NH Bill Would Create New Public Pension System

January 23, 2012 10:15 AM

(AP)  CONCORD, N.H. — Last year, Republican lawmakers shifted more of New Hampshire's public pension costs onto workers to ease employers' expenses. Now, they're proposing a parallel plan for new employees that lacks a guaranteed lifetime benefit.

State Sen. Fenton Groen, a Rochester Republican, is sponsoring legislation to create a mandatory defined contribution plan for public employees hired starting Nov. 1. Such plans are relatively rare in state governments, though more states are looking at them as a way to shift the financial risks of traditional defined benefit plans from employers to employees.

Under Groen's proposal, employees and their employers would have to contribute to a system similar to a 401(k) where their money is invested and their retirement payment depends on their total investments when they retire.

Groen is confident workers will be able to retire with a comparable retirement. Their retirement payment will depend on the amount of risk the worker is willing to accept in his investments, he said.

"If he chooses to accept a higher level of risk, then the average return is likely to be higher," he said.

The existing system, which provides employees with a guaranteed retirement payment based largely on the employee's years of service and final salary, would not change, though labor unions representing workers worry the shift to a new system will weaken the old system over time.

The existing system covers more than 50,000 active and nearly 26,000 retired state and municipal workers, teachers, police and firefighters. It is funded by contributions from employees and employers and by the return on the $5.9 billion fund's investments.

Labor unions believe as more workers are required to enter the new system and workers in the old system retire, too few active workers and their employers will be paying into the old system to support it. They argue a recession like the one experienced in 2008 would hurt the pension fund's investments, putting pressure on employers to boost contributions or close the system.

"We're not howling at the moon. Clearly the thought is the old system will collapse," said Rick Trombly, director of policy and advocacy for the National Education Association of New Hampshire.

Labor groups are fighting Groen's proposal as too risky. They argue workers won't know what they can count on for a pension.

"Now it will be: A, they assume all the risk; and B, it will be an unknown number; and C, the risk that it will not be enough for them to live on," said Trombly.

Labor groups point to a study by the New Hampshire Retirement System's consultants that concluded transitioning to a defined contribution system will be more expensive for employees and employers than maintaining the current system. The study said that closing the old defined benefit system to new members would change its demographic makeup and require changing to a more conservative investment strategy. That would mean less investment income and require higher employer contributions.

The existing public pension system is only 57 percent funded. The study estimates the unfunded liability would increase from $4.3 billion to $5.5 billion if the system is closed to new members and a parallel defined contribution system implemented.

Colin Manning, spokesman for Gov. John Lynch, said that given "the estimates of a significant increase in costs, the governor has some very real concerns about the legislation."

Over the past few years, the Legislature has taken a series of steps to fully fund the system. A portion of employers' rates go toward funding the unfunded liability gap with a goal of closing it in 26 years. The study said if lawmakers close the existing system to new workers and increase the unfunded liability, employer rates would increase. The gap was created both by employers not paying enough into the system and union-backed withdrawals from the fund to improve pension benefits.

"A key difference between (defined benefit) and (defined contribution) is that the investment risk is borne by the employers in a (defined benefit) plan and by the participants in a (defined contribution) plan," the study said.

New Hampshire AFL-CIO President Mark MacKenzie said he worries that the employees will find themselves facing what millions of other Americans faced when the stock market crashed four years ago. He also questions if enough regulations are in place to protect employees' money.

Under Groen's bill, workers would pay the same amount into both plans. For example, a teacher would pay 7 percent into whichever plan he or she was enrolled in. The employer would pay into each plan as well. Employers also would contribute to the old plan for workers in the defined contribution plan to help close the old system's unfunded liability gap.

Workers would be gradually vested in the new plan over eight years, at which time they would be fully vested.

"After the eighth year, all the money belongs to them and can be taken to another employer," said Groen.

Labor groups who fought last year and failed to block changes to the existing system that increased their contribution rates to ease the costs to employers say they're wary of Groen's proposal. Last year's changes also required newly hired workers to work longer for reduced benefits.

"I think the intent is to set up the defined benefit plan for failure under the guise that the defined contribution plan is better for new workers. I don't think their intent is to do right by workers," said Diana Lacey, president of the State Employees' Association which represents most of the state's roughly 10,500 workers.

Groen disagrees and argues a defined contribution plan ultimately is better for workers because they gain more control over their money. If workers leave public employment, they can take the money with them, he said.

"The money will go out to the employee and not be subject to the whims of politicians seeking to have lower employer rates or unions seeking higher benefits," he said.

© 2012 The Associated Press. All Rights Reserved. 

Buffalo Teachers Are Charging Plastic Surgery To Taxpayers Thanks To This Loophole

Jill Krasny | January 18, 2012

What began as a rider to cover reconstructive surgery in the 1970s has evolved into a perk for teachers wanting "a little work done" at the expense of Buffalo, New York taxpayers. 

The school district foots the entire bill and the teachers taking advantage of the rider aren't on the hook for so much as a co-pay.

But taxpayers are, reports the Buffalo News, and the Board of Education, namely member Christopher Jacobs, isn't pleased. As Jacobs told the paper in October, the way these costs have skyrocketed "smacks of abuse." 

Though Buffalo's teachers earn around $52,000 a year, their "plastic surgery tab (nearly $9 million last year) would pay salaries for 100 educators," wrote Jordan Weissman in the Atlantic. What's more, the millions spent on these surgeries could have spared layoffs that have hampered the district's morale. 

So why is Buffalo footing these costs? 

Part of it has to do with the Triborough Ammendment, a 1982 state law that allows employees working under expired contracts to continue under its terms unless their union negotiates a new agreement with the state, said Weissman. 

In the Buffalo teachers' case, this translates to working under a 2004 contract, with 2.5 percent yearly salary increases—unheard of in this economy—and little incentive to make any changes. 

Said Amber Dixon, the interim superintendent Weissman spoke to: "You get to keep your benefits. You get to keep your cosmetic rider. You get to keep your 2.5% step increase. It makes getting back to the table difficult."

A near-fatal car crash involving a school employee's daughter in 1996 also fortified arguments for keeping the rider at a time when the board wanted to do away with it. 

For now the rider still stands, despite the board's pleading with the union to end it in an effort to retain more jobs.

The union waved away the offer last year, reports Buffalo News, though the Buffalo Teachers Federation president Philip Rumore did agree to return to the issue next year when a more "comprehensive agreement" might be on the table. 

Gov’s Public Pension Bomb

By ERIK KRISS Bureau Chief - NEW YORK POST

Last Updated:5:28 AM, January 18, 2012

Posted:1:50 AM, January 18, 2012

ALBANY — Gov. Cuomo lobbed a political grenade at New York’s powerful public-employee unions yesterday, proposing a radical pension overhaul for future city and state workers as part of his $132.5 billion state budget plan.

Cuomo said the plan would save New York City $30 billion in pension costs over 30 years, while saving $83 billion for the state and local governments outside the city over the same period.

“We can no longer sustain the current pension system,” Cuomo said, citing a projected 185 percent treasury-busting increase in pension costs from 2009 to 2015 if nothing is done.

“This is devastating to the state and the local governments,” he said of the rising costs.

“We need pension reform. We need it desperately.”

Under the proposal, Cuomo would add a new pension tier for new employees that would raise the retirement age from 62 to 65 and increase worker contributions from the current 3 percent to 4 percent for lower wage earners and as much as 6 percent for higher wage earners.

The new pension tier would include an option for 401(k)-style “defined contribution plans.”

New employees would be able to vest after one year — rather than 10 for current state employees — under the defined contribution plan, which would be portable.

“All the private-sector companies are doing it, and the person has the option,” Cuomo said of the 401(k)-style option. “Why wouldn’t you want to give the person the option?”

The governor said the new pension tier would be 50 percent cheaper for government.

Mayor Bloomberg, who has long called on Albany for pension reform, said, “Pension costs are killing us.”

But, he added, “It’ll be a long time before you get any benefit out of this because we’re not hiring anybody new.”

Getting the reform through the Legislature will be a heavy lift, particularly the Democratic-controlled Assembly, where unions have close ties to leaders.

While Senate Majority Leader Dean Skelos (R-LI) predicted, “We’re going to get it done,” Assembly Speaker Sheldon Silver (D-Manhattan) said it remains to be seen “whether one-year vesting is an attraction.”

He acknowledged the option “saves a significant amount of money” and “is significant to some people who may not intend to be in government until they’re age 65.”

Unions gave every sign they plan to fight Cuomo tooth and nail.

Uniformed Firefighters Association President Steve Cassidy charged the new tier would “throw the widows and children of future firefighters killed in the line of duty under the bus.”

Patrolmen’s Benevolent Association President Patrick Lynch said pension reform “would jeopardize the effective delivery” of city police services.

Civil Service Employees Association President Danny Donohue, whose 66,000-member state-worker union swallowed an austerity contract last year with three years of basic wage freezes, called Cuomo’s proposal “an assault on the middle class and a cheap shot at public employees.”

The budget would gradually eliminate increases in the city’s and counties’ costly Medicaid bills — picking up $824 million in costs for New York City over five years.

But Cuomo is tying a promised 4 percent increase in school aid, $805 million statewide, to the approval of teacher-evaluation plans within a year, as first reported by The Post.

The spending increases for health care and schools are funded in large part by $2 billion in new revenue from last month’s hike in taxes on million-dollar earners.

Pension reform is aimed at long-term costs. But yesterday, Cuomo also made more immediate moves to control spending — his new plan is $225 million less than the current budget.

But Cuomo also made good on promises he made last year to boost school aid and health-care spending.

In other cost-cutting moves, Cuomo wants to merge the Lottery Division and Racing and Wagering Board into a new state gaming oversight agency while consolidating and streamlining other agencies and eliminating 25 “inactive” boards and commissions.

Cuomo’s budget proposal also calls for:

* $15 billion in infrastructure projects through $1.3 billion in new and existing state funds, $9 billion in public-authority money — including $5 billion for a new Tappan Zee Bridge — and $12.8 billion in federal aid to leverage $3 billion in private-sector investment.

* Suspending $15 million for a new New York City eviction- and homelessness-revention program until it is reviewed.

* Requiring commercial health insurers to cover early-intervention services.

* Replacing lost federal funds with state money to keep 19,000 child-care slots for working families.

* Creating a federally funded state Health Benefit Exchange to buy and sell health insurance the governor says would insure 1 million more people and cut small business premiums by 22 percent.

NEW YORK POST is a registered trademark of NYP Holdings, Inc.

America’s Atlas Generation – The Forgotten 33%

BY EDITOR, ON JANUARY 9TH, 2012 - unionwatch.org

Much has been made of the 1% vs. the 99%; the “super-rich” vs. the rest of us, who are presumably the hard working, loyal Americans who’ve been left behind. But who are the rest of us, and how does who we are affect how much we pay in taxes, and how we may vote?

The chart below depicts the American electorate divided not into two groups – the 1% vs. the 99%, but four groups – the 1% super-rich, then 20% representing government workers, 46% representing citizens who either pay zero taxes or negative taxes (ala the “earned income credit”), and the remaining 33% who are neither super-rich, government employees, or not paying taxes. One might term this group the forgotten 33%, because no special interest will speak for them. They have neither the numbers nor the financial wherewithal to decisively influence elections.

The choice of colors – red for the 20% political class AND for the 46% entitlement class, is not accidental. These voters have an identity of interests that automatically inclines them to favor more government spending; government workers because more government spending means more job security, higher pay and benefits, and more expansion of their organizations, and citizens who pay no taxes because their economic status is enhanced through receiving entitlements for which they bear no share of the costs. This identity of interests between the political class and the entitled class has created a supermajority of voters in America who have a self-interest in supporting big-government.

Perhaps the most appalling – and unchallenged – fallacy promoted by the big-government supermajority, primarily through their spokespersons in the public sector unions, is that the super-rich are “trying to destroy the middle-class by pitting the private sector workers against the public sector workers.” Nothing could be further from the truth.

The middle class can indeed be represented by the 20% of the population who works for the government, combined with the 33% of the population who works in the private sector and make enough money to pay income taxes. But the similarity ends there. Government workers have pay and benefits that are, on average, twice what private sector workers earn. Their pension funds offer defined retirement benefits that are literally five times better, on average, than what private sector workers collect from social security.

While the government worker union spokespersons want us to believe that Wall Street is trying to divide and conquer the middle class by pitting private sector workers against government workers, the truth is this: Government workers have joined with Wall Street and turned against the private sector taxpayers, because it is in their mutual economic interests to do so. Nothing illustrates this fact more clearly than the existence of nearly $4.0 trillion in government employee pension fund assets, paid for by taxpayers, invested and managed by Wall Street, with taxpayers guaranteeing the returns (if the investments fall short, taxes go up), and government workers guaranteed the defined benefit that allows them to retire, on average, 10-15 years earlier than private sector workers, with pensions that average 3-4 times as much money as social security.

The “super-rich” embody, of course, more financial interests than just those of Wall Street bankers. But Wall Street bankers, who used their bipartisan political influence to over-build America’s financial sector and defer any sort of meaningful regulations that might have introduced competition and accountability into their industry, are the ones who most deserve the ire of the American electorate. They are also the ones who are most co-dependent with the political class, because there is no source of money pouring into Wall Street that comes anywhere close to the hundreds of billions each year that taxpayers have to fork over to the public employee pension funds.

To turn around and suggest that somehow the super-rich are aligned with the forgotten 33% – those middle-class private sector workers who make enough to pay taxes – strains credulity. Both the super-rich as individuals and the super-rich to the extent they are associated with corporations or financial institutions are completely bi-partisan in their political contributions. For that matter, Republicans are only scarcely less addicted to big government programs and higher taxes than Democrats. Many of the super-rich are not capitalists in the most virtuous and productive sense of the word – they aren’t trying to altruistically imagine innovations that will make our lives better, then fighting to convince people to voluntarily purchase these products – they are using their political influence to lock out competitors, access government subsidies, and force people to purchase their products through laws and regulations.

America’s forgotten 33%, those who are neither entitled to avoid all taxes, nor members of the political class who pay no taxes, nor the super-rich, might be called “The Atlas Generation.” They carry the world on their shoulders. Their challenge is daunting – they must convince the political class to support sustainable taxpayer funded benefits under formulas that apply equally to ALL workers, public or private, without relying on Wall Street speculative investments to pay for this. Equally challenging, they must convince the entitled class that there is an alternative to identity politics, the politics of envy, and the cycle of government dependency. And they must convince a critical mass of the politically influential super-rich to embrace and advocate a political economy that nurtures competition instead of crony capitalism.

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The Excellence Gap

Our public schools are shortchanging their best students.

By SOL STERN

From City Journal

If an out-of-control national debt weren't reason enough to worry about America's global competitiveness, here's another. Virtually all education reformers recognize that America's ability to remain an economic superpower depends to a significant degree on the number and quality of engineers, scientists, and mathematicians graduating from our colleges and universities—scientific innovation has generated as much as half of all U.S. economic growth over the past half-century, on some accounts. But the number of graduates in these fields has declined steadily for the past several decades. A report by the Information Technology and Innovation Foundation concludes that "bachelor's degrees in engineering granted to Americans peaked in 1985 and are now 23 percent below that level." Further, according to the National Center for Education Statistics, only 6 percent of U.S. undergraduates currently major in engineering, compared with 12 percent in Europe and Israel and closer to 20 percent in Japan and South Korea. In another recent study, conducted by the Conference Board of Canada, the U.S. scored near the bottom relative to major European countries, Canada, and Japan in the percentage of college graduates obtaining degrees in science, math, computer science, and engineering. It's likely no coincidence that the World Economic Forum now ranks the U.S. fifth among industrialized countries in global competitiveness, down from first place in 2008.

Making matters worse is mounting evidence that America's best students—kids we're counting on to become those engineers, scientists, and mathematicians—have had a drop-off in academic performance over the past decade. A recent Thomas B. Fordham Institute study finds that the country's highest-performing students in the early grades are losing some of that advantage as they move through elementary school and into high school.

Ironically, one reason for their slipping performance is almost certainly the 2002 No Child Left Behind Act, the most significant federal education-reform legislation of the past half-century. Partisan squabbling has stalled congressional reauthorization of NCLB for two years. But NCLB became law thanks to a rare bipartisan consensus that U.S. public schools were failing to turn out high school graduates who could flourish in a technology-based economy. Democrats and Republicans need to reunite and recognize that federal support for elite education—above all, in math and science—is essential for advancing America's economic success.

No Child Left Behind was propelled by a moral imperative best expressed by President George W. Bush's call to overcome the "soft bigotry of low expectations." The new law's "civil rights" component shaped some of its unique features, including holding states and school districts accountable for their success in narrowing racial achievement gaps. Before NCLB, the federal government had sought to achieve some degree of educational equity through the Title I compensatory funding program, which sent nearly $200 billion to the nation's highest-poverty schools over four decades. Title I yielded meager results, however, and suffered from lack of accountability. With NCLB, the federal government took a new, interventionist approach to education reform, requiring states and school districts to meet certain goals and mandates in return for Title I funds. The states henceforth had to conduct annual tests in reading and math for all children in grades three through eight, with the results—broken down by race, sex, and socioeconomic status—made public.

Unfortunately, NCLB also left the door wide open to the corruption of educational standards. The law demanded that all American students be "proficient" in reading and math by 2014 and imposed increasingly onerous sanctions on districts and schools that failed to make adequate progress toward that goal—but then let each state set its own proficiency standard. To look good to the feds and the public, education authorities unsurprisingly lowered standards and found other ways to game the tests (see "Can New York Clean Up the Testing Mess?," Spring 2010).

But NCLB's accountability system led to another distortion, this one harming top students. Because the law emphasized mere "proficiency," rewarding schools for getting their students to achieve that fairly low standard, teachers and administrators had an incentive to boost the test scores of their lowest-performing students but no incentive to improve instruction for their brightest. Robert Pondiscio, communications director for the Core Knowledge Foundation and a former New York City Teaching Fellow, describes how the process worked at his South Bronx elementary school. "Eighty percent of the kids in my fifth-grade class were scoring at the two lowest levels on the state reading and math tests," he recalls. (Each student in New York State receives a test score from 1 to 4, with 1 signifying performance far below grade level, 2 below grade level, 3 grade level, and 4 advanced.) "Early in my teaching career, an assistant principal told me that the kids in my class already scoring a 3 or 4 'are not your problem.' In other words, my goal should be to move the kids scoring at the lower levels up a few points on the scale. I was not specifically ordered to do this, but the message was very clear. My job was to get more kids over the lowest two hurdles, because that's how the school was rewarded for good performance in the city's accountability system."

As a result, Pondiscio says, the few gifted minority students in his class didn't receive any extra attention—attention that could have given them a better chance to pass the rigorous test for admission to one of the city's elite specialized science and math high schools. That's especially sad when you learn that the percentage of black students passing the admissions test for top-ranked Stuyvesant High School has dropped steadily over the past decade. Last year, it fell below 1 percent.

Writing in the Washington Post, California educator Susan Goodkin similarly showed how NCLB's requirements were undermining high achievement in her state. "Teachers must contend with constant pressure to focus their attention simply on bringing all students to proficiency on grade-level standards," Goodkin wrote. "My district's elementary school report card vividly illustrates the overriding interest in mere proficiency. The highest 'grade' a child can receive indicates only that he or she 'meets/exceeds the standard.' The unmistakable message to teachers—and to students—is that it makes no difference whether a child barely meets the proficiency standard or far exceeds it. Not surprisingly, with the entire curriculum geared to ensuring that every last child reaches grade-level proficiency, there is precious little attention paid to the many children who master the standards early in the year and are ready to move on to more challenging work."

And so, in the No Child Left Behind era, America's elite students have often found themselves left behind—or at least taken for granted. "Let's be honest about the trade-offs," said Fordham Institute vice president Michael Petrilli, commenting on the institute's study. "We've been making good progress for kids at the bottom and for poor and minority kids—that's important. It just can't be the only thing that we do."

Though I was among the education writers who enthusiastically supported No Child Left Behind, I should have realized that by focusing almost exclusively on the educationally disadvantaged, yet ignoring the country's future scientists, mathematicians, and engineers, NCLB—despite its framers' best intentions—would damage America's competitiveness. As noble as combating "the soft bigotry of low expectations" is, America's global standing and economic well-being are more likely to be improved by nurturing a culture of academic excellence and creating programs that support elite education in math and the sciences.

NCLB could easily have included reforms to benefit academically gifted students—for example, using financial incentives to encourage states and school districts to expand programs for gifted kids in the early grades and to create more merit-based science and mathematics high schools. The idea of strengthening elite education never entered the NCLB conversation, however; the civil rights agenda pushed everything else off the table. With Republicans trying to establish their civil rights bona fides, a bipartisan consensus formed to focus the new legislation almost exclusively on shrinking the racial achievement gap.

A decade later, despite indications of academic decline among the country's top students, education policymakers still haven't expressed much interest in improving instruction for high achievers. Look on the website of the U.S. Department of Education, and you'll find the usual impossibly optimistic boilerplate about bridging achievement gaps. "Under the Obama administration," says one report, "education has become an urgent priority. By 2020, we will close the achievement gap so that all students—regardless of race, income, or neighborhood—graduate from high school ready to succeed in college and careers." Meanwhile, Congress eliminated $7.5 million in funding for the Jacob K. Javits Gifted and Talented Program earlier this year.

Regrettably, the states haven't done much better in helping gifted youngsters achieve their best. Perhaps the best indicator of the states' neglect is that fewer than 100 science and math high schools currently exist across the country, and they enroll only 47,000 students. This is an absurdly low number, particularly when you consider the declining number of American students pursuing advanced science and engineering degrees. Yes, there are lots of good comprehensive high schools, primarily in wealthy suburbs, that provide top science and math students with opportunities to excel, to take college-level courses, and to compete in contests like the Intel Science Talent Search. But as the Information Technology and Innovation Foundation report points out, graduates of dedicated science and math high schools are, on average, better prepared for advanced college-level academics and far more likely to pursue undergraduate and advanced degrees in "STEM studies," as educators have dubbed the fields of science, technology, engineering, and math.

Many states lack specialized math and science public high schools altogether. New York City, though, has eight, with admission to each determined entirely by the applicant's score on a competitive exam. These eight schools present a model that, were it replicated throughout the country, would almost certainly raise the level of instruction for the nation's elite students. The three largest of the schools—Stuyvesant, Bronx Science, and Brooklyn Tech, with a total enrollment of about 10,000 students—have been around for a century. So has another, Hunter College High School, which begins in seventh grade. Three new schools, each with about 400 students, opened in 2001 on campuses of the City University of New York. And five years ago, a regular high school upgraded to specialized status.

It is remarkable that these schools have been able to maintain their uncompromising meritocracy. In the 1970s, New York's quintessentially liberal mayor, John Lindsay, tried to get their admissions policy changed by claiming that the entrance test was "culturally biased." (All the schools, Hunter excepted, use the same eighth-grade exam.) But parents at the schools pushed back and successfully petitioned the state legislature to preserve the test as the sole basis for admission by writing it into New York's education law. Periodically since then, advocacy groups (including Acorn) have made similar charges that the admissions tests are biased and should be scrapped.

The specialized high schools, though, have repaid the city, state, and nation time and again by turning out thousands of extraordinarily talented graduates, some of whom have gone on to make great contributions in science, engineering, medicine, and the law. Bronx Science boasts seven Nobel laureates among its graduates and Stuyvesant four. Supreme Court Justice Elena Kagan is a Hunter graduate.

This success has come despite the schools' having to operate in less than ideal conditions. (I know this partly because both my sons attended Stuyvesant and my wife teaches in one of the new specialized high schools.) The 41-year-old state law that preserved the elite science and math schools as a meritocracy offered them no relief from the bureaucratic regulations and corrosive work rules that hamper every public school in the city. Among the worst regulations is the prohibition against hiring instructors who, though they may have advanced science or math degrees, lack the useless graduate-level education courses needed to qualify for a state teaching license. The single pay schedule mandated by the union contract is another obstacle to success. Thanks to it, a gym teacher at top-rated Stuyvesant will earn the same salary as a colleague with a mathematics Ph.D. teaching college-level calculus. In fact, the gym teacher will earn more if he has more experience or has taken 30 extra college credits in any subject. (The teachers' union offers many of the courses that he can take to qualify.)

A decade after passing No Child Left Behind, Congress needs to correct one of the law's most damaging oversights. An amended NCLB could direct the federal Department of Education to offer financial incentives to states to boost the number of competitive, specialized high schools like Gotham's, but free of their bureaucratic and union constraints—just as the department already rewards states for such reforms as increasing the number of charter schools and creating new teacher evaluations based on students' test scores.

These specialized high schools, in fact, could be charter schools. Education reformers under the sway of NCLB's reigning philosophy have viewed charters almost exclusively as a way to lift up the educationally disadvantaged. But charters could also play a constructive role in improving instruction for the smartest students. Why shouldn't we encourage universities' engineering schools, say, to create charter engineering high schools? Competitive entrance exams for such a school could take place at the sponsoring university's campus. Top students at the school could take college-level engineering courses and even obtain early admission to the university. Companies like IBM and Microsoft could sponsor similar charter schools for science and math.

America will gain if school reformers get over the idea that elite education is undemocratic or comes at the expense of the disadvantaged. Education scholar E. D. Hirsch recently reminded me that Thomas Jefferson, in his Notes on the State of Virginia, laid out an education blueprint that included a separate, dedicated instructional track for the most academically gifted. "The ultimate result of the whole scheme of education would be the teaching all the children of the state reading, writing, and common arithmetic," proclaimed the Founders' greatest democrat, "turning out ten annually of superior genius, well taught in Greek, Latin, geography, and the higher branches of arithmetic: turning out ten others annually, of still superior parts, who, to those branches of learning, shall have added such of the sciences as their genius shall have led them to." The next iteration of No Child Left Behind should have a great deal more of this Jeffersonian belief that, though America's schools should educate all children well, they should also nurture academic excellence for the good of our democracy.

Mr. Stern is a contributing editor of City Journal and a senior fellow at the Manhattan Institute.

Copyright 2011 Dow Jones & Company, Inc. All Rights Reserved

Editorial: Quinn Finally Admits It: Time For a Pension Fix

Editorial - CHICAGO SUN-TIMES

Last Modified: Jan 12, 2012 02:15AM

Gov. Pat Quinn this week finally found his voice on the most important issue facing the state of Illinois: a gargantuan pension bill that threatens to gobble up dollars needed to finance the most basic of state services — schools, prison guards, state troopers, universities, human services and more.

Quinn on Tuesday pledged to reform the public employee pension system “once and for all.”

“This is a major mountain to climb this year and I’m willing to lead the expedition,” Quinn said. He is setting up a pension working group to produce a bill that can pass this spring. This is a tall but vital order as every legislative seat is up for grabs this year.

It’s also long overdue. We’ll now see if Quinn’s actions are as bold as his words.

Illinois’ pension bill is $85 billion, so large that left unchecked it will either devour an unsustainable portion of the state budget or bankrupt the pension system itself, putting at risk hard-earned pensions for thousands of state workers and teachers. This year’s pension bill will be $6.8 billion out of a roughly $33 billion budget.

“I think it’s important that all of those who are in the system understand that if the system isn’t there, then there’s no pensions whatsoever,” Quinn said, finally speaking a hard truth without equivocation. These are words everyone in Illinois needs to hear.

Quinn’s comments come after Moody’s Investors Service downgraded the state’s rating last week, giving Illinois the worst rating of any state. Moody’s cited the state’s failure to “implement lasting solutions to its severe pension underfunding or its chronic bill payment delays.” A downgrade almost certainly means Illinois will pay more to borrow.

This editorial page has come around, reluctantly, to the view that the only way out of the pension mess — caused not by overly-generous benefits but by the state’s failure to pay its share each year — is to reduce pensions of current employees going forward.

We haven’t heard yet of a workable alternative, though we remain open to what Quinn’s working group comes up with so long as it’s bold and aggressive.

The days ahead likely will be bitter, nasty and partisan. Gov. Quinn must hold firm, guided by one simple truth: Cleaning up Illinois’ pension mess cannot be put off for another day.

Copyright © 2012 — Sun-Times Media, LLC

Most Misguided Quotes of 2011 Selected by Call

By MIKE ANTHONY, Executive Editor - CALL NEWSPAPERS

Past year a memorable one for officials' misguided quotes

January 11, 2012 - 2011 certainly was a year of change in south county, but one constant was the misguided comments by would-be politicians and elected officials.

As in past years, we had no shortage of candidates for inclusion in the annual Most Misguided Quotes of the Year column in which we chronicle the most misguided, misinformed and misleading statements of the year. So without further ado, we offer the Most Misguided Quotes of 2011.

Though Michael Klund didn't have much to say to the public during his campaign against incumbent Aaron Hilmer for a seat on the Mehlville Fire Protection District Board of Directors, he may have set a new record for having the most number of misguided quotes in the shortest period of time. (For more on Mike Klund click HERE)

Klund did not attend a candidate forum scheduled for March 24, citing a family emergency, and declined a request to appear April 4 on Charlie Brennan's radio show on KMOX.

Hilmer did appear and fielded questions from Brennan and listeners.

In response to a Call questionnaire, Klund contended the fire district's reserves had been "depleted'' in building new firehouses.

"... The reserves have been depleted in the building of these firehouses and the old ones were functioning well anyway ...,'' he stated.

But the reserves are not depleted, according to the district's 2010 Comprehensive Annual Financial Report, which states the general fund had an unreserved fund balance of roughly $15.5 million or 129 percent of general fund expenditures while the ambulance fund had an unreserved fund balance of more than $7 million or 150 percent of ambulance fund expenditures.

Klund also contended ambulance billing, which had been approved in 2002 by a previous board, was "double taxation.''

"Put a stop to ambulance billing — that's double taxation,'' his campaign literature stated.

To eliminate ambulance billing, Hilmer later said the Board of Directors would have to ask voters to approve a tax-rate increase of roughly 10 cents per $100 of assessed valuation.

Klund told the Call he was pleased with his campaign, saying it was based on "facts.''

"I'm really happy with my campaign. I believe I ran facts on everything I stated in my literature and stuff and it can all be verified ...,'' he said.

Voters weren't buying what Klund was selling, but the nearly $100,000 supporters contributed to his campaign certainly had an impact as Hilmer narrowly retained his seat.

That's a good thing, too, given that after the election, Klund said, "I hope that the new board looks at the issues I brought up like ambulance billing, that they readdress that and make sure people don't get billed.''

Perhaps Klund can cough up the $2.4 million in revenue the district's 2012 budget projects ambulance billing will generate this year.

Then we have Mehlville Board of Education member Tom Diehl, who in early February blamed "sloppy paperwork" for the Committee to Restore the Pride's post-election finance report missing the filing deadline by more than two months. (For more on Tom Diehl click HERE)

The committee had advocated passage of an 88-cent tax-rate increase proposal for Mehlville that voters defeated in the Nov. 2, 2010, election.

The delay prompted someone (ed:from the MCTA) to file two complaints against the committee with the Missouri Ethics Commission.

The complaints, dated Feb. 1, contended the Committee to Restore the Pride had violated state law by failing to file post-election and January quarterly campaign finance reports with the ethics commission.

"It's just a matter of sloppy paperwork," Diehl said.

But by the time Diehl organized the "sloppy paperwork,'' a retired Mehlville educator was on the hook for a fine from the ethics commission.

In a Sept. 14 consent order, the commission fined the committee and former Treasurer Jack Jordan a total of $2,000.

The commission's order stated if the respondents pay $200 of the fine, it will stay the remainder of the fee for two years.

The respondents will not have to pay the rest of the fine if they do not violate campaign finance laws during the two-year period, according to the consent order.

Diehl, the committee's current treasurer, told the Call in February that Jordan "agreed to serve as treasurer in name because of his name recognition. None of us have any intention of dumping anything on Jack's lap because that wasn't his role."

But Jordan, a retired Mehlville principal whom the school board recognized by naming the Mehlville Senior High School stadium in his honor, was on the hook for the fine — essentially hung out to dry by Diehl.

So it's no wonder that Jordan opted to pay the fine himself to put an end to the matter.

"Jack wrote the check himself. He just wanted to get the thing settled and done," Diehl told the Call. "We had offered to pay it, but he chose to do it himself."

After Democratic County Executive Charlie Dooley backed off his proposal to roll up the county's property tax rate by 2.3 cents in early September, he told the County Council some things he said "were misspoken, and I do want to apologize for that.''

"In my zeal to get some things done that I think were important, I think I didn't do a very good job in communicating to the council and that's something that has to be corrected," Dooley said. "That's something I need to do a better job of ...''

Dooley apparently neglected to heed his own advice when presenting to the council his recommended 2012 county budget that called for the closing of 23 county parks, eliminating 175 jobs and not plowing streets of snow in unincorporated areas when accumulations are 2 inches or less, among other things.

A nearly unanimous council led by then-Chairman Steve Stenger, a Democrat from Affton, opposed Dooley's proposed budget and Dooley ultimately announced a compromise in which all of the county's parks will remain open "at a reduced rate.''

The proposal to not plow streets of snow in unincorporated areas when accumulations were 2 inches or less also was rescinded.

And last, we have what may be the final appearance of former Crestwood Mayor Roy Robinson in this annual column.

During a heated discussion at the April 12 Board of Aldermen meeting, Robinson told former Ward 4 Alderman Steve Nieder, "You're finished. Sit down, and if you don't, I'll have you sit down.''

In telling Nieder he was "finished,'' Robinson could have been talking about his own dashed reelection hopes, as he had been soundly trounced a week earlier by Jeff Schlink in the April 5 mayoral election.