changed they are in jeopardy of extinction in the future.

[asmodeus]

Feb 23, 2010 22:38:28 GMT -6 southsidesignmaker said:

macrockett , You hit the nail on the head, the entitlement programs did not add up 15 years ago, they do not add up now, and if they are not radically changed they are in jeopardy of extinction in the future.

But look at Greece...everyone knows their budget is screwed due to profligate spending, and yet the public workers are striking (and poised to riot) in protest of any cuts.

[EagleDad]

Feb 24, 2010 8:25:44 GMT -6 asmodeus said:

Feb 23, 2010 22:38:28 GMT -6 southsidesignmaker said:

macrockett , You hit the nail on the head, the entitlement programs did not add up 15 years ago, they do not add up now, and if they are not radically changed they are in jeopardy of extinction in the future.

But look at Greece...everyone knows their budget is screwed due to profligate spending, and yet the public workers are striking (and poised to riot) in protest of any cuts.

Good for them - being all gathered in one place it should make communicating the cuts easier.

My point being that those receiving the cuts naturally aren't going to like it, whether it is Greece, or public employees in Illinois.

Have a bitch session if it makes you feel better, but at the end of the day you have to put your big boy pants on and face the real world.

Welcome to 2010, and before you come to me for one with your hand out for more of my money in taxes/revenue, there's going to be some significant cuts. The sooner that is realized by those "entitled", the we'll be able to move forward.

[doctorwho]

Feb 24, 2010 9:45:10 GMT -6 EagleDad said:

Feb 24, 2010 8:25:44 GMT -6 asmodeus said:

But look at Greece...everyone knows their budget is screwed due to profligate spending, and yet the public workers are striking (and poised to riot) in protest of any cuts.

Good for them - being all gathered in one place it should make communicating the cuts easier.

My point being that those receiving the cuts naturally aren't going to like it, whether it is Greece, or public employees in Illinois.

Have a bitch session if it makes you feel better, but at the end of the day you have to put your big boy pants on and face the real world.

Welcome to 2010, and before you come to me for one with your hand out for more of my money in taxes/revenue, there's going to be some significant cuts. The sooner that is realized by those "entitled", the we'll be able to move forward.

This is so true.

In 1999 my company suddenly ceased it's traditional pension plan ( as did many companies in the late 90's) - even for those with 1-24 years already in the biz. It sucked totally but the alternative was laying off massive %'s of the workforce.
-- So retirement became a non - entity for a few hundred thousand workers world wide and we all hated it, bitched and complained etc. We were 'promised' - or the E word. Also gone were benefits after retirement and health benefits we paid zero for as late as the early 90's now cost $600-$700/month contribution.
Well the options were this simply, shut the hell up and keep your job , or if you couldn't take it, leave the company. Very few chose the latter but that option was always open.

the public employees have been sheltered from the real world he last decade + , because the taxpayers were/are on the hook for their pensions ( and benefits). Reality sometimes is a cold slap on the face. and the reality now is we cannot afford the structure as is... so either a whole lot of people are going to lose their jobs or changes have to be made- and now.

I'm not telling the teachers or anyone else it doesn't suck to lose what you have, it does, I know as do most of us.

[twhl]

I think that any School District including D204 needs to reevaluate how they determine which teachers are to be given pink slips. Tenure alone as the absolute criteria is absurd. No one including the teachers can guarantee that a tenured teacher is potentially twice as effective or valuable as one who does not have as many years under their belt. In fact they in many cases are more valuable because they were " learning " about real life cases while they were happening in the real world and real world discussions and business cases. They are also more inclined to use current technology like the "magic blackboards" than lets say a tenured teacher just putting in their time. They generally have more energy and have not developed bad habits. I am not trying to slight our senior staff but telling us that a teacher is more/less qualified because they haven't been around long enough is somewhat discriminatory and just not true. Somewhere along the line they have equated length of service with quality and skill - not always so.

You have to think that for every (1) old teacher we keep we have to let (2) non-tenured teachers go. Which means larger classrooms and higher pupil to teacher ratio. That can be avoided.

Lastly I think that paying a Kindergarten or 1st Grade teacher $100k or more is insane. Nuff said.

[Arch]

Tenured vs non tenured is about as effective as choosing just those that wore brown shoes that day.

I have a long list of tenured teachers in this district that my kids have encountered that are burnt out and ineffective.
I also have a long list of both tenured and non tenured teachers that have not forgotten why one becomes a teacher.