BY PASCAL J. GOLDSCHMIDT AND KENNETH W. GOODMAN

PGOLDSCHMIDT@MED.MIAMI.EDU

Miami Herald – link to original

Feb 6, 2010

Medical fraud kills people. Because it does this slowly and indirectly, we tend not to notice it, and our response is more often the clucking of tongues than the moral outrage that usually accompanies mass murder.

But make no mistake: People who abuse the system by charging for bogus medical services, billing for unnecessary or inappropriate procedures or devices — or even inventing patients and billable maladies — are killers.

Alas, South Florida leads the nation in medical fraud. In recent years, according to the Medicare Payment Advisory Commission and the Dartmouth Atlas of Health Care: “Miami-Dade and Broward counties spent 39 percent more on health services than the national average, the highest rate of any U.S. community.” Miami-Dade spent an average of $2,200 per Medicare patient on durable medical equipment; the national average is $250. The county has more per capita equipment suppliers than anywhere else.

Miami-Dade received half a billion dollars in payments for the sickest home healthcare patients. That sum was more than the rest of the United Stated combined, despite the fact that 98 percent of eligible patients do not live in Miami-Dade. It has therefore become a regular occurrence to learn that someone in South Florida has been arrested for inventing another way to defraud the system by especially odious means — billing or charging patients under the false pretense of providing medical care.

Recently, U.S. agents arrested 26 people, including a Miami doctor who was accused of a $40 million rip-off in which home-care patients were fraudulently described as blind diabetics so Medicare could be billed for extra nursing visits. So, what else could we spend that $40 million on? How many lives could be saved under a comprehensive reform of the U.S. healthcare system — reform impeded by distrust that is magnified by fraud? Medical reform has for generations focused on reducing the cost of healthcare, about $10,000 per year per adult. Healthcare budgets are generally capped annually, so that when criminals acquire resources through fraud, those resources are not available for real patients, for needy patients, for the rest of us. That is, the consequence of fraud is the diversion of resources that would otherwise improve — or save — the lives of patients.

It is not as if that $40 million home-care swindle is directly responsible for the deaths of Garcia or Smith or Baby Marie, or that the money will somehow show up in the budget. We contend that medical fraud is fatal because the budget for Medicare and Medicaid is limited and healthcare con games can divert resources from life-saving procedures, treatments and public health services such as vaccinations.

Indeed, some of the billions diverted by Medicare and Medicaid hoodlums could in principle be allocated judiciously and used to save the lives of newborns and frail elderly patients, help poor patients of all ages to buy their medicines and provide uninsured patients with access to life-saving procedures such as dialysis for kidney failure.

What can we do to stop this epidemic of fraud, one of South Florida’s most dangerous scourges?

Some steps are obvious: If you know of someone who is engaging in medical fraud, report it to the police. If you are invited to participate as a patient or care provider in medical fraud, report it. Prosecutors say the Miami doctor arrested in the $40 million fraud case referred 1,250 patients and bribed two clinic owners — lots of potential warning-flag wavers there.

The government gives solid advice: “You, as the Medicare beneficiary, are the most important link in finding Medicare fraud.” (Visit www.medicare.gov/fraudabuse/HowToReport.asp for comprehensive instructions.)

Federal authorities are focusing on South Florida to combat medical fraud. We welcome their efforts and want to help them. Indeed, all people of good will need to help them, and support the fight against this deadly 21st Century crime wave. Health system rip-offs are not very interesting to ethics experts; their wrongness is beyond dispute. The real challenge is at the level of public policy, where civil society must find the means and mettle to say enough is enough.

Pascal J. Goldschmidt is dean of the University of Miami Miller School of Medicine and CEO of the University of Miami Health System. Kenneth W. Goodman is director of UM’s Bioethics program.

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They’re growing, despite union hostility.

The Wall Street Journal - link to original

Charter schools reached a new milestone this year. According to the Center for Education Reform, more than 5,000 charters are now operating in 39 states and the District of Columbia. Considering that the first charter didn’t open until 1992, and that these innovative schools have faced outright hostility from teachers unions and the education bureaucracy, their growth is a rare gleam of hope for American public schools.

More than 1.5 million students now attend charters, an 11% increase from a year ago. That’s only about 3% of all public school students, but the number has more than quadrupled in the past decade. And it would be much higher if the supply of charter schools was meeting the demand. As of June, an estimated 365,000 kids were on waiting lists.

The students who attend these schools, which are concentrated in urban areas, tend to be low-income minorities. Yet they regularly outperform their peer groups in traditional public schools often located blocks away. In their 18-year history, only 740 schools have lost their charters and been shut down for poor performance. Unlike traditional public schools, charter schools must be re-authorized every few years, which means they don’t exist in perpetuity to fail multiple generations of youngsters.

Despite this record of accomplishment and accountability, the charter school movement continues to face all manner of obstacles. Eleven states ban charters, and even those that don’t can make it very hard for them to succeed and multiply. Charters typically receive less money per pupil and, unlike other public schools, they must pay for the buildings they occupy. In many states, charter enrollment is capped and only school districts—which generally oppose charter schools—are allowed to approve charter applications.

The Obama Administration has said it will withhold discretionary federal education dollars from states that block the creation and growth of charter schools. Let’s hope it follows through. We’d be hard pressed to name a more successful education reform in recent decades.

Printed in The Wall Street Journal, page A26

The Ford Foundation finds a needy cause: teachers unions.

Nov 17, 2009

The Wall Street Journal, page A24 -  link to original article

http://online.wsj.com/article/SB10001424052748704402404574527641778464958.html?mod=article-outset-box

We hate to say it, but don’t be misled by headlines. The biggest headline in education circles last week was that the Ford Foundation is making a whopping $100 million grant “to transform secondary education in the nation’s most disadvantaged schools.”

Our eyes raced to see which piece of the vibrant school-reform movement Ford was going to support. Would it be America’s 4,600 charters schools, many outperforming their traditional school peers and some even closing the race gap? Maybe it would be Teach for America, busting at the seams and turning down Ivy League applicants by the hundreds. Or, who knows, maybe Ford’s really on the leading edge, and would want to support voucher programs in cities like Washington.

Would you believe the recipients of Ford’s largesse are the teachers unions? Yup. The folks at Ford are giving new meaning to the word “retro.”

Ballyhooing the $100 million, the foundation’s president Luis Ubinas said, “Improving our schools, and giving the most vulnerable young people real educational opportunities, benefits all of us. With this initiative we want to shake up the conversations surrounding school reform and help spur some truly imaginative thinking and partnerships.”

And yet the Ford press release contains not one mention of charter schools, vouchers, merit pay or even Teach for America. Literally speaking, this really does shake up, not to say shock, “the conversations surrounding school reform.”

Ford’s formula for reform involves more money, less accountability and a bigger role for the unions. “Many state finance systems fail to allocate enough resources to provide quality schooling for all students,” Ford’s daring analysts write. And, “standardized tests are a blunt and inadequate tool by which to gauge student learning and school effectiveness.”

But one of the screaming ironies of public education, known to all, is that some of the worst school districts in the country spend the most money on students. Standardized tests may be a “blunt” instrument, but they are also the only way that parents have had of holding bad teachers and terrible students accountable. This is why the unions dislike student testing, as well as teacher pay based on student performance.

One of Ford’s first grants will go to the new American Federation of Teachers Innovation Fund, a “union-led initiative to make grants to AFT affiliates nationwide for innovative efforts established jointly by teachers, administrators, and parents.” Here’s guessing the main such innovation will be more money for everyone regardless of results.

The fact that Ford is supporting the unions—the biggest barrier to school reform in America—is no surprise. The foundation has funded just about every major failed liberal establishment program since the Great Society. Head Start, Job Corps and the Community Development Corporation were launched from Ford templates. In the 1970s, the foundation supported forced sterilization programs to curb overpopulation in the third world. A few years ago it gave money to an Arab NGO that wanted to wipe Israel off the map. It also largely paid for the University of Michigan’s defense of affirmative action at the Supreme Court.

Last Wednesday, by contrast, the Gates Foundation offered $10 million to help the wildly successful KIPP charter schools expand in Houston. One might have hoped that Ford’s administrators would have looked at some of the real innovation being done by philanthropies such as Gates or the Walton Foundation and seen how truly far behind the times Ford’s ideas are.

Oh, well, another $100 million for education down the drain.

——————————————

Letters to Editor – Dec 3, 2009

Ford Foundation Has Right Idea in Helping Education

It is unfortunate that too many people involved with education reform reinforce outdated ideas and create other barriers to real change (”The Edsel of Education Reform,” Review & Outlook, Nov. 17). However, the notion that we can move forward and improve education in this country without addressing and grappling with the complex issues of teacher unions in a way that ultimately supports the primacy of educators is both shortsighted and counterproductive.

It is essential that we untangle the terrible knot that both management and labor have created when it comes to defining teacher roles. Today’s schools need to improve, and real improvement evolves from redefining the roles and responsibilities of educators in a way that supports both teachers and learners. We must give teachers the resources necessary to provide all students with high-quality educational experiences and we must hold educators accountable in fair, rigorous and meaningful ways.

The Ford Foundation seems to recognize this, and to simply cast its strategy as another stage in some supposedly backward-thinking program ignores both its regard for diligence and the priority it has consistently placed on innovation across all of their grant-making. If anything, the foundation deserves credit for taking another stab at undoing a difficult knot that the status quo has long kept tangled.

Nicholas C. Donohue

President and CEO

Nellie Mae Education Foundation

Quincy, Mass.

The Ford Foundation is pumping $100 million into the teachers unions—hoping for a miracle. Pouring more money into an inferior system will continue to result in the same disastrous outcome; that’s what happened to the U.S. auto industry and that is precisely what will happen in the U.S. education system.

Andre George

Paradise Valley, Ariz.

It may be true that the Ford Foundation is testing unknown reforms, but that is the perfect role for a foundation: private funds seeding innovation that can then be taken up in the public sector. Head Start is a prime example of such success. Despite the implication in the editorial, the research on the interventions lauded by the Journal is inconclusive, for any study citing benefits of charter schools you can find another documenting their shortcomings. These and other similar initiatives may appeal to an audience with a propensity towards competition and market-based solutions, but it is disingenuous to regard them as the only real reform.

Lori Bezahler

President

Edward W. Hazen Foundation

New York

The Ford Foundation’s $100 million gift to the teachers unions to “transform secondary education in the nation’s most disadvantaged schools” is more of a political donation than an educational one.

As chairman of the board of directors of the Chicago Annenberg Challenge, Barack Obama oversaw the dispersal of $110 million, all supposedly to help the kids in Chicago public schools. William Ayers co-founded the Challenge. Together they burned through the $110 million over a five-year period. Not surprisingly there was little improvement in student achievement.

Steve Tanberg

Denver

By JENNIFER MEDINA

Published: November 25, 2009

The New York Times – link to original

WASHINGTON — Mayor Michael R. Bloomberg said on Wednesday that New York City public schools would immediately begin to use student test scores as a factor in deciding which teachers earn tenure, a proposal that has been bitterly opposed by the teachers’ union and criticized as putting too much weight on standardized exams.

The city already uses test scores in evaluating the system: to determine teacher and principal bonus pay, to assign the A through F letter grades that schools receive, and to decide which schools are shut down for poor performance. The mayor is now putting even more weight behind those scores by using them to decide which teachers should stay and which should go.

In a speech in Washington on Wednesday, alongside the secretary of education, Arne Duncan, the mayor also called on the State Legislature to make a number of changes, some of them also anathema to the unions, that would help New York State compete for hundreds of millions of dollars in the so-called Race to the Top federal grants. The program will distribute $4.35 billion in stimulus financing to states for innovative education programs.

The speech suggested that the mayor may use his third term to take on the United Federation of Teachers, which sat out the mayoral election during a period of relative labor peace. The mayor did not mention that he could achieve some of the same changes by negotiating with the union, whose contract expired shortly before the election.

While many of the changes he is seeking could be accomplished at the negotiating table, his speech indicated that he would turn to Albany to take up much of the fight.

The Bloomberg administration contends that it already has the power to use test scores in tenure decisions. But, he said that the Legislature should require all districts in the state to evaluate teachers and principals with “data-driven systems,” one of the factors Mr. Duncan will use in deciding which states will receive Race to the Top grants.

The mayor also said the state should allow teacher layoffs based on performance rather than seniority, as they are now. It is a particularly crucial topic now, because the city may face large budget cuts and potential layoffs.

“The only thing worse than having to lay off teachers would be laying off great teachers instead of failing teachers,” Mr. Bloomberg said. “With a transparent new evaluation system, principals would have the ability to make layoffs based on merit — but only if the State Legislature gives us the authority to do it.”

Sheldon Silver, the Assembly speaker, suggested that the mayor would not find satisfaction in Albany. “These are all contractual issues that should be dealt with at the bargaining table,” he said.

The teachers’ union has fought the use of test scores in tenure decisions, and last year successfully lobbied the Legislature to ban it for teachers hired after July 1, 2008. That law is to expire next year.

The city contends that it has the power to use scores for the next batch of teachers up for tenure — those hired in 2007 — and if the Legislature does not renew its law, the city could do so for all teachers hired thereafter. Teachers generally receive tenure after three years; 93 percent of teachers up for tenure in the last school year received it.

Mr. Bloomberg said that banning the use of student achievement in tenure decisions is “like saying to hospitals, ‘You can evaluate heart surgeons on any criteria you want — just not patient survival rates.’ ”

Michael Mulgrew, the president of the city’s teacher union, said he was “very, very disappointed” in the tone of the mayor’s speech.

He did not rule out filing a lawsuit once the details of the mayor’s plan have been fleshed out.

He said that using the test scores was a poor way to measure teachers, citing criticism that the tests have become too easy, with so many students showing large improvement that they have lost their meaning as gauges of learning.

“How do we constructively fix that instead of saying let’s play political agenda and propaganda?” Mr. Mulgrew asked.

Perhaps anticipating such criticism, Mr. Bloomberg also urged the state on Wednesday to adopt national standards and make the test more difficult.

Kate Walsh, president of the National Council on Teacher Quality, called the issue of state tests the “Achilles’ heel of the accountability movement.”

“When you ask any teacher, even a good one, they tend to be pretty leery of being held accountable on these tests,” Ms. Walsh said. “These tests aren’t linked to the actual curriculum, and they have to be.”

But, she said, they have “validity for making decisions at the extreme end: Teachers who are really talented tend to be in the top and teachers who are poor tend to be in the bottom year after year.”

Teachers interviewed on Wednesday about the plan were universal in their condemnation. “It’s ridiculous,” said Kanayo Al-Broderick, a third-grade teacher at Public School 56 in Clinton Hill, Brooklyn, who is in her 22nd year of teaching. “It just means they did well on this test. Does it show we’ve built them to be lifelong readers, to love reading? That’s what all teachers want.”

Education officials said they had no details on just how scores would be used for tenure decisions. Many teachers have no scores to go by: Only children in grades three through eight take the annual English and math state standardized tests, and high school students take Regents exams only in certain subjects.

The mayor also called on legislators to make it easier to fire bad teachers and teachers whose jobs have been cut but who are guaranteed their salaries even if they cannot find a new job in the system. The city is now paying more than $100 million for these so-called reserve teachers, many of whom lost their positions because their schools were closed for poor performance. Mr. Bloomberg said that the state should place a one-year limit of teachers in the reserve pool, something he could also press for in the contract.

In a move almost certain to increase that pool of teachers, the mayor also said that his goal was to shut down the lowest-performing 10 percent of city schools. So far, the Bloomberg administration has shut down 91 schools across the city.

Legislators in Albany are preoccupied with cutting the state budget, and Mr. Bloomberg appears to be trying to convince them that changes in state education law could bring much-needed millions of dollars to the state.

“We’re committed to exploring any avenues to bring in increased federal funding to the state,” said Austin Shafran, a spokesman for Senate Democrats.

Many states have made significant changes to state law to improve their chances at receiving Race to the Top money, but the Legislature in New York has not made any considerable effort to do the same.

Mr. Duncan, who sat just feet away from the mayor but remained silent on most of his proposals, said that he supported the idea of tying student data to teacher evaluations but he stopped short of endorsing the administration’s plan.

“Everyone agrees the current system is broken,” he said. “We have to talk about what makes sense.”

Karen Zraick contributed reporting.

By Thomas Oliver

The Atlanta Journal-Constitution - link to original

6:19 p.m. Thursday, November 19, 2009

You know things are awful when Washington politicians seem genuinely concerned about small business, rather than simply spouting the usual platitudes toward an amorphous group that typically lacks the political muscle of Wall Street or unions.

Within the last week, head honchos from the Federal Reserve, the Treasury, Goldman Sachs and Warren Buffett himself have expressed concern that small business isn’t responding as needed.

And it is needed.

Small business (defined as 500 or fewer employees) creates 60 to 80 percent of new jobs. So it’s not an exaggeration to suggest that without a healthy, growing small business sector, there will be no recovery.

Yet there is mounting evidence that small business has taken an unusually hard hit this recession.

In looking at data since 1992, Atlanta Fed economist Melinda Pitts wrote: “Firms with less than 50 employees have made up approximately one-third of the nation’s employment growth. During the employment declines associated with the 2001 recession, these firms made up only 9 percent of job losses. In the current recession, though, these very small firms have made up 45 percent of the nation’s job losses.”

Ouch. That’s five times the rate of job losses than in the previous recession, or over 3 million people dropped from payrolls of the smallest firms.

And to make matters worse, the financing needed to reverse that trend and fuel growth just isn’t there.

Treasury reported that the 22 largest banks receiving TARP money had cut $10.5 billion from their small business portfolio.

The Small Business Administration has approved one-third fewer loans this year than last.

Smaller banks, too, have clamped down on lending.

Add the fact that many small businesses are partly financed through their owners’ credit cards and home equity – two major lines of credit that banks have clamped down on — and the picture grows dim.

As if that wasn’t bad enough, Fed officials note a link between smaller banks, which normally supply small businesses their loans, and the commercial real estate crisis that is further curtailing lending.

In a recent speech to the Urban Land Institute’s Emerging Trends in Real Estate Conference in Atlanta, Dennis Lockhart, president of the Atlanta Fed, said banks with the most exposure to commercial real estate are the same banks that lend mostly to small businesses.

Those banks are hunkering down. They aren’t looking to help small business get back on track.

Jimmy Adams, executive vice president of the Atlanta-based Adams Transfer & Storage, said his bank is providing credit for continuing operations but nothing that would be associated with growth.

“Anything beyond the core that even remotely smells of investment, or something for which you don’t have a contract in hand to pay for it, and you aren’t going to get credit,” Adams said.

“We are all on the sidelines,” he added.

Growth does not occur on the sidelines. Nor does it feel like a recovery to those on the sidelines.

It feels fragile.

Like “any bump in the road will put us back in recession,” Adams said.

————

Thomas Oliver writes the Sunday business column. He can be reached at toliver.writeright@gmail.com.

OP-ED CONTRIBUTOR

By FRANK R. GUNTER

Published: November 15, 2009

Bethlehem, Pa.

The New York Times – link to original article

AFTER returning from the second of two tours in Iraq, I can attest to notable progress. Iraqi civilian casualties have dropped sharply, the result of both the United States surge and negotiations with Sunni groups. There has been political progress as well. Provincial elections were held this year and national elections are scheduled for early 2010.

The future of the Iraqi economy, however, remains bleak. Without fundamental change, unemployment and the accompanying instability will rise while the widespread corruption will worsen. The political and security gains made at such great cost in Iraqi and American blood and treasure will be imperiled.

Iraq not only has a severe shortage of jobs, it also has a growing number of job-seekers. As much as 51 percent of the Iraqi labor force is either unemployed or underemployed; the number is even higher for young workers. For three decades, the Iraqi government has been the primary source of employment. Almost half of the country’s labor force is paid by the government from its revenues from petroleum exports. With the exception of agriculture, legitimate private-sector employment is small — by my calculations, about 6 percent of the labor force. Most of the remainder of the Iraqi labor force is either unemployed or working in the underground economy.

In 2008, the sharp rise in oil revenues and improved security led to an economic boom. The government created more than enough new public sector jobs to absorb the approximately 250,000 young people who enter the work force every year.

However, this economic surge was short-lived. After oil prices dropped by almost $100 a barrel earlier this year, the government imposed a hiring freeze and unemployment began to rise.

Unfortunately, there is nowhere for these job-seekers to go. Iraq’s private sector is unable to employ many of the jobless because the country has one of the most hostile business regulatory environments in the world. (Of the 183 countries ranked by the World Bank for the “ease of doing business,” Iraq is 153rd.) In Iraq, it is hard to legally start a business, get credit or trade internationally. As a result, most private businesses either hide in the underground economy — with all of the associated inefficiencies — or accept the necessity of bribing an unending stream of government officials.

This is not sustainable. In 2010, the Iraqi government will hit the wall. A combination of low oil prices, exhausted cash reserves and the expense of paying for a bloated government sector will prevent the creation of public sector jobs. And the private sector, as it continues to struggle with excessive regulation and corruption, is unlikely to create more than a fraction of the needed employment. Rapid growth in the number of unemployed young men will likely follow — and these young men will be attractive recruits for political insurgents, fundamentalist terrorist groups and criminal gangs. Increased instability is almost certain.

There is another path. The potential for private sector job growth in Iraq is great. The country is blessed with a strong entrepreneurial tradition, a relatively well-educated labor force and a natural resource more valued in the Middle East than oil: water. Only Iraq and Turkey have sufficient water for large-scale agribusiness, and Iraq is surrounded by wealthy countries that need to import food. But to exploit these advantages, Iraq needs to make important changes. And it should start by rationalizing its commercial code.

The chief problems in Iraq’s commercial code are its incredible complexity, long delays in processing requests for licenses and high cost. For example, registering a new business in Iraq costs almost $2,800 compared to $139 in Delaware. (However, a group of Iraqi businessmen assured me that if $600 in cash was given to the right person, a license would be available immediately and no further fees would be required.)

The country could simply throw out its current commercial code and adopt a less restrictive, regionally acceptable one — like Saudi Arabia’s. Or, more realistically, it could make its code more user-friendly by, say, allowing business owners to work with one ministry — as opposed to a dozen.

The government could take other steps, too. With the exception of tax collection and international trade regulations, responsibility for regulating private businesses could be taken from the Baghdad ministries and delegated to the country’s 18 provinces. Encouraging the provinces to compete for private-sector jobs would lead to friendlier regulatory environments around the country — just as it has in the United States.

But whatever is decided, the government of Iraq is running out of time. It must either end its hostility toward private businesses — or accept that a sharply growing mass of unemployed will nullify the progress of the last three years.

Frank R. Gunter, an associate professor of economics at Lehigh University, was the senior civilian economics adviser to the Multinational Corps in Iraq from 2008 to 2009.

The Department of Education reported the other day that, of the $97.4 billion in economic-stimulus funding that Congress steered its way, 69 percent was “obligated” by September 30. (The balance — including Secretary Arne Duncan’s much-discussed “Race to the Top” money — must get out the door by September 2010.) In other words, Washington spent almost $68 billion more on education in fiscal 2009 than it otherwise would have. Though this is less than 10 percent of total “stimulus” spending, it’s a whopping big number by historical standards of federal aid to schools and colleges.
What has all that extra money actually bought? The main answer, trumpeted by the Obama administration in a new 250-page document, is jobs, jobs, jobs. “The data,” boasts the Education Department, “indicate that approximately 400,000 jobs have been retained or created through the U.S. Department of Education ARRA grants. They reveal that the rapid distribution of this funding allowed States to fill significant education budget gaps in order to avert layoffs of personnel in public school districts and universities across the nation.” (Colorado, for example, salvaged or added 3,370 educator jobs with its $844 million.
It’s a fact that employment was an explicit purpose of stimulus funding — Congress said as much — and with today’s jobless rate over 10 percent, only a churl would deny the humanitarian value as well as the political appeal of this. That said, well-run public organizations and private firms are using the economic crisis to purge weak performers, cherry-pick talent, and position themselves to be more productive going forward. Turning schools into a jobs program is a dubious way to tone them up for the 21st centuryAnd a tone-up — indeed, a makeover — is what they need. When the American Recovery and Reinvestment Act (ARRA) was unveiled last winter, President Obama and Education Secretary Duncan said exactly that. In February, Obama told Congress that “We know that our schools don’t just need more resources; they need more reform.” Duncan termed ARRA an “historic opportunity to create jobs and advance education reform.” He declared that “a lot of this money will be tied to higher standards and reforms that are desperately needed.” In March, he told the House Budget Committee that ARRA provided “unprecedented levels of Federal support for our schools in return for a commitment to meaningful reform strategies.”
Eight months later, however, it’s all about jobs — and this in a sector that has been a job factory for many decades. Indeed, education employment has grown far faster than pupil enrollment, and more dramatically than employment in many other fields. Though coaxing greater productivity and efficiency from the private-sector workforce has been a major contributor to U.S. prosperity and economic growth, things haven’t worked that way in our schools.
Primary- and secondary-school enrollments have risen by about 10 percent since 1970, but the teacher rolls grew by 61 percent during the same period — an addition of some 1.4 million instructional personnel. The higher-education picture is similar though less egregious, with enrollments up 64 percent since the mid-1970s while campus employment doubled.
Let’s at least acknowledge that all these added employees have not boosted the performance of our schools and colleges. Seen in that light, today’s recession, however painful for individuals who might lose their jobs, could have had a useful purgative effect on the education workforce as in other fields. One might even wager that seizing this opportunity to shed the least effective instructors and ancillary personnel would result in higher quality. Such close analysts as Stanford economist Eric Hanushek estimate that substantial gains in pupil achievement would follow from (permanently) ridding K–12 education of the weakest 10 percent of today’s teachers — even if that means adding a few pupils to the classrooms of those who remain.
ARRA has cushioned districts and states from having to consider such bold moves. Meanwhile, there’s absolutely no evidence — let’s acknowledge the administration’s honesty here — that ARRA’s flood of additional federal spending has done anything for pupil learning or education reform.
To be sure, the $4.5 billion in “Race to the Top” money that remains to be committed in 2010, though barely 5 percent of education’s ARRA funding, may well pay for some worthy changes. Enthusiasts, including David Brooks and a bevy of zealous reformers, point to cases in which states have already been prompted to lift their charter-school caps or revisit their data policies so that, for example, student achievement can be linked to teacher evaluations. Such measures are welcome indeed, but it’s not clear whether they justify ARRA’s whopping cost or the avoidance of belt-tightening that it has made possible. It’s good that the administration pushed Congress to include Race to the Top, but the education stimulus package still looks like a jobs cake with a bit of reform frosting.
Moreover, while Duncan seems bent on making Race to the Top a program with real traction, will he be able to stick to his guns once senators and governors start to pound on the White House for their states’ shares? It could yet disintegrate into superficial compliance, canny grant-writing, and political arm-twisting. Still, optimism is a virtue. And heavy-duty reform, as Duncan well knows, remains America’s top education need.
Someone should point out that “our children will compete for jobs in a global economy that too many of our schools do not prepare them for . . . [even as we have] managed to spend more money and pile up more debt, both as individuals and through our government, than ever before. In other words, we have lived through an era where too often short-term gains were prized over long-term prosperity, where we failed to look beyond the next payment, the next quarter, or the next election.” Oh, wait. Someone did point it out. That was President Obama, addressing Congress in February about ARRA. Seems so long ago. Today, with two-thirds of that money out the door, the best his administration can claim is that hundreds of thousands of adult jobs were saved (and even more created), not that kids are learning more or schools are more effective.
The teachers who are beneficiaries of the grants are surely grateful. Their unions are undeniably pleased. But this is not the audacious change that was promised — and that is needed. Indeed, the 50 million young people who will end up repaying these 97 billion borrowed dollars might want to inquire about a refund.
Chester E. Finn Jr. is president of the Thomas B. Fordham Institute. Frederick M. Hess is director of education-policy studies at the American Enterprise Institute.

Will New York City’s public school administrators pander to the teachers’ union?

by Emily Esfahani Smith

11/12/2009

Weekly Standard – link to original

At the end of last month, the New York City teachers’ contract expired, opening the door to a series of negotiations between the teachers’ union and the city’s department of education, led by chancellor Joel Klein. But more than a week into negotiations over the new contract, the talks are ominously quiet.

Though Klein has talked tough on the unions, whether he will actually get concessions on issues like tenure, merit-based pay, and what’s known as the “absent teacher reserve” pool will soon be determined. That last point, in particular, reached a boiling point this past summer when the Department of Education instituted a hiring freeze that excluded talented new hires from getting teaching jobs–showing how necessary it is for the new contract to handle the ATR in a satisfactory way.

The ATR, or “absent teacher reserve,” excess pool is a pool of teachers that were let go by their schools’ principals. At its peaked, it numbered 3,000 this past summer. Though these teachers were let go, they still received their salaries and benefits thanks to the 2006 union contract.

One measure that Klein wants to see implemented in the new contract is limits on the amount of time a teacher can spend in the excess pool. After a nine month or so period, ideally, the teacher will no longer be on the city’s payroll. Today, they could stay in the excess pool until Armageddon. Some teachers even get tenure while they’re in the excess pool.

If each teacher received only the equivalent of a first-year teaching salary, 45,530 dollars, the Department of Education was paying at least $136,590,000 to maintain the excess pool–a significant sunk cost. As of September, about 1,400 teachers were still sitting jobless waiting to receive their paychecks.

“Excessed” teachers were either let go because their schools were downsizing or simply shut down, or because the principals were looking for ways to cut their budget. “Even with federal stimulus funds, we had a 400 million dollar gap between expenses and revenue,” said Ann Forte, spokeswoman for the New York’s department of education. The result? “Schools budgets were trimmed 3.8% on average.”

The upshot of the budget cuts is that most schools in New York City experienced a hiring freeze at the beginning of this school year, or what Teach for America’s Jemina Bernard delicately called, “restrictions on hiring.” For the most part, schools could hire internally, from teachers already on the Department of Education’s payroll–meaning that in many cases, principals must hire from the excess pool, passing over the very talented recruits of Teach for America and the New York City Teaching Fellows.

But Klein has repeatedly said that he wants fresh blood entering the school system. Teach for America, which usually places 550 teacher recruits in public schools by the first day of school, only took on 320 this year, anticipating the Department of Education’s budget cuts, caused provisions of the 2006 contract. Still, Bernard was able to place many of her recruits in schools in large part because of some “exceptions” to the hiring freeze.

For instance, charter schools were not affected by the hiring freeze, nor were new schools less than three years old. Also, in the sciences–except for biology–and in special education, principals could continue to hire from external sources, since not enough “excessed” teachers are qualified to teach in those two areas. The Department of Education, for instance, hired only 1,700 new teachers this year–compared to last year’s 5,600–and 1,200 of those new hires were in special education and the sciences.

Despite these welcomed exceptions to the hiring freeze, the ATR still is a cause of concern. Teachers in the ATR are “excessed” based on seniority, meaning that least senior teachers are the ones principals must let go first. The highly mobile teachers market ensures that principals who need to fill vacancies will quickly snap up good teachers in the excess pool. One victory of the 2006 contract was abolition of the “seniority transfer,” which ensured that senior teachers could walk into a school and get a job. Today, thanks to the city’s education chancellor Joel Klein, that same contract allows principals to choose the teachers coming into their schools.

Now that the principals have a greater say in the hiring process, they avoid, at all costs, hiring teachers that have been in the excess pool for over nine months–and some have been in the pool for three years. Those teachers who can’t find new placements tend to either have a bad record, present themselves poorly in interviews, or simply do not want to work, since they receive a paycheck in any case. So though teachers are never put in the excess pool for incompetence, they remain there because they are unwanted.

There has been whispers in New York City that contract currently being negotiated will pander to the union agenda, despite Klein’s desire for reform. But if Klein is serious about education reform, he will at least limit the amount of time teachers can sit in the reserve pool–if not abolish it altogether.

Emily Esfahani Smith, a Collegiate Network fellow, is an editorial assistant at THE WEEKLY STANDARD.

By David Frum, CNN Contributor – link to original article

STORY HIGHLIGHTS

• The House bill passed Saturday night protects the fees of trial lawyers, Frum says
• He says states that have capped fees have seen increase in doctors
• When Texas capped fees, lawsuits fell and doctors moved to the state, he says
• Frum: Trial lawyers are benefiting because they provide campaign funds for Democrats

RELATED TOPICS

• Medical Errors and Malpractice
• Association of Trial Lawyers of America
• Health Care Policy
• Personal Injury Law

(CNN) — You’ve heard the saying: “In war, amateurs talk strategy, professionals talk logistics.”

The political equivalent: “Amateurs talk ideology — professionals talk interest groups.”

Small but sophisticated interest groups use big political battles to gain special advantages. Health care reform is, of course, the biggest battle of them all, with trillions of dollars at stake.

On Saturday night with the House vote in favor of the health reform bill, the trial lawyers sliced themselves a nice little piece of that bonanza.

It’s Section 2531 of the bill — to be precise Section 2531(4)b — and it provides as follows:

The new health bill will empower the Secretary of Health and Human Services to make grants to states that reform their medical malpractice systems. There are just two conditions: Those reforms must not “limit attorneys’ fees or impose caps on damages.”

Which is like saying that we’re going to encourage you to develop a personal weight loss plan that includes neither exercise nor changes in diet.

Here’s how Section 2531 works. Over the past decade and a half, states have reacted to abusive lawsuits by imposing various restrictions on personal injury awards.

In California, pain and suffering damages cannot exceed $250,000. Attorneys may collect no more than 15 percent of malpractice awards over $600,000.

The impact of these kinds of reforms can be dramatic. After Texas capped pain and suffering damages at $750,000 in 2003, the number of malpractice lawsuits dropped abruptly. Lawsuits in Harris County (Houston and environs) plunged by 50 percent.

Fewer lawsuits meant lower malpractice premiums. Texas’ largest malpractice insurance carrier cut costs to doctors by 17 percent. Lower insurance premiums attracted more medical professionals to the state. In the 1990s, Texas ranked low in the nation in the number of doctors per person. In the four years after 2003, the number of doctors in the state jumped by 18 percent.

“It was hard to believe at first, we thought it was a spike,” the executive director of the states’ medical board told the New York Times.

Texas’ experience is dramatic, but consistent, with other reforming states. States with damage caps gain more doctors than uncapped states — and the difference is greatest in the most underserved counties within capped states. Capped states have 5.5 percent more OB-GYNs per person in their rural counties than do states without caps.

But the money saved by insurers, doctors and their customers is money subtracted from the pockets of trial lawyers — and those lawyers carry real clout in the Democratic Congress.

The trial lawyers’ national PAC, the American Association for Justice, was the second-biggest source of PAC dollars for Democratic candidates in the 2006 election year: almost $2.6 million. That same year, Iowa’s trial lawyers elected a former president of their association to Congress. Had the National Enquirer been less inquiring, a former trial lawyer named John Edwards might well be serving as attorney general right now.

Huey Long once summed up the professional politicians’ credo:

“Those who support me early will have my close attention when I win office. Those who support me late will have my attention when I win office. And those who oppose me –” and here he’d wink — “they’ll get good government.”

We all know what Long meant by “close attention,” and his old party apparently still lives by his rules. On Saturday, House Democrats have delivered some very “close attention” to their friends in the trial bar. The question is: who will stand up for good government for the rest of us?

The opinions expressed in this commentary are solely those of David Frum.

Editor’s note: David Frum, resident fellow at the American Enterprise Institute, was a special assistant to President George W. Bush in 2001-2002. He is the author of six books, including “Comeback: Conservatism That Can Win Again,” and the editor of FrumForum.com

Hernando de Soto RAUL RUBIERA / RAUL RUBIERA

BY GLENN GARVIN

GGARVIN@MIAMIHERALD.COM

• The Power of the Poor with Hernando de Soto, 10-11 p.m. Thursday, WPBT-PBS 2

Posted on Thursday, 10.08.09

Third World governments come and go, trading monarchy for populism for military autocracy and even for the trappings, at least, of democracy. Yet the poor remain poor: from one to four billion of them, depending on whose estimate you accept. And, as everybody from ACORN to Hugo Chavez will tell you, the movement toward economic globalization doesn’t seem to be cutting their numbers.

In this provocative new PBS documentary, Peruvian economist Hernando de Soto argues that globalization has been irrelevant to the world’s poor because they’ve been systematically locked out by legal systems that force them into a shadow economy where their rights aren’t recognized and their resources don’t benefit them.

In fact, he says in The Power of the Poor with Hernando de Soto, the world’s poor are potentially anything but — they control as much as $1 trillion in unregistered property and unlicensed businesses. But the law prevents them from building their assets into anything beyond a subsistence existence.

“Because they are not legally recognized, because they have no legal identity, because they can’t make contact with the outside world, they are not part of globalization,” de Soto says.

The Power of the Poor is essentially a video version of his 1986 book, The Other Path, well known among economists if not ordinary readers. In the book, de Soto documented the vast so-called informal economy of his native Peru, where millions of poor people live as squatters on unowned land to which they cannot get title and operate businesses without legal licenses or permits.

Without a property title, poor Peruvians can’t use their land as collateral for loans to buy equipment for small businesses or seed for their farms. And no lender will put up money for a business operating without legal permits. Without property rights, the taxi drivers and fruit-stall vendors and the rest of the mini-entrepreneurs of Peru’s informal sector can’t execute contracts, employ other workers or use virtually any tools of a modern economy.

Their twilight existence is not a consequence of capitalism, as Peru’s Marxists argued (the title of de Soto’s book was a jibe at Shining Path, the country’s cold-blooded communist insurgency), but of stifling government rules and bureaucracy. De Soto’s researchers (four law students working under the direction of a veteran attorney) discovered it took them nine months to legitimately open a simple sewing business. And though Peruvian law supposedly allowed squatters to claim unowned land on which they lived, it took de Soto’s team six years and 207 separate legal procedures to obtain a deed.

The bureaucratic tangle that chokes property rights is not unique to Peru, de Soto argues in The Power of the Poor, but a common problem across the developing world. And by preventing as much as two-thirds of the world’s population from either creating wealth or spending it, they victimize the rest of us as well.

“They’re also the world largest market,” de Soto says of the poor. “We need them as much as they need us.”