MyGovCost News & Blog

VA Deploys Golden Parachutes for Badly Behaving Bureaucrats


Thursday September 22nd, 2016   •   Posted by Craig Eyermann at 6:25am PDT   •  

37193706 - golden parachutes. dollar signs parachuting down from the sky Last week, the U.S. House of Representatives approved a bill that would make it easier for managers at the troubled Department of Veterans Affairs to fire the employees and supervisors at the VA who have engaged in misconduct by a vote of 310 to 116.

The House voted 310-116 Wednesday to arm the Department of Veterans Affairs, exclusively among federal departments, with tougher employee “accountability” tools to punish misconduct and better protect whistleblowers.

It’s the latest political fallout from the patient wait time scandal of 2014 and multiple smaller investigations into misbehaving VA supervisors and staff that have become the primary focus of the House Veterans Affairs Committee under chairman Rep. Jeff Miller (R-Fla.) who is to retire January.

The VA Accountability First and Appeals Modernization Act of 2016 (HR 5620), introduced by Miller in July, would provide new authorities for VA to withhold financial incentives or to demote or fire employees faster than current federal employee protection law allows.

Such a bill is needed because of a combination of civil service rules and government union protections that make it extraordinarily difficult to hold federal government employees who have engaged in on-the-job misconduct accountable for their actions by firing them.

In fact, the situation has become so bad that VA officials have turned to financial incentives to entice employees who have engaged in misconduct into leaving their jobs. Luke Rosiak of the Daily Caller News Foundation reports on the VA’s golden parachute plan for its badly behaving bureaucrats.

Union protections and civil service rules prevent many government agencies from outright firing employees, so in the case of the Department of Veterans Affairs (VA), they are paying 150 employees millions of dollars to quit.

Leigh Bradley, the VA’s top lawyer, claimed that “many” times the settlements didn’t mean money, and only “once in a while” do they involve agreeing to hide the misconduct from future employers. That stands in stark contrast to the current data that Bradley herself provided, which shows that 72 percent of settlements were indeed monetary and that 96 percent required the agency to give the employee a “clean record.”

“We don’t use [clean record agreements] regularly as has been depicted,” she said without explaining how 96 percent is not regularly.

The collective payments to terminated employees totaled $5 million, mostly being paid to employees facing misconduct charges; the money came from budgets that would otherwise be used to help veterans.

$5 million equally divided by 150 employees works out to an average incentive of $33,333 per badly behaving employee to leave the VA’s payroll. At the same time, the VA is frequently agreeing to cover up the misconduct that led to the generous severance package being paid to the departing employees in the first place.

That’s how U.S. taxpayer bucks are being used to pass the buck.

Tax Limitation Measure Still Under Attack


Wednesday September 21st, 2016   •   Posted by K. Lloyd Billingsley at 8:50am PDT   •  

CA_HomesCalifornia’s Legislative Analyst has released Common Claims About Proposition 13, the People’s Initiative to Limit Property Taxation 65 percent of California voters approved in 1978. The LAO examines whether Proposition 13 stabilizes property taxes, discourages new business creation, increases home ownership, and so forth. Prop 13 opponents, primarily government ruling-class types, claim it reduces revenue. Common Claims finds that, across all California local governments, per–person tax revenue has increased 36 percent since Proposition 13. Overall, the LAO report explains, “California local revenue increased” under Proposition 13. But this will not put to rest attacks on the measure.

Big-government apologists claim Prop 13 is inherently unfair because owners of similar properties pay different amounts of property taxes. With property tax pegged to the purchase price of a home, that differential is inevitable. The LAO says higher–income Californians “own more homes and own homes of higher value and, therefore, receive the majority of the total dollars of tax relief provided to homeowners by Proposition 13.” Actually, these homeowners do not “receive” anything. They pay less of their own money to the government because of a measure voters approved. Contrary to statist superstition, to allow anyone to keep more of what they earn is not to give them something.

While giving credence to the most infantile attack on Proposition 13, the Legislative Analyst does not weigh in on the need for property tax limitation in the first place. As we noted, before voters approved Proposition 13, people were being taxed out of their homes. Even so, Jerry Brown, in his first go-round as governor, called the measure a fraud and a rip-off. He was never, as he claimed, a “born-again tax cutter,” and he now spearheads a tax counterrevolution.

Common Claims About Proposition 13, meanwhile, might have tabulated the new state spending and new state hires mandated by the 1978 ballot measure. A ballpark figure for both would be zero. That’s why the ruling class still wages war on the People’s Initiative to Limit Property Taxation.

Education Fat Cats No Joke for Taxpayers


Monday September 19th, 2016   •   Posted by K. Lloyd Billingsley at 10:25am PDT   •  

35293683 - fat cat boss on a white background vector illustrationChris Evans, superintendent of the Natomas Unified School District, bears a strong resemblance to the late Chris Farley of “Saturday Night Live,” but for students, parents and taxpayers, Evans’ latest happy meal is no joke. As Diana Lambert notes in the Sacramento Bee, the district’s board just boosted Evans’ pay by $46,130, a raise of more than 20 percent bringing Evans salary to $270,000, almost $100,000 more than the $182,791 Jerry Brown pulls down as governor of California. Evans’ lucrative deal now extends to 2020 and includes a $500 monthly car allowance, $1,500 per year “to pay for technology” and a $12,000 annual annuity. It was less clear what superintendent Evans had done, if anything, to deserve all that, plus his new raise of $46,130.

Natomas school board president Teri Burns issued a statement citing Evans’ “continuity in leadership, stability in administration” and “a clear vision for the district.” Burns cited no increase in student achievement during Evans’ five years with the district, no reduction in truancy, nor any savings he might have achieved in administrative costs. To calculate the raise, Lambert wrote, the district “used data from other school districts in the state.” The only one cited was the Twin Rivers School District, also in the Sacramento region, where superintendent Steven Martinez makes, $260,000 a year. As we noted, that raise was not tied to any achievements by Martinez, and the district has seen more than its share of troubles.

This dynamic models the entire government monopoly K-12 system, the state’s collective farm of ignorance and mediocrity. If schools fail, the money keeps coming. The educrats keep crying for more, and they get it, regardless of achievement or accountability. The education establishment resists reform, particularly parental choice. Their latest quest is to make schools more difficult to evaluate, which Dan Walters of the Sacramento Bee describes as “at worst a cynical maneuver to evade true accountability.”

U.S. National Debt Grows Past $19.5 Trillion


Monday September 19th, 2016   •   Posted by Craig Eyermann at 7:02am PDT   •  

Visual Capitalist Jeff Desjardins has a new take on how to visualize the sheer size of the U.S. government’s $19.5 trillion total public debt outstanding. In the chart below, you’ll discover that:

  • The U.S. national debt is bigger than the value of the S&P 500.
  • The U.S. national debt is greater than the combined value of all the financial assets held by the world’s Top 7 money management firms.
  • The U.S. national debt is 25 times bigger than the value of all the crude oil exported by the world’s oil producing nations.
  • The U.S. national debt is 155 times more than the value of all the gold that was mined in 2015.
  • If you took all the world’s physical cash, gold, silver, and cryptocurrencies like Bitcoin, their combined value would add up to only 65% of the value of the U.S. national debt!
  • The U.S. national debt represents one-third of the total amount of sovereign debt accumulated by all nations around the world.

The chart was produced by Visual Capitalist in collaboration with Texas Precious Metals as part of The Money Project, which explores the concept of money through rich visuals.

Courtesy of: The Money Project

U.S. Taxpayers’ Cash to Iran Buys Worsening Behavior


Saturday September 17th, 2016   •   Posted by Craig Eyermann at 1:56pm PDT   •  

10115590 - robbery of the businessman in its car According to recent news reports, the Obama administration may have far more to answer for with respect to the $1.7 billion in U.S. taxpayer cash it has paid to Iran.

The Wall Street Journal reports that after the U.S. first sent Iran equivalent of $400 million in foreign currency, loaded on wooden pallets in an unmarked cargo plane, the Obama adminstration sent another $1.3 billion in cash on two additional flights, which accounts for the money that it had withdrawn in $9,999,999.99 increments.

The Obama administration followed up a planeload of $400 million in cash sent to Iran in January with two more such shipments in the next 19 days, totaling another $1.3 billion, according to congressional officials briefed by the U.S. State, Treasury and Justice departments.

The cash payments—made in Swiss francs, euros and other currencies—settled a decades-old dispute over a failed arms deal dating back to 1979. U.S. officials have acknowledged the payment of the first $400 million coincided with Iran’s release of American prisoners and was used as leverage to ensure they were flown out of Tehran’s Mehrabad on the morning of Jan. 17....

The $400 million was converted into non-U.S. currencies by the Swiss and Dutch central banks, according to U.S. and European officials.

The Treasury Department confirmed late Tuesday that the subsequent payments were also made in cash.

“The form of those principal and interest payments—made in non-U.S. currency, in cash—was necessitated by the effectiveness of U.S. and international sanctions regimes over the last several years in isolating Iran from the international financial system,” Treasury spokeswoman Dawn Selak said.

Since being paid by the Obama administration, Iran’s leaders appear to have embarked on an increasingly confrontational strategy in the Persian Gulf, where their behavior has been described as “worsening” rather than improving, with the threat of costly military conflict increasing as a direct result of the Obama administration’s payments.

On June 3, 2016, two full months before what would become the story of the Obama administration’s $1.7 billion in cash payments to Iran began to break, Saeed Ghasseminejad of the Foundation for the Defense of Democracies reported that Iran’s leaders would entirely direct a “financial settlement” totaling $1.7 billion it had reached back in January 2016 to Iran’s military.

Of the $19 billion, $11.3 billion is earmarked explicitly for the armed forces’ annual budgets. In addition, Parliament allowed the government to allocate $5 billion to “military projects,” to be chosen at the discretion of the military apparatus. The budget also allows the military to raise $1 billion through fees for Iranians who buy their way out of military service. Finally, it lets the government give the military $1.7 billion from a financial settlement reached in January.

That $1.7 billion financial settlement certainly lines up with the Obama administration’s payments to Iran in exchange for the American hostages it held in January 2016. Payments made entirely in cash loaded on wood pallets and delivered to Tehran in unmarked cargo planes.

Whenever bad behavior is rewarded, more bad behavior soon follows. The Obama administration’s cash payments of $1.7 billion to Iran may very well be a classic case study in that basic tenet of both human psychology and international diplomacy, not to mention being the answer to the question of what happened to all that cash after it was delivered to Iran.

Corruption and Waste at Government Water Agencies


Monday September 12th, 2016   •   Posted by K. Lloyd Billingsley at 11:43am PDT   •  

Government corruption is a staple of the news, with politicians such as San Francisco Democrat Leland Yee, a consort of gangsters such as Raymond “Shrimp Boy” Chow, recently landing in prison. Chris Reed of Calwatchdog has charted corruption in the California city of Bell, which “was being run like a criminal enterprise.” In the city of Carson, the corruption included a brand of government agency not often in the news.

Al Robles served simultaneously as mayor of Carson and board member of the Water Replenishment District of Southern California, which ponied up money to pay Robles’ legal bills. The Central Basin Municipal Water District is facing allegations of a $2.75 million slush fund created to pay politically connected consultants such as former Assemblyman Tom Calderon, D-Montebello. Further, as Reed notes, “Central Basin board member Art Chacon was allowed to collect car allowance and mileage reimbursements from the district from 2006 to 2014, an eight-year span in which he didn’t have a driver’s license.” In 2014, “the district settled sexual harassment allegations made by a female contractor against district Director Robert Apodaca for $670,000.”

As Cross-Currents in California Water observes, water districts can be top-heavy hotbeds of cronyism. As the Goleta Water District (GWD) on the central coast shows, outlandish salaries and benefits do not guarantee sound management. Since water is not evenly distributed, the GWD has purchased water from other districts and even private landowners such as television producer Dick Wolf, whose Slippery Rock Ranch sits atop a reservoir of 200,000 acre-feet. When negotiations broke down, GWD took the ranch to court to block its sales to local municipalities and claimed that the ranch’s groundwater basin was connected to the district’s. As a spokesman for the ranch put it, “How did water that they had been negotiating to buy suddenly become theirs?”

As the Santa Barbara News Press noted, the district’s legal bills are up more than 300,000 for the lawsuit alone, and overall budget costs are $1.3 million, “considerably higher than the other three South Coast water agencies.” And of course “ratepayers are picking up the tab.”

 

The Cost of the War on Terror


Sunday September 11th, 2016   •   Posted by Craig Eyermann at 9:00am PDT   •  

The U.S.’ War on Terror has endured for 15 years and has cost U.S. taxpayers over 1.75 trillion dollars. MyGovCost is marking the occasion by illustrating its accumulating cost from year to year along with a timeline of the major events that have defined it.

MyGovCost_The_Cumulative_Cost_of_the-War_on_Terror_FY2001_to_FY2016

Timeline of Key Events in War on Terror
from September 11, 2001 through September 11, 2016
Month Events
Sep-2001 Al Qaeda attack on World Trade Center in New York City and the Pentagon in Virginia using passenger planes on September 11. The phrase “War on Terror” is officially used for the first time by President Bush on September 20.
Oct-2001 War in Afghanistan begins with U.S.-led NATO combat operations on October 7.
Nov-2001 Afghanistan’s capital of Kabul falls to U.S. and NATO troops as Taliban are driven from power.
Jan-2002 Guantanamo Bay Detention Camp for foreign terrorists captured abroad is opened.
Nov-2002 U.N. Security Council adopts Resolution 1441, offering Iraq’s Saddam Hussein’s regime a “final opportunity to comply with its disarmament obligations” on November 8.
Mar-2003 Iraq War begins on March 20. Baghdad is captured by U.S. troops 20 days later.
May-2003 Major combat operations in Afghanistan end on May 1.
Sep-2004 Battle to retake Iraqi city of Fallujah from Sunni insurgents begins on September 8. U.S. troops finally retake Fallujah on November 7.
Nov-2005 U.S. begins initiative to root out foreign fighters infiltrating into Iraq on November 5.
Dec-2005 President Bush acknowledges that his decision to invade Iraq in 2003 was the result of faulty intelligence.
Jun-2006 Al Qaeda’s leader in Iraq, Abu Musab al-Zarqawi is killed on June 8.
Jul-2006 Taliban insurgency grows and violence returns to Afghanistan.
Oct-2006 Al Qaeda in Iraq rebrands itself as the Islamic State of Iraq on October 15.
Jan-2007 The Iraq “Surge” to address increasing Sunni insurgent activity in Iraq is announced by President Bush on January 10.
Nov-2007 Success in surge in restoring peace allows for troops supporting it to begin leaving Iraq on November 24.
Feb-2008 The Iraq Surge is officially scheduled to end in July 2008 as U.S. troops will be reduced to near pre-Surge levels on February 16.
Sep-2008 Escalating attacks by extremists make 2008 the most deadly year for U.S. and NATO troops in Afghanistan since 2001. 31,000 U.S. troops are in Afghanistan, will increase to 36,000 by end of January 2009, with NATO forces totaling 32,000.
Feb-2009 Further U.S. troop reductions in Iraq are announced by President Obama on February 1. Later in the month, President Obama approves deployment of additional 17,000 U.S. troops to Afghanistan.
Jun-2009 U.S. troops redeploy to leave Iraqi cities on June 30.
Jul-2009 U.S. Marines launch major offensive operation in southern Afghanistan as part of new counterinsurgency strategy.
Dec-2009 President Obama announces Surge strategy for Afghanistan on December 1. With 71,000 U.S. troops in Afghanistan, the surge will add another 32,000 to 35,000.
Aug-2010 Combat operations in Iraq end on August 31.
May-2011 Al Qaeda leader Osama bin Laden is killed by U.S. special forces in Pakistan on May 1.
Jun-2011 President Obama announces troop withdrawals in Afghanistan on June 22.
Dec-2011 Iraq War officially ends as last U.S. troops leave Iraq on December 18.
Sep-2012 Islamist militants kills 4 Americans, including Ambassador Christopher Stevens in Benghazi, Libya on September 11.
May-2013 Islamic State in Iraq merges with Nusra Front in Syria to create the Islamic State of Iraq and the Levant (ISIL), which is also referred to as the Islamic State of Iraq and Syria (ISIS), on May 9, 2013. International campaign against ISIS begins one month later.
Jan-2014 ISIS takes control of Fallujah, Iraq on January 4. Ten days later, it takes control of Raqqa, Syria.
May-2014 President Obama announces U.S. troop withdrawal from Afghanistan on May 27.
Jun-2014 ISIS takes control of Mosul, Iraq on June 10. It captures the city of Tikrit, Iraq two days later.
Aug-2014 President Obama authorizes airstrikes against ISIS in Iraq on August 2.
Sep-2014 U.S. begins airstrikes against ISIS in Syria on September 22.
Dec-2014 War in Afghanistan ends when NATO officially ends combat operations on December 28.
Jan-2015 War in Afghanistan resumes when Taliban resurgence forces NATO’s plans to remove troops to be delayed until end of 2016.
Apr-2015 Iraqi forces take back Tikrit from ISIS with assistance from U.S. airstrikes on April 1.
May-2015 Iraqi city of Ramadi falls to ISIS on May 17. Five days later, Syrian city of Palmyra falls, as ISIS gains control over half of Syria’s territory.
Oct-2015 President Obama abandons plan to remove all remaining U.S. troops in Afghanistan by end of 2016 and instead commits to keep them there through 2017.
Feb-2016 U.S. deploys hundreds of troops to Afghanistan to combat resurgence of Taliban on February 8.

References

Reforms Failing at the VA


Friday September 9th, 2016   •   Posted by Craig Eyermann at 6:12am PDT   •  

US-DeptOfVeteransAffairs-Seal-Large In 2014, the Phoenix branch of the Department of Veterans Affairs became ground zero for the national health care rationing wait list scandal that rocked the federal agency. In response, both President Obama and the department’s bureaucrats pledged to implement reforms that would fix the problems that led to thousands of the nation’s veterans being denied timely medical treatment, where hundreds died waiting for appointments without ever receiving any care.

This summer, Steve Cooper, a 45 year old veteran seeking care for Stage 4 prostate cancer, secretly recorded his encounter with VA medical staff at a recently opened regional branch of the VA in the greater Phoenix metropolitan area. Local NBC affiliate PNNX 12 News provides a transcript for some of the more remarkable statements that came out in the recording.

The most notable moments throughout the 30 minutes of recorded conversations include the following:

– A nurse calls the patient phone scheduling system “a nightmare,” admitting that even as an employee she can’t get a person on the phone line.

– The doctor who saw Cooper admitted he’s “not a fan of the VA” and complained his patient load doesn’t allow him enough time with patients.

– The doctor said that, as a new employee, he is still trying to understand how the “Choice” program works.

– The doctor expressed a desire to check Cooper’s heart and lungs but said he misplaced his stethoscope. The doctor ended up not using a stethoscope at all, but nonetheless stated that “key exam findings” on Cooper were negative.

“I especially have a problem with it because earlier the nurse said my blood pressure was high,” Cooper said in an interview with 12 News. “And the excuse that a doctor says he can’t find his stethoscope just doesn’t work when you’re a doctor making six figures working for the Phoenix VA.”

Cooper says he believes the audio reflects ongoing issues at the Phoenix VA Healthcare System first identified two years ago.

“Post two-years since the crisis broke, the audio is valuable. It’s valuable to hear from the employees themselves that the system doesn’t work because of the infrastructure,” Cooper said during an interview with 12 News.

KPNX 12 News‘ report came out on August 23, 2016. In the report, Phoenix VA medical director Diana Amdur indicated that the agency would address the allegations and take appropriate actions.

Nine days later, while visiting the Phoenix branch of the VA, the Department of Veterans Affairs’ second highest ranking official, Sloan Gibson, agreed with the statements in the recording and described the VA’s patient scheduling system as a “nightmare”. KPNX 12 News reports:

“I don’t want anyone to think that we’re hanging up a ‘Mission Accomplished’ banner,” Gibson said. “We’re not. We’ve got a lot of work left to do but the simple fact of the matter is a vast amount has changed.”...

Regarding a 12 News report last week about secret audio recordings at a VA clinic, Gibson said he agreed with a nurse who said the patient scheduling system was “a nightmare.”

Gibson vowed that a “contact center” will be established at every VA medical center nationwide by the end of the year to handle issues such as scheduling.

“I’ve directed today the executive in charge of that program to come here on the ground, for him to do an assessment,” Gibson said. “To figure out what resources do we need to bring to bare so when a veteran calls somebody answers the phone and provides the help they need.”

Gibson has been one of the VA’s few bright spots in the bureaucracy’s response to its systemic problems. He will also soon be in a position to more directly influence the lack of effective implementation of reforms uncovered at the Phoenix branch of the VA through a change in its leadership, since VA medical director Diana Amdur announced several days earlier that she will be stepping down from her position for health reasons after being on the job for just nine months.

Gibson attributed the high stress of the job as being a contributing factor to Amdur’s health condition.

Meanwhile, President Obama is rejecting a recommendation of the independent Commission on Care to reform the governance structure of the VA’s hospital network. The Washington Free Beacon reports:

President Obama is disputing a recommendation to change the governance structure of the Department of Veterans Affairs network of hospitals, saying it would undermine the authority of bureaucrats overseeing the agency-run facilities.

The proposal was one of several included in the final report of the Commission on Care, an independent panel established by Congress to examine the VA’s hospital network after veterans were found to have died waiting for care as agency employees kept secret lists to conceal long appointment waits in 2014....

In its final report, which outlined a plan for “far-reaching organizational transformation” at the VA, the commission cited “weak governance” as one of the root causes of the Phoenix VA wait list scandal uncovered more than two years ago. As a solution, the panel recommended that Congress provide for the formation of an 11-member board of directors, accountable to the president, that would be “responsible for overall VHA Care System governance” and would have “decision-making authority to direct the transformation process and set long-term strategy.” The board would also not be subject to the Federal Advisory Committee Act, under the commission’s recommendations.

“The governance limitations made evident in the Phoenix scandal have profound implications for the long term,” the commission’s report stated. “The Commission believes [the Veterans Health Administration] must institute a far-reaching transformation of both its care delivery system and the management processes supporting it.”

It’s hard to see how any of that can happen without substantial reform of the VA’s bureaucracy and management structure.

How Government Mistakes “Balloon into Sizable Money”


Thursday September 8th, 2016   •   Posted by K. Lloyd Billingsley at 10:28am PDT   •  

Last year an independent audit revealed that the City of Sacramento, California’s capital, had overpaid city retirees by $2.8 million. The overpayments, which had been going on since 2005, prompted the Sacramento Bee to editorialize that “a mistake can balloon into sizable money,” citing a $60 million gap between projected payouts and expected revenue for the city’s old retirement system in which the overpayments occurred. Add in CalPERS, the editorial said, and the total unfunded liability increases to $675 million, a big jump from $161 million in 2004-05. “It’s going to be tough to whittle down that debt,” the Bee’s editorial lamented. “Paying out more than retirees are owed only made it worse.” That turned out to be true, in more ways than one.

Since the overpayments went undetected for a decade, the city’s own oversight process is obviously useless and unaccountable to taxpayers. On the other hand, the overpayment of nearly $3 million did not prompt the City of Sacramento to fire those responsible. The only city employee named in connection with the overpayment is “human resources analyst” Kimberly Isaacs. According to the Bee’s Anita Chabria, last July Isaacs’ “title and duties were reduced but her pay remained the same.” So she got the same money for less work until May of 2016, when she took a pay cut of “more than $20,000.” As Chabria reports, Isaacs is now charging that her demotion was based on “race and age,” and the 54-year-old African American has filed a complaint with the state Department of Fair Employment and Housing.

However this turns out, it will not whittle down any pension debt, which the overpayment made worse. Indeed, the complaint will consume more public resources. The city’s new human resources director, Melissa Chaney, wants to hire a new “diversity manager” at a salary of $180,000. That won’t help whittle down the pension debt either, but it does confirm the dynamic. At all levels of government, mistakes can quickly balloon into sizable money.

State Stem Cell Institute Still Conflicted


Wednesday September 7th, 2016   •   Posted by K. Lloyd Billingsley at 4:55am PDT   •  

As we noted, California’s $3 billion Stem Cell Research and Cures Act, Proposition 71, promised life-saving cures and therapies for a host of afflictions including heart disease, diabetes, Alzheimer’s and Parkinson’s. Celebrity promoters included Christopher Reeve, Michael J. Fox and Arnold Schwarzenegger. In 2004 voters approved the measure, which created the California Institute for Regenerative Medicine. Real estate tycoon Robert Klein cleverly wrote Prop. 71 to install himself as the institute’s chairman, and Klein protected CIRM from almost all legislative oversight by requiring a 70 percent supermajority of both houses to make any structural or policy changes. He awarded huge salaries to CIRM bosses such as Alan Trounson, who bagged $490,000 a year, courtesy of California taxpayers. As David Jensen of the California Stem Cell Report shows, CIRM is still paying off big time for Trounson.

The former CIRM president “received $443,500 in total compensation from the Bay Area stem cell company that appointed him to its board of directors only seven days after he left his state post.” This came courtesy of StemCells Inc., “a firm that was awarded more than $40 million in funding while Trounson headed the California Institute for Regenerative Medicine.” The company, Jensen observes, was “the only applicant ever to reach that level of success” and “one of the two $20 million awards . . . approved by the stem cell agency’s board despite being rejected twice by its grant reviewers. It is the only time that an application has been rejected twice by reviewers and then approved by the governing board.” Jensen does not explain that CIRM founder Robert Klein lobbied for the company, and that CIRM directed a full 91 percent of its research funding to institutions with representatives on its governing board. Jensen does acknowledge, however, that “conflict-of-interest allegations have dogged the agency since it was created in 2004.”

At present, by Jensen’s count, California’s $3 billion government stem-cell agency still has “about $800 million in uncommitted funds” and “expects to run out of cash for new awards in 2020 unless it finds fresh sources of funding.” With the number of promised cures and therapies still holding at zero, CIRM remains the California Institute for the Redistribution of Money.

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