An Open Letter to the Board of Trustees of Purdue University
by Mike Kimel
An Open Letter to the Board of Trustees of Purdue University
Dear Board of Trustees of Purdue University,
If I may, I’d like to bring some facts about your President, Mitch Daniels, to your awareness. Now, it may be odd for me to do so, as I am not actually affiliated in any way with Purdue University. I have never been a student or employee of the institution, nor have I so much as ever been to West Lafayette. But I do know a bit about data, and there was a time I was looking at facts and figures pertaining to Mr. Daniels.
Thus, I was interested when I read Mr. Daniels bio on your website. It certainly is quite impressive. He was a business executive and head of a think tank. To quote the bio directly,
[H]e also served as Chief of Staff to Senator Richard Lugar, Senior Advisor to President Ronald Reagan and Director of the Office of Management and Budget under President George W. Bush.
And for the past eight years, of course, he was governor or Indiana. As I said, all very impressive.
However, I have read earlier versions of his bio before, and they all suffer from the same issue, namely a gloss over actual accomplishments. Simply reading his bio tells you nothing of why or how he managed to rise so high and hold so many high profile positions. Some people manage through extreme competence. Others are born with the right connections, or are great self-promoters. Some are even, for lack of a better term, charlatans.
Now as I said, I’m a data guy. So I tend to read bios a bit differently than other people might. I notice that we have to go four paragraphs down to find anything measurable. Here’s how that paragraph reads:
Daniels’ first legislative success created the public-private Indiana Economic Development Corporation to replace a failing state bureaucracy in the mission of attracting new jobs. In its first four years of existence, the agency broke all previous records for new jobs in the state and was associated with more than $18 billion of new investment. In 2008, Site Selection Magazine and CNBC both named Indiana as the Most Improved State for Business in the country. In 2012, Indiana became the 23rd Right-to-Work state. Indiana is now near the top of every national ranking of business attractiveness and is the top job-creating state in the nation.
Other sources also tell us of Mr. Daniels’ interest in employment. Reading this article from the Indianapolis Star from a week or so before Daniels took office as governor, one is reminded that:
a) Daniels even pitched putting the state on daylight savings as “a jobs issue”
b) Daniels asked the legislature to make creating the public-private Indiana Economic Development Corporation their first order of business in 2005 so that, as the article noted, his people could “quickly begin their jobs of seeking to boost Indiana’s job market.”
So it is natural to see how how whole job-push did, right? Yes, there are blurbs like “associated with more than $18 billion of new investment” or “Most Improved State for Business.” But those aren’t results. Results are whether jobs are actually created or not. And here’s a guy who had the keys to the car, so to speak. The ideas that got implemented were his. The team that implemented those ideas was his. The buck stopped with him. So if this was his main focus, the one of which he is most proud, the accomplishment he lists first, it is worth looking at how the job market actually did under Mr. Daniels.
Now I know what you’re thinking – that isn’t fair. The job market tanked nationally while Mr. Daniels was in office, and even his excellent job creating skills weren’t enough to mitigate the macroeconomic headwinds. But we can deal with that – we can compare, say, how the unemployment rate changed during Mr. Daniel’s administration to how the unemployment rate changed in the neighboring states over the exact same time period.
One nice source of that information is the Federal Reserve Economic Database (FRED) maintained by the St. Louis Fed. It has data on the unemployment rate for Indiana here. One can use FRED’s graphic capability to index that unemployment rate to the week before Daniels took office as a baseline, and then to add in the unemployment rates of neighboring states, also indexed to the week before Daniels took office. The graph below runs until Daniels’ last week in office, so it should be a fair representation of how Indiana performed relative to its closest peers on Daniels’ most important priority during the time period when he had more influence on that measure than anyone else:
Basically, the performance of the job market in Indiana was best in the first half of his term, but underperformed every single neighboring state by the end. Put another way, the longer his policies were in effect, the worse they did. Of course, we live in a society where almost nobody checks these things, though the data is easily accessible and generating the graph above takes only a few minutes. Perhaps Mr. Daniels himself doesn’t have the native curiosity to check how his policies actually did on what he claims was his most important issue. Maybe he knows but he doesn’t care. Maybe he believes what he believes, facts be damned. I don’t know enough about him to hazard a guess. In any case, Mr. Daniels has felt quite free to continue touting what happened to Indiana job seekers as a success, and he’s had plenty of other people willing to make that claim for him too.
I could go on, and look at other claimed accomplishments during his term as governor, but this is already getting long and I still have a lot to cover. Suffice it to say that I fear Indiana may soon learn a lesson ordinary Argentines learned after a similar bout of privatization – for a while things look very good, but having an executive who papers over the difference between recurring revenues and non-recurring revenues is extremely harmful.
As I noted before, I’ve dealt with data pertaining to Mitch Daniels in the past. I could write volumes on Mr. Daniels, but I think it best to point you to something I wrote about Mr. Daniels some time ago – if you read what his office put out while he was head of the Federal Government’s Office of Management and Budget back in 2002, owned a working pencil, and possessed the patience to do a bit of arithmetic accessible to the typical sixth grader, you would have been flabbergasted by the gall. I laid out the numbers here, but the claim from Daniels’ OMB was basically this: were it not for the recession, the country’s GDP would have risen by double digits in FY 2002 due to the Bush tax cuts. That sort of claim isn’t just politics, and it isn’t even buffoonery. It is quite simply outlandish nonsense.
And yet, Daniels parlayed that into becoming governor of Indiana. And that wasn’t the worst of it. There were also predictions that the surplus would grow so much that by now, the national debt would be all but paid off. And there was the transformation of a surplus into a deficit. Sure, those last two weren’t all him – he was after all enacting his boss’ wishes – but the insane retroactive prediction of a double digit growth rate was on him.
Which is to say, this was an instance where Mr. Daniels took an absolute and dismal failure, a disaster in fact, and used it as a stepping stone on his career path. Just like the governor of Indiana spot, which, as we see above, was used as stepping stone to a nice sinecure worthy of an emeritus statesman at Purdue. Which brings us back to another point I raised earlier – given his public sector performance, can we really assume that Daniels was successful in his private sector career? Or is it more likely he kept failing upward, spinning every past mess left behind into a reason to move into the next, higher position?
It is an important question if you care at all about Purdue University. Mr. Daniels, I am sure, is very good at raising money and bringing political clout to bear, which certainly are useful functions for a university president. And I don’t see anything on your website indicating he intends to apply himself to the betterment of the university. But what if he does?
Mike, I have mixed feelings when I read your letter. I can vaguely recall my early career as a college prof and, to me at the time, university presidents were, first and foremost, public relations people. Key was their ability to pave the way to attract resources even if only through contacts. I would have welcomed a president that knew people in high places with fingers in the budget pie of federal and state government. Even if his resume is weak on accomplishment, is it weak on his potential for opening paths to funds and prestige for the university and it’s faculty? There some people with long university careers here. It will be interesting to see their response.
Not to be argumentative, what Mr. Daniels claims as far as attracting jobs and companies to Indiana and claimed when the law went into effect while still in court is nonsense. Anna, take a moment and Google Indiana RTW and check out Mr. Daniels claims as to job creation and attracting companies. States which have attracted companies or have created more jobs than neighboring states have done so based upon other internal factors such as the Texas energy economy, Florida’s weather, etc. In the end, free bargaining states have out performed right to work states for reasons other than legislative largesse.
Back to your point, Mitch Daniels accomplishments are built upon a shell game having no substance. UI would do better to improve its stature by attracting Wisconsin’s Barry Alvarez as its Athletic Director (which has little to do with education and more to do with image than having Mitch Daniels as its president.
I recognize what you wrote. As I noted in the last paragraph, his money raising and politicking skills – the skills we know he really does have – are important for the job. It is just that that the Board of Trustees should develop contingency plans in case Daniels decides to expand beyond fund raising and politicking.
Having watched Michigan tilt at the same wind mill of imaginary beasts when it comes to RTW laws, I agree with your thoughts on job creation. Governor Rick Snyder cited Indiana as an example of what RTW laws will do for job creation and attracting companies. Daniels accomplishments are little more than a house of cards waiting to be knocked over by the first informed citizen who manages to search out the facts of job creation and why companies coming to Indiana. The law has barely been in place and was stuck in court for a period of time to have had much impact since 2012. Yet Michigan has cited it as an example?
“In 2012, Indiana became the 23rd Right-to-Work state. Indiana is now near the top of every national ranking of business attractiveness and is the top job-creating state in the nation.”
EPI in reviewing Michigan’s quest for a RTW law cited the following: “Recently, Michigan Gov. Rick Snyder has pointed to Indiana’s economic success since passing “right to work” as a reason for Michigan to adopt similar legislation. Neither the governor nor Indiana officials, however, have been able to provide evidence that “right to work” (RTW) was the determinative factor in even a single company’s decision to locate in the state. A close examination of the law and of data provided by the Indiana Economic Development Commission (IEDC)—which served as the basis for Gov. Snyder’s comments—suggests that there is little reason to think RTW has significantly impacted job growth.” http://www.epi.org/publication/pm199-indiana-experience-offers-little-hope-michigan-right-to-work/
The examples cited by Indiana officials as proof of attracting companies have not proven to be true;
– On March 12, 2012, Gov. Daniels identified the MBC Group as an employer that he said was creating jobs in Indiana because of RTW. MBC is not an out-of-state firm, but was founded in Indiana in 2009, and opened its Brookville location—the site of the expansion heralded by the governor’s claims—in 2011. The MBC Group promptly denied that RTW was the reason for its location decision.
– Busche has been based in Indiana since its founding in 1997, with 14 facilities all in close proximity to one another. The company announced its decision to expand on March 22, 2012, after being offered $750,000 from IEDC to help create 120 jobs by 2015.
– Steel Dynamics is a longtime Indiana firm with facilities in 19 Indiana cities. In 2011, the company decided to build a new facility in Indiana, without RTW.11 For its 2012 expansion, IEDC promised the company $600,000 for creating 50 jobs.
– SealCorp USA is a longtime Evansville, Indiana, business. IEDC provided $340,000 in incentives in return for the company undertaking an expansion expected to create 35 jobs. Tellingly, the company’s own statement regarding the expansion decision mentions these economic incentives—but not RTW.
– Whayne Supply is another Evansville, Indiana, business that simply expanded its existing operation. Whayne is a distributor of Caterpillar mining equipment, and all the company’s facilities are located in either Indiana or Kentucky—a non-RTW state. Indiana’s coal mining has been growing dramatically, so expansion is not surprising. IEDC provided $450,000 in state funds in return for the company’s adding 50 new jobs. At the same time, the company is establishing two entirely new facilities not in Indiana, but in non-RTW Kentucky.
The state continues to lose jobs to other states such as Ohio (Manitowoc) for reasons suiting a company’s needs other than RTW. The same IEDC has reported this on job creation in 2012:
“IEDC reports that private-sector job creation by companies recruited to Indiana has been lower in 2012 than in 2010, before the law was adopted.” Indiana Economic Development Commission, Legislative Update, PowerPoint presentation, August 2012.
You need to evaluate mike’s post and the additional comments from run75441 not from the perspective of Mr. Daniel’s possible fund raising capabilities, but, instead, from the perspective of his limited abilities when it comes to facts and the truth. Will Perdue U. benefit from having a deceptive and self aggrandizing President at its helm? If image means anything to the University then it should be concerned about the truth as much as it may be about the potential for future funding.
Looks like just another example of republicans’ great skill at job creation.
I disagree with you. I think Daniels has the potential to be successful, despite the mess he left behind him in the past, provided he sticks to being a figure head and raising money. After all, it is what he can actually do. I am not at Purdue and I don’t know what he has been up to since assuming office, Bur I get the feeling he isn’t content to speak in platitudes and wave vaguely in the direction of buildings while ushering around people with far check books. Therein lies the potential for another painful mess which will nevertheless eventually be peddled to the willfully ignorant as a success.
I encourage bloggers to start documenting the facts as you did here. I doubt if it will get much traction or coverage outside of sites like this but it needs to be done if only to shame the media into a responsible follow up one day. Personally, I would not hire this man to do anything since he presided over one of the biggest economic delusions in the last 30 years during his term in the Bush administration. I can only hope that this site continues to expose the record of so many of these socalled economic experts and policy makers. Keep it up.
What of the possibility that Daniels was given the job at Perdue not for what he might be able to do for the university, but for what he had already done for big business? Who are the Board members at Perdue who may have been very pleased with Daniel’s over all performance within all of his public/political career? Do people in such positions get picked for what they will do, or for what they have done as evidence of how they will act in the future. People like Erskine Bowles or Phil Gramm come to mind. They talked the talk and now they reap the rewards. In many cases, again Bowles is a prime example, they continue to promote the party line.
i think your last guess is correct. purdue know what daniels has done. at that level its all about how good are the lies you can get away with. he should do well as a fund raiser. and that’s what he’s for.
consider that harvard is not embarrassed by R and R. neither were they embarassed by B.F.Skinner. Veritas is not truth as ordinary folks think of it.
i assume you mean the job daniels created for himself.
It is important to remember that an entity like Perdue, little different from a corporation or so called nonprofit Institute, is directed in all of its actions by a group that makes up its Bd. of Directors/Governors. These are almost always heavily weighted with financial supporters. That means big money people from corporate America. At Perdue it would not be surprising to find its Board made up of corporate board members.
It’s an incestuous situation resulting in the promotion of like minded people to positions of importance within these organizations. And they’re all very well paid. Enough so that such positions are worth striving for by people who put self interest ahead of organizational good.
it’s always good to know who the decision makers are when you’re trying to understand why the decisions were made as the were. Perdue U’s Board of Trustees appears to be an affable group of well employed corporate officers, some of whom sit on multiple Boards.
I love this post. This is exactly the kind of thing that blogs like AB should be publishing: actual facts, compiled by real research, that cuts through and refutes the ideology misrepresented as fact.
I’ve been doing some more reading… seems if we were from Indiana, we’d all know that Daniels had nominated most of the board of directors that appointed him. There’s a surprise.
Thanks. Sadly, it won’t do any good. Apparently Daniels is a nice, polite guy who invites people over to his house and makes them oatmeal. Everyone loves him. Nevermind that he keeps pushing policies that don’t work, and in fact do the opposite of what they are supposed to do, and which inflicted harm on a lot of people. Pointing that out is mean, especially when we’re talking about a nice, polite guy like Daniels.
Open Letter to Louis D’Ambrosio…I mean Eddie Lampert…