COMMENT: Work-Comp Cave-In
by Rick Reiff
GOV. GRAY DAVIS HAS SHOWN ONCE AGAIN THAT HE CAN TAKE DECISIVE
action,not to address the real problems of California, just to keep his fund-raising machine on a roll.
With the economy dragging and employers already reeling from a three-year run-up in their workers’ compensation premiums, what does Davis do? As Howard Fine discloses on page 8, the governor cuts a deal with liberal lawmakers and labor leaders to hike employers’ payments to injured workers by $2.5 billion, or roughly $100 a week per injured worker.
In the prior three years Davis had vetoed similar measures amid complaints from employers that an increase in benefits should be offset by reforms that reduce the role of middlemen so that more of the system’s existing dollars reach the injured employees.
But it’s an election year and organized labor has made its support for Davis conditional on his signing a work-comp benefits hike. So Davis is fast-tracking the process without consulting business groups as he had previously done.
That’s a blow for the state’s employers, but they should know by now that when it’s crunch time, candidate Davis trumps Gov. Davis.
Liberal Bias, Cont’d
LAST WEEK WAS A BAD ONE FOR A ONCE HIGH-FLYING, TECHNOLOGY related, well-connected company that in a few short years grew into a corporate behemoth. The company was characterized by a wheeler-dealer boss, aggressive accounting practices that were audited by Arthur Andersen, insider stock sales and generous political contributions. But the company skidded in recent months, imperiling many pension fund investments, and last week it filed for bankruptcy.
This is not Enron, the energy-trading operation that filed for bankruptcy two months ago. This is Global Crossing, LA-based Gary Winnick’s fiber-optic empire. Like Kenneth Lay’s Enron, Winnick’s Global Crossing spread its campaign contributions across the political board. But unlike Enron, it gave more to Democrats than Republicans in the 2000 and 2002 election cycles, according to the Center for Responsive Politics.
The LA Times reported that at their peak stock price, Global Crossing shares that former President George Bush took in lieu of an $80,000 speaking fee were worth $14 million. But Matt Drudge reported that Democratic Party chairman Terrence McAuliffe reaped an $18 million windfall from an early investment in the company, and that Winnick gave $1 million to the Clinton library. Moreover, according to “top-level GOP insiders” cited by Drudge, the current Bush Administration last summer canceled a Defense Department contract valued at up to $400 million with Global Crossing after questions were raised about the bidding process, a process that may have been “sweetened by players” from the Clinton administration
With all that in mind, I did a Dow Jones Interactive search of mainstream news stories from Jan. 29, the day after Global Crossing’s Chapter 11 filing, until this issue’s deadline:
Keying in the words “Enron, Bush, Republican and scandal” produced 72 stories. Keying in “Global Crossing, McAuliffe, Democrat and scandal” produced no stories. The result was the same when Democratic was substituted for Democrat.
“Enron, Republican and scandal” produced 87 stories, while “Global Crossing, Democrat (or Democratic) and scandal” still failed to produce a hit.
The only television network that I heard making hay of the Democratic ties to Global Crossing was, no surprise, Fox.
Maybe other journalists will have finally begun to chase this story line by the time you read this. But, even then, I doubt that most news outlets will do so with the same zeal they’ve shown for the GOP-Enron connection.
, Rick Reiff
