The Electron Pencil

Bennett Left His Soul In Indiana

Let’s not get all turned around by the revelation of what a pig Tony Bennett was here in Indiana.

Busted

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Forget him. We have to focus on the real evil here and that’s the whole concept of schools for profit. It’s as eff-u’d as health care for profit, and we know how well that‘s working out for us in this holy land.

So, we know Bennett took a powder on his new job as barn boss of the Florida state school systems yesterday in light of breaking news that he’d jiggered a school’s efficiency rating here while he was the Indiana Superintendent of Public Instruction. Turns out the woman who runs that school was a big time donor to Bennett and the Republican Party.

It doesn’t take a Superintendent of Public Instruction to calculate two plus two equal four.

Fine, Bennett’s paying the price now, having to give up his comfy job as penance. But we’re all stuck with charter schools. Who pays the penance for that?

My guess? Taxpayers and kids.

Some 71 charter schools are operating in Indiana, according to the state’s Department of Education. That includes the Christel House Academy, owned by GOP idolator Christel DeHaan. She made her fortune by starting a time share business with her husband, buying out his half of the business in 1989 after their divorce, and then selling the company for a cool $825 million in 1996. She opened her Indianapolis charter school in time for the 2002-03 school year.

DeHaan: An A+ Contributor

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Christel House Indianapolis was graded C in 2012 by INDOE, even though Bennett had been running around telling anybody who’d listen that the school was an A institution. This just wouldn’t do, considering DeHaan had contributed $130,000 to Bennett’s political campaigns in 2008 and 2012.

Voila, the Christel House C became an A.

Money, natch, is magic.

And money is what drives many charter schools.

Not all charter schools are for-profit enterprises. Quite a few have popped up as alternative educational institutions where children can learn that the world is 6000 years old and that god doesn’t like Muslims.

No question our public schools need work. Many school systems are management top-heavy, have crushing bureaucracies, and reward too many teachers simply for being alive. Let’s work on those problems.

Let’s not turn the education of our kids over to profiteers and religious fanatics.

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Absolutely Fabulous

At long last, some son of a bitch is going to jail for his part in the shell game that was collateralized debt obligations.

Or, as I like to characterize those intentionally byzantine financial instruments, legal larceny.

CDOs, credit default swaps, and other sleight-of-hand schemes developed by “creative” financiers set us up for the the Great Recession of 2007-08. And, no doubt, these same Wall Street shamans are working overtime to create another economic bubble. They’ll make their piles of cash upon which they’ll fall when the global economy tanks again while the rest of us hit nothing but concrete. Splat.

Fabulous Fabrice

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Anyway, it’s nice to see former Goldman Sachs trader Fabrice Tourre get slapped with a guilty verdict in his federal fraud trial yesterday. “Fabulous Fab,” as he liked to call himself, sold a phony bill of goods to his investor clients, telling them a credit derivative plan he’d conjured up was a good risk, even though he knew it wasn’t. Financial organs like Wall Street Journal and Bloomberg are trying to position this case as an outlier, that Fab Fab was a rogue.

They even assume the Who Me? stance that his sales spiel was rife with dense industry jargon that even they couldn’t penetrate. His patter was so dizzying, they imply, that investors were left only to understand two words out of his mouth: Trust me.

Problem is, Fab Fab wasn’t an outlier. He was normal. Goldman Sachs and other agents of Satan were stuffed to the gills with shysters like him. And WSJ and Bloomberg slobbered all over those slobs when they were making huge fees and bonuses back in the 1980s, ’90s, and ‘Aughts. The collective motto of reprobates like Lloyd Blankfein and Jamie Dimon was Trust Us.

I recommend Michael Lewis’s book Liar’s Poker as a primer if you’re interested in starting to learn about the fraud economy that sprang out of Saint Ronald Reagan’s deregulation heaven. And, by the way, don’t get me wrong, Saint Ronnie and the Republicans aren’t the only villains in the Wall Street Wild West mess we’ve found ourselves in. Dems from Jimmy Carter to Bill Clinton to Barack Obama sold their souls to the devil, trading in deregulation and a wink-wink attitude toward the banksters’ excesses for a share of the campaign cash support that the GOP had monopolized for decades.

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Lewis penned his tome in hopes young folk would begin to shy away from business schools, reversing the trend of the late 20th Century wherein those university biz factories were churning out millions of grads eager only to make a killing. Funny thing is, his book had the opposite effect.

Lewis wrote in Portfolio magazine in 2008:

I had no great agenda, apart from telling what I took to be a remarkable tale, but if you got a few drinks in me and then asked what effect I thought my book would have on the world, I might have said something like, “I hope that college students trying to figure out what to do with their lives will read it and decide that itʼs silly to phony it up and abandon their passions to become financiers.” I hoped that some bright kid at, say, Ohio State University who really wanted to be an oceanographer would read my book, spurn the offer from Morgan Stanley, and set out to sea.

Somehow that message failed to come across. Six months after Liarʼs Poker was
published, I was knee-deep in letters from students at Ohio State who wanted to know if
I had any other secrets to share about Wall Street. Theyʼd read my book as a how-to
manual.

So yeah, I’m glad Fabulous Fabrice took the rap yesterday. I hope he looks fabulous in prison orange. But I won’t be totally happy until more and more greedy biz school grads, Ayn Rand-ists, and investment bank con men are wearing the same color.

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