Bill Gates: fraudulent state budgets hide cost of teacher pensions

Ever since its inception in 2007, the Aspen Ideas Festival has been a proving ground for thinkers who want to break with liberal orthodoxy on certain subjects. One is education. The event, sponsored by the Aspen Institute, has been a annual refuge for Democrats who would like more choice and competition in K-12.

"The education system is built on the three pillars of mediocrity: lockstep pay, lifetime tenure and seniority," was Joel Klein's assessment at this year's Festival. He ought to know -- he's the chancellor of the New York City Department of Education, the nation's largest school system.

John Fund discusses Robert Gibbs's comment yesterday that GOP could take the House. Also, Joe Rago discusses President Obama's meeting with business leaders.

This year, Mr. Klein also had some backup from a friend (and former rival in the Microsoft antitrust case), Bill Gates, who has devoted much of his time to education since stepping down from full-time work with the company in 2006. Undermining public education, he said, is a system that channels too much money to pensions for retired teachers. He predicts that state and local governments will have to lay off 100,000 active teachers in the next couple of years. "I'm very much against that," said Mr. Gates who noted that many of the teachers who lose their jobs will be younger, more motivated teachers at the bottom of the seniority system.

Mr. Gates said a big part of the problem is "fraudulent" state budgeting systems, which fail accurately to account for the cost of pension promises. A legislator who "says 'yes' doesn't feel any pain at all," he said. Thus the "accounting fraud" that lets politicians treat generous teacher pensions as a free lunch rewards them for spending more on retired teachers than on current students.

Even in Aspen, where slippery is always in, Obama is crashing

NEW YORK – Even the Aspen Ideas Festival, an annual gathering of the country's brightest lights, isn't Obama country anymore. Lloyd Grove on the president's waning support among the intelligentsia.

You’d think the well-heeled and enlightened eggheads at the Aspen Ideas Festival—which is running all week in this fashionable resort town with heady panel discussions and earnest disquisitions involving all manner of deep thinkers and do-gooders—would be receptive to an intellectually ambitious president with big ideas of his own.

In a way, the folks attending this cerebral conclave pairing the Aspen Institute think tank with the Atlantic Monthly magazine might even be seen as President Obama’s natural base.

Apparently not so much.

“The real problem we have,” Mort Zuckerman said, “are some of the worst economic policies in place today that, in my judgment, go directly against the long-term interests of this country.”

Obama’s top economic adviser, Larry Summers, and his departing budget director, Peter Orszag, can expect heavy weather when they land in Aspen later this week to make their case to this civic-minded clique of wealthy skeptics.

“If you’re asking if the United States is about to become a socialist state, I’d say it’s actually about to become a European state, with the expansiveness of the welfare system and the progressive tax system like what we’ve already experienced in Western Europe,” Harvard business and history professor Niall Ferguson declared during Monday’s kickoff session, offering a withering critique of Obama’s economic policies, which he claimed were encouraging laziness.

“The curse of longterm unemployment is that if you pay people to do nothing, they’ll find themselves doing nothing for very long periods of time,” Ferguson said. “Long-term unemployment is at an all-time high in the United States, and it is a direct consequence of a misconceived public policy.”

Ferguson was joined in his harsh attack by billionaire real estate mogul and New York Daily News owner Mort Zuckerman. Both lambasted Obama’s trillion-dollar deficit spending program—in the name of economic stimulus to cushion the impact of the 2008 financial meltdown—as fiscally ruinous, potentially turning America into a second-rate power.

“We are, without question, in a period of decline, particularly in the business world,” Zuckerman said. “The real problem we have…are some of the worst economic policies in place today that, in my judgment, go directly against the long-term interests of this country.”