They Knew Exactly What They Were Doing
OK, so this guy committed fraud:
In the hundreds of bills for which he has provided estimates to
lawmakers since 2000, the actuary, Jonathan Schwartz, said legislation
adjusting the pensions of public employees would have no cost, or
limited cost, to the city.But just 11 of the more than 50 bills vetted by Mr. Schwartz that
have become law since 2000 will result in the $500 million in eventual
costs, or more than $60 million annually, according to projections
provided by Robert C. North Jr., the independent actuary of the city
pension system, and by Mayor Michael R. Bloomberg's office....Mr. North and other city employees made the calculations on the 11
bills when they were before the Legislature, but for the other bills,
no alternative to Mr. Schwartz's projections could be found. The New
York Times reported last month that in an arrangement that had not been
publicly disclosed, Mr. Schwartz was being paid by labor unions. He
acknowledged in an interview that he skewed his work to favor the
public employees, calling his job "a step above voodoo."
But really, did any of the legislators supporting these bills really think the costs were zero? If the public employees union is asking for a pension change, you can be sure it is not to save the state money. This does not let legislators off the hook for failing to exercises any common sense.
Pieter:
Did you know that the NYTimes (which provided the original of this story) provided multiple versions of the same story?
Here's the quote from the actuary (Mr Schwartz) about what he did and why in the version I read. From the NYTimes (http://www.nytimes.com/2008/05/16/nyregion/16actuary.html?scp=3&sq=schwartz+pension&st=nyt)
He said: “The Legislature knows full well I’m being paid by the unions. If they choose not to disclose that, that’s on them, not me.â€
“What people call actuarial science is at least as much as an art as a science,†Mr. Schwartz said.
“Back in my days as city actuary, I would go to that part of the range that would make things look as expensive as possible,†he added. “As consultant for the unions, I go to the part of the range that makes things as cheap as possible, but I never knowingly go out of the range.â€
June 10, 2008, 4:03 pmPieter:
I forgot to add that these issues are extremely complex and technical. In a democracy, more effort should be made to make the relevant information available to the public, including a discussion of the wide uncertainty in projections that are made to justify political decisions.
June 10, 2008, 4:05 pm