A Citizen's Guide to Indiana

Masson's Blog

Rich on Daniels at CPAC

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Just saw Gov. Daniels got a mention in a Frank Rich column.

There was one serious speech at CPAC — an economic colloquy delivered that night by Mitch Daniels, the Indiana governor much beloved by what remains of mainstream conservative punditry. But Daniels was quickly thrashed: Limbaugh attacked him for his mild suggestion that the G.O.P. welcome voters who are not ideological purists, and CPAC attendees awarded him with only 4 percent of the vote in their straw poll. (The winners were Paul, with 30 percent, and Romney, with 23 percent.) Indeed, Daniels couldn’t even compete with the surprise CPAC appearance of Donald Trump, a sometime Democrat whose own substance-free Obama-bashing oration drew an overflow crowd. Apparently few at CPAC could imagine that Trump might be using them to drum up publicity for his own ratings-challenged television show, “Celebrity Apprentice,” which returns in just two weeks — or that he had contributed $50,000 to the Chicago mayoral campaign of no less an Obama ally than Rahm Emanuel.

SB 72 – Carbon Dioxide Pipelines and Eminent Domain

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Ted Evanoff, writing for the Indy Star, and Gary Welsh at Advance Indiana have some good coverage of the Senate defeat of SB 72, introduced by Sen. Gard, concerning eminent domain for a coal gasification pipeline.

The bill establishes procedures for DNR to issue a certificate of authority for a carbon dioxide transmission pipeline, allowing – among other things – the use of eminent domain for construction and maintenance of the pipeline. The permit can be issued for a pipeline with a carbon monoxide source with a production facility in Indiana that is transmitting the carbon monoxide out of state. On February 8, it was defeated by a vote of 21 to 28.

Ted Evanoff’s story reports that the bill was necessary to clear the way for a special pipeline sought by investors to move carbon dioxide away from the southwestern Indiana plant to buyers on the Gulf Coast.

Without legislation allowing eminent domain for such pipelines, lead investor Leucadia National Corp. doubts it could secure the federal guarantees on construction loans for the $2.6 billion gasification plant it has proposed at Rockport.

Gary Welsh goes on and connects some dots, painting a picture with a lot of cozy relationships among rich people and chides the Star for not making those connections. He also notes the oddity that oversight on this is given to the Department of Natural Resources instead of the Indiana Utility Regulatory Commission which would normally be expected to have oversight of something of this nature.

Sen. Gard suggests that the defeat was caused by a coalition of Democrats who are suspicious of any deal brokered by Gov. Daniels and ultra-conservatives who don’t like anything that says “eminent domain.”

Obama Proposes Delay to Benefit Unemployment Debtor States

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The New York Times has an article about a proposal by President Obama to delay unemployment insurance repayment obligations for states that owe money to the federal government for unemployment insurance. Obviously this doesn’t concern Indiana since we’ve been fiscally responsible and Gov. Daniels has been talking about our surplus and whatnot. Oh . . . wait, we owe roughly $2 billion for unemployment funds we’ve borrowed from the feds. That doesn’t count somehow, I guess.

Anyway, my take from the article was that without this fix, automatic tax increases would hit employers and states would start getting charged on the debt. Congressional Republicans are cool to the idea because it would mean higher taxes in the longer term. But Republican Governors might put pressure on them because their states are going to feel the sting from their debt.

I would expect Gov. Daniels – if he wants to stick to his espoused principles – would have to say that the government, like businesses and households, have to pay their debts and, thanks but no thanks, a deal is a deal so we’ll have to repay the funds in the manner specified at the outset. It’ll be interesting to see if and how he responds on this one — as not only a Governor but a Presidential aspirant.

Working is for Chumps

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Advance Indiana has a post looking mostly at Rahm Emanuel’s impressive feat of raking in $18.5 million in two years in the private sector as an investment banker despite having no previous experience in the field. After working in the Clinton White House, Rahm had good connections. He got hired into a lucrative position because of a connection, and he was able to obtain huge compensation by working other connections.

Gary isn’t being particularly partisan in this post. He also notes that Gov. Daniels came out of the Reagan White House with a professional resume that consisted only of politics. Nevertheless, “by the time he ran for governor in 2004, he had earned more than $50 million from Lilly and the corporate boards on which he served[.]”

There is big money to be made working the good old boy network. The average person can be excused for looking around and being skeptical of the notion that working hard and smart is a good substitute for knowing a lot of rich people if your goal is to become wealthy.

Unfortunately, I don’t know any other way, so I’d probably better get back to work.

Gov. Daniels versus the State on Education

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Nikki Kelly has an article in the Journal Gazette contrasting some of Gov. Daniels education priorities with a recent poll on the public’s preferences for education.

Much as I like needling Gov. Daniels, I’m also skeptical of the value of polls on people’s policy preferences. People who are smart enough in their own areas of expertise don’t necessarily have the time or inclination to be informed on details of government policy.

But, for whatever it’s worth, people favor financing struggling schools more generously than those with rapid population growth. Gov. Daniels goes the opposite direction. Coincidentally, I’m sure, older schools with more challenging student populations tend to be in areas that are more likely to vote for the Democrats. Schools in high growth areas tend to have more children of affluent people who are more likely to vote for Gov. Daniels.

People think parental involvement is more important than changes like paying teachers more. Gov. Daniels says you can’t mandate parental involvement. He’s mostly right with that, but I’d say policies he favors that put downward pressure on wages contribute to the lack of parental involvement. It’s simply tougher for parents to be involved where you need two incomes to support the family instead of being able to have one parent at home.

The last item said that the public favors, by a 2-to-1 margin, supporting current schools rather than creating more charter schools. I tend to chalk up continued support for charter schools – in the face of evidence that, on the whole, they don’t perform notably better than traditional schools – to a love of union busting.

Chris Coyle on Unitary County Government

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Chris Coyle has a column in the Perry County News on the county executive portion of the Kernan Shephard recommendations for local government restructuring. In the name of efficiency, the report suggests and Gov. Daniels apparently supports, removing the current three member board of county commissioners and replacing it with a single county executive. In addition, that person would appoint officials like the sheriff, clerk, treasurer, auditor, and coroner; currently elected positions.

I agree with Chris that the costs outweigh the efficiencies. Taking an extreme to illustrate the point, there is little doubt that dictatorships are more efficient than democracies; but there is more to government than efficiency. Chris points out a not unlikely scenario: what if you like the sheriff and even the county executive, but the coroner is just awful. Your choices at that point are pretty much to either put up with the poor public official or vote out the whole administration.

Chris went the high road, elaborating his point. I’ll go the low: Boss Hogg was a sole county commissioner.

Welcome to FSSA; Here is a bill for $39 million

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Two related articles were in my feed reader, side by side. One noted that Gov. Daniels has appointed Michael Gargano to be FSSA’s new director. The other reports that the federal government has audited FSSA and claims that it owes the federal government more than $39 million in overpayments to medical providers.

It’s a bad time for FSSA (but when isn’t a bad time for that agency?) Advance Indiana has a blistering blog entry noting that Gargano was a consultant for ACS, the company with the insider privatization deal to manage welfare eligibility services that collapsed so spectacularly. This is particularly bad since one of the more unpalatable aspects of that ACS deal was that Mitch Roob, head of FSSA at the time, was a former ACS employee.

Meanwhile, state workers are reportedly telling parents of disabled children who can’t get assistance via Medicaid waivers that dropping their kids off at homeless shelters might be a viable option to get treatment for the kids.

CAFOs in Indiana

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Seth Slabaugh has a very good article in the Muncie Star Press about the rise of CAFOs (confined animal feeding operation) in Indiana, east central Indiana in particular, under the Daniels administration. Gov. Daniels had hoped to double pork production, but that hasn’t happened. He has dialed down the goal to 3% per year increases.

The short version is that we don’t want to be like North Carolina. Apparently they allowed unfettered growth without regulation (libertarian paradise!) which caused all manner of environmental problems. The response of local regulators is (and I paraphrase), “pshaw! couldn’t happen here. We’re much smarter than those dupes in North Carolina, and our soil is better for this kind of thing. Apples and oranges!”

Under the Daniels’ administration philosophy, I think what has saved Indiana from a lot more environmental problems from increased CAFO pig production is that the hog market has been in the toilet for the past few years. There are good operators out there who want to do things the right way, but the fact is they won’t survive for very long if the economic advantages, even if those advantages are short-term, are stacked in favor of the guys who take short cuts.

Being a Candidate is Hard

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Gov. Mitch Daniels, who is not running for President, appeared on a news-like program to speak with Chris Wallace (who, to be fair, can actually be a decent journalist from time to time). According to an article from Niki Kelly in the Fort Wayne Journal Gazette, he was for the stimulus before he was against it; he cashes federal checks; and probably most telling, takes credit for a budget made possible by federal stimulus credit dollars.

In response to a question about whether he supported federal stimulus spending:

Daniels responded, “Really don’t. You know, the – it amounts at this point in time to asking the citizens of responsible states like ours to subsidize those places who have been more reckless. It’s probably not going to help the economy.

“It’s this notion sort of a trickle-down government. You pour a few more bajillion dollars in the top of the funnel and maybe a little demand and a few private-sector jobs will fall out the bottom. It’s really not the way to do it.”

But in February, Daniels signed onto a letter with 46 other governors encouraging congressional leaders to extend enhanced federal Medicaid match rates that were part of the first stimulus bill. Medicaid is a joint state-federal program providing health care for the state’s poorest citizens.

The article also reports that Gov. Daniels was trying to talk up Indiana’s “balanced” budget but that he neglected to recognize that the budget was balanced with federal stimulus dollars — (not to mention by passing a lot of costs and taxing responsibilities to local units of government.) It would also seem to me that Indiana’s bankrupt unemployment insurance fund would also be a valid topic of discussion when bragging about a surplus.

I’m not trying to say that Indiana’s economic condition is all Gov. Daniels’ fault (or, if credit is due, it’s not all his); but I suspect he could be more forthright about Indiana’s condition and good federal policy, as he sees it, if he didn’t have 2012 on his mind.

Advance Indiana, Moldthan, Roob, and FSSA Privatization

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I’m late to note this, but for those who haven’t seen it, Gary Welsh at Advance Indiana posted a blog entry on July 11 that is really required reading for anyone interested in the realities versus the myths of privatizing government services. It recounts the efforts of Carl Moldthan to analyze and offer suggestions for the efficient reform of the Family and Social Services Agency to save money. Moldthan was a Republican supporter and local government consultant tasked with reducing waste at FSSA.

The short version (and, really, go read the long version) is that Mitch Roob was determined to privatize FSSA functions before any review was conducted of the best way to improve services and reduce waste. Moldthan’s suggestions fell on deaf ears, presumably because privatization was the desired end in itself, not one of many potential tools for creating better, more efficient government.

The myth is that privatization will create cheaper government. The reality, all too often, is that it simply creates a profit center for well-connected friends and well-wishers of the people making the privatization decisions.