living liberty december 2004

December 2004 • Volume 14, Issue 12Living LibertyLiving LibertyLiving LibertyLiving LibertyLiving Liberty

FF’s I-884 voter-education efforts paid off in an informedelectorate that soundly rejected the billion dollar salestax increase for education funding. EFF staffers worked

with Citizens for a Sound Economy and the National TaxpayersUnion in traveling across the state, speakingat 30 different events (editorial boards,chambers of commerce, PTAs, politicalgroups, forums, etc.). We were ontelevision at least seven times, includingKING 5 and KIRO 7, and made at least adozen major radio appearances, includingmultiple appearances on the Clear Edge(KGA, Spokane) and the Mike Siegel Show(KTTH, Seattle).

To assist citizens wading through some ofthe misconceptions about I-884, EFFlaunched an I-884 resource center. We alsopublished numerous editorials and suppliedquotes for many news stories. EFFmembers agreed to write letters-to-the-editor about I-884, came to events, andpassed out information to friends and co-workers.

Together, we informed the public about the true costs of theinitiative. As a result, voters were able to see through the well-intentioned, but poorly thought-out, arguments of the pro-884public relations gurus.

Unfortunately, many legislators seem short on ideas now thatvoters have put responsibility for education reform squarely back

What Works?Successful reforms for public schools

in their laps. Post-election commentary is fixated on money,and legislators are throwing up their hands wondering wherethey’re going to get more of it.

There’s nothing new in the rhetoric—and that’s the problem.

It’s time to consider the fact thatwe may already be spendingenough money on education; wejust aren’t spending it effectively.And it’s time to discuss the crucialneed for structural reforms in ouroutdated, monopolistic educationdelivery system.

Despite what advocates said, I-884was not the only option, and moremoney alone will never solve oureducation crisis. Now that votershave spoken and declared that theyare not willing to just throw moremoney into the same tried andfailed programs, we can begin to

adopt the solutions that really work.

Washington legislators and other key decision makers shouldaggressively pursue the following policy recommendations toimprove our state’s public schools.

December 2004

What Works continued on page 9

E“Despite what advocates said, I-884

was not the only option, and more

money alone will never solve our

education crisis. Now that voters

have spoken and declared that they

are not willing to just throw more

money into the same tried and failed

programs, we can begin to adopt the

solutions that really work.”

Living LibertyLiving LibertyLiving LibertyLiving LibertyLiving LibertyA publication of the Evergreen Freedom Foundation

Letter from Lynnby Lynn Harsh

2

live in a reddish part of a bluecounty, in a blue state. But 30 blocksdown my peninsula, the bluish turns

reddish. Ten blocks further, and three“Kucinich for President” signs are stillvisible in a one-mile stretch. I can’t tellyou how badly I’ve wanted to stop andlook intently at those people... maybe turnup their eyelids and check their teeth tosee if they are healthy. [Or knock on theirheads and listen for a hollow sound.] Ifigure they feel the same about me.

Imagine how excited I was when I pulledmy car into the local Grange for a “Caringfor Your Septic Tank” meeting right nextto a “Kucinich for President” car. At timeslike that, I salivate at the prospect of afascinating conversation. It’s always easyto begin a friendly exchange when standingnext to a person whose car is held togetherby politically inspired bumper stickers.And, no doubt, they salivate too at theprospect of another convert.

“So, what made you decide DennisKucinich would be a great president?” Iasked this unsuspecting young man. Hejust stared blankly at me.

I pointed to his bumper sticker.

“Oh,” he said. “This is my mother’s car.She likes him. I couldn’t make up mymind, so I didn’t vote. But I don’t likeBush. My mom couldn’t come to thismeeting, so she sent me.”

Sizing him up as all of 20 years old or so,I said, “Well, I’m glad Kucinich didn’t win,because you would have spent the rest ofyour life earning money to support meand my generation instead of using yourpaycheck to invest in your own future.”

He was visibly surprised. A couple ofparagraphs worth of conversation later, Idiscovered he attends the local communitycollege where all his teachers told studentsthat President Bush was killing ourcountry. He asked me if I agreed.

We talked about the deficit, which I agreedis a terrible millstone around hisgeneration’s neck. We discussed the PatriotAct and what I consider to be its corrosiveeffects on individual liberty. We talkedabout the war and the mixed feelings somany of us have.

Then I explained my philosophy ofgovernment, which basically boils downto government protecting individualliberty—protecting equal opportunity, notequal outcomes. I said I thoughtPresident Bush felt similarly. We discussedthat for a moment, and then I asked himwhy government shouldn’t allow him toset up his own personalaccounts for health care,potential unemployment,and social security. He likedthose ideas and could notunderstand why they wouldbe called radical.

When we started talkingabout education reform, hereally became animated! Hesaid he’d always felt like hewas trapped inside a petridish in the three differentschools he had attended. Hethought there ought to behundreds of options for howand when kids could learn.You won’t be surprised toknow I agreed with him. Nor

will you be surprised to learn I told himthat the greatest obstacle to this type ofreform is the current K-12 monopoly—amonopoly protected by legislation andpreserved through forced political“donations” from unwilling teachers. Wetalked about the perversity of payingteachers the same amount of money, nomatter if they are excellent or mediocre.He was outraged!

And that was his condition when we saidgood-bye—when he went home to hisKucinich-loving mother. Neither of usmade it into the septic tank meeting. Butit was an encounter meant to be. I gavehim my card, and now his mother wantsto talk with me. She’s unhappy about the“outright lies” she says I put in her son’shead. I agreed to meet with her as long asher son comes along.

And I promise to resist the temptation tolift up her eyelids, check out her teeth,and knock on her head.

Don’t it make his blue eyes red?

Tired of waiting for your monthlynewsletter for the latest news?On occasion, we send out press

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email address for our Alert Mailing

List. Budget and Taxes? Educa-

tion? Health care? You can sign up

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www.effwa.org/mailing.php

I


4 Illegitimate “degrees”Earlier this year multiple stories surfaced in the national media exposing theproblem of federal government employees obtaining “fake” degrees to acquiresalary increases.

Contents

Evergreen Freedom FoundationPO Box 552

Olympia, WA 98507(360) 956-3482

Fax (360) [email protected] • www.effwa.org

Living Liberty is a publication of theEvergreen Freedom Foundation.

Editors:Lynn Harsh

Marsha Richards

Publisher:Joel Sorrell

EFF’s mission is to advance individualliberty, personal responsibility, and

limited and accountable government.

Quoteof the month

6 Welfare womenJason DeParle’s work is all the more poignant because it is true. DeParle’s intimateportrait of three women and 10 kids trapped on welfare is also an intricatelydetailed chronicle of how decades of American policy helped to get them there,and how Bill Clinton and Newt Gingrich got them off.

7 Stealing other peoples’ moneyDespite protestations by the Departments of Employment Security (ESD) andLabor and Industries (L&I) about security checks and balances, fraudulent claimsfor unemployment and/or workers’ compensation benefits are growing at analarming rate.

8 The Boeing caseAs many of you know, since December 2003 we have tried to obtain a copy of thecomplete contract our state signed with the Boeing Corporation. The entire packagewas worth billions of dollars, and we wanted to see what state officials had agreedto do on behalf of us taxpayers and how many jobs were anticipated as a result.

12HSAsIn just one year, consumer-driven health care options have launched a powerfulmovement. Consumers are realizing that whoever controls the money also controlsthe choices.

14TPP UpdateThe unabashed political agenda of unions nationwide has brought attention tothe fact that unions derive significant political clout from the use of mandatoryteacher dues. Activists in many states are confronting the teacher unions, and wecontinue to maintain our momentum here in Washington state.

3

“The welfare state reduces acitizen to a client, subordinates

them to a bureaucrat, and subjectsthem to rules that are anti-work,anti-family, anti-opportunity andanti-property … Humans forced to

suffer under such anti-humanrules naturally develop pathologies.The evening news is the natural

result of the welfare state.”

– Unknown

In last month’s Living Liberty, an article on the death tax (Death Tax:Washington state “death tax” rises from the ashes!) referred to the Departmentof Revenue (DOR) reducing the threshold for filing and paying Washingtonstate estate taxes from $ 1,000,000 in assets to $700,000. The DOR changetook effect in 2002 and the threshold was set at $700,000. The currentthreshold is set at $850,000.

CLARIFICATION:


4

arlier this year multiple storiessurfaced in the national mediaexposing the problem of federal

government employees obtaining “fake”degrees to acquire salary increases. These“degrees” were claimed by employees atthe Department of Homeland Security,the Pentagon, the Transportation SecurityAdministration, the Defense IntelligenceAgency, the Department of Treasury and

the Department of Education. Illegitimatedegrees also surfaced in a number of statereviews of teacher personnel files.

In 2002, three Oregon teachers had theircredentials revoked after claiming to holddegrees from La Salle University in

Louisiana, a now-defunct diploma mill(there is an accredited La Salle inPennsylvania). In 2003, the state ofGeorgia audited its 130,000 teachers andfound 11 had received salary increasesbased on “degrees” from Saint RegisUniversity, a diploma mill in Liberia. InJuly, those teachers were permanentlybarred from teaching in Georgia. Similarinvestigations have been launched in Texas,

California and Hawaii, as well as abroadin the United Kingdom, Australia andIndia.

Using an illegitimate degree to obtain ajob or promotion is only illegal in NorthDakota, Nevada, Indiana, New Jersey,

Illinois and Oregon, where the crime is amisdemeanor punishable by jobrevocation and/or fines ranging from $350to $2,500.

What is a diploma mill?

The Oregon Office of DegreeAuthorization states: “Diploma mills (ordegree mills) are substandard or fraudulent

‘colleges’ that offer potentialstudents degrees with little orno serious work. Some aresimple frauds: a mailbox towhich people send money inexchange for paper thatpurports to be a collegedegree. Others require somenominal work from thestudent but do not requirecollege-level course work thatis normally required for adegree.”

Regarding the problem withdiploma mills, AlanContreras, Administrator ofOregon’s Office of DegreeAuthorization recently said:“We as a society treat the ideaof a college degree as thoughit means something. Ifeverybody’s got a Ph.D., thenwhere are you? We all run

around calling each otherdoctor. But the effect on societyis profoundly negative.”

These concerns prompted us tolaunch a survey of the state’sschool districts to determine ifany teachers had usedillegitimate degrees to obtainsalary increases. We sought to

verify that all Washington teacherspurporting to hold advanced degreesactually received them from legitimate,accredited institutions of higher learning.In the United States, accreditedinstitutions can be checked through a

Illegitimate “degrees”by Sarah Carrico

being used by some teachers to obtain higher pay

E


[ ]5

Chris Halsne of KIRO 7 TVinterviewed EFF Research AssistantSarah Carrico regarding her researchon teachers in Washington state usingfake degrees in order to obtain payincreases. Sarah’s research inspiredKIRO News to do its own additionalinvestigation into the diploma millstory. KIRO Team 7 Investigatorsexpanded on EFF’s research to identifyillegitimate degrees for Principal Evoyat Thurgood Marshall Middle Schoolin Olympia, a teacher in Zillah and acounselor in Bremerton. The releaseof EFF’s research was scheduled tocoincide with the airing of the initialKIRO story.

Chris Halsne of KIRO 7 TV inter-viewed EFF Research Assistant SarahCarrico regarding her research onteachers in Washington state using fakedegrees in order to obtain pay increases.

EFF staffer featured on aKIRO investigative storyspurred by EFF research

KIRO ended its initial report with a challenge for taxpayers: “You can help solve thisproblem by checking the web site for the Office of Degree Authorization with the state ofOregon. In Oregon, it’s illegal to profit from a fake degree. If you know a teacher whoclaims to have a degree from one of these institutions, let us know. We’ll investigate.”

A C T I O N A L E R T:

comprehensive institutional databasecompiled by the Council for HigherEducation Accreditation.

The Office of the Superintendent ofPublic Instruction (OSPI) includes as aminimum prerequisite to hold a teachingcertificate in Washington “a bachelor’sdegree from a regionally accreditedcollege/university.” A phone inquiry toOSPI also revealed that the samerequirement applies to an advanceddegree: such a degree must come from aregionally accredited college/university(foreign transcripts are evaluated todetermine US-equivalency).

Of Washington’s 296 school districts, only65 provided the information werequested. An additional 25 districtsrefused to provide assistance. Mostdistricts did not respond at all.

Of the 65 school districts that providedinformation, five districts were found tohave a total of seven teachers claimingillegitimate degrees.

This data is troubling when one considersthat, of the 22 percent of school districtsthat provided information, there are atleast seven degrees from “institutions”unaccredited for use in qualifying forhigher salaries based on degrees obtained.This begs the question: How many moreunaccredited degrees have been claimedin the remaining 78 percent ofWashington’s school districts?

The State Auditor’s Office issued a findingearlier this year against the Pateros SchoolDistrict for not verifying the degreesreported by teachers. The auditordetermined that at least one Paterosteacher received $35,365 in “unearnedsalary and benefits” as a result of claimingan unaccredited university degree.

Recommendations

1) Washington should follow the lead ofstates that have made it illegal to obtain ajob or profit from the use of illegitimatedegrees.

2) Until changes are made to the currentteacher salary model, OSPI should

perform a statewide audit of all schooldistricts to confirm all teacher degreescome from legitimate, accreditedinstitutions of higher learning.

3) Instead of basing pay primarily on jobseniority and degrees earned, legislatorsshould adopt a flexible salary model thatallows educators to earn competitive payfor demonstrable excellence and forteaching in high-demand subject areas.Earlier this year the DemocraticLeadership Council recommended asimilar policy.

Conclusion

The state’s current salary system, whichpays teachers based on how long they’veheld their job and how many degrees theycan show on paper, is bad for studentsand provides incentives for fraud. Thestate should instead pay teachers basedon their effectiveness in the classroom andtheir ability to demonstrate studentachievement.

[email protected]/oda/unaccredited.html


AMERICAN DREAM: THREEWOMEN, TEN KIDS AND ANATION’S DRIVE TO END WELFAREBY JASON DEPARLEVIKING BOOKS, 422 PAGES, $25.95

6

A review of “American Dream: Three Women, Ten Kidsand a Nation’s Drive to End Welfare” by Jason DeParle

by Nicole Gelinas

This book reads like an epic novel that chronicles the lives ofone extended family as each generation forges ahead with fewmodest hopes to counteract crippling doses ofheartbreak.

But Jason DeParle’s work is all the more poi-gnant because it is true. DeParle’s intimate por-trait of three women and 10 kids trapped onwelfare is also an intricately detailed chronicleof how decades of American policy helped toget them there, and how Bill Clinton and NewtGingrich got them off.

The three young protagonists of DeParle’sstory—Angie, Jewell and Opal—are black. But“welfare,” as it was first conceived, pre-datedthe segregated, northern ghettos the programcame to sustain.

President Roosevelt viewed the 1935 aid pro-gram as a temporary measure to support wid-owed mothers whose husbands had never had achance to bank Social-Security benefits because Social Securitywas so new. Ninety-six percent of early beneficiaries were white.

Then came the 1960s. Civil-rights activists, notably in NewYork, “launched a remarkably successful crusade for somethingnot previously known to exist: ‘welfare rights,’ “ DeParle notes.New York and other cities dropped stringent welfare-eligibilityrequirements, partly to quell urban riots. Caseloads of singleblack mothers with children doubled and doubled again.

When Angie, Jewell and Opal were born in the mid-1960s, 80percent of black kids would spend part of their childhoods onwelfare. But Angie, Jewell and Opal are not statistics, and DeParledoesn’t treat them as such. He traces their family histories fromthe post-slavery sharecropping era of Delta Mississippi in the1930s to the urban environs of Chicago in the 1960s.

DeParle follows the three teen mothers as they migrate furtherfrom Chicago to Milwaukee to take advantage of higher wel-fare benefits and lower rents there. He chronicles their journey

EFF publisher’s note: Soon Congress will decide whether the currentwelfare reforms will be extended, modified or undone. A battle brewsbetween those who believe government is obligated to ensure a living wageto all Americans and those who believe government must ensure equalopportunity and then get out of the way. This book provides a glimpse ofthe human and practical outcomes.

from the welfare rolls to formal work after Clinton signed theRepublican-backed law to “end welfare as we know it” in 1996.

DeParle offers no illusions about what welfare reform accom-plished. Through DeParle’s narrative, the program can be viewedas welfare fraud reform. Angie and Jewell long worked low-wage jobs while on welfare—indeed, during any single year,more than half of recipients worked while (illegally) collectingbenefits.

When Milwaukee forced welfare recipients to work to get theirchecks, the women realized that they couldn’t be in two placesat once. So they did the economically rational thing, and optedto drop welfare to keep their private-sector jobs—which oftenpaid more.

Nor does DeParle romanticize his subjects.

Opal lands a job at Target only to be caughtstealing—and her criminal record then pre-vents her from getting a better job. In the end,neither welfare nor welfare reform saves Opalfrom falling into crack-addicted oblivion. By

the early 2000s, she’s lost her check and herkids—and Wisconsin’s half-hearted efforts toforce her into treatment haven’t saved her fromherself.

But DeParle does offer two stories of incrementalgrowth. Angie and Jewell emerge as strong women. If they don’texactly thrive, they do survive—and they expect their men andtheir children to build on their painful progress. Jewell findssteady work as a nurse’s aide after years of sporadic work andwelfare—and her example spurs her longtime boyfriend to foregoselling cocaine for honest work.

Welfare’s end doesn’t keep Angie’s daughter, Kesha, from bear-ing two children by 19. But Kesha, unlike her mother beforeher, knows that welfare won’t support her. “[Welfare’s] for peoplewho really need it. I like to earn my own money,” she says.

And Kesha’s situation is becoming an aberration. In what maybe welfare reform’s greatest unpredicted success, the percent-age of unwed teenage mothers has plummeted in the eight yearssince Clinton signed that law.

Nicole Gelinas is a freelance writer whose work has appearedin numerous publications, including the New York Post. Shecan be reached via E-mail at [email protected].

WELFARE WOMEN


PEOPLE’S MONEY:STEALING OTHER

7

thief takes several thousanddollars from your home inbroad daylight. Even if he’s

caught, it is unlikely that you will ever seeyour money again.

Unfair, right?

Now, suppose the police let the thief intoyour house and help him carry away yourmoney.

Welcome to the world of unemploymentinsurance and workers’ compensationfraud. The work is easy and the benefitsgenerous. Anyone can do it and many are.

Despite protestations by the Departmentsof Employment Security (ESD) and Laborand Industries (L&I) about security checksand balances, fraudulent claims forunemployment and/or workers’compensation benefits are growing at analarming rate.

Businesses faced with a fraudulentunemployment insurance or workers’compensation claim are hurt no matterwhat they choose to do.

Businesses that don’t challenge the claimsuffer increased insurance rates. Whenclaims are paid out, rates go up, whichdrives up the cost of employment andeventually forces the business to cutbenefits, jobs, or hiring opportunities.

Functionally (and in the case of L&I,statutorily), the burden of proof is usuallyon the employer. This means that the

by Cole Nevins

business challenging a claim decision mustinvest time and money in the dauntingtask of proving that a former employee isineligible for the benefits received.

Unless the employer supplies an oftenunreasonable preponderance of proofrefuting the former worker’s claim, theclaims investigators of L&I and ESDtypically rule in favor of the claimant. Inthe unlikely case that the employer issuccessful and the fraudulent claim isdenied, any money already paid out tothe claimant (an overpayment) may takeyears to recover if it’s recovered at all. Inthis case, the employer avoids a rateincrease, but the cost of the uncollectedoverpayment is shouldered by all theemployers in the industry.

Occasionally, the decisions handed downby Labor & Industries border on theridiculous. For example: After being fired,one logging company employee filed anL&I claim for a knee injury allegedlysustained after slipping from a log themonth before. There were no witnesses,and the employee worked the rest of themonth without a complaint. Repeatedexaminations, an MRI and eventually anarthroscopic examination yielded noevidence of an injury, only gout. Despitethe doctor’s finding, the Departmentallowed the claim. The employee collectedalmost $20,000 in time loss and medicalbills and continues to receive paymentstoday.

UI and Workers’ Compensation Fraud

Not only does L&I have problemseffectively determining the eligibility ofclaimants, but the Washington StateAuditor’s 2003 Statewide AccountabilityReport asserts that during a six-monthperiod in 2002, Washington statebusinesses paid $5.8 million that was notcredited properly to their insuranceaccounts. The report notes: “Neither ourstaff nor [L&I] Department personnelwere able to determine what caused thedifference.”

Unfortunately, allowing fraudulent claimsisn’t limited to Labor & Industries. Thesame Audit Report shows that ESD paidan estimated $767,677 in overpayments.According to the U.S. Department ofLabor, the state of Washington paid 12.2percent of all 2002 unemploymentbenefits to ineligible claimants.

Essentially, this fraud occurs because thereare external sources of money that can betapped by the unscrupulous as well as thedeserving. Unemployment insurance andworkers’ compensation funds aresupported by the mandatory contributionsof workers (in the case of UI, it comesindirectly in the form of lost potentialwages and benefits) and employers alikeand is guarded by presumably well-meaning but historically ineffective agencyeligibility safeguards.

Stealing continued on page 11

A


8

This is a case of “old” news becoming “new” news.

As many of you know, since December 2003 we have tried toobtain a copy of the complete contract our state signed with theBoeing Corporation. The entire package was worth billions ofdollars, and we wanted to see what stateofficials had agreed to do on behalf of ustaxpayers and how many jobs wereanticipated as a result. So we asked thestate’s “office of Boeing” for a copy of thecontract. This office is officially known asthe 7E7 Project Office, housed in the Community Trade andEconomic Development agency (CTED).

You will remember the surprising results of that request. Whenwe finally got a copy of the contract, it was missing many parts.The section we were particularly interested in was the one thatcited the state’s legal authority to agree to this multi-levelgovernment deal in the first place. The contract called this “ExhibitF, the Authorizing Governmental Resolutions.” When we gotthe contract, Exhibit F was blank—not redacted—but BLANK.CTED staff promised they would send the parts as soon as theywere available. This was in December 2003.

The contract itself said that these governmental resolutions hadto be adopted within 30 days of the contract being signed, whichtook place on December 19, 2003. So, in February 2004, whenwe followed up to get the many missing pieces, we assumedthey must be available, especially Exhibit F.

It was not. CTED said it was only required to give us the actualcontract as it was signed, and since the all-important Exhibitpages were blank when the contract was signed, they decidedthey were not obligated to fill in the blanks. Besides, they told us

they didn’t have many of the missingparts we were asking for, includingExhibit F. “To the extent thoserecords are provided to CTED ormy office and become publiclyavailable at a future time, we arehappy to provide them.”

CTED’s statement was made underthe penalty of perjury, so we believedthe state would keep its word. Butit turns out the state did have thedocuments in its possession, and didnot turn them over to us until July,nearly five months later. CTED’sdefense: Officials claim Boeing andthe state had not yet approvedreleasing the records to us.

By this time we were already incourt seeking access to records wehad unsuccessfully requested formany months. In court, under oath,

CTED officials said the records we requested were not in theirpossession and that we had been harassing them. AttorneyGeneral Christine Gregoire’s office, arguing on behalf of CTED,said: “It is difficult to understand why EFF complains that

CTED or the Project Office have not complied with the publicrecords act when we have disclosed records ready for disclosure,and cannot disclose records we do not have or do not exist.”The judge agreed with CTED and the attorney general.

Further, she ruled that EFF could no longer ask for public recordsrelated to the Boeing case unless we hired an attorney to firstmake the request to the attorney general who would decide itssuitability.

We appealed the lower court ruling. Subsequently, CTED“discovered” that the documents that we had been requestingfor nearly five months had been in their possession all along. Inexplaining what happened, CTED claims it thought it had alreadyprovided the records to us.

Since our whole reason for being in court to begin with was thestate’s refusal to give us the public records we had requested,we asked the appellate court to append this new information toour case. In other words: CTED originally claimed they didnot refuse to give us public records that were in their possession,but they just admitted they were wrong.

THE BOEING CASE:IF YOU DON’T LIKE EFF’S BARK, WAIT ‘TIL YOU FEEL THE BITE

by Jason Mercier

“When we got the contract, Exhibit F wasblank—not redacted—but BLANK.”

Boeing continued on page 9


9

Perhaps you will not be surprised to find out that Gregoire’sattorney general’s office is fighting to have this informationexcluded from the court’s eyes and ears. Rather than addressthe evidence during the current appeal process, state attorneysare demanding we go through the time and expense of filing anew lawsuit.

Ironically, in an October 25, 2004, legal brief, the attorneygeneral’s office claimed EFF never asked the court to force the7E7 Project Office to turn over the documents. These would bethe same documents the 7E7 Office claimed, under penalty of

perjury, they didn’t have. Apparently the state believes EFF shouldhave challenged the trustworthiness of its February declarationsmade under the penalty of perjury. (We uncovered this evidencein August.)

This is a terrible abuse of taxpayer trust and taxpayerpocketbooks—the kind of abuse that cannot go unchecked. Withyour help, we will check it.

If the state thinks this watchdog’s bark is bad, wait until it feelsour bite.

Boeing continued on from page 8 . . .

1. Ensure academic rigor and financial accountability.

The foundation of literacy is proficiency in reading, writing,mathematics and the sciences, and knowledge of our cultural,scientific and historical heritage. Ensuring that all children havean opportunity to obtain this knowledge and these skills shouldbe the core mission of our K-12 system. All of Washington’spublic schools should be organized to achieve that missionefficiently and effectively.

Recommendations:

• Legislators should require all schools and districts to havewell-defined missions with a clear academic focus andmeasurable outcomes.

• The legislature should review current education spending toidentify where every dollar is being used. Education agenciesshould be required to submit reports showing how each dollarspent adds maximum value to student achievement, and thesereports should be audited by the appropriate legislative reviewcommittee.

• The legislature should mandate that a larger percentage ofallocated dollars follow students to the school building andclassroom where education takes place. (Currently less thanhalf of the dollars spent are used for basic instruction.)

• The appropriate legislative committee should reviewcurriculum standards to ensure the adoption of rigorouscontent and expectations.

2. Ensure a highly qualified teacher in every classroom.

A highly qualified teacher in the classroom is the single mostimportant controllable variable in student achievement. Teachersshould be rewarded for demonstrable excellence (as measuredby student academic progress), and for choosing to enter high-demand fields like math and science. (Currently, ourSuperintendent of Public Instruction cannot identify how manyof the math and science teachers in our state’s classrooms areactually qualified to teach those subjects.)

Recommendations:

• Adopt a flexible salary model that rewards demonstrablyexcellent teachers and teachers who choose to enter highdemand fields like math and science. Remove the state’sarbitrary salary ceiling.

• Address teacher shortages in high-demand subjects bystreamlining and enhancing the state’s alternative certificationprograms to allow qualified individuals (those withdemonstrated knowledge and ability) to teach in Washingtonclassrooms.

• Adopt objective value-added assessments as a means ofevaluating teacher quality and student progress.

• Reject National Board Certification (through the NationalBoard for Professional Teaching Standards) as a means ofevaluating and rewarding teachers.

• Provide a mechanism for enforcing requirements thateducators teach within their field.

3. Spend dollars on successful academic programs, not failed ones.

Reliable studies and evaluations show the state’s currentpreschool, learning assistance and bilingual education programsprovide little or no academic value to students. These should bereplaced with programs that have a proven track record ofsuccess.

Recommendations:

• Adopt “structured immersion” as a means of teaching non-English speaking students. Stop funding the state’s currentprogram, which has a failure rate of 90 percent even afterstudents have been in the program three years.

• Identify successful learning assistance programs and adoptthem. Provide a clear and objective evaluation of the state’scurrent programs and stop funding them if they do not showmeasurable and adequate student achievement.

What Works continued from page 1 . . .

What Works continued on page 11


10

The Freedom Calls Foundation uses state-of-the-art Wi-Fi, Video Conferencing and Satcom technology to allowU.S. troops to communicate free of charge from their basecamps with their families at home by internet telephone,instant messaging and video conference. Contributions tothe Freedom Calls Foundation serve to ease the burden ofthousands of our brave soldiers and their families.

http://www.freedomcalls.org

“Gifts from the Home Front” allows you to buy giftcertificates to send to an individual military family member,friend or loved one. (You may also send a gift certificate tobe given to someone without naming a particular person.)The certificates can be used at any military exchange (AAFES,NEX, MCX, Coast Guard Exchange) retail store aroundthe world, including those supporting Operation EnduringFreedom and Operation Iraqi Freedom.

http://www.aafes.com/docs/homefront.htm

The Defense Department has also recently launched the“Help Our Troops Call Home” program, which authorizesthe Armed Services Exchanges to sell prepaid calling cards toany individual or organization that wishes to purchase cardsfor troops who are deployed overseas.

http://www.defenselink.mil/releases/2004/nr20040423-0646.html

Operation Hero Miles was created by U.S. airlines andCongressman Dutch Ruppersberger to meet the travel needsof our fighting men and women deployed overseas. It relieson the generosity of thousands who have donated more than540 million frequent flyer miles. Donations are currentlybeing accepted from Delta, Northwest, and Southwestairlines. Other airlines are participating directly by offeringfree flights to service members. If your airline is not listed,please call them and ask them to participate in this greatprogram.

http://www.heromiles.org/

Operation Gratitude seeks to lift troops’ morale and bringa smile to their faces by sending care packages to servicemembers overseas. Operation Gratitude care packagescontain food, toiletries, necessities, entertainment items andpersonal letters of appreciation and support. Throughcollection drives, letter writing campaigns and donations ofrequested items or the cost of postage, Operation Gratitudeprovides civilians anywhere in America a way to expresstheir respect and appreciation to the men and women ofthe U.S. military in an active, hands-on manner.

http://opgratitude.com

Christmas is a time for giving. Not many have given more than the soldier, airman, sailor, or Marine

stationed far from family and loved ones during the holidays. So, let us not forget the brave young fighting

men and women of this nation. We can do plenty to help make their time overseas less difficult. The following

sites are not specifically endorsed by the Department of Defense (DoD), but they are listed on the DoD’s

“Support Our Troops” website as particularly appreciated by service men and women.

FOR THOSE WHO GIVE ALL


By eliminating the perverse incentives inherent in an easilyaccessed fund, the state could dramatically cut caseloads andadministrative headaches, increase the amount of money availablefor legitimate claims, and lessen the burden of unnecessaryemployer insurance rate increases.

Ultimately, the only way to implement a fair and effective financialsafety net is to create one in which the worker has an overridingpersonal stake.

After all, who would want to rob their own house?

Cole Nevins was a summer research assistant for the EvergreenFreedom Foundation.

• Adopt class-size reduction efforts at the local level based onlocal student needs, not as an indiscriminate across-the-boardreform.

4. Ensure that schools have strong and accountable leaders.

School principals need authority and flexibility to organize andmotivate schools to achieve their academic mission. Currently,

principals in Washington’s schools have very little authority overhiring, firing or the school budget, and schools are required tocomply with a set of onerous rules and regulations.

Recommendations:

• Give school principals authority to hire and fire schoolemployees and direct and modify school budgets.

• Adopt collective bargaining laws that allow teachers to choosetheir professional workplace representation.

5. Deregulate schools to basic health, safety and civil rightsstandards.

Control over schools should to the extent possible be in thehands of local administrators, parents and teachers. Currently,Washington’s public schools are governed by 1,300 pages ofsmall-print rules and regulations, stifling their ability to be flexibleand innovative in meeting the needs of unique students.

6. Increase productivity of the state’s colleges and universities.

We’re facing a shortage of positions in our state’s public collegesand universities. Significant contributors to this problem arelow graduation rates, high remedial rates, increasing time

What Works continued from page 9 . . .

required to earn advanced degrees, low professor/student contacttime, inefficient use of facilities, and credit duplication.

• Recommendations: Require teaching faculty to spend morehours in class with students. (A 1994 study conducted by theHigher Education Coordinating Board shows that professorsat the University of Washington spent an average of 5.6 hours

with students each week. The state average was about 12hours. No evaluation has been done since then.)

• Adopt incentives and penalties to improve four- and six-yeargraduation rates. (Currently less than 60 percent of thestudents in our state’s public universities graduate within sixyears.)

• Decrease number of students enrolled in remedial reading,writing and math classes. (Fifty-seven percent of the studentswho enter our state’s community colleges must take remedialcourses in reading, writing or math.)

• Consider how technology can be used to reduce instructionalcosts.

• Reduce the cost of facility construction by repealingunnecessary prevailing wage laws and contracting out servicesthat can be provided more efficiently by the private sector.

The only long-term, cost-effective solution to this problem offraud is to remove the source of the money altogether as itcurrently exists. Instead of forcing workers and employers topay into systems requiring extensive and failure-prone oversightof a general fund, worker and employer contributions should beplaced into individualized, employee-owned UnemploymentInsurance and Workers’ Compensation accounts. These accountswould follow the worker regardless of job changes, and wouldrequire a minimum of oversight, since the money received byclaimants comes from their own accounts. Additionally, theflexibility of these accounts would allow workers to utilize themfor retirement, providing an incentive to save.

Stealing continued from page 7 . . .

11

“Control over schools should to the extent possible be in the hands of localadministrators, parents and teachers.”


emand for consumer choice inhealth care is on the rise. OnJanuary 1, 2004, insurance

companies across the U.S. began offeringa new form of consumer-driven healthcoverage that is like a medical IRA, calledHealth Savings Accounts (HSAs).

HSAs offer individuals, employers andemployees the option of depositing tax-free money into a special account to payfor current and future routine medicalexpenses. You may go to the doctor ofyour choice without the need for a referral.Payment is made with an HSA debit cardor checkbook directly to the doctor, whois often willing to give a discount forpayments made on the day of service. Acompanion high deductible health plan thatis coupled with the HSA covers medicalexpenses after the deductible is met.

Monies saved with a lower premium areavailable to deposit into the savingsaccount tax-free. In many cases both thepremium and the maximum out-of-pocketamount are less with an HSA than with atraditional plan. Withdrawals from HSAsare tax-free as long as the funds are usedfor qualifying medical expenditures. Fora list of medical expenditures the IRS saysqualify for tax-free withdrawals from yourHSA, go to www.irs.gov/pub/irs-pdf/p502.pdf.

Unspent funds roll over without limit fromyear to year. Interest on savings accruestax-free. Individuals or employees owntheir HSA, making it and the funds in

How did they do in their first year?

the savings account completely portableduring job changes.

In just one year, consumer-driven healthcare options have launched a powerfulmovement. Consumers are realizing thatwhoever controls the money also controlsthe choices. Double-digit premiuminflation has convinced many consumersthat they are ready to control more of theirown health care dollars. HSAs are onetype of consumer directed health plan thatfits the bill.

So how did HSAs do in their first year?

HSAs are lowering costs and creatingpersonal savings.

There are several exciting examples of howHSAs are making a real difference toconsumers:

· Golden Rule Insurance Companyreported on September 29, 2004, thattheir customers banked $110 millionin their tax-advantaged HSAs duringthe first nine months of 2004. Theirmonthly sales volumes tripled. Onaverage, Golden Rule’s customers saved45-55 percent on annual insurancepremiums.

Janet and Ted Lippzer, owners of an icecream shop in Pennsylvania, are glad theychanged to an HSA. When the premiumfor their traditional health insurance planskyrocketed to over $900 a month, theysigned up for a Golden Rule HSA plan,saving them $700 a month and helping

them save for future medical andretirement needs.

· Carl Blachowicz runs a one-person autorepair shop in Orlando, Florida. Afterhis wife Debbie retired from workingat AT&T, they discovered it would cost$1,200 per month to continue coveragefor the family. They decided just to keepDebbie on the AT&T policy for $440per month. Carl established an HSAwith a $5,000 deductible for himself andtheir two children for $230 per month.Carl says, “It’s one of the best thingsI’ve done since I’ve been in business.”

· According to an October Wall StreetJournal article: “Pam Wimbish was thefirst person in the country to buy intoa new health savings account earlierthis year. Since then, she has definitelygotten more involved in—and choosyabout—her healthcare. Before surgeryon her foot, she asked how much itwould cost. She offered to pay up fronton the day of the procedure and got a50 percent discount in return, reducingthe surgery center’s fee from $1,260to $360.”

· A 45-employee commercial printingfirm in Ohio changed to HSAs from aplan that had a $500 deductible forsingles and a $1,000 deductible forfamilies. With the new HSAs, the firmfunds 50 percent of each employee’ssavings account, while keeping theemployee’s maximum out-of-pocketlevels the same. The result? Thiscompany saved $56,500 in one year.

Fears that HSAs are only for the young,healthy and wealthy are disappearing.

According to the National Center forPolicy Analysis, people who don’t haveinsurance have been setting up healthsavings accounts as fast as people whodo—47 percent to 53 percent. Nearly halfof HSA buyers are families with incomesbelow $50,000. More than a third live inhomes that have a market value of lessthan $125,000. Seven of ten HSA buyersare over 40 years old.

HSAs continued on next page

HEALTH SAVINGS ACCOUNTS:What can we expect in 2005?

by Cheryl Hymes

D

12


Union members are showing an interest in HSAs.

Fire, police and public employee unions in Minnesota supportexpansion of HSAs to Medicare recipients. Representative GilGutknect (R-MN) received letters from the Minneapolis PoliceRelief Association, the Minnesota Teamsters Public & LawEnforcement Employee’s Union, Local No. 320, and from theMinneapolis Firefighters’ Relief Association Pension Fund askingthat the restriction in law prohibiting Medicare recipients bechanged to allow those over age 65 to be eligible to establish HSAs.

U.S. federal employees are signing up for HSAs.

When the U.S. Office of Personnel Management announcedthat federal employees would be allowed to sign up for HealthSavings Accounts, more than 11,000 people signed up prior tothe official open enrollment date. The federal government plansto deposit roughly 50 percent of the deductible amount into anemployee’s health savings account, essentially cutting thedeductible in half for the employee, while jump-starting fundsin the savings account, which will accrue tax-free and be availablefor routine medical, vision and dental care.

Looking to the future, Congress is more likely to pass legislationthat will make consumer driven health plans even more affordablenext year, which in turn will expand their acceptance.

Two pieces of federal legislation to watch are House Resolutions3901 and 4662. H.R. 3901 would allow individual consumers

to deduct 100 percent of the cost of the premiums on highdeductible plans sold in conjunction with HSAs from their federalincome taxes. H.R. 4662 would allow people who can’t findaffordable health insurance in their own state to purchase moreaffordable health insurance from a company that is regulatedand licensed in another state.

If enacted, these laws would help people in states where theycannot find a vendor who offers an HSA plan to individuals, aswell as people in a state where HSAs are priced higher due toregulations and mandates (like Washington State).

Not all Americans have the same access to affordable healthinsurance or choices of plans. If they can find an affordablepolicy regulated by another state, people should not go uninsuredsimply because state regulations have made insurance in theirstate unaffordable,

In Washington state, many vendors have begun selling consumer-driven health plans or have announced the availability of suchplans in 2005, including Premera Blue Cross, LifeWise Healthof Washington, Regence Blue Shield, KPS Health Plans, Great-West Healthcare, Lumenos, CIGNA, Pacificare of Washington,and the ODS Companies (only in the Vancouver/Portlandmarket).

When it’s time to renew your health insurance, be sure tocompare your traditional plan to a consumer-driven health plan.You’ll be glad you did.

MERRY CHRISTMAS!From Bob Williams and the EFF staff

HSAs continued from page 12 . . .

Not present, but still here: Juliana McMahan, Mike Reitz, Cheryl Hymes, Irene Endicott, Kathy McDonald, Dan Steele, Jeanne Montgomery, andDvorah Hartson

Left to right: Joel Sorrell, Ryan Bedford, Kristen Mercier, Marsha Richards, Amy Bakker, Priscilla Charles, Gail Kramer, Mike Vernon,Denise Brandt, Jami Lund, Marie Giger, Booker Stallworth, Lynn Harsh, Bob Williams, Jason Mercier

13


The unabashed political agenda of unions nationwidehas brought attention to the fact that unions derive sig-nificant political clout from the use of mandatory teacher

dues. Activists in many states are confronting the teacher unions,and we continue to maintain our momentum here in Wash-ington state.

· In October, EFF held a Labor Policy Session at theannual meeting of the State Policy Network, a con-ference of state-based public policy organizations.Nearly 40 people, representing organizations from25 states, attended the session. If the tremendousresponse we received is any indication, union offi-cials in ten to twenty states next year will be focus-ing on defense.

· The Wall Street Journal recently reported on theteacher union’s assault on meaningful education re-form, specifically discussing the WEA’s effort to de-feat Washington’s charter school Referendum 55.Teacher unions spent over $1,000,000 to defeat thismeasure in our state.

· The Washington Times reported that the NationalEducation Association (NEA) spent more than $1million for the Kerry-Edwards ticket, and spent $1.8million in direct contributions to Democratic con-gressional candidates. According to Reg Weaver,president of the NEA, only one-third of the union’sdues-paying members are Democrats, meaning two-thirds of the teachers were forced to financially sup-port a candidate for whom they did not vote.

· Other unions came out in full force this fall: theAFL-CIO spent $45 million in an attempt to defeatPresident Bush. The Service Employees InternationalUnion spent $65 million, while AFSCME budgeted$48 million. All of these efforts were funded by work-ers’ dues.

· Utah—Education Excellence Utah and Parents forChoice in Education have taken on the teacher unionin Utah, filing two complaints for potential campaignfinance violations.

· Colorado—The Independence Institute hosted acommunity meeting on the topic of the union’s abuseof power in one of the state’s larger districts, attract-ing attention in the press and among the teachers ofthe district.

· Nevada—The NEA spent nearly half-a-million dollars on afailed ballot measure to raise education spending. The NevadaPolicy Research Institute is investigating whether a complaintmight be filed against the NEA for unreported political expen-

ditures.

· PDC dismisses EFF complaint against WashingtonAFL-CIO—The Public Disclosure Commission(PDC) dismissed EFF’s complaint against the Wash-ington State Labor Council for not reporting politi-cal expenditures. The dismissal came in spite of aPDC staff investigation that revealed the WSLC spentover $500,000 to impact state elections, not includ-ing voter registration and political training efforts.Evidence indicates the WSLC spent 32 percent ofits 2002 general operating funds on state and federalelections, with totals for 2004 even higher.

· Washington state unwilling to protect non-union work-ers—The Public Employment Relations Commissiondenied a petition filed by EFF and 35 teachers re-questing the right for non-union workers to partici-pate in workplace decisions. Despite paying forcedunion dues, many non-union employees are barredfrom participating in employee decisions. EFF filedan appeal with Governor Locke’s office on October27. The governor is obligated to respond in writingand address the concerns listed in our appeal, evenif he plans to deny the rule-making request.

· Washington state employees disgruntled—The stateemployees’ unions have negotiated their first con-tract proposal with the governor’s office since thelegislature gave unions the right to bargain on com-pensation. We have received and responded to manycalls from state employees affected by their new col-lective bargaining contract. Starting in July, thousandsof state employees will begin paying their union apercentage of their wages or face termination pro-ceedings. The unions afflicting workers with thismulti-million dollar racket may have kicked a bee-hive with more fury than they anticipated. The Olym-pian reports that an organized effort is underway todecertify (throw out) the union from state workplaces.

EFF staff working on theTeachers’ Paycheck Projectremain very excited about the many promising op-portunities to shape the discussion and pave the wayfor union accountability reforms. Thank you for yourcontinued support…because freedom matters!

PAYCHECK PROTECTION UPDATEby Michael Reitz

T

14


Checking Account–Egiving Systems (Attach a voided check)

Savings Account–Egiving Systems (Attach a voided deposit slip)

I want to invest in the Evergreen Freedom FoundationYes,Dear Friend of EFF,

While we welcome every gift, our greatest need is reliable monthly support. It is imperative for reaching ourgoals. Please consider monthly giving as a solid way to invest in the cause of freedom. Our secure EgivingSystem ensures that more of your contribution goes directly to our work.

Cordially,

VISA Master Card Discover American Express

(required for bank and credit card donations)

Bank Debit/Credit Card Donation Authorization I request my bank or credit cardcompany to transfer funds in the amount of $ each monthuntil further notice. I understand that I am in full control of my donation, andthat I can decide to make any changes or discontinue the service at any time bycalling 360-956-3482 or writing to EFF.

Date

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C

Please mail or fax in this form (fax 360-352-1874) or call 360-956-3482.We will send you a confirmation letter for your records.

Please mail or fax in this form (fax 360-352-1874) or call 360-956-3482.

I would like to give a one time gift of $

Does your company offer matching contributions? Manycompanies offer their employees a matching gift programand will double the money they give to charitable

organizations. Usually, all that is required is for you to send us aform with your check or credit card contribution. We then fill outthe “bottom” section to verify we have received it and send it backto the company. Then they send us a matching check!

And how about this creative idea from one of our innovativemembers? He told his like-minded co-workers that he would matchtheir contributions to EFF (up to a certain amount). Anyone whotook him up on his offer quadrupled their money because theircompany matched both employees’ contributions!

Please ask your company if it will match your contribution toEFF. We are a non-profit 501(c)(3) organization. All contributionsare tax-deductible to the extent allowed by law.

15

Double or Quadruple your money

For more information please contact Juliana McMahan at (360) 956-3482 or [email protected].

LandAmerciaMicrosoft CorporationSafeco Insurance CompanyPlum Creek FoundationWashingtonMutual

AutodeskBank of AmericaExxonMobilHome DepotVerizon

Address service requested

A few upcoming events . . .

Wednesday, December 1 - Washington, D.C.Dr. Maximilian B. Torres, winner of the 2003Novak Award, will deliver the fourth annualCalihan Lecture: “Business Ethics and Truth:Rebuilding the Broken Nexus.” This eventwill be held in Washington, D.C. For moreinformation, visit the Acton Institute onlineat www.acton.org.

Thursday, December 2 - Palo Alto, CA.The Cato Institute will be sponsoring“Liberty, Technology, and Prosperity.” Theconference will be held in Palo Alto, CA. Formore information, visit the Cato Instituteonline at www.cato.org.

Thursday, December 2 - Washington, D.C.The Toward Effective CompassionConference will be held in Washington, D.C.,and will feature Marvin Olasky. For moreinformation, visit the Acton Institute onlineat www.acton.org.

December 2-4 - Washington, D.C.Bob Williams will be speaking with newlegislators on budget and tax issues at ALEC’s2004 States & Nation Policy Summit inWashington, D.C. For more information,contact the American Legislative ExchangeCouncil at (202) 466-3800.

Friday, December 25 – Christmas eve. TheEFF office will be closed.

Saturday, December 25 – Merry Christmas,everyone!

Monday, December 27 – EFF holidayobserved. The office will be closed.

Friday, December 31 – New Year’s Eve, EFFholiday observed. The office will be closed.

living liberty december 2004

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