Saturday, January 08, 2005

Narcissus Lays an Egg 

Something's wrong. Der Governor's political handlers are supposed to pick issues that will make him look good. But the agenda that emerged from Wednesday's speech is an odd conglomeration with no visible unifying principle. It consists of four proposed amendments to the state constitution that first go to the Legislature and then to the voters, and two goverment reorganization packages that will be reviewed by the state's curiously named "Little Hoover" commission and then become law unless rejected by the legislature.

What is the thread that connects these six proposals?

1) An amendment (no text available yet ) to further tangle up state budgeting.

2) An amendment that outlaws pension plans for new state employees, forcing them to bear their own investment risk in 401(k)-type "defined contribution" plans. The text of ACA 1_1 is now online, and it's worse than was imagined. "State", it seems, also means cities, counties, school districts, public universities and every other public entity or agency, right down to the Antelope Valley Mosquito Control District. So, by definition, "new state employee" includes all city police, local firefighters and schoolteachers who start work after June 30, 2007. How long until we see the headline: "Arnold Screws the Cops", or the TV ad showing the disabled retired firefighter begging on the sidewalk?

And why should Arnold do this? Barring new hires from joining a *city* pension plan, like San Francisco's, isn't a state budget issue at all. And why prompt a run on the Cal-PERS pension bank with Sec. 8(c), which allows the active members of existing public pension plans to cash out in full by rollovers to new defined contribution plans -- but only during the last six months of 2007?

Professor Tax has hinted that Arnold is being manipulated in private by the special interest devils he condems in public. Lo! We read in section 8(d)(2) that:

"a public agency may use one or more private-sector third-party administrators to manage a defined contribution plan provide investment vehicles and educate members and retirees on the appropriate investment strategies".
This confirms the hunch. Der Governor's plan isn't about efficient government, but rather is a scheme to enrich brokers and investment managers by @$1.6 billion/year in fees and profits from privatizing the pool of public pension assets now held by Cal-PERS. Who is telling Arnold to do this? Which adviser to der Gov was corrupt enough to push this crude pension grab? Did somebody bribe a palace guard, or was this the work of those ideological fools "who sell their souls and votes for naught"?

There is one good thing about ACA 1-1 -- as submitted, it is so poorly drafted (e.g. it's unclear if a state worker who changes agencies is a 'new employee', e.g. one can't compute 'net present value' with no stated interest rate; eg. no co-ordination with the Federal tax rules for retirement plans) that it can't be intended as serious legislation. At least, let's hope not.

3) An amendment to base employment status and pay for teachers and school administrators on "performance." It's not called "merit pay" any more, because there's too much research showing that:

"Teachers have viewed merit pay plans as unfair and divisive, promoting competition that is counterproductive to a collaborative atmosphere and having a demoralizing effect on non-receipts. Likewise, from an administrative perspective individuals responsible for implementation and oversight of merit pay plans have found the plans to be unduly burdensome and time-consuming." When first introduced, in Massachusetts in 1908, "its reign was short- lived because of charges of ambiguity, favoritism and inequity" and in every subsequent generation, "merit pay plans have been tested, tried, and usually trashed within six years of implementation" (Desander, "Teacher Evaluation and Merit Pay" 14:4 Journal of Personnel Evaluation in Education 307-308 (2000) )

Professors Wilms and Chapleau trace pay linked to student performance test scores back to Victorian England, where it was finally dropped after 30 years because it distorted incentives, turned teaching into rote mechanical exercises, and encouraged manipulation and falsification of data. Some things never change. In NBER Working Paper #9414, Professors Jacob (Harvard) and Levitt (Chicago) report work on developing an algorithm to detect cheating by teachers and administrators (like "correcting" answer sheets after-the-fact or directly telling the students how to answer) when students take standardized tests. They estimate that the pressure from "high-stakes testing" that links incentives to test results leads to such cheating in 3% to 5% of Chicago's public elementary school classrooms every year.

The text of SCA 1X is not available yet. There's only a promotional fact sheet posted on the website of State Senator George Runner (R- Antelope Valley) telling us that local school boards will decide how to combine annual performance evaluations (by whom, on what basis, is not stated) with measures of student improvement on state standardized tests in order to assess teachers and administrators -- and adjust their pay in some unspecified way. We also learn that teachers now receive job tenure rights after a two-year probationary period, but this Constitutional amendment will require all new school employees to have 10 straight years of satisfactory performance evaluations before they get any such rights.

Poor Senator Runner! Arnold has given him the odious task of sponsoring legislation that repeats 140 years worth of mistakes in teacher performance evaluations. Or perhaps the Senator thinks that public school teaching in California is an attractive and lucrative occupation, with qualified potential teachers in such surplus that they will gladly work an additional eight years with no job security. Apparently some of der Governor's political advisers confuse "reforms" with "re-enacted failures", like the Englishman who replied, when asked if he had learned anything from his mistakes, "Certainly. I'm sure I could repeat them exactly."

4) Redistricting is der Governor's trump card. It really is outrageous, the way the Democratic legislature has gerrymandered legislative and congressional districts into fractal shapes resembling sea monsters and other nightmare creatures, so as to preserve their majority while protecting the incumbents of both parties. The progressive spirit of good government tells us to take the job of drawing district maps away from hands tainted by partisan self-interest. However, that progressive spirit also calls for many other reforms -- campaign finance, access to the media, artificial term limits, Republican congressional gerrymandering in Texas by Tom "The Enforcer" Delay, etc. The painful conclusion is that redistricting on der Governor's terms, without other political reforms or nationwide change in how districts are drawn, would amount to unilateral disarmament by California's Democratic party. A leader like Mahatma Gandhi or Martin Luther King might carry it off, but failing such leadership, redistricting in the name of good government would just deliver control into the hands of those who have no interest in better government.

5) Der Governor's first reorganization plan proposes to fix a broken and costly prison system. Professor Tax has no experience or expertise with regard to the criminal justice system, and can only hope that the plan will be a successful improvement.

6) The second reorganization proposal would increase government accountability to the public by abolishing 88 specialized boards and commissions on which members of the public now sit. The plan would replace public participation in government thru boards and commissions with bureaucratic authority exercised by directors and department managers.

"But, Professor Tax", you say. "That makes no sense. How does reducing public participation in government increase accountability to the public? Surely that page of der Governor's briefing book must have been turned upside down."

Actually, the page is in the right position -- it's the idea that's upside down. Der Governor's California Performance Report team (remember? those folks who fed the media dishonest numbers based on fraudulent research) -- have their own twisted definition of "accountability." The reorganization plan they scripted for der Governor (.pdf p. 10 of 57) comes right out and says it:

"Regardless of such a public forum, any board empowered to do what it wants without consequence is not accountable. If power and responsibility for making policy lies with an unelected, term-appointed board or commission, then no individual, group, or state agency is held responsible. Accountability for the failures and the successes of the executive branch must rest with the elected leader."

This is a familiar theme, but not an American one. More like central Europe @ 1938. No checks and balances, no professional responsibility, no participation with neighbors and colleagues, no separation of powers, just top-down rule by an ambitious, charismatic elected dictator. Wasn't a particularly good idea, either, as California kids learn in 10th grade. Accountability for failure in particular can lead to a rather unpleasant end.

Professor Tax will return to the details of Arnold's new agenda in the next post. What's important now is understanding that the core premise of this reorganization plan is completely false. Accountability is much too important to rest with any one man, no matter how charming or how vain.

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