I Welcome Tracy Jordan- In Support of Dr. Janine Caffrey

I welcome a new contributor to my blog, Tracy Jordan. She is a good friend and a passionate resident of Perth Amboy, dedicated to shedding light on this town's many problems. Together we will be creating a new town paper, The Perth Amboy Wave, which will debut in the next 60 days.

I am posting this letter as a relatively new resident of the City of Perth Amboy. I moved here five years ago. I write to express support of Dr. Janine Caffrey, Superintendent of Schools for the Perth Amboy Public Schools for two distinct, yet related, reasons.

First, after attending several Perth Amboy Board of Education meetings, and keeping an eye on the Board of Ed website, Dr. Caffrey has earned my respect as a competent and forward-thinking change maker. She is focused and action-oriented. At the meetings I attended, various staff members presented everything from new curricula and creative teaching methods to meet high academic goals, to tracking databases and increased parental input mechanisms. All of these initiatives are being implemented under the administration of Dr. Caffrey. Frankly, I was very pleasantly surprised and very relieved. This leads me to my second reason.

Up to and including this year, Perth Amboy’s public school system ranked 500 out of 559 in the State of New Jersey (Source: National Center for Education Statistics, U.S. Dept of Education, and New Jersey Dept. of Education. Rank score is determined by averaging). I don’t have any children of my own and neither do most of my friends in this town. But that does not mean that I am not affected by the level of performance of our school children. Not at all.

I consider myself to be quite fortunate. I have held good jobs here, I currently own a business and a waterfront home. However, much to my distress, what I have seen over the past five years, is that parents of young children move out of town as the time draws near for their child to enter school. This has happened too many times for me to count. However, my experience has been that long time residents of Perth Amboy do not want to hear that. They supposedly “love” Perth Amboy, insinuating that I must not since I am “so negative.” Imagine all of the parents, or soon to be parents, who never even move here in the first place because the quality of the school system is considered to be substandard. If you don’t think that affects the quality of life of every person in this town, then you need to think again.

This city that I do love needs to break its pattern of poor decision making at critical moments. Ambitious waterfront development plans – scrapped. Five full time economic development jobs merged into one and all left vacant by the retirement of one very overworked woman. The willful disintegration of our Chamber of Commerce. Property assessments conducted by our assessor in a “random” pattern that goes unexplained. The list goes on and on and on.

Now we are faced with the possibility of losing a qualified and effective education administrator. And for what? It is frightening to think that the reason could be that she’s actually implementing the sweeping, dramatic changes needed to overhaul an educational system that languishes in the bottom 10% of the State. I implore the Perth Amboy Board of Education to not take another step backwards at yet another critical moment in the revitalization of Perth Amboy.

The 99% Speak

The 99% issued a clarion call to CEO's and corporate boards all over America this week. I commented recently that America has not heeded President Obama's call for a new age of accountability, but this is the clearest signal yet that this may be changing.

Under the Dodd-Frank Act, which was signed into law July 21,2010, corporate stockholders have the right to cast a non-binding vote approving or disapproving the compensation packages of senior management.

In a vote held this week, 55% of Citigroup investors rejected the proposed pay package for the senior management, most notably the $15 million pay package for Vikram Pandit, the current CEO.

And why not. Mr. Pandit took over the position of CEO in Dec. 2007. Since then Citigroup's stock has had an annual return of -44%. The 5 year price chart for the stock, shown in the link below, looks like a great ski slope, but a bitter disappointment for anyone who wanted to make money.

http://www.marketwatch.com/investing/stock/c

The pay package would have brought Mr. Pandit's compensation back to the level seen before the price of Citigroup stock collapsed.

Forbes Magazine, which is famous for its list of the 400 richest people, also publishes an annual list of America's best and worst bosses. To qualify for the list, you have to have a six tenure as CEO. As previously mentioned, Mr. Pandit has only been CEO for about 4.5 years. But if that criteria were discarded, then Mr. Pandit would fall solidly in the middle of the pack on the worst boss side.

There are two questions which will be answered in the coming weeks. First, will the board of Citigroup pay attention and compensate Mr. Pandit in accordance with the wishes of shareholders? Second, will those same shareholder stay on top of the situation and fight for compensation more closely in line with stock performance? I hope the answer to both questions is yes.

I have heard the argument made on a general basis that this level of compensation is necessary to retain the best talent. In Mr. Pandit's case, that argument borders on insanity. Even in general, it is a ridiculous assertion to make. The assumption made is that there are only a few hundred or maybe a few thousand people in the world who could do the job as well as Mr. Pandit. That is a lie that the big corporations would love you to keep believing.

The fact of the matter is that there are hundreds of thousands or perhaps even millions of people who could perform that function effectively. Didn't we just pass the 7 billion mark in world population last month? Let's assume that only 1/10 of one percent of the people in the world could do the job as well as Mr. Pandit. Remember, that's calling a guy who averaged a loss of 44% annually effective. But that is still 70 million people. And I'm sure that a vast majority of them would take the job for less than $15 million a year.

Let's call a spade a spade. A CEO's pay should be directly linked with the valuation of the company. Of course, Citigroup's board may just be arrogant enough to ignore the will of its shareholders. But then let's see what happens the next time the board comes up for a vote.

I applaud the action of the Citigroup shareholders. Let's hope the groundswell that signals a new age of American activism carries over to the area of corporate governance.

Another Victim of the Male Ego

There is a reason this blog is called The Age of Accountability. In deciding what to call this blog back in 2008, I had both personal and sociological reasons. I was searching for personal redemption after a rather dark period, and my feeling was that the country was itself entering a dark period after deregulation had been allowed to run amok.

I felt vindicated when President Obama, in his inaugural address, used the very same phrase. I held out the faint hope that given the circumstances Americans might get the message.

I wish I could say that my hope had come to fruition. But, unfortunately, it is clear that arrogance and complacency still hold a prominent position in the American consciousness.

During my personal dark period, I read a book by the historian Barbara Tuchman called The March of Folly. Her main assertion, which I at first thought was rather superfluous, was that the male ego is responsible for many of the worst tragedies in human history. But the more I thought about it, the more I had to admit that she was right.

In the past two weeks, we have had two glaring examples. First, we had the anti-intellectualism displayed by the Augusta National Country Club when they refused to extend a membership to the recently installed female CEO of IBM, after having given the past four male CEO's memberships. There was no logical reason given for their refusal. They just didn't feel like it.

Today, we have the culmination of the scandal involving Bobby Petrino, the now ex-football coach at Arkansas. It seems that Mr. Petrino lied about the circumstances surrounding a motorcycle accident he had on April 1st. The first report was that Mr. Petrino was alone when he had his accident. Over the weekend it was revealed the he had been accompanied by a female companion half his age. Today, the rest of the details were filled in. This female companion was someone he was having an affair with and he had hired her above 159 other applicants for a job with the Arkansas athletic department.

It turns out he lied to his superiors about the circumstances of the accident to cover up the affair for the sake of his family. This man is 51 years old, he is being paid $3.5 million a year, and his position as football coach of the biggest school in the State automatically makes him a high profile individual.

The question has to be asked: What was going through this man's mind? If he was 25 or even 30 years old, you could offer an explanation of immaturity or youthful indiscretion. But this guy is 51. What are we to conclude? That he hasn't learned his lesson yet? He is being paid $3.5 million a year. His contract was in place through the end of the 2017 season. Consider this in light of the fact that the governor of Arkansas, Mike Beebe, was paid a salary of less than $90,000 in 2010. So to sum it up in a few words, he was willing to risk close to $20 million in order to indulge his ego.

This is far from the first controversial action Mr. Petrino has taken. He has a rather tumultuous employment history. He has shown no loyalty to his employers or his players. And now he has slapped his family across the face as well. It's just the latest example of a male ego gone completely out of control.

As a disclaimer, I will say that I committed a similar indiscretion when I was in my 30's and I paid a high price for it in personal shame and public ruin. But I wasn't the coach of a major university football team and I wasn't making anywhere near $3.5 million a year. I am not trying to say that I was less wrong or hurtful in doing what I did than Mr. Petrino was. But I am saying that if I was in Mr. Petrino's position I would have given the matter more serious thought before taking such a tremendous risk. I just find it fascinating that a man would engage in such self degradation at his age, especially given the fact that I am just about the same age and I feel like I have learned a few hard lessons from the mistakes of my past. Maybe this latest indiscretion will help Mr. Petrino see the light.

In any case, these two latest examples of ego induced idiocy only serve to prove that Barbara Tuchman deserves the posthumous title of modern day genius.

Shame on Augusta

A lot of issues have confusing, gray nuances. This one doesn't. Augusta National Golf Club, the country club where the Masters Tournament is held every year, has refused to admit the recently installed CEO of IBM, Virginia Rometty, as a member because she is a woman. Since IBM has been a major sponsor of the Masters Tournament for many, the previous four CEO's, all male, were made members.

The ridiculous argument the Club's members and supporters are making is that they have the right to associate with whoever they want. Really? Are you telling me you don't want to associate with women? I have a few other questions. Do you only do business with men? Do you only go to church with men? Do you only go on vacation with men? Do you only have sex with men? If you saw a woman broken down on the side of the road would you let her in your car? Do you practice chivalry towards women?

I could probably think of 50 more questions that render the argument just as irrelevant. The 19th amendment, passed in 1920 should have put an end to this argument. Of course, the club is in Georgia, which naturally leads me to the question of how many black members they have. I would guess not many. I would agree that the club should be free to determine its own guidelines for membership. However, sex or race should not be among those criteria.

If the golfers participating in the Masters Tournament had any real balls, they would boycott the tournament until the club admits a female member. Perhaps the loss of millions of dollars in attendance and sponsorship fees would be enough to shake the Jurassic minds of the Augusta National Golf Club members out of their sexist stupor. We all know that closed minded men need to be hit in their wallets before they'll listen to reason.