Harold Ford and New York: An Issue of Attachment

I know that New York is traditionally open to “carpetbaggers” (in this context meaning a politician or would-be-politician who moves to his or her non-primary State with the intent of running for office in the new State) in a way that, say, the Southern States are not. New York's own Governor has pointed that out.

"Well generally speaking, I don't think carpetbaggers - I mean if the people of the state want them they can have them," Paterson said on WOR this morning in an interview with John Gambling (and listened to by the DN's Glenn Blain).

"New York did do this with Robert Kennedy in 1964 and Hillary Clinton in 2000, and I know Harold. If he wants to run for Senator in New York State, I'm sure that's an interesting idea."

Ok, fine. New York's experience is greatly informed by waves of immigrants, so maybe immigration from another State directly into New York's corridors of power isn't as odd as I might think off-hand.

Still, the idea of a failed Tennessee politician (he lost a U.S. Senate race in his home State of Tennessee, to a Republican, in 2006, during the buildup to the Democratic sweep of 2008), coming to New York, working on Wall Street for awhile, taking helicopter rides around the City, and then deciding he's qualified to run for U.S. Senate, is, I think, a tad much, even for New York.

I remember when Ford's name was first floated for the U.S. Senate, back in late 2009 or in the very first days of 2010. I hadn't heard of him at all. I located his own website which, back then, expressly described him as not living in New York State, but only working there. "Ford lives,” the site stated, “in Memphis and Nashville and has offices in New York and Nashville." I was surprised to see a 5 January 2010 article in the New York Times, describing Ford as having “moved to New York three years ago,” presumably meaning sometime in 2006 or very early 2007. The bloomberg.com article announcing Ford's Wall Street job, also linked to above, is from early 2007. Even assuming Ford moved to New York State immediately upon getting this job, despite his own website indicating otherwise, this basically means he left Tennessee within just a few months of losing the U.S. Senate election, a fact that I find interesting all by itself.

Yet, even after this New York Times article, Ford's own website continued to refer to him as “working,” but not living, in New York. The mainstream media eventually caught up with me a couple of days later. On 7 January 2010, Josh Robin, a political reporter for New York 1, “Twittered” about the seeming contradiction. Shortly afterwards, Ford's site was changed to reflect a dual residency, in New York and Tennessee.

I'd suggest that the very least this strange incident means is that Ford has displayed a lack of common sense diligence. I know that if I were contemplating a run for the U.S. Senate representing a State I hadn't moved to all that long ago, updating my website to reflect my residency there would be one of my first priorities. But maybe that's just me.

I also have to wonder, strongly, if Ford's strange error reflects a lack of attachment to New York State as much as it reflects a lack of diligence. Length of residency may or may not be an issue in a U.S. Senate election, but attachment, I strongly feel, should be.

Ford is sometimes spoken of in the same breath as Robert Kennedy and Hillary Clinton, because, it is argued, all three are subject to the “carpetbagger” label. Surely, New Yorkers had little problem being represented by carpetbaggers named Kennedy and Clinton. So why not one named Ford?

From what I can tell, though, Clinton and Kennedy both bothered to form, or already had, attachments to New York State before they ran.

Regarding Kennedy, note the following passage from Arthur Meier Schlesinger's book Robert Kennedy and His Times (first published in 1978, reissued in 2002):

In fact, Robert Kennedy was less of a carpetbagger than his older brother had been in Massachusetts in 1946. He had lived in New York from a few months after his birth until 1942, indeed, had lived nowhere longer. Except for schools and summers, he had never really lived in Massachusetts. (Page 668)

The Clintons purchased, and lived in, a home in Westchester County. Granted, it was merely the September prior to her Senate run. But, in fairness, before that she had a place to live: The White House. She wasn't going to live anyplace else until January 2000, when her husband's term as President was up. Bill Clinton also set up his firm, the Clinton Foundation, in New York State, specifically on 125th Street in Harlem.

And, as far as I can tell, the Clintons maintain that residence, and Bill Clinton maintains his Harlem office.

Contrast this with Harold Ford. He supposedly moved to New York sometime in late 2006 or early 2007, but he didn't so much as update his official website to reflect the move until early 2010, after his technically-still-undeclared Senate campaign was already underway, and after he was "caught" twice. Further, as I also pointed out above, assuming Ford really moved to New York when he says he did, he had to have done so almost immediately upon losing a U.S. Senate run from his home state.

Governor Paterson pointed out something similar in an article also linked to above.

"But what's kind of interesting about the way he's [Ford] doing it than the way they [Clinton and Kennedy] did it is that both of them traveled extensively around the state and were pretty familiar with what was going on before they ran," the governor continued.

"I honestly - and I know Harold - had no idea he was interested in running for the Senate until the last few weeks." [emphasis added]

Interesting.

Full Circle: An Open Letter to Senator Marty Golden

Dear State Senator Marty Golden:

I am nearly positive that your Brooklyn constituents appreciate the strong moral stance you have taken regarding your colleague, Senator Hiram Monserrate. You are undeniably correct that it's ridiculous for Senator Monserrate to compare himself to Civil Rights workers, or to Jesus.

As everyone reading this most likely knows by now, then-Senator Elect Monserrate and his girlfriend had an incident at his apartment late in 2008. Assault charges were filed against him. While he was acquitted of felony assault charges resulting from the incident itself, he was convicted on misdemeanor assault charges resulting from the aftermath, wherein he was seen on security cameras literally dragging her to the hospital.

Many were shocked by Senator Monserrate's conduct. Based on this incident, and other factors, in this article I have outlined my own case for Senator Monserrate's resignation from the Senate, but regrettably Senator Monserrate hasn't listened to me, thus forcing that institution into a peculiar dilemma.

There is a movement afoot to expel Senator Monserrate from the Senate. Senator Golden, your strong statement indicates that you are at the forefront of this movement. I am certain that your constituents are, justly, proud of your strong, inviolable moral stance in seeking to expel Senator Monserrate.

However, the closer I look at you, Senator Golden, the more I wonder about what appears to be certain nuances in your moral outlook. Perhaps your constituents will have questions too.

For example, they might have questions about allegations made in this March 2009 Village Voice article that you employed a $65,000 a year Research Assistant while he was facing assault charges. Strange. The fact that this Research Assistant was the son of your Republican colleague, Senator Owen Johnson of Long Island, is, I am sure, unrelated to his employment. (Interestingly, the SeeThroughNY.net database still shows an “Owen Johnson” employed as a “Research Assistant” by the Senate for just under $50,000 a year, as of August 2009, but it doesn't specify what office Mr. Johnson works for.)

Perhaps the difference is that Hiram Monserrate is a Senator, whereas Senator Johnson's son is, despite his family name, still just a Research Assistant? It's possible that's the distinction. If so, though, it begs the question: Why support undoing an election to take a moral stand and yet refuse to take one simply by firing your Research Assistant?

I don't know the particulars of Mr. Johnson's case, of course, other than the brief mention in the Village Voice article. He was accused, that article states, of assaulting his “roommate.” The alleged victim, thus, was likely male. Is that the distinction, Senator? If so, though the sentiment is noble, isn't it a little outmoded, even inappropriate?

As stated, I don't know the particulars of Mr. Johnson's case. It could be that those particulars are the source of the distinction. Regrettably, I can't address those.

If it turns out that Mr. Johnson wasn't convicted, whereas Senator Monserrate was, perhaps that's the distinction? No, it can't be that, because you were an early-comer to the crusade against Senator Monserrate, a fact which your recent statement proudly references. Before Senator Monserrate was convicted, you attempted to prevent him from “being seated” in the Senate. ("Being seated," basically, is technical parliamentary jargon for fulfilling the office, literally sitting in the Senate Chamber.)

Which brings me to another point I'd suggest your constituents have a right to question. After Senator Monserrate was seated after all, you, Senator Golden, actually dropped your campaign against him for awhile, and even shook his hand. The Times Union's website has a picture. It's obvious from the picture that you both knew there was a camera there. You're both smiling at it.

A few months after that, you and Senator Monserrate actually joined forces to challenge Senator Malcolm Smith's leadership of the Senate. Perhaps predictably, Senator Monserrate chickened out on the coup, after only a week, leaving the State Senate paralyzed at 31 to 31, for weeks. Eventually, of course, Senator Pedro Espada, the other Democratic partner in the coup attempt, returned to the Democratic fold as well, and life at the State Senate, such as it is, went on as “normal.”

To review, first you tried to undo Senator Monserrate's election, prior to his conviction, while employing a Research Assistant who had also faced assault charges (and who happened to be the son of a fellow Senator). Then, you appeared to change your mind, first shaking Senator Monserrate's hand publicly, and then joining him in an attempt to basically undo the results of 2008 State Senate elections in their entirety. After he chickened out of that effort, some months later, here you are again, Senator Golden, calling to undo your colleague's election.

Your position has come full circle.

There is, I might suggest, nothing wrong with a little pragmatism or flexibility, or even a lot of it. Except, of course, when you first take a strong, seemingly-inviolable moral stance that appears to exclude taking actions that you are, as a pragmatist, more than willing to take. Further, even on a practical level, what does it say about your judgment that you were willing to rely upon the political support Senator Monserrate for something as major as a floor fight in the New York State Senate?

Could it be, Senator Golden, that you simply support anything with money, prestige, and patronage attached? Could it be that you are more than willing to undo an election or work with the person whose election you wish to undo, all dependent upon your needs of the moment? Could it be that your strong moral stance is something less than it appears to be? Could it be that you are simply a pragmatist, and a relatively poor one at that?

I wonder if your constituents will consider these issues this Autumn. I have read that you have an opponent.

Perhaps he'll ask.

Sincerely,
The Albany Exile

The Field

• Introduction
As of the time of writing, the late afternoon of 14 January 2010, there are 5 candidates I am aware of, some declared and some undeclared, for the New York State Governorship.

After looking at the 5 candidates I am aware of at the moment, I came to a depressing realization, that led to a single hope. I realized that all of the 5 carried negatives that were extremely significant, potentially (or in some cases almost definitely) impinging upon their ability to govern the State at this critical moment. And the hope was, simply, that someone else takes up the mantle, and does it soon.

• Name: Steve Levy
• Democrat, Suffolk County
• Current Occupation: County Executive of Suffolk County
I had hopes for Executive Levy. He came on the Statewide scene not trashing his rivals, but simply implying that he could do better than they. However, more recently I have read that he's feuded with the police in his county. If this foretells his relationship with the State Police should he become Governor, it could be a dangerous spot for him to be in. (To negotiate with police unions in a tough manner is one thing, but some of Executive Levy's critics see open hostility.) I have also read that Levy has been so anti-illegal immigrant that some have argued he is anti-Hispanic and anti-immigrant in general. (I haven't examined his immigration statements or positions personally; I'm reacting, at the moment, to the perception. In politics, perception is over half the battle.) Hispanics are found just about everyplace in New York State, they pay taxes, and they've been part of the fabric of life in New York for a very long time. I think it's fair to count it against a politician when that politician apparently goes out of his way to alienate a major demographic of the State. If he wins, he'll be representing Hispanics too, and his Departments usually are understood to have to enforce certain laws as vigorously on behalf of illegal immigrants as on behalf of others.

Levy's response to two Hispanic Assembly Members' promising to oppose him politically was to attempt to file a complaint against them with the Public Integrity Commission (PIC). The, to my mind questionable, theory was that they had threatened to use their offices to harm those who supported Levy.

I find Levy's action to feel eerily similar to the SLAPP Lawsuits that are filed by major corporations in an attempt to silence whistle-blowers and critics; basically it's seeking legal sanction upon those who criticize you. (Imagine what Levy might do as Governor.) Further, Levy also went about this stupidly; the PIC has no jurisdiction over the Legislature.

To my mind that's the kind of thing you should look up before you take such an action.

• Name: David Paterson
• Democrat, Albany County and New York County (Manhattan)
• Current Occupation: Governor of New York State
New York State's first Black and first disabled Governor is a man of many talents, many gifts, and also many flaws. The latter have been especially on display for quite awhile now. He has what The New York Observer called “a complicated relationship with the truth.” His staff often appears to be in disarray. They often present an incoherent or muddled message. (As a recent example, take the Governor's office's unclear response to the Legislature's ethics bill). Paterson's son's recent run-in with the police on its own, wouldn't necessarily mean anything, but it fits Paterson's odd pattern too well to be ignored. And finally there's the bizarre notion he's tried to put forth, that he should be judged on what he wants to do rather than what he is able to actually accomplish.

New Yorkers believe many of Paterson's central messages, but they lack confidence in his ability to actually do much. And, really, who at this point could blame them for their skepticism. Political Scientist Richard Neustadt once wrote that presidential power is the power to persuade. The Governor of New York State has institutional powers that the President would envy, but the Governor still needs that power to persuade. David Paterson has lost it, and there's no realistic way for him to get it back. Even if he somehow wins the election, which seems unlikely, he won't be able to do anything.

And I disagree with the Governor that he should be judged more by his intentions than his actions or accomplishments.

• Name: Rick Lazio
• Republican of somewhere in New York City and somewhere in Long Island (Counties unspecified)
• Current Occupation: Full-time Candidate, as far as I can tell; he has most-recently worked for J.P Morgan Chase and for some kind of advocacy group for CEOs called the Financial Service Forum
Rick Lazio is chiefly known as the man who thought he could beat Hilary Clinton for the U.S. Senate in 2000 by bullying her in a debate, a move which even he now admits was a mistake. However, that he could ever think such a move (he essentially charged across the stage to angrily shove a piece of paper in front of her) was wise speaks poorly for his judgment. Not only did he come across as a bully, but as a bully who was bad at bullying.

I also at this point think that anyone who worked in the financial industry during the early 2000s should be considered suspect. A lot of things that this industry did during this era violated both common sense and all analytical logic.

Also, who has heard of him? Not many. Want to bet that the first two things many voters will find out about him are that he's a bully (a poor one at that) and that he used to work for an advocacy group for CEOs?

• Name: Chris Collins
• Republican of Erie County
• Current Occupation: County Executive of Erie County
The kindest way to talk about Chris Collins's recent actions is to say that he has seriously seriously embarrassed himself. He is supposedly a Christian, but he is a peculiar sort of Christian who allows Nostradamus to enter into his religious thinking, alongside the Bible and other Christian texts. He has, for example, publicly used Nostradamus's writings to claim that Assembly Speaker Sheldon Silver is the “Third Antichrist.” The second one, you see, was Adolf Hitler. I forget who the first one was. (Other Christians of this stripe assign the honor of being the “Third Antichrist” to President Obama.) So not only does Collins compare a Jewish politician to a man known for attempting to wipe out Jews, but he resorts to calling his political opponents the “Antichrist,” and uses to bolster the argument the demented writings of a man who is more typically the subject of New Age books, the cover page of the Weekly World News, and an album by the heavy metal band Judas Priest.

And then there's the matter of the recent incident wherein he openly sexually harassed a woman, in the New York State Assembly Chamber, while waiting for Governor Paterson's State of the State speech to start. (And yes, publicly remarking that a woman who can't find a seat would get one if she offered lap dances does in my book qualify as sexual harassment.) The fact that this was done so openly makes him not only a harasser, but a stupid one.

One word: Fail.

• Name: Andrew Cuomo
• Democrat of Albany County and New York County (Manhattan)
• Current Occupation: New York State Attorney General
Andrew Cuomo is currently the most popular candidate in the field, by far. He is definitely electable, at least assuming he doesn't make any major missteps or otherwise screws up. And we know that screw-ups by New York State politicians are almost totally unknown.

However, Cuomo has several negatives as well, which will sooner or later get more publicity than they have so far. The first is his last name. Hardly anyone I have spoken to who lived through his father Mario Cuomo's 12-year reign as Governor of New York remembers it with much fondness. The business climate was considered bad (though it should be noted that “business climate” is a difficult concept at best), and Mario Cuomo was the most recent Governor to engage in layoffs of State workers. Young Andrew was deeply involved in his father's administration.

As Attorney General, Cuomo has pretty much stuck to easy targets, such as Wall Street and Senator Pedro Espada. Cuomo was also on the (legally) “wrong” side of Governor Paterson's battle with the Legislature over the appointment of a Lieutenant Governor. I have analyzed one of the policy proposals Andrew Cuomo made as Attorney General, his plan to manage the largest government employee pension fund. The article is elsewhere on this site. The proposal appeared to be poorly researched, not well thought out, and at the time the article was written there was no publicly available bill to examine, just some Press Releases.

As Governor, Andrew Coomo will not have the luxury of only taking on easy targets, and his judgments and policy proposals will have much more a direct impact on people's lives.

Finally, I must make a highly subjective judgment. I find it difficult to look at Andrew Cuomo, or read anything he or his office has produced, without somehow “feeling” a sense of entitlement oozing off of it. Others may disagree, I know. But to the degree that I'm right, New York surely doesn't need a Governor with a sense of entitlement.

• Conclusion
Quite simply, New York needs another candidate, and needs it badly. I don't ask for perfection, or even near-perfection. But the Empire State, at this juncture, badly needs someone worth having confidence in, rather than someone who is better than the rest.

Sadly, the latter may be all New York can expect.

Chasing Rats: Brief Thoughts on Eliot Spitzer and the Financial Industry

Eliot Spitzer, disgraced former Governor and Attorney General of New York State, has managed to turn himself into quite the financial industry expert, if one uses the number of television appearances he has made as an indicator of his expertise. As well as television, Wall Street is also a frequent topic of Spitzer's at his Slate column.

The most recent television appearance Spitzer has made on the topic as of the time of writing was on CBS's This Morning, on 11 January 2010. Spitzer, readers will be glad to know, confirmed that the anger at seemingly excessive Wall Street bonuses was “legitimate,” because tax dollars were used to fund the bonuses. (I reacted by breathing a little easier. I had worried that my anger was not legitimate, until Eliot Spitzer confirmed that it was.)

Spitzer says this as though there's people outside of the financial industry and, to a degree, Fox News, who disagree with him. (And even with Fox News, it depends on which conservative face they are putting on that day: Ayn Rand's corporatist capitalism or Pat Buchanan's pitchfork populism.)

Even Governor David Paterson, who turned a 9 December 2009 speech at the Museum of American Finance into an odd pep talk to Wall Street, probably agrees with Spitzer about the bonuses. Paterson, however, thinks he can get more mileage out of taxing the bonuses for State revenue than he can by complaining about them.

In the same CBS interview, Spitzer also let the world know that he has caught on to the fact that the Bush Administration's financial industry bailout (referred to in policy wonk jargon as the “Trouble Asset Relief Program” or TARP), has, as implemented, effectively socialized risk, and privatized profits. In other words, we all put up the money when things go poorly, but when things are going well, suddenly Capitalism kicks in, and the individual's profits are the individual's profits. We all share in the risks together, not the profits. It's grand to know that Spitzer has caught onto something that actual financial experts were talking about awhile ago.

However, I, for one, have long suspected that Spitzer actually played a role in the troubles (for want of a better term) on Wall Street, due to actions he took as New York State Attorney General. Not that he conspired with Wall Street, not that he participated directly, but rather that his actions pushed things further underground, where they could flourish all-the-more.

My argument goes something like this.

The Bush Administration, acting within a lax regulatory framework that I have read can be traced in part to the Clinton Administration, basically allowed the financial industry to do pretty much anything it wanted. Complicit in this of course was Federal Reserve Chairman Alan Greenspan, who openly praised the overly complex financial time bombs known as derivatives. We now know that derivatives were one of the main sources of the financial industry collapse.

For more than a decade, the former Federal Reserve Chairman Alan Greenspan has fiercely objected whenever derivatives have come under scrutiny in Congress or on Wall Street. “What we have found over the years in the marketplace is that derivatives have been an extraordinarily useful vehicle to transfer risk from those who shouldn’t be taking it to those who are willing to and are capable of doing so,” Mr. Greenspan told the Senate Banking Committee in 2003. “We think it would be a mistake” to more deeply regulate the contracts, he added.

See this New York Times article, the source of that quote, for more.

At about the same time, then Attorney General Spitzer was emerging as the “Sheriff of Wall Street,” pursuing the crimes of the financial industry with a driven intensity Eliot Ness would have envied.

It is frighteningly easy to imagine that Spitzer had prophetic powers, that his pursuit of financial industry misdeeds foretold the economic crisis. And certainly I have little doubt that Spitzer, with his undeniably sharp and keen intellect, had some idea of the obvious parallels between the lead-up to the 1929 Stock Market Crash and the lead-up to the 2008 Stock Market Crash. (Then again, however, so would anyone else who cared to read John K. Galbraith's great book The Great Crash, 1929 sometime during 2005 through 2008.)

(It is, of course, likely Spitzer's embittered pursuit of Wall Street that forms the basis of the media's re-imagining of him as some kind of financial industry expert.)

Consider this analogy, however. If the exterminator's rat poison is taken away, can you effectively kill the rats by chasing them into the walls where they can breed in privacy? No, you cannot. Rather, the exterminator needs his poison back, or needs traps.

Bush and Greenspan took away the poison. Spitzer, I would suggest, chased the rats into the walls. At the very least, I find it doubtful that Spitzer's sheriff act helped matters. Even Thomas Friedman in his book The World is Flat (at least in the edition of that book that I happened to read), admitted that Spitzer's actions had driven certain Wall Street analytical jobs overseas. Traps are slow going, and aren't as much fun as the chase. Same for poison. But you can kill a lot more rats than you can by chasing them.

The financial industry is a noble and necessary one. As long as there has been money, there has been a financial industry.

But, unregulated, it just becomes a rat breeding colony. And when you pursue the bad actions in that industry, of which I'm sure there are many more than we know about, using legal tools designed to chase common street criminals, all that happens is you chase the rats into the wall, where they are safer, and can breed in the dark.

The truth is that the financial sector doesn't need an exterminator, or a sheriff. It is telling that the most prominent current book about Spitzer was entitled Spoiling for a Fight. This was not the approach America needed on Wall Street. Rather, America needed "adult supervision" of the financial industry.

I find it telling that one potential for such an adult, U.S. Treasury Secretary Timothy Geithner, is one of many current objects of Spitzer's ire.

Spitzer thinks that Geithner, who then was at the New York Federal Reserve, either had a role in the troubles at AIG, or at least did not help. And Spitzer may well prove correct. But is anything Geithner might or might not have done at the New York Fed really the source of Spitzer's ire? Or is it the fact that Geithner is an adult, and the intelligent, spoiled child can always see the adult's faults more clearly than he can his own?

I don't know exactly how to test my theory that Spitzer's rat-chasing games hurt more than helped. I will leave it to Historians, I suppose. Perhaps one day it will make a fine exhibit at the Museum of American Finance.

-The Albany Exile

Hollow

Reports indicate that Senate Minority Dean Skelos is rejecting a deal with the Majority Democrats that would have potentially granted Committee Chairmanships to around 4 of his Republican Senators.

At the time of writing, just one of these Minority Chairmanships, of four that we know of that were being floated, is still in-play (Senator Maziarz, to chair the Standing Committee on Energy).

In a piece posted on the Albany Times Union's Website, Senator Skelos had this to say:

Senator Sampson, as the Democrats' new leader, believes that offering committee chairmanships to a few minority senators will change all that {the negative impact of one-party rule}. While well intentioned, his offer rings hollow.

Hollow. A very interesting word to use.

Elsewhere, Leader Skelos said:

“Senator Sampson’s proposal to appoint new chairs should be considered along with these other recommendations, by the bipartisan committee, before any action is taken," Skelos said.

"Our conference strongly believes that additional reforms must be made in a comprehensive way and not in a piecemeal fashion."

"We fought hard for the reforms that were enacted in July," Skelos continued. "We will continue to push for internal reforms, as well as other governmental reforms to make this Legislature and our government more responsive to the people’s needs."

And Senator Bonacic, in the same article, said something very similar:

"Chairmanships are positive. However, as the Majority repeatedly has said, real reform is not about titles. In fact, titles can sometimes mask dysfunction, since they create a presumption of bi-partisanship, when one may not truly exist. Chairmanships do not equate to reform."

The above quotes point to one of two stated reasons for the refusal: “Good government.” Reform of the Senate must be “real,” and committee chairmanships are a “hollow” half-measure. Another reason, however, was pointed to by Skelos spokesperson John McCardle, in the same article linked to above.

"Members would love to be chairs again," McArdle said. "But I think they all understand as a conference that there needs to be a sense that we're all in this together."

"(Skelos) has spoken to all of them {the Republican Senators}. He's not speaking for anyone, but everyone agrees a comprehensive solution is better than something done individually."

Party unity. Really, this is all the Senate Republicans have going for them, all they can offer, all they bring to the table.

Citing the “good government” reasons described above is, I believe, at best disingenuous of Leader Skelos. Anyone who knows anything about how legislatures operate, be it the U.S. Congress or the New York State Legislature or the Senate of Ancient Rome, knows that the committee system, by whatever name it is known, is critical to the operation of a legislative chamber. The idea of a committee system is simply to spare every lawmaker having to read every bill. On non-major issues, you can often simply trust your colleague who chairs the relevant committee.

Further, one of several insights reached by Political Scientist Joseph M. Bessette in his book The Mild Voice of Reason: Deliberative Democracy and American National Government is that true deliberation over public policy, at least in the U.S. Congress, tends to take place mostly at the committee level and below, mostly outside the public eye. (I should note that this statement is at best an oversimplification of the insights achieved by Bessette's in his complex and insightful work.)

Exactly how critical committees are in the legislative process depends of course on the legislative body and the particular policy at stake. And, of course, the ultimate say over what comes up for a vote, and usually what passes, is up to the leader of the chamber. No amount of “reform” can change the basic fact of majority rule in pretty much any legislature that is recognizable as such.

Under these real world conditions, minority committee chairmanships fit pretty much any reasonable definition of “real” reform. Committee chairmanships represent a real impact on policy outcomes, both directly (through influencing what bills can be considered by the whole Senate) and indirectly (by placing the Republican Senators in the most logical place for policy deliberation, where their ideas can be heard and matter).

Senator Skelos calls this “hollow.” A realistic chance for real, tangible influence is “hollow.” But what else is it that legislatures are supposed to do, if not legislate?

Democratic Conference Leader John Sampson's argument in favor of such an arrangement, also posted on the Albany Times Union's Website, is infinitely more convincing than is Senator Skelos's argument against it, if only because Sampson's argument recognizes that legislatures primarily exist to legislate.

Now, {wrote Leader Sampson} through the offering of bipartisan appointments to committee chairmanships, the Republican minority conference will enjoy an unprecedented level of involvement in the legislative process. Their constituents, as well as the entire state will realize a Senate more representative of all New Yorkers.

When the Republicans held the Majority in the State Senate, and they offered a single Democratic Senator a committee chairmanship (Senator Carl Kruger, Social Services), the Republicans hailed the move as unprecedented and bipartisan. If one Chairmanship was supposed to be good enough for the Democrats back then, why is more than one not good enough for the Republicans now?

Based on what I have seen, and based on Senator Skelos's own words cited above, I believe the answer is that legislation is not Leader Skelos's goal.

And thus we return to party unity. Leader Skelos appears to see unity not as a means to an end (as a tool to be used to influence policy), but as an end by itself. All he and his Republicans have going for them is party unity, or at least the appearance thereof. To run even a minor risk of losing unity, even if it is for the sake of doing the business that legislatures are supposed to do in the first place, is unacceptable politically to the Republicans.

I also cannot help but wonder if what Leader Skelos is really after is a higher central staff allocation. This presents him with a potentially large patronage base, and could allow him to increase his influence in New York State's shattered, increasingly irrelevant Republican Party. Central staff is nice. The Republicans, at least initially, were denied even the allocation that they granted to the Democrats, the Minority Conference staff budget having gone down from $7 million a year to $3 million a year, according to this New York Times article.

Senator Skelos's desire for more staff is certainly understandable. But, staff allocation should not be seen as an end. Nor should party unity. Both should be seen as different means to an end: Influence over policy. A Committee Chairmanship, or two or three or four, is another such means. It is most definitely not "hollow."

Whether or not a deal that involves Minority Chairmanships is ever reached, Leader Skelos has already tipped his hand. Based on his own statements, he appears to see the central activity of legislatures, enacting and influencing legislation, as “hollow.” This does not speak well for what he might do with the staff allocation he wants if he ever gets it.

A Reaction to the Gay Marriage Vote

The outcome of this vote was sad, but predictable.

I have a few messages for several parties.

• Firstly, to the supporters of liberal causes in New York State
Democrats are not automatically your friends. Flipping the Senate has not done you all that much good. The Senate Democrats have failed you.

• To Governor Paterson
Flipping the Senate did not help you. It has in fact hurt. You lack a foil now, you lack someone you are able to blame things on. It's just you, Speaker Silver, and the cowardly, incompetent people you helped to put in place in the Senate. They did not help you balance the budget, they did not help you pass gay marriage. Blaming failure on those of your own political party just does not work as well.

The Senate Democrats have failed you.

• To Senator Duane
You should have gone along with the Skelos-Espada coup, the bill would have stood more of a chance a few months back. Your personal distaste for Senator Espada pales in importance by comparison to the issue of gay marriage.

Your colleagues have failed you, and it is not only the Republicans' fault now.

• And, finally, to Republicans in the State Senate
I find it likely that many of you are basing your nay votes on the a misinterpretation of the events of the North Country Congressional race. This is a strategic error on your part, and a very bad one at that.

If this trend continues, if you continue to take your marching orders from Glenn Beck, I would be surprised if there were not a price to be paid.

The Attorney General's Pension Management Proposal

• The Bill That Isn't

The first thing to know about Attorney General Cuomo's pension bill is that it doesn't exist, at least not in public. Or if it does, it hides extremely well.

The bill was announced on 8 October 2009, in this Press Release of the Office of the Attorney General. Entitled the “Taxpayers’ Reform for Upholding Security and Transparency” (T.R.U.S.T.) Act, the bill's main feature is the replacement of the State Comptroller as “sole trustee” of the Common Retirement Fund (CRF) with a Board.

But the bill doesn't appear to actually exist yet, as far as I can tell. I can find no bill number, no public language. (And when I say “exist” I mean “exist in public.”) Senator Foley, alleged to be the bill's prime Senate sponsor, doesn't have the bill on his introduction record, and a search of two New York State bill databases, here and here, with the search terms “Transparency” and “Retirement” (separate searches) comes up with no relevant legislation. The former term I used because, often, when a bill has a popular name, like this one does, the name will appear in the bill's first Section, or in the Sponsor's Memorandum in Support. And the latter term because the bill's likely to amend New York State's Retirement and Social Security Law.

Either way, the point is that those searches were likely to have found the bill, if it were introduced. I must conclude therefore that the bills are not yet introduced. The Attorney General has spent a lot of time and money drumming up support for his bill, in suburban downstate, and on Long Island, and in Rochester, and in Western New York, but not one of these Press Releases features a bill number. The Attorney General has managed to build a lot of bipartisan support for a bill that does not, as far as I can tell, actually exist.

If someone knows the bill number, please E-Mail me with it at Albany_Exile at Yahoo.com. I'd love to take a look at it.

We are not assessing a bill, as there isn't one. Rather we're assessing a concept.

The best-known piece of this proposal, and apparently its centerpiece, is the proposal to dump the “sole trusteeship” of the CRF and replace it with management by a board of directors. So that's what this article is devoted to.


• Backdrop

The CRF is the pool of money that pays for the pensions of most State and local employees, including pretty much everyone except for most teachers. Teachers are covered by the fund of the New Yorks State Teachers' Retirement System (NYSTRS). The CRF has the money from 2 separate retirement systems, one for police, one for everyone who is neither a cop, nor a firefighter (they seem to be in the police system), nor a teacher.

The NYSTRS fund is managed by a Board, the CRF is run by the State Comptroller as a sole trustee.

The Attorney General's policy concern for this issue arises from multiple scandals that have arisen revolving around former Comptroller Alan Hevesi.

I make no claims to know the facts of the various Hevesi matters in any kind of detail. In broad terms, however, the scandals revolve around the exchange of money or employment of certain individuals to encourage certain pension fund investments. Effectively it's a form of lobbying the Comptroller to invest in certain ways. Some of these lobbyists were honest, some less so. The system has come to be known as “pay to play.” The investments themselves may have been legitimate in many cases, but the system itself is obviously questionable at best.

Some allege that the sole trusteeship system, which places sole responsibility for a rather large pile of money with one person, encourages corruption by providing a readily available point of entry for those who would engage in corrupt practices. The Attorney General thus proposes establishing multiple points of entry. The bill has this as its specific, explicit purpose. The following is a quote from the Press Release linked to above:

“For decades, the State pension fund has been weakened and corrupted by the sole trustee model,” said Attorney General Cuomo. “The model has allowed pay-to-play to flourish in a system meant to protect the retirement accounts of thousands of hard-working public employees. To put it simply - the model doesn't work. It’s about as sensible as having a single lock on Fort Knox. Today’s legislation will ensure that the fate of our public retirement fund isn’t decided by one individual, and that the entire system is rid of the kind of pay-to-play that infected and derailed it in the first place.”

That's the policy purpose of the bill. Obviously it's quite possible, and I'd go so far as to say it's likely, that the bill also has a political purpose: To undermine the current State Comptroller (Thomas DiNapoli, a potential rival, though for what I can't really guess), and add to Attorney General Cuomo's emerging reputation as a fighter of corruption in all its forms.


• The Sole Trusteeship

Having established that the explicit, deliberate purpose of the Cuomo proposal (we can't quite call it a bill yet, regrettably, as seen above), is to lessen corruption, judging the bill is thus heavily contingent upon its ability to do just that. That's only fair.

The CRF may or may not be unique among public pension funds in having a sole trustee, but it surely is at least nearly so. As described above the teachers' retirement fund, the NYSTRS, is managed by a board, as are the 5 pension funds for New York City employees. Jun Peng, in his 2009 book State and Local Pension Fund Management, does refer to the CRF's sole trusteeship system as “unique” (page 93). So, even allowing for the fact that Peng might be wrong, at the very least we can fairly say that the sole trusteeship system is very rare.

Now keep in mind I am fairly certain that in most cases it isn't the Comptroller actually running the CRF on a day-to-day basis. He likely has staff who does most of that. In fact they are likely career civil servants who are highly-paid, highly-skilled, very good at what they do, and largely invisible to us. But the point is that the Comptroller is responsible for the fund. (Such terms as “trustee” and “fiduciary” are made to imply responsibility as much as they are made to imply day-to-day duties.) And, further, that he could steer investments in certain directions regardless of what his likely-capable staff tells him.

I went through some of the writings on management of pension funds. For the most part, the writers assume it is a board or committee of some kind managing the fund. The sole trusteeship is rare enough that the issue of the relative advantages and disadvantages of sole trusteeship versus board management hasn't come up all that much. That doesn't mean, however, that the issue hasn't come up at all.

In 1968, a conference on pension fund management was held, and in 1969 a book was produced based on this conference, with the awkward title of, Pension Fund Investment Management: Proceedings of the CFA Research Seminar, Sep 13-14, 1968, Charlottesville, VA. For some reason, when this book was published, all the conference participants were assigned 3-letter false names, and those false names were then randomly-rotated, thus keeping everyone anonymous. (Why people would participate in a conference and think they had some kind of expectation of anonymity is completely beyond me.)

At a panel discussion at that conference, the following relevant exchange was had:

“HAP: Isn't the conclusion that somebody should act alone, either the company or the bank? It's a joint management that runs into trouble, it's the centralization of responsibility that produces the best results in performance, whether it be company-operated or bank-operated.”

“VAL: The closer you get to one man doing it, the better. Get away from the committee. You've got to get down to one man. Get the right man, give him responsibility, and let him go. Not only in investment, but in anything you do.”

“KEN: That's true. That works in the bank too. You must get away from the committee system.”

“TED: The investments that two people are going to agree on, are going to be insipid investments. They are the ones that are not going to be very bad or very good. But the investments that they're going to disagree on may be those that make a lot of money.” (Pages 10-11)

On page 12, all of the participants in the panel again agree that unitary management of a pension fund is best.

Jun Peng's 2009 work has already been mentioned. The following quote is telling:

This brief story of the New York pension system offers two lessons. First, the unique pension governance structure [the sole trusteeship] limits to some extent the reduction in pension contribution by the State government, which can be best appreciated in comparison with New Jersey. The independence of the New York pension system trustee allows it to be more willing to challenge any government attempt to reduce pension contribution. Second, even such independence cannot render the system impervious to the temptation of pension contribution reduction in times of strong investment return and, thus, the risk of volatility to state and local government operating budgets. (Page 164)

Peng, mostly by accident, does point to a specific disadvantage of the sole trusteeship system, which he curiously fails to consider seriously. On Pages 162-163 he considers then-Comptroller H. Carl McCall's reduction of local government employer pension fund contributions to near-zero levels, which occurred in the late 1990s and early 2000s. Peng considers this move solely in the context of that the fund was doing quite well at the time, and didn't necessarily need a great amount of money from the employers. Investment returns were funding the system quite well. He fails to consider, however, the obvious fact that Comptroller McCall was preparing for a run at the Governorship in 2002, for which the support of perpetually cash-strapped local government officials would surely have helped.

Based on these writings, it appears as though the best thing that can be expected from switching to a board system is an at-best neutral result. So, I must ask, why spend the money to establish a board and then staff it up and then make it work on a day-to-day basis for a result that's at best neutral.

What kind of analysis did Attorney General Cuomo engage in to produce this proposal? Did his policy people find writings that I didn't find?

Well, perhaps he studied the fund management of other States, which by and large do not have the sole trusteeship system, and discovered it to be corruption-free or nearly-so.


• Pension Fund Corruption in Other States

So, are pension funds managed by boards corruption-free or nearly-so?

In a word, no. In and of itself, that fact didn't surprise me, but what did surprise me was to find this article on the website of Governing magazine, dated 5 November 2009, detailing a “pay-to-play” scandal in California's CALPERS retirement system, which is run by a board. I must admit that I expected to find the occasional scandal or corruption involving other states' pension funds, but I hadn't expected to find something that similar to New York's scandals, that quickly, dated that recently.

In the Spring of 2009 a civil trial began related to an odd, multi-layered scandal involving the city of Milwaukee's public pension funds, as detailed in this article on the website of the Milwaukee Journal-Sentinel, posted 2 May 2009. This scandal didn't involve investments, but still.

Here, the Heartland Institute discusses the under-funded and “scandal-plagued” nature of the State of Illinois' public pension funds. And, also involving Illinois, here is an April 2009 proposal from the Illinois State Treasurer to reform the Illinois pension funds in the wake of various scandals. The funds at issue are all managed by boards, but it hasn't helped Illinois remain scandal-free. In an interesting twist, the Treasurer has proposal involved consolidating the State's 5 pension funds into a single entity. While this isn't quite the same as his having proposed a sole trusteeship, it does provide some evidence against the “more is better” idea underlying the Cuomo proposal.

It is clear that, at least at first glance (and second glance, for that matter), that neither the body of writings on pension fund management nor a cursory analysis of other states' funds so much as suggests that changing the management system would exclude corruption from the system. At most it would offer the potential, sooner or later, for a pay-to-play system to emerge with multiple points of entry.

If the Attorney General and his policy staff have some kind of specific reason to think this measure will work, if they have some analysis indicating why their idea will succeed where other board management schemes have failed at forestalling corruption, if they have some kind of analysis showing that corruption in other states' pension funds, while it does happen, is measurably less than in New York? If they have any of that? They are for some reason keeping it a secret. To rely on “common sense,” is a bad idea. As journalist (or is he a “humorist?” I'm not sure honestly) Charles Pierce points out in his darkly humorous 2009 work Idiot America: How Stupidity Became a Virtue in the Land of the Free, common sense “rarely is common and even more rarely makes sense” (page 35). At the very least, it is fair to say that common sense alone is not enough to justify this conclusion.


• Conclusion

Why do something like this in the middle of a fiscal crisis when the State might run out of money for normal operations in under a month? From the body of writings on pension fund investment, the move from sole trusteeship to board management would be a neutral one, and that's being rather generous. It would doubtlessly be expensive, and disruptive. How could it not? The board will need staff. The board will need to be elected. The board will need to do a lot of report-reading in order to come up to speed.

And is there anything New York State needs less at the moment than to enact a policy potentially expensive, doubtlessly disruptive, and unlikely to achieve its specified aims?

In any other time, if the money was there, the answer would be a “why not?”

But, not now. This measure ultimately has a lot more to do with Attorney General Cuomo's quest to become Governor of New York (and why anyone would want that job is beyond me) than it does with policy.