Monday, March 23, 2015

Before There Was #IHateChristianLaettner, There Was 'We All Hate Frank McGuire!'

UNC Coach Frank McGuire
The Spark That Started The
Intensity of the Duke/Carolina
Rivalry
Now that we are in the heart of the NCAA Tournament, and 3 teams from Tobacco Road, Duke, Carolina and NC State, are in the Sweet Sixteen (where they rightfully belong) for the first time since 2005 and for the 4th time ever, we thought it might be an interesting time to look backwards and see how the Duke/Carolina rivalry got as big as it has over the years.

Duke and Carolina have never met for the National Championship, although they have been to a combined 33 Final Fours in their storied history. In 1991, both made the Final Four where the the Tar Heels lost to Kansas (and to Roy Williams, oddly enough) in the semifinals (when Dean Smith was ejected for 2 technicals) and Duke upset UNLV on their way to their first NCAA Title.

They could meet again this year in the Final Four but only in the semifinals, not the championship game.

Either way, a Duke/Carolina Final Four game would be one for the ages. We all hope we get to see one before long.

Many of you saw the recent, very well-done and produced 30-for-30 ESPN special, "I Hate Christian Laettner'. Duke haters loved it because it confirmed why they hated Christian Laettner in the first place.

Duke fans loved it because they loved Christian Laettner for the very same reason Duke haters hated Christian Laettner.  Especially going to 4 straight Final Fours and winning the first 2 National Titles for Duke.

We heard many people say that that is when they thought the real rivalry started. Some said, no, it was when J.J. Redick was at Duke. Others said, no, it was when Wojo was there or when Gerald Henderson clobbered Tyler Hansborough with his elbow. Others said it was when Christian Laettner elbowed Eric Montross and left him with a bloody cheek.

All of those would have happened way too late in history to have 'started' the rivalry. As intense as any of those feelings were on both the Tar Heel and the Blue Devil side of things, the heated rivalry started much further back in the sports history between the two universities located about 8 miles away from each other on 15-501 which runs between Durham and Chapel Hill.

Many young people are now all caught up in the rivalry which resembles the storied feud between Hatfields and the McCoys where the younger generation never really knew 'why' they were trying to shoot people from the other side in the first place. They just knew that 'they were Hatfields (or McCoys) and we Hatfields (or vice-versa, we McCoys) shoot those darned old McCoys (or Hatfields)'. That is all there is to it.

There's a little history you need to know about the Duke/Carolina rivalry before you can really understand why it is such a heated rivalry today.

Long before there was a #IHateChristianLaettner to hate at Duke, or a J.J. Redick, or a Michael Jordan to hate at Carolina or a Tyler Hansborough, there was a basketball coach at Carolina named Frank McGuire. He brought home an undefeated national championship to Chapel Hill in 1957, 32-0 after enduring not 1 but 2 triple-overtime games in the Final Four, the second against the Goliath of college basketball at the time, Wilt Chamberlain of the University of Kansas. (There's that UNC/Kansas thing going on again)

Frank McGuire was an Irish Catholic dandy of a coach and snappy dresser who came south from St. John's to challenge the supremacy of Everett Case, the coach at NC State who was clobbering everyone in the ACC. Case put the state of North Carolina on the map of college basketball. College basketball in North Carolina before Everett Case came to NC State from Indiana was just a nice diversion between fall football and spring baseball and golf and tennis when the weather was nicer.

Coach McGuire at one point 'declared war' against Everett Case, which sparked things up considerably on Tobacco Road. Just as Dean Smith would later 'go to war' against Vic Bubas at Duke; then Norm Sloan at State would 'go to war' against Dean at Carolina; then Coach K would 'go to war' against Dean and now Roy and everyone else is 'going to war' against Coach K.

All in the name of good fun and college athletics, of course.

Up until the late '50s, the basketball games between Duke and Carolina were not considered the #1 rivalry in all of college sports as some consider it today. Far from it. The football games were considered much more important each year since Duke had been a powerhouse in Southern football circles since 1931 and Carolina had a flurry of success under Charlie 'Choo-Choo' Justice from 1946-1950 and later in the 50's.

While intense in spirit on the field, the football players enjoyed friendships off the field, no doubt tempered by their shared experiences in World War II after the war when they returned from battle. Coach Wallace Wade, the winningest coach in the South before the War, returned to coach only 4 years after the war, saying that after fighting in war and seeing the bloodshed and the loss of life on the battlefield, football just didn't seem that important any longer.

Southern football was a game of sport fueled by whiskey sours, tailgating picnics and pageantry on warm Indian summer afternoons late in the fall. It was a game played by gentlemen, for the most part, and coached by Southern gentlemen who enjoyed the camaraderie of the whole show. And the cocktails. And straight martinis. And beer.

Frank McGuire changed all that. He blew into the South from New Yawk City in 1952 where he challenged the supremacy of Everett Case and the Wolfpack at NC State. He won a national title in 1957. He dressed in expensive New York-tailored suits. He recruited Long Island and New York City Catholic and Jewish Yankees to the South. And he generally pissed off most everyone he came into contact with, both friend and foe alike.

Frank McGuire had a bad habit of shading the rules when it came to recruiting big-time talent to come to what was then a much more rural North Carolina than it is today. Sometimes he got caught. Which led to the spark that set the Duke/Carolina rivalry on fire.

You know when and why the Duke/Carolina rivalry went ballistic?

It had nothing to do with the basketball court. Some point to the incident in 1958 where UNC Coach Frank McGuire requested a police escort to protect his Carolina players off the court after a loss at Duke.

From The Duke Report:
'In 1958 when Carolina met Duke in Durham, they both had 10-3 ACC records. Bradley decided to go with a smaller, faster line-up. It proved a brilliant strategy. Carolina chased them doggedly the whole game. There was a brief scuffle late in the game but no violence. Duke Player, Bobby Joe Harris, called a timeout with two seconds in the game just to rub it in a little, but the fans were not about to wait for two seconds. They rushed the court and the refs just called the game. Duke had played a great game and won it 59-46. 
McGuire suddenly decided his players were in mortal danger. As fans and Duke players evacuated the gymnasium, McGuire kept his guys on the bench until a police escort was brought in to usher his boys to the locker room. Bill Murray, Duke manager of operations, (and Duke head football coach) was outraged. He shouted, “In all my coaching experience I have never seen a more obvious exhibition. It was the most revolting act by a college coach I’ve ever witnessed. He’s created a monster…”

Some people point to the Art Heyman/Larry Brown fight as the tipping point in the rivalry but the Heyman/Brown fight didn't happen til February 4, 1961 . That fight just fanned the flames of passion and anger that already existed into a fever pitch.

Duke University Coach and AD
Eddie Cameron
Here's the real reason why the Duke/Carolina rivalry spilled over onto the basketball court and spiked into a feverish pitch that has not abated to this day.

Eddie Cameron was the athletic director at Duke in the '50's and truly was one of the most distinguished and finest Southern gentleman ever in college athletics. Yes, he is the reason why 'Cameron Indoor Stadium' is no longer called 'Duke Indoor Stadium' as it had been since inception in 1940 until 1972.

He alleged, not only as Duke AD but also in the interests of the relatively new and young ACC Conference, that Frank McGuire was cheating his rear end off over at UNC recruiting Catholic and Jewish guys from Long Island and the Bronx. Even the UNC administration folks knew about McGuire's gilding of the lily...they wanted to get rid of McGuire as much as Duke wanted to see him go too.

Cameron alleged some serious recruiting violations, probably over the Heyman recruiting in 1958. Frank McGuire went crazy...he hated Cameron for some reason, maybe the fact that he was a southern gentleman and McGuire was not. Or maybe because he was a hot-tempered New York City Catholic Irishman.

McGuire went on the radio to talk about the allegations and to defend his practices. He let it slip that it was a vendetta against The University of North Carolina at Chapel Hill Tar Heel basketball program led by Eddie Cameron of Duke and, by the way, 'Eddie Cameron is a prick!'

Duke Football Coach
Bill Murray
Duke Head Football Coach Bill Murray was in his football office when he heard this. According to Murray himself after a few
drinks at my parents' New Year's Day Annual Party that lasted from noon to midnight every New Year's Day with a legion of Duke luminaries hanging around all day drinking whiskey from Wallace Wade to George McAfee (teetotaler compared to the other guys) to Dumpy Haigler to Herschel Caldwell to whoever was around at the time, this is what happened next:

Bill Murray ran out of his office in a storm and got in his 1950 Chevy or something like that and roared out of the Duke parking lot spitting gravel every which way. He was heading to Chapel Hill to kill Frank McGuire with his own two bare hands for having dared call his friend Eddie Cameron a 'prick'.*

If you ever shook hands with Bill Murray, you know they were vice-like clenches of death. You could hear your own hand cracking whenever he shook your hand....and Murray did it to everyone.

Somehow, one of his assistants managed to get in a car and somehow get ahead of a furious Bill Murray on 15-501 somewhere and headed him off at the pass. Maybe near Piney Mountain Road or Erwin Road or somewhere.

The assistant somehow calmed him down and got him to turn around and go back to Duke.

Otherwise, the Durham Morning Herald would have had this headline: 'Duke Football Head Coach Bill Murray Kills UNC Basketball Coach Frank McGuire With His Own Two Bare Hands'

And a jury in Durham would have found him 'not guilty'.

That is the precise moment when the 'spark got hot' in the Duke/Carolina rivalry according to the old-timers who knew what happened for sure. Each of them would point to this moment in time when the otherwise competitive but reasonably cordial feelings towards the other university took a major leap upwards in intensity and emotion and, yes, anger, mostly directed at Frank McGuire.

It was one thing to compete hard on the basketball court or football field and then acknowledge each other in the spirit of sportsmanship after the game.

It was an entirely other thing for a head basketball coach at one school call the AD at the other university 8 miles down the road a 'prick' in public. Those were fighting words back then.

The Duke/Carolina rivalry was never the same after. For better or for worse.

*Story corroborated with one unnamed source on deep background whose identity is not to be revealed. Since almost all of the people involved with this rivalry are now dead, and none of this was reported in a public newspaper at the time, we are almost on the same level of much modern-day reporting: You just have to 'trust us' that it is true.


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Saturday, March 21, 2015

'President Obama Is Shredding The US Constitution!' (And Other Conversations Heard on Capitol Hill)

Or 'How To Not Win Friends and Influence Congress'
by President Barack Obama
Being in the chief of staff chair in both the US House of Representatives and the US Senate in Washington, you hear a lot of things.

Some things you don't want to repeat in polite company. Some things were so confidential you couldn't believe the virtual stranger told you such things.

The first thing you have to understand about people working on Capitol Hill is that they are human beings, just like you and me and anyone you deal with every single day.

They can be Members of Congress, US Senators, staff people, janitors, elevator operators, clerks or sergeant-at-arms. They are human beings first and foremost before they are public servants serving in the public trust as Thomas Jefferson was so fond of saying.

Since they are humans, they have feelings and emotions just like you do. The only difference is that what they do on a daily basis affects you and 310 million other Americans plus billions of folks around the world. Sometimes it is negatively. Hopefully it is mostly good, or else what are we doing with our government anyway?

With the last 6.2 years of the Obama Administration as a backdrop, we thought we would listen in to some of the conversations you might hear around a Republican chief-of-staff meeting with perhaps maybe 5-10 chiefs-of-staff in attendance.

We think it might be helpful to you to understand the critical difference it makes having a President in the White House who is not only 'comfortable' dealing with the US Senate and Congress but who might actually 'enjoy' the give-and-take and the banter and the struggle that goes on in our representative democracy.

Ronald Reagan did it. He played a lot of gin rummy with Democrat Speaker Tip O'Neill when he faced a recalcitrant US House that was opposed to much of the Reagan Revolution agenda in 1980 and 1984.

George H.W. Bush did it in 1989-1993. Got the 1990 Budget Act passed and signed that led to PAYGO, discretionary caps and entitlement spending moderation for the rest of the decade.

Bill Clinton did it from 1995-2000. In 1997, he signed a budget deal with Newt Gingrich, Tom DeLay and Dick Armey, the Three Spawns of Satan in many Democrats' book at the time, that actually balanced the budget for the last 4 years of the 90's and probably for the last time in any of our lives now living to be honest about it.

The Bush 43 years were not known for their bi-partisanship on Capitol Hill and look at what that got the Republicans? Lost the Senate and Congress in 2006, big-time. It took the election of Barack Obama in 2008 to unite the Republicans again.

These such conversations among chiefs-of-staff or legislative directors or other staff could be at a formal meeting; in a Member or Senator's office; at Bullfeathers or on a golf course (if playing golf with lobbyists was allowed anymore which it is not in which case it has become a 'small fundraiser' in which case it is legal).

The key point to try to see in such conversations is where the loss of comity and respect for individuals and the institutions of Congress, the Senate and the White House have seriously eroded our capacity to govern in Washington nowadays.

It is going to take some unusually gifted people to enter elective office and reverse these damaging trends. Much of it is basic 'common sense', 'deal-making' and the ability to 'Make Friends and (Therefore and Thereby) Influence Capitol Hill', to paraphrase Dale Carnegie.

President Obama apparently has not read the book on how to win friends on Capitol Hill.

The sooner we find new people to run for public office, though, the better we will all be.

****************************************************************************
Conversations Over a Beer on the Golf Course

'Didja see what Obama just did? He appealed to the Iranian people directly to urge them to tell the Ayatollah to support his nuclear deal?'

'C'mon! Are you serious? He did what again? Didn't he just get all involved with the Israeli elections and meddling in their political game? Who does he think he is..the Messiah of The World or something?'

'And then he told people that he wanted the United Nations to ratify this nuke deal with Iran but not the United States Senate! What is his deal anyway?'

'Yeah. We asked his legislative liaison to come to our office so we could discuss some amendments we are considering to the ACA this summer so that when the Supreme Court strikes down the exchanges in King vs. Burwell, we have some backstop ready to go legislatively which will plug the gap for the people who thought they were getting federal subsidies but won't under this decision.

All we heard was 'crickets'. Nothing.'


'Yeah. That is the same experience we have had with this President and his staff people for the past 6 years! Did you know my Senator has NEVER even met President Obama yet?'

'That is because your guy is from Idaho, Bub! No one even knows where Idaho is anyway.'

'Shut up! Sammy!' 'Shut Up Henry!'

'Seriously. In your wildest dreams, would you have ever imagined that a US President would be playing so footloose and fancy-free with the US Constitution?'

'Nixon did a pretty good job of that, didn't he?'

'He was a paranoid schizophrenic when it came to his political career. He covered up his involvement in Watergate which was a dumb thing to begin with. But at least Nixon respected the constitutional prerogatives of Congress and he stayed pretty much preoccupied with foreign affairs such as opening diplomatic relations with China and all that.'

'Yeah. I wish all Obama did WAS bug the RNC Headquarters in 2012! At least we coulda blamed Romney's loss on that and now we would be having impeachment hearings to get rid of Obama today! McGovern must have been laughing his rear end off during the while Watergate hearing mess.'

'President Obama pretty much has made it clear he doesn't like the US Constitution very much. It is too 'binding', he says. It prevents him from getting done for the American people what 'he wants to get done for the American people'. He is signing executive orders like they are orders for cheeseburgers at McDonald's except no one is paying for them!'

'This Iran nuclear deal is just like an 'executive order' to Obama. He could bring it to the US Senate for ratification which would build public and bipartisan support for it...but he won't. Why?'

'That is the $64 million question, then. Did you boneheads know that the President does not have to bring any treaty or international agreement to the US Senate for ratification if he doesn't want to? The Constitution says the President 'shall' have power 'by and with the advice and consent of the Senate, to make Treaties....' but that doesn't mean he has to submit anything for a treaty unless he wants to. Otherwise, it just becomes a bilateral or multi-lateral agreement that can be easily overturned when the next President comes around.'

'Yeah. You can bet Hillary Clinton will overturn everything Obama has done in these 2 terms. She was right there with him for the first 4 years of all this mess to begin with!'

'Did you know that no Democrat has replaced an incumbent Democrat in the White House by election since James Buchanan replaced Franklin Pierce in 1856?'

'Wow. And he was one of the great ones ever, wasn't he?  Buchanan was such a terrible President that no one in Congress wanted to commemorate his legacy with anything so his niece left money in her will to build him a park north of the White House on Meridian Hill'

'Who are you...the travel guide for the Travel Channel in your spare time?'

'Shut up, Henry!' 'Shut up Sammy!'

'Boys, boys! Calm down! We have a real constitutional crisis here with this President! From his sealed records before he ran for the White House to his ramming-through of Obamacare down our throats when the Democrats were in control of Congress and the Senate from 2009-2011 to the IRS harassment of Tea Party groups to the NSA tapping of phones to Benghazi to this 'secret' Iran deal to his snubbing of our only true ally in the Middle East, Israel, we have a real problem with a rogue President who really doesn't think the Constitution applies to him!'

'Well, one thing is for certain. We sure as heck would not be in the majority of the US Senate, the US Congress, number of Governors and state legislatures in record numbers since Harry Truman without Obama being in office, that is for darned sure! We have over 1000 more legislative and executive Republican offices now across the nation than before Obama became President in 2008!'

'Well, thank God for little miracles then!'

'Well, here's something the Democrats and Obama have not thought of yet: Every precedent Obama is setting right now can and will be used by every Republican President elected from now on! Turn-about is fair play, right?'

'Maybe. But Republicans like to play by the rules so we are probably going to go back and honor tradition such as restoring the filibuster in the US Senate and forgetting all about Harry Reid's insane 'nuclear option' to get people confirmed to various positions in the federal government.'

'Yeah. Republicans like to follow convention. They are like the guy who not only tucks his shirt in his pants; he tucks his undershirt into his underwear before he tucks his shirt into his pants!'

'Doesn't everyone do that?'

'Shut up Henry!'

'Well, I gotta get back to the office now. You know how complicated this budget mess is and entitlement reform and health care and financial services regulation and all that. Just a few of the 'little' problems facing us today as a nation.'

'Yup. Go get 'em, Sammy! I am sure this President will turn things around and the next 1.8 years will be smooth-sailing for everyone!'

'Yep. Sure it will. Sure it will.'



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Saturday, March 14, 2015

'The Center for the Eradication of Poverty Through Free Enterprise at The University of North Carolina at Chapel Hill'

'Thou Shalt Not Violate The Hatch Act!'
Much ado has been made about the 'attack on academic freedom' with the recent closing of the Center on Poverty by the UNC Board of Governors (BOG).

As far as we can tell, life goes on at every campus in the UNC System as it did before the announcement of the closing of the Poverty Center: students are going to class that professors and teaching assistants are teaching; the libraries are still open and people are following the basketball teams still playing in the tournaments.

In short, much of campus university life is going on just as it did before the Center for Poverty was opened at the UNC Law School in February of 2005.

Does anyone remember the circumstances of the 'founding' of the Poverty Center at UNC Law School in the first place?

Former US Senator John Edwards (NC) had lost his vice-presidential bid as running mate to failed presidential candidate John Kerry just 3 months previous. His platform included a lot of talk about  'Two Americas', the haves and the have-nots, and he wanted a place where he could continue talking about poverty and other issues of his political interest.

There was no 'Center for Poverty' at UNC before John Edwards wanted to set it up as a platform to advance his political interests. Later, confrontational and controversial professor Gene Nichol took over as director of the Center.

You would think that a university of that size would have had such a poverty center already on campus if that was a chosen priority of interest before a political figure decided he/she needs a place to hang their hat after a losing campaign at any level, yes?

The argument that the BOG closing of the Center for Poverty at the UNC Law School is an 'attack on academic freedom' has to be couched more in terms of it being closed as a result of 'reversing a political favor' first, doesn't it?

Beyond that, we got to thinking about what would have happened if, say, the tables had been turned and the Democrats in North Carolina now had 100% control of everything in state government from the Governor's Mansion to the Lt. Governor to the state general assembly after 140 years of straight Republican rule since right after the Civil War.

Let's make-believe and imagine that in 2004, after a person left the employ of a Republican US Senator in Washington, he/she asked friends and political supporters on the BOG and at Carolina at that time, since they were all Republicans, to set up 'The Center for the Eradication of Poverty Through Free Enterprise' (CEPTFE) at UNC.  The idea would be to work on issues this person considered important to eradicate poverty through the miracles of the private sector and expansion of jobs in our capitalist society in addition to advancing his/her political career.

Which may have included, oh, say...running for President of the United States of America in 2008, perhaps.

The Koch Brothers would have been asked to fund it separately from the University although the person in question would have been granted an adjunct visiting professor of the practice position to be paid for by the taxpayers of North Carolina. It would have been housed in the Kenan-Flagler School of Business because this person would have had an MBA from Carolina, not a law degree as John Edwards had which is why his preferred choice of venue was the UNC Law School.

Let's also imagine that the North Carolina General Assembly allocated over $1 million of your hard-earned taxpayer-paid money from inception in 2005 to 2010 to support this political figure and their efforts at CEPTFE (because that is exactly what was done for Gene Nichol and the Center on Poverty at the UNC Law School by the Democrats then in charge of state government in Raleigh).

Let's go on to imagine that over the years, this person may have taught a few classes in the business school on public policy and business. A few.

However, this person's main reason to get up every morning was to blast the Democrat in the Governor's Mansion at the time, Mike Easley and the Democrats who ran the GA at every single opportunity and public speaking engagement.

Every single day, this person wrote columns and gave speeches excoriating the Democrats in charge of North Carolina as to their ignorance about how to help poor people through the miracles of private business and proper training and education. There was no real academic research going on; instead of thoughtful persuasive arguments on the merits of the facts, this person just hauled off like a long-driver on the golf course who could smash a golf ball with a picture of Mike Easley or Marc Basnight or Tony Rand on it as far as humanly possible.

Here are some of the paraphrased quotes this person could have used (which are based on just some of the actual quotes used by Gene Nichol during his tenure)

'North Carolina must reject and inter its unforgivable war on private business…. It is a rank violation of our history, our ethics, our scriptures and our constitutions. We’re a decent people. We aren’t bullies. And we don’t like those who are'--March 2014

'(Governor Perdue is the) 21st century successor to Winken, Blinken and Nod' - October 15, 2013

'We’re engaged in a breathless competition to produce the most extreme government in America...Havoc nears. The result will be unlike anything we’ve seen in more than three decades'- (actual quote)

And those are the 'nice things' Mr. Nichol had to say about Republicans in public!

Would anyone care to guess how long this Republican political figure and the CEPTFE would have lasted under the Democrats once they took over the NCGA in 2010 in our hypothetical situation described above? About 'as long as it takes poop to go through a goose' as the old saying goes.

What is lost in this story is that it not as much of a case of 'academic freedom' as much as it is a case about the lack of 'civil public discourse'.

Everyone wants 'academic freedom'. But doesn't that mean 'universal' academic freedom? Where is the counterpart to the liberal Center on Poverty on any UNC System-wide campus? We asked some people who should know. They all shook their heads and said they couldn't think of any pro-enterprise center on any campus. One prominent Democrat actually started laughing out loud to our face when we asked them this question:

'Maybe there is a conservative Republican law faculty member at the UNC Law School we could talk to about this?'

'There are none!' he replied laughing so hard he could hardly breathe. 'Are you crazy?'

'Sorry. I lost my head there a second'
I had to admit nicely.

Another thing that many people either don't realize or respect is the fact that every single professor or teacher in the UNC educational system from top to bottom, from UNC-Chapel Hill to the smallest elementary school in Tyrrell County, is a 'public servant' of the taxpayers of North Carolina.

They are paid salaries by the taxpayers of North Carolina. They participate 100% in one of the nicest health care plans in the country, the NC State Employees Health Plan, paid for by the taxpayers of North Carolina. They participate 100% fully in the North Carolina State Pension Fund, one of the most fiscally sound state pension plans in the country.

'Public servants' are exactly that: People who choose to work in the public sector because they like to help other people in our state and communities. Once they are named or sworn in to their state government jobs, they become public servants to all of us: white or black or hispanic; rich or poor; smart or not-so-smart whether they disagree with the elected officials in Raleigh or not.

We can't have public servants serving only 'part' of the public, the part of the public they like or agree with. If anything, public servants have to divorce themselves of their own personal preferences and serve people they might not ever agree with or particularly want to work with because of some political difference of opinion.

They do it. 95% of them do public service well and in an honorable fashion, just as in any business  where 95% of the people do well-meaning, heartfelt good jobs.

Gene Nichol attacking the NCGA now run by the Republicans would be like you walking into your boss's office one day; telling him/her that they were a son-of-a-bitch bastard..but you wanted a raise anyway because you were such a good worker. Or your son or daughter yell and scream at you every day telling you what an awful father or mother you had been 'but, hey, mom or dad, can you buy me a new car for my birthday and give me an allowance of $100/week?'

That won't feed the bulldog as another quaint Southern expression might explain.

We had one person tell us that UNC professors have not been and never will be 'public servants'. As a result, public university professors had the opportunity and yes, the duty and responsibility to 'speak their minds about whatever they wanted to say' in essence.

That is not true. No one wants to frustrate fair and reasonable debate about anything. The day America can't talk about everything openly is that day America ceases to be America when you really think about it seriously.

However, public servants can't take taxpayer money and expect everyone to be happy when they start what is essentially a 'political vendetta' against anyone in state government. That is where Gene Nichol crossed over the line with the NCGA and the Republican Governor's office. It was just like the angry employee in the office or the spoiled kid asking for a higher allowance.

There are 'adult' ways to air political differences and there are 'childish' ways to air political differences. Presenting data in objective ways and offering to disagree in agreeable manners is the adult way to do so. Using ad hominem attacks on people's character and political beliefs is not.

In Washington, there is a thing called the 'Hatch Act'*. All federal employees have to abide by the Hatch Act which simply states that when you are on your federally taxpayer-paid job, you do the work of your country first and foremost and only. Period.

No politicking while on the federal pay tab. No fundraising on federal grounds. No nothing political while serving the public as a whole.

You want to be political? Go off the federal payroll and join a campaign and do it! Go ahead! Knock yourself out! If Mr. Nichol wants to be political and passionately advocate the issues of the poor, he should run for the US Senate or the Governor's Mansion or run a 527 off of publicly-supported state grounds at the University of North Carolina at Chapel Hill.

For any federal worker who wants to be political, they can request a leave of absence perhaps or they might have to retire altogether from federal service. They just have to be ready to drop all the political baggage at the door when they do come back from their leave of absence and be ready to serve the totality of the public with their talents and energy. Not their political party or interests.

North Carolina should adopt a version of the Hatch Act if they haven't done so already. If Gene Nichol didn't know there was already a Hatch Act-like statute on the books in North Carolina, perhaps they should teach it at the UNC Law School.

Soon.

*The Hatch Act of 1939, officially An Act to Prevent Pernicious Political Activities, is a United States federal law whose main provision prohibits employees in the executive branch of the federal government, except the president, vice-president, and certain designated high-level officials of that branch, from engaging in some forms of political activity. The law was named for Senator Carl Hatch of New Mexico. It was most recently amended in 2012.


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Thursday, March 5, 2015

Values and Principles: Which is Which in Politics?

Diogenes swinging a lamp
'Can't we find an honest person
anywhere in politics?'
We have long been enamored by the public discussion of ardent activists on all sides of the political spectrum about what their driving 'principles' are and why a voter should vote for them to be their elected representative in any legislative body.

Typically, you will see a candidate 'promise' to do something and then get into office only to find out that they can't just snap their fingers and get it done as they 'promised' during the campaign.

Then, of course, their most ardent supporters call them a 'cop-out', a RINO, a liar, a cheat and a nincompoop.

No wonder so many people don't want to run for public office! Who wants to be called a 'nincompoop'?*

We have long thought that part of this problem was an incomplete knowledge and understanding of how our US Constitution works. It is a magnificently drawn document, one with enough checks and balances in it to frustrate even the most charismatic politician. It defends the rights of the minority party and does its darndest to make sure no one person becomes a tyrant and tries to runs America solely as he/she sees fit. It also guarantees that no political faction or party dominates for too long in our elective democratic republic.

We have come to learn that this confusion among candidates and their supporters may also have a lot to do with our collective lack of understanding of the differences between 'principles' and 'values' as a politician pursues his/her political 'goals' while in office.

What is the difference between political 'principles' and 'values' you say? They seem to be so much the same thing, don't they?

We recently had the chance to listen to a great lecture about these differences by Professor Geoffrey Sayre-McCord, Chair of the Philosophy, Politics and Economics (PPE) joint degree program between The University of North Carolina at Chapel Hill and Duke University.

If you ever thought philosophy was a dry, dead discipline, you need to go to one of Dr. Sayre-McCord's lectures and listen for awhile. He is quite entertaining and in this case, very enlightening about a question we have been pondering for a long, long time.

Here's one list of American political 'values' that may encompass most of the generally accepted political values we hold true in our society:

LIBERTY
EQUALITY
INDIVIDUALISM
THE RULE OF LAW

Many of these core values, much like the iconic rugged American cowboy of yesteryear, may be more of a dream nowadays than actual fact. Yet, they do encompass the promise of the American Dream as well as any we have seen lately.

Principles tend to be of a higher order of generally observed and accepted virtues, don't they? As in the following:

HONESTY
INTEGRITY
RESPECT
KINDNESS

Political values tend to be of a nature that lends themselves to some sort of balancing between two competing values. For example, we all say we want 'freedom' in America. Are we willing to trade off a little freedom, however, to have a homeland security department that protects us from another 9/11 attack? Haven't we all given up a little 'freedom' to be frisked every time we get on a plane lately?

How about 'individualism', that rugged can-do spirit most of us say we want? Are you really willing to go it completely alone in this world without any access to government-funded Social Security and Medicare which is accessible to every senior citizen regardless of financial situation or annual income? Warren Buffett and Bill Gates might say they are willing to not partake of either federal assistance program but hundreds of millions of other Americans of more modest means probably won't.

Political 'values' tend to be 'trade-able', don't they? It is a matter of negotiation and compromise to see how far one value gets degraded at the increase of another political value. Less liberty for more equality, as in 'more taxes for the rich to provide more benefits for the poor or elderly' to name one recurring example in Washington forever it seems.

'Political Principles' don't seem to be negotiable. They seem to be sacrosanct, inviolable, extant forever.

'Honesty' is one of them. One thing is for certain in politics: Lying to anyone, whether it be an ally, your opponent, a lobbying group or your constituents, is a straight ticket to irrelevance in the public arena.

Sure there are individual cases where people can forgive a politician. Bill Clinton is a prime example. But they are few and far between.

During Dr. Sayre-McCord's talk the other day, it dawned on us that perhaps we need to separate political 'values and principles' from political 'goals and pledges' as a first step to cleaning up our current political debate. The sooner the better in our opinion.

We have been conflating them all together into some sort of meaningless gruel whereby our values are indistinguishable from over-arching principles which are undecipherable from political pledges and goals nowadays. That near about makes it impossible to figure out who's on first, what's on second and I don't know if we will ever get to third base or steal home again until we do.

We have recently been struck by the number of elected politicians who have started to decline signing pledges because they have come to realize how hamstrung they have become in office. They just can't get any deals or compromises done with hundreds of pledges hanging on them on each and every issue.

They might as well phone it in since a trained chimpanzee can be taught to vote yes or no on any issue if you give it enough peanuts or something as a treat each time they vote 'the right way', yes?

Let's take a look at just a few of them:
  • The Tax Pledge- Members who sign this pledge promise to never vote for higher taxes
  • The Social Security Protection Pledge- Members who sign this promise to never do anything to address any problem with Social Security other than when it is about to run out of money
  • Various Defense Pledges-Members who sign these pledges promise not to cut specific defense programs or the overall defense budget in absolute terms
  • Medicare and Medicaid Pledges-Members who sign these pledges promise to never do anything to change or reform either of the two largest medical care programs the world has ever known
  • Pro-Life Pledge-Members who sign this pledge promise to support pro-life positions
  • Pro-Choice Pledge-Members who sign this pledge promise to support pro-choice policies
These pledges are nothing more than a statement of their legislative goals and agendas. These pledges, in a somewhat simpleton way of boiling down very complicated issues to fit a bumper sticker, are really more of an indicator of where a candidate is likely to go once elected than an underlying value or principle, isn't it?

The problem comes because when the pledge is signed, it becomes a 'promise' to the voters, both those who supported the candidate and those who didn't. You can do many things in American politics except 'break a promise'. Because for some deeply inherent human reason, when you break a promise or a pledge, you become viewed as a liar and someone who can't be trusted. And with good reason.

We think there may be a way for candidates to clearly express their political and legislative goals by talking about what they would do once elected on any of these contentious issues named above. But they would have to stop signing these simple-minded pledges and focus instead on the values and principles they would hold high if elected to high public office.

Let's face the truth of the matter: Republicans who sign the Tax Pledge under the assumption that it would 'starve the beast' in Washington and deprive it of the revenues necessary to grow have been proven abjectly wrong. The government has still grown exponentially in the last 30 years and now we have a $18 trillion national debt to go along with it.

Know how to cut spending in Washington? Send people there who will CUT SPENDING IN WASHINGTON! Plain and simple.

Liberal Democrats (and Republicans) who sign any pledge 'not to touch SS/Medicare/Medicaid' to show seniors they are 'serious about protecting their entitlements!' are just as culpable as the Tax Pledge Republicans when it comes to not paying for what we are spending today and laying off that same $18 trillion national debt (soon to be $20 trillion, count on it) to our children and grandchildren.

SS/Medicare/Medicaid now make up well over 1/2 of the federal budget. When combined with defense spending and interest on the national debt, close to 80% of the federal budget is 'untouchable' if you have signed too many pledges not to do this, that or the other.

You ever wonder why nothing is getting done in Congress? Pledges are one main reason why.

Dr. Sayre-McCord got us thinking about what a candidate might sound like if he/she understood the difference between values and principles and stopped signing this simple pledges which some have described as 'going on autopilot' or worse, 'checking your brains at the door of Congress before you get sworn in'.

'If they had any to begin with...' we can hear many of you saying in a thought balloon over your head.

A conservative Republican running for Congress might say this:

'I am a small-government conservative (value) in the legacy of Thomas Jefferson and James Madison. I fear the concentration of power (value) in a few hands in Washington and prefer to allow the state and local governments handle as many issues as possible away from Washington help and interference.

My goal is smaller government at the federal level. (legislative goal) I will do everything and anything in my power to achieve that legislative goal. I don't like taxes any more than you do. (legislative goal) 

However, if I was presented with a legislative package that would reduce spending by $10 trillion over the next decade through a series of reforms and cancellations of federal programs that do not work, and the package included a $1 tax hike on everyone in the country to make sure it would pass the Senate, I would vote for it. (principle=honesty/integrity)

To do otherwise would be short-sighted and small-minded at this point in time.

A liberal Democrat could say almost the same thing in a mirror image of this statement:

'I am a big-government advocate (value) in the legacy of Alexander Hamilton. I support the concentration of power (value) in Washington because we can concentrate resources and redistribute them across the nation to make this a more fair country for everyone to live.

My goal is more government at the federal level. (legislative goal) I will do everything and anything in my power to achieve that legislative goal. I don't like cutting entitlements any more than you do. (legislative goal) 

However, if I was presented with a legislative package that would reduce our national debt by $10 trillion over the next decade through a tax hike on everyone in the country, and it included a series of reforms in entitlements and cancellations of federal programs that do not work, I would vote for it. (principle=honesty/integrity)

To do otherwise would be short-sighted and small-minded at this point in time.'**

Both of these statements convey the differing visions of how our country can and should be run. They both stay away from signing away their flexibility before they even get to Washington. They both stay true to the 'values' of America while maintaining the highest 'principles' of honesty, integrity and respect. 

At least they would not be insulting the intelligence of the electorate by 'promising' to balance the budget 1) without raising taxes! or 2) without cutting spending!

That would be a good first start.

*One possible word derivation of nincompoop- Late 17th century: perhaps from the given name Nicholas or from Nicodemus (by association with the Pharisee of this name, and his naive questioning of Jesus Christ; compare with French nicodème 'simpleton').

**(Voting for a tax hike AND a cut in entitlements might be the ultimate suicide mission for anyone, including a liberal Democrat in the safest possible district but follow this for illustrative purposes right now. Although it is right out of John Maynard Keynes' General Theory: raise taxes and cut spending during expansions; cut taxes and raise spending during recessions)

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Tuesday, February 24, 2015

Dean Smith and Wallace Wade: Teachers of Life, Not Just 'Coaches'


How were Dean Smith and Wallace Wade most alike?

'They saw themselves as 'teachers' first and foremost'.

'What's that you say? 2 of the most successful collegiate coaches in the history of college sports in America thought of themselves as 'teachers' first and 'coaches' second? Are you kidding me?'

It's true. Of course, it helped them a ton that they were great strategists, tacticians and geniuses of the sport they coached as well. And great recruiters, let's not ever forget that.

However, at the heart of both men was the heart of a 'teacher' in the truest sense of the word.

Dean Smith has been eulogized for the past week by many people and writers, as well it should be. The theme of 'greatest college basketball coach ever' and 'retired with most wins ever' at the time has paled in comparison to the other attributes Coach Smith had towards his players and University, most of which indicated a selflessness of the man and a desire to teach young men how to become men.

95% of his players graduated with a degree from The University of North Carolina at Chapel Hill. That may be a record that will never been reached by any coach in the future due to the pressure to 'win at all costs' which usually means 'at the cost of the student not getting a real education'.

Know what Coach Wade used to tell his recruits to play football at Duke University from 1931-1950?

'Duke University will do far more for you in your lifetime than you will ever do for Duke University on the football field'

Meaning: 'Come to Duke, go to class in substantive courses, get your degree and you will be able to live a full and wonderful life regardless of whether you get drafted to play in the pros or not'

Of course, back then, pro football players made $100/game so playing pro ball was not as lucrative or as attractive as it is today. The average salary of a NFL football player is about $2 million per year notwithstanding the fact that a few QBs make $25 million per year.

Coach Wade was recruited to come to Duke from the University of Alabama Crimson Tide where he coached 3 national championship teams in the 1920s including such teams as the 'Thundering Herd of Red Elephants' in 1931 which must be where Alabama picked up the association with their elephant logo.

Know what he wanted in his negotiations to come to Durham to coach a lowly football program after winning 3 national titles at Alabama, then and still a hot-bed of college football?

He wanted to be: 1) head football coach, of course; 2) Athletic Director, which makes sense and 3) Director of the Intramural Athletic Program for all undergraduates.

Director of Intramurals? That would be like Dean Smith wanting to be the director of the UNC fraternity flag football leagues and all the indoor intramural basketball, wrestling and racquetball leagues during the winter and softball leagues in the spring!

Coach Wade thought it was important to be the Intramural Director. Simply because he was a teacher first and foremost and wanted to be a molder and shaper of men's character, morals and ethics, all of which come to light during any athletic contest. Just watch and see how different players react to bad calls by a ref next time you watch a game.

Coach Smith believed in the team first, not the individual player. That is why he was the 'only person who could hold Michael Jordan below 20 points per game' goes the old saying. (actually it was 17.7 ppg)

The team was always stronger than the individual, Coach Smith preached. He invented the 'finger point' to the guy who passed the ball to the guy who got an easy shot because of his unselfishness and game smarts. He invented the 'run-and-jump' which was a variation on the trap defense. He invented the huddle at the foul line to call the next defense.

And...he invented the Four Corners offense. (or as he claims, he saw an Air Force team do it one time and he adapted it for his use at Carolina). If there ever was a way to teach people how to use your head to win a game, Dean Smith figured out how to do it regardless of the talent level he had on his team which was mostly great as the years went by.

He said of the Four Corners: 'It was a way to tell the other team that we owned you. Completely'. How demoralizing for the other team. And it was simply an impossible offense to practice against in freshman ball at Carolina.

But you know what Coach Smith and Bill Guthridge and the entire Carolina coaching staff put at the highest priority year-in and year-out?

'Going to class'.

If you wanted to run 32 flights of steps in Carmichael long ago, all you had to do as a varsity or jayvee player was skip a class and the next thing you knew, you were running up and down 32 sections at Carmichael with a 20-lb vest strapped to your chest and back. Try that sometime.

Dean Smith and Wallace Wade could not have been more apart on the political spectrum than any other two men on the face of this planet. Coach Smith was an active proponent of liberal causes from civil rights to nuclear freeze movements. Wallace Wade supported conservative causes and candidates such as Ronald Reagan and Jesse Helms.

You know where they both seem to be very similar?

They believed in the meritocracy of sport. That is, the best should play because the best players give your university the best chance of winning. Regardless of race; regardless of background.

Coach Wade played in the 1916 Rose Bowl as a guard on the  Brown University team with one of the first black All-Americans ever, Fritz Pollard. In 1938, Coach Wade took his southern Duke team up north to play Syracuse which had a black running back named Wilmeth Sindat-Singh who had been adopted by Indian parents. Coach Wade could have canceled the game or asked that Singh not play because of racial attitudes at the time but he didn't.

Coach Smith recruited the first black player to play at Carolina, Charlie Scott in 1967. Scott had been insulted in a Davidson, NC soda shop when a coach named Lefty Driesell took him there to seal the deal to have Scott join the Davidson Wildcats under Lefty who had Davidson in the top 5 in national basketball polls at the time.

After the incident, Scott supposedly told Driesell: 'I think I am going to play at Carolina, Coach'. No doubt Lefty got that guy fired from the soda shop for helping him lose one of the most talented players in the nation at the time.

Both Dean Smith and Wallace Wade won a lot of games for The University of North Carolina and Duke University, respectively. That is for sure.

Perhaps their most enduring legacy, or at least should be, was their dedication to the noble ideal that college athletics should be used to shape and mold the character of young men and women and help them get a solid broad-based liberal arts education while in college. Not to have college athletic programs used over-abundantly as a springboard to the NFL or NBA.

Less than 1% of all college athletes ever get a chance to play professional sports, About the same amount of high school athletes ever get the chance to play at the collegiate level. A star high school athlete has a far greater chance of becoming a neurosurgeon, a business person, a lawyer or astronaut than becoming a professional athlete....assuming he takes advantage of the opportunity and goes to class every day and works his butt off like every other student who wants to achieve the same outcome.

It is true that the highest average lifetime earnings by any Carolina undergrad major is geography. Mainly because Michael Jordan was a geography major, which to his credit, he promised his parents and Coach Smith he would come back to get even as a star with the Chicago Bulls which he did.

You would have to imagine that both Coach Smith and Coach Wade would be saddened by the almost ridiculous commercialization that has taken place in college athletics over the years. They both played a part in that commercialization, mainly because they put out so many great teams that people wanted to watch play in person early on and then later in the Smith era, on television.

However, regardless of whether or not they contributed to the commercialization of college sports or not, they both held true to their basic principles that colleges and universities are there primarily to educate the minds of  young people and train them to be productive citizens for the future. Not to be mere steppingstones on the way to a professional career.

We don't know if Coach Smith or Coach Wade would agree with this but maybe college sports should adopt the same rule that exists in MLB.  A high school baseball prospect has to decide whether to sign right out of high school and go into the minor league baseball system or go to college and not be eligible for the draft until after their junior year. That would be a minimum of 3 years for the athlete to go to class with other students and learn what it really means to be an academic student above and beyond being a jock on campus.

Plus, if they don't become the next Clayton Kershaw of the Dodgers, they have an education they can use to start a business or get a job somewhere.

Nothing is ever perfect about college sports. It never has been. But in a world of imperfections and downright scams and disappointment in many athletes and programs, Dean Smith and Wallace Wade have set the standard for what collegiate athletics can, and should be all about.

Like the Philosopher Kings, we'd all be fortunate to see more 'Coaching Teachers' like them.


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Friday, February 13, 2015

Medicaid Expansion in North Carolina

Medicaid-The PAC-Man of Government Budgets
We are always interested in what people say to justify what they want to do politically.

Sometimes what they say lines up with the cold hard steel facts of business, economics, accounting and basic money principles.

Most times, it does not. Sadly.

Let's take a cursory look at the issue of whether or not to expand Medicaid coverage in North Carolina under the ACA. It is a very complicated issue involved hundreds of billions of taxpayer dollars each and every year across the nation, both state and federal. Very few people, including many legislators, even know what the difference is between Medicare and Medicaid, truth be told.

Here's the basic deal offered by President Obama and the Democrats who controlled Congress in 2010 when they passed ACA:

'States that expand Medicaid can get the federal government to pay 100% of the costs of expansion for the first 3 years PLUS 90% of the expansion cost for the next 2 years!'

You can almost hear some carny barker like Billy Mays selling Oxy-Clean on television saying: 'But wait! There's more!' 


It sounds too good to be true, yes?

Let's see if it is too good to be true:

Medicaid expansion would probably add on 600,000 new enrollees on top of the roughly 1.8 million North Carolinians who are now on Medicaid. That would mean 2.4 million out of the over 9 million people in North Carolina would be on Medicaid.

Not everyone stays on Medicaid forever.  The average length of time on Medicaid is estimated to be about 9 months per enrollee. However, at any one time, the number of North Carolinians on Medicaid is about 1.8 million people for now.

The current budget for Medicaid in North Carolina is just under $14 billion this year. Accounting solely for inflation and current expectations of program growth, it is reasonable to see this number grow to $15 billion soon and possibly to $16 billion in a couple of years.

Out of the $14 billion now spent on Medicaid's 1.8 million enrollees today, roughly $4 billion is paid by state taxpayers through the state general fund as passed by the General Assembly bi-ennial budget; $10 billion is paid by the federal government. The official Medicaid split for North Carolina is 65% federal/35% state.

$14 billion divided by 1.8 million enrollees amounts to $7777/person spent each year in Medicaid. This number is vastly skewed by the fact that roughly 50% of the entire Medicaid budget is spent on nursing home care and not on every single Medicaid patient every year. But for argument's sake, let's use the $7777/person figure for purposes of illustration.

Let's assume North Carolina today accepts the ACA deal of 100% coverage for Medicaid expansion in years 1-3 and 90% for the next two years, what will that cost in absolute budget terms?

For 600,000 more enrollees at roughly $7777/head, that totals an additional $4.6 billion more spent on Medicaid in North Carolina per year or the first 3 years. Regardless of whether there is a 100% or a 90% match paid by the federal government. Probably this figure will be a lot higher.

'See there! North Carolina would get $4.6 billion more per year from the federal government scot-free to pay for these people who need health care! What could be wrong with that?'

For one thing, this is not 'free' money from Washington like it is some Monopoly money in a game. YOU are paying for the federal match share of Medicaid through your federal taxes paid to Washington just like YOU are paying for the state match share of Medicaid through state taxes paid to Raleigh.

Assuming you are paying personal income taxes of some form, that is. Close to 50% of American taxpayers pay only payroll taxes and excise taxes, not personal income taxes.

Medicaid is not paid for by your payroll taxes even though it is an entitlement just like Medicare. It is funded entirely through general funds allocated by the government every year, not paid for by a dedicated payroll tax sources such as is the case with Medicare.

About 25% of the new expanded Medicaid spending will probably be paid by more debt borrowed abroad. So what? We have already hocked our kid's futures to the tune of $18 trillion and counting...why not add on about $1 billion federal debt more for 5 years so we can expand Medicaid coverage in North Carolina?

The second problem comes when the high 5-year Medicaid ACA matching payments ends, say in 2020 if expansion happens in 2015. What happens then? *

Well, what happens then is that the historic 65/35 federal/state match comes back into play where North Carolina no longer gets 100% or 90% of the Medicaid expansion paid by the federal government but has to start paying the 35% match again. Forever. Including the 600,000 expanded coverage universe of Medicaid enrollees.

'That doesn't sound like a lot' we can hear advocates of expansion say.

Well, again, 35% of an additional roughly $5 billion in added Medicaid costs amounts to an additional $1.75 BILLION per year that North Carolina taxpayers will have to pay forever, adjusting upwards for inflation annually.

That would be on top of the $4 billion NC taxpayers are currently playing for our state share of Medicaid expenses as it is. The total would be at least $5.75 billion in 2020 if North Carolina expanded Medicaid coverage this year and probably another billion or two more if Medicaid costs keep expanding as they have annually for the past 30 years.

Want to guess where this additional $1.75 billion per year will come from in 2020 and beyond? It almost certainly will not come from more taxes since the GOP is likely to retain control of the General Assembly for the next 5 years at least. Plus, people already feel overtaxed and over-burdened as it is.

If you think they are not over-taxed, try running for any office anywhere in NC on this Walter Mondalesque platform: 'I will never cut spending anywhere and I will raise taxes everywhere to pay for more state government spending across the state!'

You will have a better chance of running the gauntlet unscathed than you will getting elected that way.

That additional $1.75 billion in Medicaid spending will come from where it has already come from in the state budget under Democrat and now Republican control: public education, transportation and every other program ending in '-tion' in the state budget.

Medicaid is the PAC-Man of state and federal budgets. It (and Medicare) have gobbled up increasingly larger shares of taxpayer dollars in Washington and across the states such that the other discretionary programs are much smaller as a percentage of the overall budgets than they were just 10 years ago.

You want to pay teachers more in salary? Or support higher education through the UNC system? You will not be able to do it if Medicaid chews up an additional $1.75 billion of state tax dollars in 2020.

The entire state budget today, sans the federal matching programs, is only about $21 billion. $1.75 billion would be an additional 8% of the state budget by 2020 and it could be more.

The North Carolina Medicaid program has had a long history of not being managed very well and having to go back to the General Assembly at the end of legislative sessions to ask for an additional $300 million to $500 million to pay the bills in the last 5-6 years. The first priority of business is to figure out how to oversee and manage the existing Medicaid program so that costs can be controlled while offering the best care possible to our state's Medicaid recipients.

We have explained before why we think Medicaid MCOs (Managed Care Organizations) are a good idea whose time has come for North Carolina. For one thing, they typically produce better health outcomes for the very people who need better outcomes the most, the poor and indigent, simply because they are assigned health care caseworkers who monitor and counsel their every health care decision and move.

For another thing, MCOs can possibly finally get North Carolina's state Medicaid budget costs under control with or without expansion. If Medicaid expansion ever does happen, the costs to the taxpayer and the other programs in the state budget will be mitigated significantly.

The main point here is to point out that the old adage of 'There is no such thing as a free lunch!' is very much true. Especially in the ACA Medicaid expansion issue.

On the House Budget Committee, when tough decisions needed to be made, someone would invariably say: 'This is why we have to be the adults in the room'.

Adult decision-making that takes into account both the short- and the long-range implications of expanding Medicaid is important at this time.

Just have all the math and the arithmetic at your side.

* Medicaid Expansion is complicated as heck as you can well imagine. Some advocates will say this is a good deal because the ACA, 'as written' does not call for a sunset of the 90% federal match specifically. It can be read as saying the 90% match can 'extend for as long as it is sustainable or until Congress says it can't be that high any more'

Which stands to reason since no prior Congress can bind the arms of any future Congress.

Here's some important information you can read that explains how the states will have to adjust to the realities of the federal budget pressures going forward, regardless of whether or not Congress explicitly repeals the 90% match going forward after the 5-year period.

No budget guy we have talked with in DC is willing to bet the farm that after the 5-year expansion in any state, the Medicaid federal match will stay that high and not revert back to the historic norms for each state.

in NC, the match is 65/35 fed to state. In Mississippi, for example, it is 73/27 or something like that.

Chuck Blahous is one of 3 Medicare/SS Board Trustees and has worked on entitlement issues in the US Senate under Senator Alan Simpson and in the Bush White House for 8 years.

He has written a pretty detailed explanation of what states face when considering Medicaid Expansion....here's the summary version: http://www.economics21.org/commentary/expanding-medicaid-conflicting-incentives-facing-states

full version here is you really want to dive in deep here: http://mercatus.org/sites/default/files/Blahous_MedicaidExpansion_v1.pdf

After you read those two reports, you might want to read this in detail and depth....it is a 10-year forecast from CBO about everything in the federal budget.

https://www.cbo.gov/sites/default/files/cbofiles/attachments/49892-Outlook2015.pdf

Deficits are expected to go back up to $1 trillion around 2020, if not sooner.

It is very highly unlikely Congress is going to allow Medicaid expansion stay at 90% under continued upwards budget pressure. There are too many inherent contradictions such as where a pregnant woman at 60% of the federal poverty line gets a lower reimbursement rate from the feds than a childless adult with double the income,

It is the 'Law of Unintended Consequences' again. Such contradictions will lead to more review of the ACA going forward, not less.



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Sunday, February 8, 2015

President Obama's National Prayer Breakfast Speech

'Christians: Get Off Your High Horse!'
What is the big deal about President Obama's speech to the National Prayer Breakfast?

After all, there's no secret that some people have used Christianity to further their misguided or horrific goals in the past.

Possibly the worst and most polluted human life form with a brainstem that has ever lived, Adolf Hitler, tugged at the strands of the diminishing thoughts and writings of a declining Martin Luther who became increasingly more anti-semitic as he aged, to justify what came to be known as 'The Final Solution' as he and his henchmen exterminated at least 6 million Jews during World War II and possibly millions more.

Mentally and morally sick and corrupt people will grasp at any ethical or religious straw they can to justify their abuse of power. It is somehow embedded in human nature to do so.

Which is precisely what the Islamist terrorists are doing today in the name of the Prophet Muhammad and Islam.

Which begs the serious question:

If the President can say that certain Christians have used Christianity to justify slavery and Jim Crow laws in the South, why can't he also say that certain Muslims have used Islam to justify jihad and kill infidels such as Americans wherever they can?
What is so difficult about that? This President seems to be ever-willing to blame America first, Christianity first, capitalism first for all the national and global ills but he is simply unwilling to cast blame on other nations, other religions or other government systems the world over for much of anything.

It is like President Obama sees himself as 'The Great Apologizer' for past American sins or something.

Here's the official transcript of the President's speech as put out by the White House immediately when he began talking at 9:13 am on February 5, 2015. Read it for yourself and see what you think.

Based on the fact that this was issued at 9:13 am makes you have to believe that his comments about the Crusades and Jim Crow were not ad-libbed or a deviation from the written text but rather a fully-thought-out-in-advance-and-vetted-with-staff-and-speechwriters-beforehand planned statement.

For the most part of the speech, there seems to be no controversy or unusual language in it. Just another of the usual run-of-the-mill political speeches at a religious event which is not as easy as it sounds to pull off unless you have seen it up-close-and-personal.

But here are the incendiary words that have set off like M-80s in the Christian community around America:
'And lest we get on our high horse and think this is unique to some other place, remember that during the Crusades and the Inquisition, people committed terrible deeds in the name of Christ.  In our home country, slavery and Jim Crow all too often was justified in the name of Christ.'
'Lest we get on our high horse?'  What sort of language is that for the Leader of the Free World to use at a religious meeting of any source?

The essence of President Obama's misguided words as heard by many Christians, whether fairly or not, in the audience at the National Christian Prayer Breakfast and in the general public was this:
'Christians are no different than the ISIS terrorists who are now slaughtering, beheading and burning innocent people to death in Iraq and Syria'
Talk about bad timing. Talk about an unforced error. 48 hours after witnessing the horrific immolation of the captured Syrian pilot who was locked in a cage like an animal before being doused by gasoline and set aflame, President Obama and his team somehow inexplicably chose to compare Christianity to these radical ISIS terrorists right when everyone still had that horrific image in their heads.

We can not see Winston Churchill in Parliament comparing the atrocities of Hitler to the Anglican Church of 1939 or even the Crusades. We can't see FDR on December 8, 1941 comparing the Japanese terrorists who bombed Pearl Harbor the day before to the institution of slavery in antebellum South.

There was no equivocation faced with the dangers of severely demented and dangerous political and military leaders in Germany and Japan. These ISIS killers are clearly cut out of the same bolt of poisoned cloth as were Hitler and the Japanese Imperialists from Hirohito on down through the military leadership.

Almost immediately upon the conclusion of the speech, we were contacted by a person we highly respect who was steaming about the speech as he was driving down the road somewhere. He has the added benefit of having served our country in the Afghanistan war theater for many years and has an acute understanding of the political situation over there, especially among the Muslim nations and factions we are facing.

Here's what bugged him the most about the President's speech:
  1. The timing was awful.
  2. It played into the narrative of the radical terrorists
  3. The President of the United States should not be giving our opponents and people who want to kill Americans any sort of support by comparing us to the Crusades since they already believe the US is part of the history against Islam from the Crusades which essentially ended in the 13th century.
It's no coincidence that the Taliban and other Islamic extremists regularly refer to the United States and its coalition partners as "crusaders." By invoking the Crusades of history, the Taliban and other such groups create a "thematic frame" to lure recruits and others by recalling supposed horrors against Muslims. By also pointing back to the Crusades, the President of the United States utilizes the same thematic frame, which only serves to amplify extremist messaging.

We could go on all day about this but suffice it to say that we are looking forward to the day when we have a US President once again who can see the good in America despite the warts and moles and cancers we have had in our past.

One thing the President could have said at the National Prayer Breakfast about Christians in America is that they were the driving force behind the abolition of slavery in perhaps the first eradication of slavery in recorded human history. The Transcendentalist movement in the Northern churches produced the abolitionists who pushed for the end to slavery almost from the beginning of our Republic.

William Wilberforce in England pushed relentlessly for the end to the slave trade in Britain almost solely because of his devout Christian faith.

America and Britain and other western cultures may not be perfect.  Certainly there are, and have been, inequities in capitalism, the Christian Church and democratic republics in history.

Winston Churchill probably said it best in one form or another: 'Democracy is the worst form of government...except for all the others that have been tried from time to time in history'

Maybe the same can be said for Christianity in the religious belief world as well.

It is our job to constantly try to make things better whether through our political views or our religious beliefs or just because it the right thing to do. It would help to have a President share in the basic inherent goodness of democracy and Christian belief to help lead us and the world towards that better tomorrow.

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Thursday, February 5, 2015

'Morning Mika' And The Minimum Wage



We were somewhat stunned to see the interview above on 'Morning Joe' recently, not because of the content of the story but because of the reaction and body language of Mika Brezinski, one of the co-hosts.

(Why isn't it called 'Morning Mika and Joe' yet, you have to wonder in these days of equality and all that?)

We thought this was an important lesson not only in the distance many in the media seem to be away from the 'real world' of everyday life where normal people run normal businesses or have normal jobs but also because of the lack of serious understanding about how our free market system works in the first place.

If you don't want to watch the entire 7-minute segment*, here's the basic story line. Alan Beatts, a small bookstore owner in San Francisco, of all liberal and tolerant and accepting cities in America, is going to shut his business down due to the mandated $5/hour hike in the minimum wage that the city recently passed into law.

'That doesn't sound like a very big hike to me', Ms. Brezinski said after Mr. Beatts told his story in a very calm and matter-of-fact manner.

Of course not. $5 is not a big deal to most people. Certainly not someone who is making $2 million per year in salary according to some sources. (Joe Scarborough pulls down $4 million per year which is not bad for a show that may have 367,000 people watch at any moment during their 3-hour morning segments. That is $10/viewer for Morning Joe; $5.67 for Morning Mika according to the Daily Beast.)

But what about to the small businessman such as Alan Beatts, owner of Borderlands Bookstore in San Francisco? How does a $5/hour hike in the minimum wage affect him? He is the 'owner'; certainly he can afford that, right?

Well, let's do the simple math:

He has 3 minimum wage employees. $5/more per hour means his costs go up immediately upon implementation of the new wage scale $15/hour. He has to pay his workers for at least 8 hours per day as they rotate on shifts; time-and-a-half for overtime or holidays and weekends perhaps.

If it is just a straight 8-hour workday for all 3 minimum wage workers, that is $15/hour x 8 hours/day or $120/day in extra costs to Mr. Beatts.

'That still doesn't sound like a lot of money to me!' we can hear Ms. Brezinski exclaim.

Of course not. $120 shouldn't be a big deal to a 'fat cat, wealthy business owner' who are all presumed to be the Koch Brothers by the news media for some reason.

The reality of life in America is that for every Koch Brother, there are probably 13.5 million small business owners in precisely the same situation as Mr. Beatts of Borderlands Bookstore in San Francisco, California. Maybe millions more.

To put this in the bottom-line context, which is important in any business, that $120/day in marginal increased costs to Mr. Beatts amounts to $26,400 over a 220-day work year, just in minimum wage hikes alone. When overtime and holidays are factored in, it could be $36,400 or more.

Mr. Beatts said that the new minimum wage on San Francisco will drive up his costs close to 39% alone not counting any other factor.

In addition to that, he will have to pay his manager more simply because the minimum wage has pushed up the wage scale across-the-board. Every other non-minimum wage worker will want to see his/her hourly wage or salary go up in commensurate scale which will add more costs to his bottom line.

What will Mr. Beatts have to see happen in his bookstore when the minimum wage goes up to $15/hour for his 3 employees to make it work? That is right...he would have to see more books sold on a daily basis to produce enough new revenue to generate a gross profit of at least $121/day to stay ahead of the game.

Is that even possible in these days of Kindles and on-line books against the backdrop of the average American reading only 1 book per year in all likelihood?

Mr. Beatts doesn't think so. So he is making plans to close his bookstore in San Francisco.

So what will happen to these 3 minimum wage workers and the manager? You are correct. They will be laid off unless they can find other work in which case they will leave Mr. Beatts all along to pack up his belongings and close down his shop that he probably bought/built with savings out of his own pocket or credit cards he maxed out to the hilt to get the original inventory of books on the shelves to sell in the first place.

If they can't find other jobs, they will apply for unemployment benefits which will drive up the costs of government and mean higher taxes which will mean another round of more debt and more spending and more central planning by government.

This is one reason why we think everyone who runs for public office should be forced to show proof that he/she had any experience running a business, even if it was a lemonade stand growing up or delivering newspapers back when people used to read them every morning.

Running any business at any level is very difficult work.We have said it before but it bears repeating again: These business people deserve a Congressional Medal of some sort just for taking the risks and making the investments and having the skills to run a business so the rest of us can be employed by them because: 1) we lack the skill to run our own business: 2) we are too risk-averse to put all of our savings at risk to start a business with no assurance that it will even succeed at some point in the future or 3) we just prefer to do our job, go home and let the owner do all the worrying and fretting every night.

What oftentimes sounds like a 'good thing' to do, such as raising the minimum wage by 30% as in the case of San Francisco, many times winds up hurting the very people that political advocates say they are trying to help.

Ask Mr. Beatts and his 3 minimum wage workers.


*( click on the link above if you are receiving this via email distribution to see the entire interview)

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