Ralph Lloyd: GPO/WEP on Congressional slate

July 28, 2007
Subject: Social Security

The Government Pension Offset (GPO) and the Windfall Elimination Policy (WEP) are again on the Legislative Menu.

They are HR 82 and SB 206. Contact your Representatives and your Senators to vote for it.

Ralph L Lloyd

[Find your representative and senator here: U.S. Congress]

Dispatch: Many had hand in divesting measure

Ohio pension funds cut investment ties to Iran, Sudan

Saturday, July 28, 2007
By James Nash
THE COLUMBUS DISPATCH

Ohio Reps. Shannon Jones and Josh Mandel solicited aid for their divestment bid.

The major players Some of the research groups and consultants with whom Ohio Reps. Josh Mandel and Shannon Jones consulted in drafting their Iran and Sudan divestment bill:

• The Center for Security Policy: Washington-based nonprofit research group associated with neoconservative movement. Advisory council includes former Secretary of Education William Bennett and former Rep. Henry Hyde.

• Conflict Securities Advisory Group: Washington-based for-profit company that maintains a database of companies that do business in Iran, Sudan, Syria and North Korea.

• Roosevelt Investment Group: New York-based "boutique" money manager that provides products and services to investors that follow divestment policies.

• American Israel Public Affairs Committee: Washington-based lobbying group with 100,000 members that advocates on behalf of Israeli security and interests.

• Ohio Jewish Communities: Columbus-based advocacy group for Jewish residents. Executive Director Joyce Garver Keller, a registered lobbyist, was in regular contact with Mandel on the bill.

Ohio Reps. Josh Mandel, a Marine veteran of the Iraq war, and Shannon Jones, a mother of two young children, both had their reasons for getting state pensions to pull their money from companies that do business with Iran and Sudan.

Mandel, R-Lyndhurst, spoke of Iran's involvement in the Iraq conflict. Jones, R-Springboro, spoke of the dangers to future generations if terrorism is allowed to go unchecked.

Together, the rookie lawmakers overcame formidable opposition to help persuade the state's five public pension systems in early June to withdraw at least half of their investments in companies connected to Iran and Sudan by the end of the year. The pensions also committed to the goal of fully divesting from those companies.

Documents and correspondence released by their offices show that Mandel and Jones didn't accomplish that feat on their own. They were aided by an array of outside groups and individuals, including Israeli and Jewish lobbyists, hawkish research groups and a growing cadre of money managers who profit from shifting money from "tainted" companies.

Those groups have successfully lobbied 10 other states to divest their pension holdings in companies that invest in hostile countries. And yet another 20 or so states are considering doing so.

Mandel said he took his cue from the Missouri state treasurer, who pioneered divestment of public-pension monies in 2005.

"We're trying to create a market for terror-free investing," Mandel said. "We're hoping to create great interest on Wall Street."

Some asset managers already see dollar signs in moves such as Mandel's. Adam Sheer, president of the Roosevelt Investment Group, flew from New York to Ohio to tout the Missouri experience.

Sheer said in an interview that although his company could get business in Ohio, he did not testify on behalf of Mandel's initiative in order to land the state's pensions as clients.

"We certainly could manage one portion of the pension fund," Sheer said, noting that his firm is comparatively small.

Documents released by Mandel's and Jones' offices show that they corresponded with several consultants in the emerging area of "terror-free" investing, such as Sheer, Boston-based State Street Corp., New York-based Northern Trust and the Washington-based Conflict Securities Advisory Group.

Jeff Glasgow, a retired assistant Franklin County prosecutor who lives in Westerville, opposed the divestment push and used the state's public-records law to get documents from the two representatives.

They turned over a box full of records, but Glasgow contends that they are withholding some documents. For example, none of the e-mail messages Mandel turned over comes from his personal account. In June, Mandel used his private account to e-mail talking points about the divestment bill to The Dispatch, including copies of testimony to legislators and a list of the companies that would be affected. Although lawmakers may use private e-mail accounts for government business, those messages are considered public records.

Glasgow said the correspondence shows that Mandel and Jones were getting advice from consultants who stood to gain from their policy.

The Ohio Retirement Study Council, a state agency representing the five public pension funds, estimates that asset managers could get up to $15 million from shifting funds out of prohibited companies.

"One would conclude that every one of those people has a vested interest in divestiture," Glasgow said. "Josh Mandel and Shannon Jones are not fiduciaries and neither are these think tanks."

Jones said she did not consult with the outside groups in drafting the divestment bill. Mandel also downplayed their involvement.

On the other hand, Chris Holton, who has headed the Center for Security Policy's divest terror initiative since 2004, said he worked closely with Mandel and his staff in drafting the bill and came to Columbus to testify on its behalf.

"We were involved in the Ohio legislative process," Holton said.

His group, which has urged pension systems across the country to pull out of companies that do business with hostile countries, didn't completely get its way in Ohio.

Mandel and Jones dropped their bill later in June after House Speaker Jon A. Husted prevailed on the pension systems to voluntarily divest. Even as they agreed to do so, pension leaders reiterated that they were loath to make any changes that could hurt pension returns.

jnash@dispatch.com

E-mail addresses:

Josh Mandel..... district17@ohr.state.oh.us

Shannon Jones ..... district67@ohr.state.oh.us

Ohio eliminates grants for charter schools

July 27, 2007 (AP)

According to Karen Tabor, spokesperson for House Speaker Jon Husted, groups starting new charter schools should no longer need the $50,000 start-up grant because anyone starting a new charter school today must be currently operating an already successful charter school. Read story here.

Frank Kaiser: When "Advantage" ISN'T - and what you can do about it

From "Suddenly Senior," July 27, 2007

WHEN "ADVANTAGE" ISN'T

Private Medicare Advantage program is costly and unfair. Now we can do something about it.

By Frank Kaiser

It sounded so, well, so "something-for-nothing, what-have-you-to-lose?"

The Medicare "Advantage" program would provide Carolyn and me with "more benefits than traditional Medicare, more predictable costs," even worldwide coverage.

"A smart investment in your health coverage," the salesman assured us.

But right off, our new Advantage HMO got our primary doctor's name wrong. A simple mistake, they said, easily corrected.

Yet, when I saw an "insurer approved" specialist, recommended by my "insurer approved" primary physician, our insurer wouldn't approve it. The phantom doctor whose name was on my insurance card hadn't authorized it.

That was back in January. By the end of that month, we'd called the insurance company five times asking that they correct their mistake.

They didn't.

Apparently, they couldn't. By June, after 17 phone calls — I'd documented each with date, time, and name of the "service representative" — I threatened to go public with the snafu. Immediately, they rectified the madness.

Demented Dummies

And it all sounded so good last December when the salesman explained how much better his Advantage program was over "plain old Medicare." Eye care, hearing aids, dental, international coverage, you name it. It was ours. Practically free for nothing!

But as the months rolled by, it seemed we were insured by a band of demented dummies.

They'd pay for medicine one month, not the next. Forced to buy my Nexium in Canada on my dime while my doctor cajoled, I pleaded, and even my pharmacy pushed, the HMO would eventually okay my prescription. But then we'd go through the same stonewalling routine the following month. Each time, they profited $150 or so by denying me a month's worth of drugs.

Soon I realized: These folks were dumb like foxes.

I went to VisionWorks where the salesman had said Advantage would "save up to 50 percent." My price for two pair of glasses: $723. "How much with my big HMO discount," I asked.

"That's with the discount," I was told.

I called HearX to learn what hearing aids already on sale would cost me with my "deep Advantage allowance." Four calls later and I still hadn't received a straight answer.

Then Carolyn was diagnosed with bone cancer. All her doctors advised that she get treatment — covered by Medicare — at the Moffitt Cancer Center. What Mayo is to Rochester, what the Cleveland Clinic is to Cleveland, Moffitt is to the Tampa Bay area where we live.

But do you think our "smart investment" HMO would cover it? Hell no!

$54-Billion Bonus! For What?

Multiply our grievances times the complaints of so many of the 8.7-million seniors now insured by private Medicare Advantage HMOs, and you see why Congress is under pressure to scrutinize the annual $75-billion taxpayers pay these private insurance companies for treating us so dishonorably.

Just today, my local paper reported about a woman who found herself in an Advantage program she neither wanted nor requested. Repeated calls to disenroll went unheeded. Then, in April she broke her hip. Now, neither the HMO nor Medicare will pay the $30,000 tab.

She's not alone. Eager for a piece of the $54-billion subsidy taxpayers will give Advantage programs as a bonus over the next four years just for participating, seniors everywhere have been fraudulently switched without their knowledge or consent.

Congress has also learned that hundreds of thousands of seniors were promised their "Advantage" plans wouldn't replace traditional Medicare, that they could stay with their own doctors, and that the plans would require no co-pays. [See below.]

All lies.

And what's the bonus for? Lying to us? Nickel-and-diming us, occasionally to death? That $54-billion could be used to better our nation's health, not simply to better profits for private insurance companies.

Why, I wonder, if private plans are so efficient at delivering healthcare while holding down costs, do they need generous taxpayer subsidies to participate? Let's put both on a level playing field and see which provides the best care.

As I have written so often, Medicare "Advantage" is nothing but a device to kill a national treasure — Medicare — replacing it with private insurers that, as we've already seen:

1. Put profits before people. It's the law;
   
   
2. Will, in spite of bonuses to HMOs ranging from 12 percent to 50 percent more than we pay traditional Medicare, charge far more for services ranging from home health care, hospital stays and chemotherapy drugs to medical equipment;
   
   
3. Will continue to lie about and arbitrarily change coverage;
   
   
4. Will eventually "cherry pick," insuring only the healthiest of us; and
   
   
5. Do anything to continue #1 and the resulting annual windfall salaries of 10s of millions to HMO executives.

Stop Free Money to Insurance Companies

Why did Carolyn and I join one? I had to see for myself. Frankly, I couldn't believe that the Advantage programs were as dangerous to our health as Suddenly Senior readers continually reported.

Boy, was I wrong!

Washington must stop Medicare cuts and preserve our access to care by eliminating bonuses to private health insurers.

Just last night, Congress took the first step. Against strong Republican opposition, HR 3162, the "Children's Health and Medicare Protection Act of 2007," passed out of committee. This bill would expand spending on both children's health and Medicare by about $47-billion in the next five years, getting the money by equalizing payments between Medicare Advantage plans and traditional Medicare.

In other words, no more free money for "Advantaged" insurance companies!

Already, HMOs are launching a huge advertising campaign to stop the bill, much like Bill Novelli's Harry and Louise helped derail Clinton's universal health plan a decade ago. This time, fictional characters Sandi, Alvin, and Charlotte complain that cuts to the Medicare Advantage plans will cost them more and lead to disruption in care.

Congress, beholden to the HMOs for millions in legal bribes, must be told, clearly, that enough is enough. Those billions are ours — not a gift to the insurance companies — and should be used for our healthcare.

Congress must bite that bullet. You can help sharpen teeth by calling your Congressperson toll-free at (877) 331-2000, (800) 828-0498, (800) 869-3150, or (866) 699-9243. Tell them to support HR 3162.

Let's stop disadvantaging Medicare. This is our opportunity to "Just say no" to privatization, waste, and billion-dollar giveaways.

Want to Switch Back from Your Advantage Program to Medicare? Basically, you're screwed, and must suffer until the end of the year. Remember: The insurance and drug companies wrote this bill. According to the Medicare Rights Center (MRC), however, an internal memo circulated recently within the Centers for Medicare and Medicaid Services allows disenrollment if you were signed up without your consent. Grounds for disenrollment also include statements by an agent that imply the plan is a Medicare supplement or Medigap policy, statements suggesting that the plan is accepted by all Medicare providers, or statements saying that you can switch back to Medicare any time you want.

Call 1-800-Medicare. Tell them you qualify for a special enrollment period because you were misled into an unwanted plan. If you are dual-eligible, you can switch back within a month just by calling Medicare. Know, too, that a state has no obligations to pay for cost sharing for dual-eligibles enrolled in an Advantage plan. Questions? Call MRC at (800) 333-4114.

RH Jones re: Israel's nondivestment

From RH Jones, July 27, 2007
Subject: Israel's Companies not Divesting from Terrorist Countries

To all:

According to Kaveh L. Afrasiabi, PhD author of After Komenei: New Directions in Iran's Foreign Policy (Westview Press) and other highly repected publications, mentions in the <http://www.atimes.com> that: "...there is little evidence that the Israeli government is doing much to apply the same pressure to Israel's own companies involved with hundreds of international companies doing business with Iran."

My opinion is that: If even Israel is not divesting from terrorist states, why are the neo-conservation, far right wing, super-rich wanting my Ohio STRS to divest?

RHJones, a retired Ohio STRS annuitant member

Sandy Knoesel responds to Shirlee's question re: Medicare Advantage

From Sandra Knoesel, July 27, 2007
Subject: FW: Question about the Advantage Plan!

Dear Mrs. Zerkel:

Dr. Asbury asked me to respond to your e-mail regarding Medicare Advantage plans. We are still working on our analysis of a pilot project; so, I don't have anything to share at this time. We plan to have the analysis completed in time for the August Board meeting. I will be happy to answer any questions at that time.

Sandy Knoesel

Idaho PERS Says "NO" to DIVESTMENT!

No divestment from Sudan
by Elizabeth Pfeuti
July 25, 2007
globalpensions.com

US - The Public Employee Retirement System of Idaho (PERSI) has decided not to divest from Sudan despite recent state and national calls to do so.

Instead, the US$11.5bn fund announced it would offer a “Sudan free” investment option to its existing 401(k) participants.

PERSI board chairman, Jody Olson, said: “PERSI’s only mission is to provide a secure retirement for its members, the public employees of Idaho.”

Olson continued: “As individuals we feel deeply sympathetic for the people of Darfur, but as an organisation with legal mandates and fiduciary responsibilities, we must stay true to our mission.”

PERSI stated eight reports had been submitted to the board, which in its opinion, clearly showed it could not divest members’ money for legal and fiduciary reasons.

In a separate development, the Securities and Exchange Commission (SEC) launched an online tool in June, allowing investors to examine company disclosure documents to expose holdings in countries designated “State Sponsors of Terrorism'' by the US secretary of state.

Countries the watch list included: Cuba, Iran, North Korea, Sudan and Syria.

They want US to divest when Israeli companies don't even have to? Am I missing something here??

From John Curry, July 26, 2007
Subject: They want US to divest when Israeli companies don't even have to? Am I missing something here??

http://atimes.com/atimes/Middle_East/IG14Ak01.html

How Multinational Corporations Avoid Paying Their Taxes

Rules of the Game
How Multinatioal Corporations Avoid Paying Their Taxes
By PETER ROST, MD
November 22, 2006

Drug companies and other multinational companies based in the U.S. systematically avoid paying tax in the U.S. on their profits. The companies elect to realize profits in low-tax countries and because of this the rest of us have to pay billions of unnecessary taxes to make up for the shortfall, writes Peter Rost, an ex-pharmaceutical executive.

The biggest tax scam on earth has a very innocent sounding name. It is called "transfer prices." That almost sounds boring. It is, however, anything but boring. Abuse of transfer prices is a key tool multinational corporations use to fool the U.S. and other jurisdictions to think that they have virtually no profit; hence, they shouldn't pay any taxes.

Corporations involved in this scam are "model corporate citizens," or so they would like us to believe. The truth is that they rob us all blind. The money we lose can be estimated in the tens of billions, or possibly hundreds of billions of dollars every year. We all end up paying higher taxes because rich corporations make sure they don't.

But don't take my word for this.

A few weeks ago U.K.-based GlaxoSmithKline (GSK), one of the largest pharmaceutical companies in the world, together with the Internal Revenue Service (IRS) announced that GSK will pay $3.4 billion to the IRS to settle a transfer pricing dispute dating back 17 years. The IRS alleges that GSK improperly shifted profits from their U.S. to the U.K. entity.

And U.K. pharmaceutical companies are not alone with these kinds of problems. Merck, one of the largest U.S. drug companies, also this month disclosed that they face four separate tax disputes in the U.S. and Canada with potential liabilities of $5.6 billion. Out of that amount, Merck disclosed that the Canada Revenue Agency issued the company a notice for $1.8 billion in back taxes and interest "related to certain inter-company pricing matters." And according to the IRS, one of the schemes Merck used to cheat American tax payers was by setting up a subsidiary in tax-friendly Bermuda. Merck then quietly transferred patents for several blockbuster drugs to the new subsidiary and then paid the subsidiary for use of the patents. The arrangement in effect allowed some of the profits to disappear into Merck's own "Bermuda triangle."

So what's going on here, how have multinational drug companies been able to gouge us for years selling expensive drugs and then avoid paying tax on their astronomical profits?

The answer is simple. For companies in certain businesses, such as pharmaceuticals, it is very easy to simply "invent" the price a company charges their U.S. business for buying the company's product which they manufacture in another country. And if they charge enough, poof; all the profit vanishes from the US, or Canada, or any other regular jurisdiction and end up in a corporate tax-haven. And that means American and Canadian tax payers don't get their fair share.

Many multinational corporations essentially have two sets of bookkeeping. One set, with artificially inflated transfer prices is what they use to prepare local tax returns, and show auditors in high-tax jurisdictions, and another set of books, in which management can see the true profit and lost statement, based on real cost of goods, are used for the executives to determine the actual performance of their various operations.

Of course, not every multinational industry can do this as easily as the drug industry. It would be difficult to motivate $6,000 toilet seats. But the drug industry, where real cost of goods to manufacture drugs is usually around 5% of selling price, has a lot of room to artificially increase that cost of goods to 50% or 75% of selling price. This money is then accumulated in corporate tax-havens where the drugs are manufactured, such as Puerto Rico and Ireland. Puerto Rico has for many years attracted lots of pharmaceutical plants and Ireland is the new destination for such facilities, not because of the skilled labor or the beautiful scenery or the great beer-but because of the low taxes. Ireland has, in fact, one of the world's lowest corporate tax rates with a maximum rate of 12.5 percent.

In Puerto Rico, over a quarter of the country's gross domestic product already comes from pharmaceutical manufacturing. That shouldn't be surprising. According to the U.S. Federal Tax Reform Act of 1976, manufacturers are permitted to repatriate profits from Puerto Rico to the U.S. free of U.S. federal taxes. And by the way, the Puerto Rico withholding tax is only 10%.

Of course, no company should have to pay more tax than they are legally obligated to, and they are entitled to locate to any low-tax jurisdiction. The problem starts when they use fraudulent transfer pricing and other tricks to artificially shift their income from the U.S. to a tax-haven. According to current OECD guidelines transfer prices should be based upon the arm's length principle ­ that means the transfer price should be the same as if the two companies involved were indeed two independents, not part of the same corporate structure. Reality is that standard operating procedure for multinationals is to consistently violate this rule. And why shouldn't they? After all, it takes 17 years for them to pay up, per the GSK example above, even when they get caught.

Another industry which successfully exploits overseas tax strategies to cheat us all is the hi-tech industry. In fact, Microsoft Corp. recently shaved at least $500 million from its annual tax bill using a similar strategy to the one the drug industry has used for so many years. Microsoft has set up a subsidiary in Ireland, called Round Island One Ltd. This company pays more than $300 million in taxes to this small island country with only 4 million inhabitants, and most of this comes from licensing fees for copyrighted software, originally developed in the U.S. Interesting thing is, at the same time, Round Island paid a total of just under $17 million in taxes to about 20 other countries, with more than 300 million people. The result of this was that Microsoft's world-wide tax rate plunged to 26 percent in 2004, from 33 percent the year before. Almost half of the drop was due to "foreign earnings taxed at lower rates," according to a Microsoft financial filing. And this is how Microsoft has radically reduced its corporate taxes in much of Europe and been able to shield billions of dollars from U.S. taxation.

But remember, this is only one example. Most of the other tech companies are doing the same thing. Google recently also set up an Irish operation that the firm credited in a SEC filing with reducing its tax rate.

Here's how this is done in the software industry and any other industry with valuable intellectual property. A company takes a great, patented, American product and then develops a new generation. Then, of course, the old product disappears. Some, or all, of the cost and development work for the new product takes place in Ireland, or at least, so the company claims. The ownership of the new generation product and all income from licensing can then legally be shared between the U.S. parent company and the offshore corporation or transferred outright to the tax-haven. The deal, to pass IRS scrutiny, has to be made using the "arms-length principle." Reality is that the IRS has no way of controlling all these transactions.

Unfortunately those of us working and paying tax in the U.S. can't relocate our jobs and our income to Ireland or another tax haven. So we have to make up the income shortfall. In the U.S. we have a highly educated society with a very qualified workforce, partly supported by our tax payers. This helps us generate breakthrough products. But once a company has a successful product, they have every incentive to move the second generation of a successful product overseas, to Ireland and a few other corporate tax havens.

There is only one problem for U.S. companies with this strategy, and that is that if they repatriate this money to the U.S. they have to pay full corporate taxes. In fact, according to BusinessWeek, U.S. multinational corporations have built up profits of as much as $750 billion overseas, much of it in tax havens such as the Ireland, Bahamas, and Singapore to avoid the stiff 35% levy they'd face if they repatriated the funds back into the U.S.

But of course, Congress, which is basically paid for by our multinational corporations, generously provided for a one-time provision in the corporate tax code, so that they could repatriate profits earned before 2003, and held in foreign subsidiaries, at an effective 5.25% tax rate.

And so the game goes on.

In the end, multinational corporations live in a global world which allows them to pretty much send their money to corporate tax havens at will, and then repatriate this money almost tax free, with the help of the U.S. Congress.

The people left holding the bag are you and me.

If you want to know learn more about the corruption in the drug industry, read my new book, The Whistleblower, Confessions of a Healthcare Hitman.

Peter Rost, M.D., is a former Vice President of Pfizer. He became well known in 2004 when he emerged as the first drug company executive to speak out in favor of reimportation of drugs. He is the author of "The Whistleblower, Confessions of a Healthcare Hitman." See: http://the-whistleblower-by-peter-rost.blogspot.com/

Reply from Senator Sherrod Brown re: GPO/WEP...Sherrod's on our side and is a cosponsor of S.B. 206

Reply from Senator Sherrod Brown
July 25, 2007

Dear (name withheld per request):

Thank you for expressing your opposition to the pension offset and windfall elimination provision(s) of the Social Security Act. I am pleased to be a cosponsor of S. 206, the Social Security Fairness Act, legislation that would repeal these unfair provisions.

From your letter, I understand you are aware that under the windfall elimination provision, retirees receiving benefits from a public pension fund may be subject to a reduction in their Social Security benefits. Under the pension offset, if you are a retired government worker and you qualify for a spousal Social Security benefit based on your spouse's employment record, you may not receive 100% of your earned benefit. The pension offset law reduces or entirely eliminates a Social Security spousal benefit when the surviving spouse is eligible for a pension from a local, state, or federal government job that was not covered by Social Security. I believe these provisions are patently unfair to individuals who earn their Social Security benefits and receive a pension. Social Security benefits should not be reduced based on other pension income.

Please be assured I will continue to push for prompt consideration of S. 206 and will support it should it come up for a vote. Thank you again for writing.

Sincerely,
Sherrod Brown

Paul Kostyu: Blame Ohio lawmakers, not Frances Strickland

From RH Jones, July 26, 2007
Subject: A need to identify lawmakers

To Paul Kostyu and all:

"Kudos" again journalist Paul Kostyu for keeping politicians held responsible. His article [below] in the Canton Repository, concerning the "D" grade Ohio received from the Center for Public Integrity pointed out that: So the fault for the low grade lies not with Ohio's first lady but with the lawmakers who have allowed a large loophole in the financial-disclosure law when it comes to the executive branch.[Click here for their state-by-state analysis] Hopefully, journalist Kostyu will follow-up this article with one that identifies those Ohio lawmakers guilty of creating the loopholes.

When it comes to such issues, American is kept free by the public's right-to-know transparency; consequently, the specific loophole creating politician, that evades his/her obligation to the public, needs to be held accountable. Could this be another ethics violation that needs scrutiny of the court system?

Here in Ohio the Democratic Caucus has been fighting this sort of thing for years - to no avail. Everytime an ethics bill is up, and they try again to tighten it - their changes are tabled w/o discussion or a vote. Public exposure of any politician, or political party, responsible for ethics violations will force the issue. Unclean politics has no place in Columbus, or in Washington for that matter.

This is my opinion, and that of another person I am not free to identify.

RHJones, a proud CORE member and Leg. CMTE Mem. SummitCRTA

Special interest group rates Strickland "D"
Canton Repository, Tuesday, July 24, 2007
By PAUL E. KOSTYU
gatehouse COLUMBUS BUREAU CHIEF

COLUMBUS Who would have thought that Frances Strickland and her predecessors as Ohio's first lady would be responsible for earning the state a D grade from the Center for Public Integrity. They seem to be such nice, honest people.

Last week, the center, a nonprofit, non-partisan organization based in Washington, D.C., released results of a six-month study that ranked the personal financial disclosure requirements for the nation's 50 governors. Ohio was one of 11 states getting a D, and a low one at that with 61.5 points. Only Washington got an A with 94.5 points. Apparently, the center doesn't grade on a curve. There were eight B's, nine C's and, if my math is correct, 21 F's. At least we are better than Michigan, which had 0 points. Talk about not trying.

BASIC FINANCIAL DISCLOSURE

All the F states failed to make available basic information about the private financial interests of their governors, according to the center. Michigan, Idaho, Utah and Vermont do not require their governors to file financial disclosure reports at all. Washington, on the other hand, provides the most complete public information on its governor's personal income.

"As the top elected officials in each state, governors sign legislation into law, recommend and approve state budgets, and have wide-ranging powers to appoint department and agency heads and fill board and commission positions," said Leah Rush, the center's states projects director. "Requiring them to disclose their private financial ties could reveal possible conflicts of interest."

Conflicts of interest? In Ohio? Say it isn't so.

Republicans last week challenged the legality of an executive order by Democrat Gov. Ted Strickland, No. 23, that allows independent home health care workers the option of forming a union that would be recognized by the state. Republicans said Strickland issued the order as a payback for union support in last year's election.

Strickland's first executive order prohibited his wife and executive branch employees from accepting gifts, other than token T-shirts or meals of less than $20, from anyone other than close family members and friends, as long as they're not lobbyists or don't have a contract with the state. Also, folks who receive state contracts or grants worth more than $1,000 must sign a statement saying they won't break ethics law.

SPOUSE'S INFORMATION NOT REQUIRED

Among the 43 questions posed in the center's survey, six dealt with financial disclosure requirements for a governor's spouse. Because Ohio law doesn't require spouse information on employment, investments, real property holdings, client information and whether the spouse is a company director or officer, the state lost 16 points. Those would have catapulted the state to a high C.

The state also lost points because the law doesn't require descriptions or specifics in several categories. And the state lost four points for not allowing or making available filings in an electronic format. One point was subtracted for not publishing a list of delinquent filers.

So the fault for the low grade lies not with Ohio's first lady, but with state lawmakers who have allowed a large loophole in the financial-disclosure law when it comes to the executive branch.

Reach GateHouse Columbus Bureau Chief Paul E. Kostyu at (614) 222-8901 or e-mail: paul.kostyu@cantonrep.com

Other Repository columns by Paul Kostyu

Click here if you wish to contact The Center for Public Integrity about the integrity of this study. KBB

Shirlee Zerkel: A Medicare question for Damon

Shirlee Zerkel to Damon Asbury, July 26, 2007
Subject: Question about the Advantage Plan!

Is STRS considering the SNP (Special Needs Plan) type of Medicare Advantage Plan?
Shirlee Zerkel

Could they(Zelman & the Board) have exercised more governance OR did they have the authority? Which is it??

Gov. Ted Strickland said he supports Padgett's proposal and department efforts to "exercise more governance over charter schools," but he thinks that state Superintendent Susan T. Zelman and the State Board of Education have been reluctant to do so.

They don't have "the kind of authority that I think they're entitled to have and need in order to exercise the kind of oversight that is called for," Strickland said.

STATE BATTLE AGAINST 'UNAUDITABLE' RECORDS
Charters get schooled in bookkeeping
Thursday, July 26, 2007
By Catherine Candisky
THE COLUMBUS DISPATCH

When the Harte Crossroads charter schools in Columbus closed this year, their financial records were in such disarray that they could not be audited.

That means taxpayers have no idea how their money was spent.

About two dozen of the state's 311 charter schools are "unauditable." State auditors have been unable to review the finances of one in Cleveland for nearly four years.

Charter-school supporters say those few bad apples undermine Ohio's growing system of privately operated, tax-funded schools.

"These schools threaten the success of those doing a good job," said state Auditor Mary Taylor.

In an effort to make charter schools more accountable for the public money they receive and to reduce the number with auditing problems, Taylor is hosting four regional training sessions.

The goal, she said, is to protect public money and promote better fiscal practices, which should help more schools stay in business.

The 70 principals, treasurers and managers attending a session in Columbus yesterday learned how to manage their money, prevent fraud, prepare financial forecasts and get ready for annual state audits.

None of those attending appeared to represent any of the unauditable schools, but Taylor said the turnout was a good start.

School closings and unaccounted-for tax dollars, as at Harte Crossroads, have been lightning rods for criticism from charter-school opponents.

Taylor, a charter-school supporter, and other state leaders are pushing a variety of reforms aimed at improving fiscal accountability.

Ohio's recently adopted state budget includes two such provisions. One requires the Ohio Department of Education to stop state aid to charter schools deemed unauditable. The other prohibits charter-school sponsors from taking on new schools if they have one that is unauditable.

"It's been very frustrating," Taylor said. "Previously, we could only issue a letter and didn't really have any ability to hold people accountable."

Meanwhile, state Sen. Joy Padgett, R-Coshocton, has proposed giving the Education Department more authority over charter schools. Her plan would allow the agency to sanction sponsors who fail to meet state performance requirements.

"We're not trying to close down charter schools," Padgett said. "Parents have a right to a choice, but … they need to know that schools are accountable. It makes no sense to move from a poorly operated public school to a poorly operated charter school."

Like Taylor, Education Department officials say they feel they do not have adequate authority to deal with poor-performing charter schools.

"We call it the fly-swatter and the atomic bomb," Todd Hanes, executive director of the department's Office of Community Schools, said jokingly. "We can suggest improvements … or we can completely revoke their ability to be a sponsor."

State regulators have never banned a sponsor.

Gov. Ted Strickland said he supports Padgett's proposal and department efforts to "exercise more governance over charter schools," but he thinks that state Superintendent Susan T. Zelman and the State Board of Education have been reluctant to do so.

They don't have "the kind of authority that I think they're entitled to have and need in order to exercise the kind of oversight that is called for," Strickland said.

Dispatch reporter Mark Niquette contributed to this story. ccandisky@dispatch.com

Baltimore Sun: Let states divest from Iran

baltimoresun.com
Let states divest from Iran
By Jonathan Schanzer and Howard Slugh
July 26, 2007

Last month, Florida Gov. Charlie Crist signed a bill ordering his state to divest its pension fund from businesses that work with Iran's energy sector. The legislation, led by Adam Hasner, Republican majority leader of Florida's House of Representatives, passed unanimously in both chambers of the Legislature.

Unfortunately, the state legislation is unconstitutional. Only new federal legislation can legally allow states to divest from Iran.

In 1996, Massachusetts restricted state businesses from working with companies that dealt with Myanmar, formerly called Burma. Massachusetts sought to press Myanmar's military junta to take steps toward democracy and provide better treatment for dissidents. In 2000, the Supreme Court unanimously struck down the Massachusetts law in Crosby v. National Foreign Trade Council.

The problem was that the state legislation conflicted with a federal statute that enabled the president to impose sanctions on Myanmar. The court argued that the president "has less to offer and less economic and diplomatic leverage as a consequence" of the Massachusetts law. According to the Constitution's supremacy clause, federal sanctions must trump state law.

Florida's sanctions against Iran could face a similar fate. Under federal law, only Congress and the president can implement federal tools - such as the Iran Freedom Support Act - to deter Iran from nuclear proliferation and terrorism. As in the Myanmar case, the Florida divestment plan conflicts with federal sanctions.

Florida has attempted to distinguish its statute from Massachusetts' by adding wording claiming that the law aims to lower fiduciary risk, not create an alternate foreign policy. But just because a state claims its law doesn't conflict with federal law doesn't make it so. The Florida law could be struck down if challenged - unless Congress does the right thing.

The House and Senate are considering the Iran Sanctions Enabling Act to authorize states to pass divestment laws aimed at Iran's energy sector. The bill would cure any constitutional conflict. It would integrate the state sanctions as an element of congressional sanctions, rather than leaving them outside the congressional framework.

Broad bipartisan support of this bill is a sign that Congress sees sanctions - on both the state and federal levels - as an important tool to weaken Iran. It also shows that Congress understands that divestment is a tool that Americans broadly support. Indeed, the growing "terror-free investing" movement is gaining traction nationwide. It echoes grass-roots efforts to divest from South Africa in the 1980s, which eventually brought the apartheid regime to its knees.

Despite the bill's wide popularity, some in Washington oppose it. William Reinsch, former commerce undersecretary in the Clinton administration and current president of the National Foreign Trade Council, claims that "a unified U.S. foreign policy - not multiple state sanctions or divestment laws - is best suited to address" the Iran challenge. Those who join Mr. Reinsch in opposing the bill claim that divestment would create economic tensions with our allies, making it more difficult to act multilaterally.

Opponents of the bill fail to understand that the lack of enforcement of federal sanctions in the past is exactly why the American people have taken matters into their own hands. They have lobbied their state legislatures because they want to punish Iran. They do not care whether their states offend our allies who continue to do business with Iran.

A handful of states are considering their own divestment bills, including Maryland, where Del. Ron George, an Anne Arundel County Republican, has proposed legislation that would bar the state pension fund from investing in companies tied to Iran. Other states are weighing different divestment options. In Ohio, state Rep. Josh Mandel reports that he and his colleagues led an effort for "state pension funds to divest the retirement dollars of policemen, firefighters and teachers from an Iranian regime that is calling for the destruction of America and Israel."

The House and Senate have deliberated over the Iran Sanctions Enabling Act since May. It is imperative that Congress pass the bill quickly, to ensure that these state efforts are constitutional.

This is an effective way to push Iran to cease developing nuclear weapons and to encumber its efforts to support terrorism.

Jonathan Schanzer, a former intelligence analyst at the Treasury Department, is director of policy at the Jewish Policy Center. His e-mail is jschanzer@jewishpolicycenter.org. Howard Slugh is a law student at Hofstra University law school and a research assistant at the Jewish Policy Center. His e-mail is hslugh1@pride.hofstra.edu.

So whose books are so screwed up that they are unauditible? Check out all the charter schools!

From John Curry, July 25, 2007
Subject: So whose books are so screwed up that they are unauditable? Check out all the charter schools!

This is a 5 page Adobe download from the Ohio State Auditor's Office. It should download on a phone modem in about two minutes or less. Check out all the community schools (charter schools on the list). This list was just made public yesterday! [Click here to view list.]

John

So whose books are so screwed up that they are unauditible? Check out all the charter schools!

From John Curry, July 25, 2007
Subject: So whose books are so screwed up that they are unauditible? Check out all the charter schools!

This is a 5 page Adobe download from the Ohio State Auditor's Office. It should download on a phone modem in about two minutes or less. Check out all the community schools (charter schools on the list). This list was just made public yesterday! [Click here to view list.]

John

Reply from Congressman Pat Tiberi to CORE member re. GPO/WEP

July 25, 2007
Subject: Reply from Congressman Pat Tiberi to CORE member re. GPO/WEP

"You will be happy to know that I have agreed to add my name as a co-sponsor to H.R. 82."

From Contressman Pat Tiberi, July 25, 2007
Subject: Reply from Congressman Pat Tiberi

July 25, 2007
Columbus, OH 43235-1624

Dear (name withheld) ,

Thank you for your communication regarding the Government Pension Offset and the Windfall Elimination Provision. I appreciate this opportunity to correspond with you.

After many discussions with residents of the 12th Congressional District, I became aware of the effect the government pension offset (GPO) has on many of my constituents. Indeed, the current procedure for calculating the offset may produce unintended consequences, particularly for low-income public service employees. Additionally, those affected are often unprepared for a smaller Social Security benefit than they assumed in making retirement plans.

The Social Security windfall elimination provision (WEP) also effects a number of my constituents. The WEP reduces the Social Security benefits payable to workers who also have pension benefits from employment not covered by Social Security, such as Public Employees Retirement System (PERS). The Social Security amendments of 1983 included a provision under which a different Social Security benefit formula applies to workers who reach age 62 (or become disabled) and become eligible after 1985 for a pension based in whole or in part on employment not covered by Social Security.

As you may know, H.R. 82, the Social Security Fairness Act of 2007 seeks to repeal the Government Pension Offset and windfall elimination provisions. This legislation was introduced by Representative Howard Berman (D-CA) on January 4, 2007 and referred to the House Committee on Ways and Means. You will be happy to know that I have agreed to add my name as a co-sponsor to H.R. 82.

Thanks again for taking a moment to share your views with me. Please don't hesitate to contact me if I may be of additional assistance.

Sincerely, Patrick J. Tiberi
Representative to Congress

PJT/ lv

One retiree's take on Sicko! Well stated!!

July 23, 2007

Have you seen Sicko? Here's my take on the movie. Michael Moore nailed it again...health care in the US is sickening...except for congress and other public officials of course. They certainly believe in universal health care for themselves! The facts are always shocking: our high infant mortality, poorer general health, less longevity, denial of benefits after paying for them through premiums. We easily compare to third world countries who don't have our wealth. (Maybe we don't either since ours is so concentrated at the top.) In England, a Labour politician said democracy brought them universal health care after WWll on the theory that if they could spend money on war, they definitely could afford to spend it on health care. That certainly applies to us. But, US citizens have been brain washed to believe health care for all equals communism and, of course, higher taxes. But we're already being taxed through our premiums and copays and expenses and still can't depend on getting adequate care.

Jim McGreevy and John Curry re: GPO/WEP

John Curry to Jim McGreevy, July 23, 2007
Subject: Re: GPO / WEP

Jim, thank you for this notice. As far as getting Mr. Jordan, Mr. Boehner, and Mr. Chabot to go along with this..well, that will be a VERY difficult concept for them to understand. With enough "political pressure" on them (via snail mail and email) just maybe they could be persuaded! Maybe last Nov. 7th sent a chill up and down their spines. I will pass this on to the troops!

Jordan, Boehner, and Chabot now (for a change) find themselves in the minority and have a difficult time accepting anything that will benefit the cause of the common public employee as they are pro-privatization and pro-Administration. Maybe now we can move them out of fear of losing their office next time 'round! Let's hope! We are in a time frame that is the most promising for repeal of the GPO/WEP that we've seen in over a decade.

John

From Jim McGreevy, July 23, 2007
Subject: GPO / WEP

John –

Pasted below is a clipping from the most recent OEA Legislative Update that should be of interest to your readers. The OEA web page with talking points and auto-email to Senators and Representatives is http://ga1.org/campaign/socialsecurityoffset . The petition that is mentioned in this release, and that has a link on the above-mentioned web page, is not available at this writing. I’ve requested a copy from OEA Government Services and will send it your way when I receive it.

- Jim

Quinn: We Can Afford Universal Health Care

From John Curry, July 23, 2007
Subject: MSNBC-"Health insurers hate this model, which would end their gravy train!"

But we have an excellent template for universal care right under our noses: good old American Medicare. When you think of reform, think "Medicare for all."

Health insurers hate this model, which would end their gravy train.

Yes, We Can All Be Insured

By Jane Bryant Quinn
Newsweek, July 30, 2007 issue
Prepare to be terrorized, shocked, scared out of your wits. No, not by jihadists or Dementors (you do read "Harry Potter," right?), but by the evil threat of ... universal health insurance! The more the presidential candidates talk it up, the wilder the warnings against it. Cover everyone? Wreck America? Do you know what care would cost?

But the public knows the American health-care system is breaking up, no matter how much its backers cheer. For starters, there's the 46 million uninsured (projected to rise to 56 million in five years). There's the shock of the underinsured when they learn that their policies exclude a costly procedure they need—forcing them to run up an unpayable bill, beg for charity care or go without. And think of the millions who plan their lives around health insurance—where to work, whether to start a business, when to retire, even whom to marry (there are "benefits" marriages, just as there are "green card" marriages). It shocks the conscience that those who profit from this mess tell us to suck it up.

I do agree that we can't afford to cover everyone under the crazy health-care system we have now. We can't even afford all the people we're covering already, which is why we keep booting them out. But we have an excellent template for universal care right under our noses: good old American Medicare. When you think of reform, think "Medicare for all."

Medicare is what's known as a single-payer system. In the U.S. version, the government pays for health care delivered in the private sector. There's one set of comprehensive benefits, with premiums, co-pays and streamlined paperwork. You can buy private coverage for the extra costs.

Health insurers hate this model, which would end their gravy train. So they're trying to tar single-payer as a kind of medical Voldemort, ready to destroy. Here are some of their canards, and my replies:

Universal coverage costs too much. No—what costs too much is the system we have now. In 2005, the United States spent 15.3 percent of gross domestic product on health care for only some of us. France spent 10.7 percent and covered everyone. The French comparison is good because its system works very much like Medicare-for-all. The other European countries, all with universal coverage, spent less than France.

Why are U.S. costs off the charts? Partly because we don't bargain with providers for a universal price. Partly because of the money that health insurers spend on marketing and screening people in or out. Medicare's overhead is just 1.5 percent, compared with 13 to 16 percent in the private sector. John Sheils of the Lewin Group, a health-care consultant, says that the health insurers' overhead came to $120 billion last year, of which $40 billion was profit. By comparison, it would cost $54 billion to cover all the uninsured.

Eeeek, your taxes would go up! Maybe not, if Sheils is right. Both the Congressional Budget Office and the General Accounting Office have testified that the United States could insure everyone for the money we're spending now. But even if taxes did rise, you might still come out ahead. That's because your Medicare plan would probably cost less than the medical bills and premiums you're paying now.

We get world-class care; don't tamper with it. On average, we don't. International surveys put France in first place. On almost all measures of health care and mortality, we lag behind Canada and Europe. Many individuals do indeed get superior care, but so do people in single-payer countries, and at lower cost.

They have long waiting times. No advanced country has waiting periods for emergency surgery or procedures that are urgently needed. The United States has shorter waits than Canada and England for elective surgery. Still, queues are developing here, at the doctor's door. In a study of five developed countries, the Commonwealth Fund looked at how many sick adults had to wait six days or more for an appointment. By this measure, only Canada's record was worse than ours. But waits depend on how well a system is funded, not with the fact that it's single-payer. Many countries that cover everyone, including France, Belgium, Germany and Japan, report no issue with waits at all.

There's no problem; people get care even if they're uninsured. They don't. They get emergency treatment but little else. As a group, the uninsured are sicker, suffer more from chronic disease and rarely get rehabilitation after an injury or surgery. They also die sooner—knowing that, with insurance, they might have lived.

Right now, Congress is trying to bring 3.3 million uninsured children into the State Children's Health Insurance Program. President George W. Bush says he'll veto the expansion as "the wrong path for our nation." He objects to "government-run health care" (like Medicare?) and says that SCHIP "deprives Americans of ... choice" (like the choice to go uninsured?). Buzzwords like "government run" are supposed to summon up monsters like "socialized medicine" that apparently still lurk under our beds. If these terror tactics work, prepare for another 46 million uninsured.

Reporter Associate: Temma Ehrenfeld

Tom Curtis to Attorney General Marc Dann re: Divestment

From Tom Curtis, July 23, 2007
Subject: Curtis To Att General Dann, Divestment

Attorney General Dann,

My name is Thomas Curtis. I am an STRS retiree and one of the initial founding members of CORE.

I want to commend you for having broken new ground by cleaning-up many of the troubling and illegal practices that were overlooked or ignored by our past Ohio administration. It appears you are doing exactly what you said you would do if elected. Please continue your reform process.

However, I am concerned that you have not entered into and stopped the state legislature in their illegal attempts to alter social investing and divestment of our public pension funds.

Please correct me if I am wrong, but is it not the job of the Federal Government to order the divestment of funds in countries deemed to be terrorist related, or for any other reason and not the job of our state legislature?

The divestment action proposed in HB 151 and SB 161 I believe is not within the realm of jurisdiction of our legislators. This action by our legislature is unnecessary, costly, time consuming and must be stopped in the future.

It is my opinion that there are far too many issues needing the legislatures' attention to be spending time in areas that they do not have the legal jurisdiction to be concerned with.

Please consider offering an opinion in the future on issues our legislature has no legal authority to even consider.

And last, why does the legislature feel they can utilize our pension funds for such purposes, which are supposedly secured according to ORC 3307? This type of consideration is unwarranted and causes much concern to public pension retirees.

I will thank you in advance for a timely response to my questions.

Thomas Curtis
North Canton, OH