school Choice Debate – Full one hour debate

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ASU law professor Paul Bender and the president of The Alliance For School Choice, Clint Bolick, debate the school choice issue.

Michael Dixon:
Tonight on "Horizon," a committee investigating patient neglect at the Arizona Veteran Home holds its first meeting. The pros and cons of school choice are debated on the A.S.U campus. And what we should be doing to invest in our retirement. Those stories next on "Horizon."

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Michael Dixon:
Good evening, I'm Michael Dixon, welcome to "Horizon." A legislative committee investigating the Arizona Veteran Home held its first meeting this morning. The group is looking into reports of patient neglect at the state-run nursing home for veterans. The problems were uncovered by the Arizona Department of Health Services during an inspection in February. In a moment, we'll talk with a capitol reporter who's been following that story. But first, some excerpts from today's meeting.

Jack Harper:
We're hoping to find out, you know, what the conditions were, who knew what the conditions were, how we're going to correct the conditions and how we can best look out for our veterans.

Deborah Piluri:
One of the residents on three different occasions had asked for some assistance from staff. And staff, we were told, you know, by the residents, that staff would either come down and answer their light and say that they'd be back and never come back, or come down and just turn off the light and not meet their needs. One gentleman who had a colonoscopy -- I'm not sure if everybody is familiar with the appliance on the abdomen which is connected to the large intestines. And this is the way that they are able to move their bowels. And this gentleman, there are appliances that you use for this and on three occasions our surveyor had had observations of him being covered in a towel and just letting the feces ooze and not having the appliance on.

Susan Gerard:
the staff and management were very cooperative and moved very quickly to make the corrections that we were recommending and taking care of the patient that is were in immediate need. So those things we move very quickly. And my staff stayed through the weekend and did not leave until they were confident that all the immediate jeopardy issues were corrected. And from that point on, you know, regardless of the governor's office being notified or not, the facility started instituting the changes and with staffing and how things were done and even some people were fired immediately. And that has continued. And I'm just going to take a wild guess, but I'll bet you 80% of the things that needed to be corrected have already -- maybe even 90% have already been done. My staff believes that real problem area was on the night shift. And it was really about management. People being managed, staff being supervised. Those aren't really things that you can change laws to make happen. That's a matter of how you -- who you hire and who's doing your work for you.

Michael Dixon:
All right. Joining me to talk about the committee investigating the veteran home and other news from the state capitol, Matthew Benson. Matthew is a legislative reporter for the "Arizona Republic." Good to see you again.

Matthew Benson:
Good to be here, Michael.

Michael Dixon:
Thank you. What happened this morning really? Was anything of substance accomplished?

Matthew Benson:
Basically what we had here was folks from the governor's office as well as the department of health services coming for this joint committee trying to explain, why is it that it took six weeks between when they knew they were problems or neglect at veterans' home and when the governor herself found out.

Michael Dixon:
The answer was?

Matthew Benson:
There is no great answer.

Michael Dixon:
Of course.

Matthew Benson:
And the truth is -- this goes up as high as her Co-Chief of Staff Allan Stevens. He was pushed on this question repeatedly. Why didn't you tell the governor? His answer was, I wish I had. He regrets how this came out.

Michael Dixon:
How is it being resolved now? They have negotiated some sort of settlement. There's a fine. Is that set in concrete now and we move forward and this is investigating what went on? Kind of put that in perspective for us.

Matthew Benson:
D.H.S., the Department of Health Services has fined the veterans home $5,250. Basically they're saying at this point most of the problems identified throughout state investigation have already been dealt with. From here this panel will continue to hold meetings and continue to try to see why it is that it took -- why the problems were there in the first place, and why it took a matter time before the governor was able to respond.

Michael Dixon:
Are some people thinking this is a waste of time to pursue that direction? As opposed to ensuring that these things aren't going to happen again and what things have been put in place to ensure they don't happen again? In other words, theoretical versus practical?

Matthew Benson:
The main issue, most of the talk has been, we don't want this to turn into a witch hunt or a political sort of exercise. Of course, it's very difficult with something like this that it doesn't begin to take on political overtones.

Michael Dixon:
Sure. Okay. Susan Gerard, who is the director now, says we thinks maybe 90% of the problems have been taken care of. Did anybody disagree with that or are they agreeing with her assessment? Is that good news?

Matthew Benson:
Nobody on this joint committee is in any position to dispute what they are saying. They have to take her at face value. I haven't heard anybody saying there's been any sort of resistance at the veterans home to these issues it seems that the problem here is that they were there in the first place.

Michael Dixon:
Of course. So now they just waiting to see why the governor didn't know earlier. And they'll go off and pursue that.

Matthew Benson:
Yes.

Michael Dixon:
What happens tomorrow? They are coming back tomorrow?

Matthew Benson:
They'll be back tomorrow. They'll bring more of the governor's staff and the D.H.S. staff. They'll be back again. In terms of how far this goes, that hasn't been determined. I think Senator Harper who is one of the chair men of this committee said it will go as long as he thinks is necessary.

Michael Benson:
What's the morale? Does anybody know what it is at the hospital? I would imagine some workers have been pretty conscientious and then obviously people who didn't do a good job. Any feel for that?

Matthew Benson:
Certainly at this point they've had their share of bad publicity. But at this point I think it's going to start to turn around. You're going to start to see more folks coming to their aid. Frankly we've heard from some families who had people staying in the home who said, these problems may have been there. We don't think it was a pattern. Our family member received good care.

Michael Dixon:
The Department of Health Services regulates not just this but all nursing homes in Arizona, all assisted living homes in Arizona. The last report I heard -- we have to do this quickly -- is that they're very understaffed when it comes to inspectors to be sent out to actually see this.

Matthew Benson:
Sure. And it certainly sounds like this is not an issue just here at this veteran's home. It's an issue at nursing homes not only in Arizona but across the country. There's just not enough nurses to handle the sort of load that they have to deal with.

Michael Dixon:
We'll watch it with you. And we appreciate your report. We appreciate you being with us tonight on "Horizon." Thanks very much.

Matthew Benson:
Thank you.

Michael Dixon:
All right.

Michael Dixon:
The Sandra Day O'Connor College of Law, here at A.S.U, hosted a debate on school choice in Arizona earlier last month. It was sponsored by the A.S.U Chapter of the Federalist Society, a non-profit organization made up of conservatives and libertarians. The debate featured Paul Bender, a professor at the School of Law and Clint Bolick, the President of the Alliance for School Choice. What you are going to see is an excerpt from the question and answer period toward the end of the debate.

Michal Dixon:
Let's take a look.

Paul Bender:
I'm not opposed to school choice. Although I'm a little worried about giving parents a whole lot of choices that they don't have any real ability to know which one to pick. But I think if you can do that and the parents have an opportunity to know what choices they're making, I'm all for school choice. But I'm for school choice on an equal basis. Or if you're not going to give it to everybody, at least prefer the kids who need it most. The kids in the lousy schools, the kids who don't have the money to go to better schools. And the best way to do school choice in that way, and the only constitutional way in Arizona, is to do it through the public schools. You can have a public school to do this and a public school to do that. And you can make them very good. But you can't have religious public schools but I don't think anybody thinks you should be able to and the Arizona constitution said we need to have a public school system that is as good as possible. And that's where that money ought to go. So, yeah, I'm all in favor of school choice. But it ought to be choice that's available to kids, even those who don't want to go to religious school, and it ought to be available to kids who don't have any money. And the Arizona program is not that. It's possible, I think, to get a voucher program that would do that. But we don't have that here.

Clint Bolick: I think when Professor Bender answered your question; I actually thought your premise was correct when you said it. But Professor Bender said something that I think indicated a far broader opposition to school choice. And that is in Arizona you can have school choice so long as it's within the public schools. That's the only way to do it constitutionally here, which is a very broad and chilling proposition. Sort of like saying, you know, you can have choice of post offices. If you don't like the U.S. post office that's close to you, go to the one that's a little further away. Do you think that our postal system would be getting better as it has over the last couple of decades if you couldn't use federal express? You know, that has been just an incredibly powerful competitive effect. And we're seeing the exact same thing. But only if you allow private schools to be part of the option.

Paul Bender:
It may be that Arizona constitution is out of date. And maybe it needs to be amended to permit public money to be spent on private education. But the framers of the constitution, who by the way were populists mostly, and really did believe that government should serve the poorest and the most disadvantaged, couldn't have been clearer in saying, don't spend public money on private education. It may be a bad idea. If so, try to amend the constitution. And let's talk about it. But it is now unconstitutional.

Clint Bolick:
And well, actually it's not. Because the arbiter of that issue has spoken and has spoken in favor of allowing it to happen. One last point here. The threshold issue is, is this public funds? Professor Bender would argue that if the government allows you to keep some of your money, if that money would have possibly come to the public budget, that's public funds. The Arizona Supreme Court rejected that proposition, thankfully, and said this money never enters the government coffers. How could it be public funds? The provision is simply not triggered.

Paul Bender:
But it's not that. They don't let you keep your money and use it for anything you want. Of course that would be okay. What they do is say, you can give that money to us, or you can give that money to a school tuition organization which has to use it for scholarships for private schools. So they tell you what you can do with that money. Give it to them or give it to private school scholarships. That is not letting you keep your money.

Clint Bolick:
Let's clarify, then. A deduction that you can use only for charitable purposes, and, that of course, includes religious expenses. That is public funds that would trigger the constitutional provision, in your view?

Paul Bender:
I think that's a closed question. I think that you can distinguish and should distinguish deductions from credits mostly on a practical basis. What's the income tax in Arizona? 5%? Yeah, too high. 5%. Something like that. Okay. If I give money to a private charity, $1,000, how much taxes does that save for me? $50. If I give $1,000 to school tuition organization how much money does that save for me? $1,000. The whole thing. If you can't make a distinction between a program that gives a tiny little benefit to people and is a broad program, by the way, refers to all charities not just to this particular charity, private and religious schools, I can distinguish between those things. I don't think there's anything wrong with general charitable deductions. What is wrong is a specific not deduction but credit where the state says, pay -- you can pay your income taxes to religious organizations to get scholarships only for religious schools. That seems to me to be wrong.

Student:
Let's have another question.

Paul Bender:
I'm not part of any side. I am participating in litigation about these programs. If you want to ask me why I think that side doesn't do, that it's because that side really thinks public education is more important than anything else. And they want that money to be used for public education. And they spend a lot of time lobbying for that. Mostly unsuccessfully. But the Arizona Center for Public Interests which is one of the groups involved in this litigation, spends almost all of its time lobbying to get more public money for public education. That is their favorite solution. I think that they -- and I think I could probably convince people who take that position -- to in a situation like disability voucher, if a disabled kid can show that there's no adequate education in the public school system, I think that it's right. And I think that it's actually required by federal law to give them a voucher to get actual education. But at the same time, the state should be trying to provide that in the public school system. If they can't, give them a voucher. That kind of program is fine. I don't think anybody has any problem with that. The problem that people who are against these programs have is that they are for public schools. And they don't want to see the public school system made worse, which most of the kids have to go to, while some private schools are made better, which a very small minority of people can go to, who tend to be the more wealthy people and people who are willing to have religious education.

Clint Bolick:
I have a slightly different view. I totally agree with your premise. I think that's the way we ought to have our public education funded. And that is an equal amount of money behind every child that will follow that child wherever the child is able to get a good education. Whether it's a public school, a charter school, a private school or a computer with distance learning or some other combination. Because every child's needs are different. And the parent is in the best position to decide what is in the best interests of that child. Now, I like much of the soothing rhetoric that I'm hearing from Professor Bender. But the reality of the situation is much different. As Professor Bender mentioned, there is a program in Florida that was providing assistance only to kids in failing public schools. And they could use their vouchers in public or private schools. No religious discrimination. The folks who care so much about kids sit back and say, you know, that's really the kind of plan that we ought to be advocating. No. They filed a lawsuit. And under the uniformity clause got it struck down. By the Florida Supreme Court.

Paul Bender:
So the Supreme Courts of states do things that are wrong sometimes.

Clint Bolick:
That is definitely true. [Laughter]

Clint Bolick:
Especially the Florida Supreme Court.

Paul Bender:
Exactly. We know all about the Florida Supreme Court.

Clint Bolick: :
We do, don't we? [Laughter]

Clint Bolick:
But this program had created a tremendous amount of public school improvement across the state. That is now being arrested. The people by and large who challenge these programs in court, the unions, are not after it because they care about public education at large. They do it because they care about their jobs and their power. And I think that the constitutions of all of our states put kids first, not special interests first. And that's why we have won a majority of these legal battles.

Michael Dixon:
That entire school choice debate lasted about an hour. And it will be available for viewing on our website at azpbs.org.

Michael Dixon:
Now, many people who live in the Phoenix area who are aged 50 or older feel overwhelmed by things called mutual funds and the choices you have in mutual funds. And they believe investing is too complex. This from AARP Financial Services which recently conducted a survey on the investing habits of a sample of Phoenix area residents who are planning for retirement. So why is financial planning for a secure retirement so intimidating? Merry Lucero spoke with Mac Hisey, a Chief Investment Officer of AARP Financial, about some ways to make retirement planning simpler and a more comfortable experience.

Merry Lucero:
Mac, thanks for joining us here.

Mac Hisey:
Thanks for having me.

Merry Lucero:
You recently did some research on the investment habits of people 50 plus who are here in the Phoenix area. What did you learn?

Mac Hisey:
Actually a lot. We surveyed last October people 50 plus in the Phoenix area. We found that there's a lot of confusion and actually intimidation about the investing process. People are confused and a little bit overwhelmed by the investing process and how they approach it. So, for instance, with over 8,000 mutual funds in the United States, it's kind of hard to figure out which is the right fund for you. So that was one of the findings we came up with. The other thing that was interesting is that people were turned off by prospectuses from mutual funds. They're too thick; they have a lot of legal jargon in them. And people actually preferred reading their instructions for prescriptions or how to operate the D.V.D. or computer rather than read a prospectus from mutual funds. We thought that was pretty interesting. The other thing that we found out of the survey was that people generally are getting more aware of the necessity for preparing for retirement, but are a little bit uncomfortable in how to get there. So, for instance, talking to a financial planner or even to mutual funds, people felt a little bit like, are they more interested in their interest rather than mine? But we did see there was a great desire to talk to somebody about the investment process, but somebody who has really had their interests at heart.

Merry Lucero:
Do you think maybe one of the reasons why people are intimidated is there's too much choice out there?

Mac Hisey:
I think that's absolutely true. A lot of studies have found that with the more choice you have, it's actually more difficult to arrive at a decision. And if you actually have a fewer number of choices but good choices, people thought were much more comfortable with that and able to get to decisions. So you're absolutely right.

Merry Lucero:
One of the other reasons why perhaps investors are wary is because they feel like they're being hard sold.

Mac Hisey:
That's right. And I think that's a very big issue. And it's something that investment business and industry really needs to think more about is how do you get people comfortable and assured that really looking after their best interests? So that's something we've looked long and hard at. That's actually been a very big part of what we're all about.

Merry Lucero:
And how do you try and solve that problem?

Mac Hisey:
With our investment counselors, they're all on salary. So they're not on commission. So it's not based on how much they sell or anything like that. They are there to help the customer. The other thing is that we evaluate our investment counselors based on the quality of their phone calls, not on the number of phone calls. So they can take as long as they need to work with somebody on the phone and help them get to a solution.

Merry Lucero:
What about being upfront with fees? How much a fee a person is going to pay on a mutual fund? Do people know how to check that and how to ask about that? And what are the fees that people should be paying?

Mac Hisey:
That's a great question. Many people don't know what they're actually paying in terms of overall fees and expenses for a mutual fund. We actually have a fee calculator that we use with our investment counselors. No matter what fund you're in, if you talk to one of our counselors they can look up your fund and see how much you're paying in fees and expenses for that particular fund. The average equity fund pays 1.3% in fees. If you think about it over time, that really adds up. So even if you can save, you know, half of that or a third of that, if you're invested for the long-term that can make a big difference in how much you have in retirement. We think that's a very important thing to look at.

Merry Lucero:
You did some research on Arizonans. How are people in the Phoenix area doing? Are we on track?

Mac Hisey:
Yeah. I think what we've found is that most people are in pretty good shape. But there is a pretty wide range of where people are. So you do have some who are very comfortable with where they are and their plans for retirement. But you do have some that are somewhat concerned. And in fact, if you look broader across the U.S., there have been studies that have shown over two-thirds of investors don't feel like they're going to be able to maintain their current standard of living. The other thing that was interesting is in 2006, the personal savings rate in the U.S. was negative 1%, which is the lowest since the depression. So we thought -- what we found in this area, it seems like people are generally pretty comfortable but there are definitely concerns.

Merry Lucero:
So you looked at the trends, whether are there more people or fewer people saving for retirement. Have you looked over what kind of time span over the last ten years? Or what is it now as opposed to five or ten years ago?

Mac Hisey:
Yeah. It used to be -- the savings rate in the U.S. used to be much higher. And what we've seen and what a lot of studies have shown is that people with an increase in housing prices in the United States, and also the traditional pension plans, that they grew more comfortable, that they would be in good shape for retirement. However, when you see more recent trends where obviously there's some concerns about the housing prices in the U.S., but also the number of companies offering the traditional pension plans is going down. So there's a little bit more of a concern now. And that's why we're pretty vocal about saying, you know, you really need to look at your situation on a regular basis and make sure that you are saving enough for retirement. And that's one of the concerns we've had about this change in the personal savings rate going negative is that people really do need to look at their situations on a regular basis.

Merry Lucero:
And how much do day-to-day finances, when you're facing $3 a gallon for gasoline, are you less likely to be worrying about your retirement fund, you know, 15-years from now?

Mac Hisey:
You are absolutely right. And we think that's a big part of what's happening. And we do -- are very, very sensitive to the fact that people have to meet their weekly expenses, monthly expenses. But one of the things we suggest is that because you're really looking over the long-term for savings for retirement, that any little bit you can do you should do and try to do that on a consistent basis. So if you do have that kind of discipline where you take it off the top of your paycheck or right out of your bank account and you don't see the money, you have less of a temptation to perhaps use it where you don't need to. So that's one of the things we're advocating. The other thing is that with the great increase in 401 k plans that are offered across the country, that is one of the best places to have an immediate impact on your long-term retirement preparedness. So we advocate that strongly.

Merry Lucero:
Thank you so much for joining us, Mac Hisey.

Mac Hisey:
Thank you very much for having me.

Mike Sauceda:
Congressman Jeff Flake has introduced a new bill that provides comprehensive immigration reform. Hear from Congressman Flake as he talks about his plan for immigration. And should cities continue to offer lucrative tax breaks for businesses to locate in their boundaries? One state senator doesn't think so. Find out more Thursday at 7:00 on "Horizon."

Michael Dixon:
Well, thanks for joining us on this Wednesday evening for "Horizon." I'm Michael Dixon. Good night.

Matthew Benson:Legislative reporter, Arizona Republic;Mac Hisey:Chief Investment Officer, AARP Financial;

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