Tag Archives: Mitch Daniels

Wanting Indiana’s Cake After Eating It

I have a great idea. I’m going to sell my house, but demand that the State continue to give me my homeowner’s tax credit.  Think “our man Mitch” would approve?

I don’t either.

But how is that any different from his complaint about the distribution of federal highway funds?

Highway funds are allocated to the states on the basis of a formula that includes the miles of road the state must maintain. As I understand it, the feds are taking the eminently reasonable position that since Indiana contracted away its responsibility to maintain the Toll Road, the Toll Road mileage should be subtracted from the mileage used in the formula. That will cost the state some $40 million this year, and our governor is incensed at the unfairness of it all.

I think we can guess what his position would be if he were still budget director; he’d not only support the new calculation, he’d probably be demanding a refund for the years since the Toll Road was leased. (Apparently, the feds aren’t trying to penalize Indiana for their delay in adjusting the formula. He should be grateful for small favors!)

Indiana got a big windfall when we “leased” (essentially, sold) a state asset, just as I would get a big cash payout for my equity if I sold my house. When the Toll Road lease was negotiated, the state made a big deal of the fact that the vendor would be responsible for maintaining that asset. If I sold my house, I would also be relieved of the need to fix the roof, keep the plumbing in repair, cut the grass…all those expenses attendant to homeownership.

The only difference is, I would be ashamed to whine about losing a tax credit to which I would no longer be entitled.

Demanding federal highway funds to maintain a road someone else is legally obligated to maintain takes real chutzpah.

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The Legacy of “Our Man Mitch”

The NorthWest Times of Indiana has an article detailing the devastation that tax caps are visiting on Indiana’s municipalities. We can thank Mitch Daniels for leading the charge to place these caps in the state’s constitution, where they will continue to strangle local governments until we manage the difficult job of passing a constitutional amendment.

WTHR relayed the result of an environmental group’s investigation that found Indiana’s rivers and streams the most polluted in the nation–no surprise to local environmentalists, who have witnessed the Administration’s distaste for environmental regulation.

Indiana’s much-touted “balanced budget” was achieved without touching tax breaks for business (and in some cases, by increasing them)–by cutting programs that aid those poor and disadvantaged citizens least able to access the political process or otherwise protect themselves.

And–as we’ve seen over the past couple of months–there’s mounting evidence that this Administration can’t even keep its own books.

Add to these “factoids” the war this administration has waged against public workers, it’s divisive, politically-motivated attack on private-sector unions, its willingness to sell off state assets and privatize everything in sight, and we are left with a legacy that will last long after Mitch mounts his motorcycle and rides off into the sunset.

You’ve got to give the Governor credit: he has created a persona that is entirely at odds with reality. Mitch “the knife” was a disaster as Budget Director; he took Clinton’s healthy budget and proceeded to facilitate creation of Bush’s enormous deficits. His reputation as a businessman, rather than a politician, rests on jobs in “government affairs”–that is, as a lobbyist. His standing in the national party rests on a fiction of fiscal expertise and a contrast with undeniably pathetic competition.

Whoever wins the gubernatorial election in November will inherit a broken state that has steadily been stripped of the tools needed to fix it. Of course, if that person is Mike Pence, he won’t notice. He’ll just add a dash of theocracy and an emphasis on social issues, and finish the task of turning Indiana into Mississippi.

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…With A Little Help from My Friends

On my way to work this morning, WFYI informed me that today is the day Mark Massa will be sworn in as the newest Justice of the Indiana Supreme Court.

When Governor Daniels announced that he had chosen Massa, there was a good deal of criticism. Some observers expressed surprise that–once again–the Governor had ignored an opportunity to diversify the Court, that–once again–he had declined to appoint an eminently qualified woman. Adding insult to injury, Daniels claimed that his choice was based upon the candidates’ relative qualifications for the job, a manifestly bogus excuse.

I was not surprised by the choice, which I’d predicted well before the commission charged with winnowing the field even sent three names to the Governor. Nor do I believe it had any more to do with sexism than it did with merit.

This is Indiana–the crony state.

There’s a pretty robust academic literature dealing with political culture. Some states (Massachusetts, say) have a liberal culture that promotes public service; others (Arizona, Texas) take a considerably more conservative, parochial approach to the role of government. When I was researching state differences in political culture for a book on the Faith-Based Initiative, I asked George Geib–past Dean of History at Butler University and a long-time Indianapolis Republican operative–how he would describe Indiana’s political approach. His answer was that the framework within which we conduct our affairs is quid pro quo. 

Look around at the so-called “privatization” initiatives. Lucrative deals for parking and welfare intake have gone to well-connected ACS. The developer of the parking garage being built in Broad Ripple used to work for the Ballard Administration. A PR firm that gets city business just “happens” to employ Ballard’s son. These are just a few examples that come readily to mind; there are literally hundreds of others.

This isn’t new in Indiana, and it isn’t the exclusive provenance of Republicans. Both parties have practiced politics as spoils system, both have favored their cronies with appointments and contracts.

The problem women have in a crony system is that we are late to the party, and less likely to play the game–less likely to be one of the favored cronies. Nothing against our gender–if we were playing by the good old boys’ rules, we’d probably be equally likely to be rewarded with the plum jobs and/or contracts.

Mark Massa was counsel to the Governor; by all accounts, the two are friends. And in a state where doing business with your friends is the way business is done, his appointment was a foregone conclusion.

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What Legislatures are For

Given the antics of the Indiana General Assembly in the just (mercifully) ended session, you might think the role of the legislature is to ensure proper singing of the national anthem,  determine whether children need to learn cursive and require the BMV to honor the prejudices of people who hate gays. So it might come as something of a surprise to learn that this branch of government really does have a proper function.

Okay, for a lot of us, it apparently comes as a surprise to learn that we have three branches of government–and that there is a reason that the legislature is separate from the executive branch.

Which brings me to a story reported by the Courier Press a week or so ago.

The Governor has been supporting a coal gasification plant being developed in Rockport, Indiana. He has been so supportive, in fact, that he has had the Indiana Finance Authority negotiate a 30-year contract to purchase the gas and resell it to Hoosier ratepayers. And Daniels also favored an award of a 20-year, $120 million dollar tax credit to the plant operation–a tax credit that required legislative approval.

When the legislature proved reluctant to provide that approval, the administration suddenly decided that the credit could be enacted by the Indiana Department of Revenue. No legislative action needed, thanks very much.

Now, I don’t know whether the criticisms of the Rockport plant as a boondoggle, and the Governor’s support as “crony capitalism”are accurate. I do know that the questions raised by other utilities and some lawmakers are legitimate, and deserve answers. Maybe taxpayer support can be justified, maybe not.

But I do know that legislatures are supposed to make these kinds of decisions.

Let’s revisit the first lesson of high school government: the legislature decides what policies to enact, and the administrative branch–under the stewardship of the chief executive–administers those policies. In the real world, of course, it is never that neat–government workers in the executive branch necessarily “make policy” in some sense when dealing with the public. But it is not within the authority of the administration to decide whether taxpayers will go on the hook for $120 million-dollar coal gasification plant.

It’s called “checks and balances.”

As the head of the Citizens Action Coalition put it, “I thought we overthrew the monarchy in 1776.”

Let me spell this out: approving applications for specialty license plates is an administrative function. Deciding whether to teach cursive is an administrative function. Deciding to spend $120 million dollars of taxpayer money on a new technology is a legislative function.

Do we provide these people with job descriptions?

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Costs and Benefits

A colleague and I were in a conversation last night with someone thinking about moving to Indiana. My colleague noted–somewhat proudly, I thought–that despite the recession, and unlike so many neighboring states, Indiana has a budget surplus. He attributed that to sound “money management” by the Governor.

This morning’s Ft. Wayne Journal Gazette has a somewhat different take on how that surplus was achieved. 

As the paper noted,

The dirty little secret behind Indiana’s budget surplus is exactly how it came to be. Not the bounty of a booming economy but the result of nicks, cuts and downright slashing of programs critical to the safety of vulnerable Hoosiers and to the economic future of all its residents.

The article focused especially on cuts to child services, noting that DCS returned an “astonishing” amount of money to the state at the same time that repeated reports of abuse went un-investigated, and at least six children died.

In a forthcoming article, Morton Marcus notes that Indiana’s unemployment remains among the highest in the country, despite the recovery. He makes the point–so often ignored–that government jobs are, in fact, jobs. When the state lays off workers, cuts teachers, police officers, child protective workers and others, it not only reduces the effectiveness of services we all depend upon (with sometimes tragic results, as the Journal-Gazette article documents), it reduces employment. It reduces the number of people paying taxes, and increases the number of those needing public services.

When times are tough, tough decisions absolutely need to be made. Budgets–at least in Indiana, which has a constitutional provision requiring it–must be balanced.

The question is: how? And at whose expense?

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