Sunday, June 11, 2006
John Kallenborn Agrees With Me
Well, sorta. Before I get into that, if you think that, now that the people have spoken, the federal aid money is ready to start flowing, and a $150M loan package has been approved, it's time for the people, the new council and even the media to unite behind the mayor, you're sadly mistaken. It might seem like the responsible, forward thinking (as opposed to obstructionist) position; in fact, it would be the height of irresponsibility. You'd just be setting yourself up to moan and bitch and kvetch if you find yourself unhappy with not only the state of the city's finances, but decisions about such issues as preservation and redevelopment in a few years. Of course, there might be some risk involved for any elected officials who oppose the mayor; he seems to know who his friends are.
With that out of the way, I'll get to why the local president of JP Morgan Chase--the man most responsible for the city's $150M loan package-- agrees with me, sort of. In a recent Picayune article about possible future scenarios for the city's finacial condition, John Kallenborn came out solidly in the optimistic camp. However, even he added:
So, when the chief architect of the city's loan package calls for closer scrutiny of the city finances, what do we get from the local paper? The editors call for more information, but don't seem to have assigned any reporters to do a thorough follow-up story (remember, there may well be pressure to commit by the end of the month). The paper's op-ed writers have been largely MIA; a reluctance to seriously citicize the mayor has combined with an overriding desire to be clever to produce some utterly shameless clowning. Frankly, there's something seriously wrong with the priorities of the paper's senior op-ed writer when's more concerned with $8,000 judicial junkets than with $2.5M sewerage contracts (to poltically connected, but not yet incorporated firms) or expensive bomb-proof garbage cans. There was a good start on the reporting (at least of the redevelpment plan), but a follow-up (before the end of June)is certainly called for. I'd particularly like an explanation of how large a bill the city or state can expect whenever FEMA pays for something. Even, if it's no bill, FEMA financed projects could have their drawbacks.
To finish up an earlier post, I wasn't just concerned about the media's election coverage. If the city's "informed sources" are too obtuse to understand that the mayor said that neither the BGR or anybody outside of his office knew anything about the city's finances, it doesn't give me great confidence in their ability to cover government by cheerleaders.
That said, I haven't made up my mind about the city hall plan--there's not enough information for that. Uh, what else is new? If little up front money is involved, it might even have minimal impact on the city's short term ability to provide basic services. Well, the added debt and committed revenues (TIF's) could affect the city's bond rating.
What concerns me more is that I see the city experiencing a short term boom, not the bleak scenario described in the article, but not quite the rosy one either. Unfortunately, even the most spectacular booms don't benefit everyone and, more importantly, local governments tend to overspend during the boom and find themselves broke afterwards. In this case, the boom, rather than solving the city's budget problems, could come to an end at the time that city's bills come due. If that happens, the city will be forced to go to congress for more aid. Even the bills that FEMA picks up the entire tab for (if such bills exist) would be remembered.
Also, Nagin's explanation that an overpriced towing contract didn't matter because FEMA was paying for it, could prove to be his most boneheaded comment yet. I'm sure that the statement will come up if Nagin finds himself asking congress for more help; I just can't imagine what the response would be. Oh, I"VE GOT IT! James Gill will write an "oh so clever" column titled If Sen. Craig can't take a joke, he should cover his ears. I wonder whether the Boise paper will pick it up.
T. thanks for the comment:I'm starting to think that the public has to be responsible for policing irresponsible journalists. My sentiments exactly, if I sometimes go overboard on the subject, it's that I think that media fact checking and even watch-dogging is one one of the few useful functions that bloggers can actually serve. Big_Shot, I'll send Lorenz a copy of the post; if I can find an email address for Norman Robinson, I'll send him a copy.
With that out of the way, I'll get to why the local president of JP Morgan Chase--the man most responsible for the city's $150M loan package-- agrees with me, sort of. In a recent Picayune article about possible future scenarios for the city's finacial condition, John Kallenborn came out solidly in the optimistic camp. However, even he added:
"Internally, we have signed on to the more optimistic case for revenues," said Kallenborn, who has led the financing effort and whose bank has agreed to cover $55 million of the loan. "But it is very important that they maintain discipline on expenses. If they get wacky on that, we're going to have a problem that will be very hard to solve."
So, when the chief architect of the city's loan package calls for closer scrutiny of the city finances, what do we get from the local paper? The editors call for more information, but don't seem to have assigned any reporters to do a thorough follow-up story (remember, there may well be pressure to commit by the end of the month). The paper's op-ed writers have been largely MIA; a reluctance to seriously citicize the mayor has combined with an overriding desire to be clever to produce some utterly shameless clowning. Frankly, there's something seriously wrong with the priorities of the paper's senior op-ed writer when's more concerned with $8,000 judicial junkets than with $2.5M sewerage contracts (to poltically connected, but not yet incorporated firms) or expensive bomb-proof garbage cans. There was a good start on the reporting (at least of the redevelpment plan), but a follow-up (before the end of June)is certainly called for. I'd particularly like an explanation of how large a bill the city or state can expect whenever FEMA pays for something. Even, if it's no bill, FEMA financed projects could have their drawbacks.
To finish up an earlier post, I wasn't just concerned about the media's election coverage. If the city's "informed sources" are too obtuse to understand that the mayor said that neither the BGR or anybody outside of his office knew anything about the city's finances, it doesn't give me great confidence in their ability to cover government by cheerleaders.
That said, I haven't made up my mind about the city hall plan--there's not enough information for that. Uh, what else is new? If little up front money is involved, it might even have minimal impact on the city's short term ability to provide basic services. Well, the added debt and committed revenues (TIF's) could affect the city's bond rating.
What concerns me more is that I see the city experiencing a short term boom, not the bleak scenario described in the article, but not quite the rosy one either. Unfortunately, even the most spectacular booms don't benefit everyone and, more importantly, local governments tend to overspend during the boom and find themselves broke afterwards. In this case, the boom, rather than solving the city's budget problems, could come to an end at the time that city's bills come due. If that happens, the city will be forced to go to congress for more aid. Even the bills that FEMA picks up the entire tab for (if such bills exist) would be remembered.
Also, Nagin's explanation that an overpriced towing contract didn't matter because FEMA was paying for it, could prove to be his most boneheaded comment yet. I'm sure that the statement will come up if Nagin finds himself asking congress for more help; I just can't imagine what the response would be. Oh, I"VE GOT IT! James Gill will write an "oh so clever" column titled If Sen. Craig can't take a joke, he should cover his ears. I wonder whether the Boise paper will pick it up.
T. thanks for the comment:I'm starting to think that the public has to be responsible for policing irresponsible journalists. My sentiments exactly, if I sometimes go overboard on the subject, it's that I think that media fact checking and even watch-dogging is one one of the few useful functions that bloggers can actually serve. Big_Shot, I'll send Lorenz a copy of the post; if I can find an email address for Norman Robinson, I'll send him a copy.
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