One of Americas statesmen stated “government is not the solution to our problem; government is the problem.” His presidency ushered in an era of disdain for government and a widespread cynicism that government could be effective in addressing our challenges.
Today, as we confront a crisis that has shaken confidence in our financial system and economy, we have an opportunity to restore public trust and confidence in the legitimate role of government. Indeed, to effectively tackle our economic challenges and to implement the reforms we need in our healthcare, education, energy, and environmental policies, our government will need to garner strong public support. However, rebuilding public trust will not happen in the face of a pervasive perception that government is not transparent and accountable, cronyism is rampant, and public officials are more interested in helping themselves than in serving the public good. Taking strong, swift, and decisive action to address abuses and begin to rebuild public trust should be the first priority for our city, state and federal government in the new legislative session. Create a Task Force on Public Integrity with a mission to develop a comprehensive proposal for ethics and lobbying reform in our city and state. Which addresses reforms in three areas: (1) strengthening enforcement of ethics, campaign finance, and lobbying laws; (2) strengthening civil and criminal penalties for abuses; and (3) improving awareness and education for public officials. Reinforce honesty, integrity and transparency by government officials as the core requirement to be and stay in office, any violations of these core tenets will cause the removal of the public official and the loss of “all benefits” retroactive. I think we should consider putting public official on a base salary plus commission based on performance. While the many of our elected officials and government employees are honest, dedicated public servants, the actions of a few create a dark cloud over all. Taking strong, swift, and decisive action to address these abuses and begin to rebuild public trust should be the first priority for our city, state and federal government in the new legislative session.

Compiled by: YJ Draiman
PS
We need honest government with integrity and fiscal responsibility.
“Good leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion”
Public confidence in the integrity of the Government is indispensable to faith in democracy; and when we lose faith in the system, we have lost faith in everything we fight and spend for.
As citizens of this democracy, you are the rulers and the ruled, the law-givers and the law-abiding, the beginning and the end.
Change is inevitable. Change for the better is a full-time job.
Action speaks louder than words.

If all donations to existing and future holders of elected officials were banned, coupled with independent realignment of election districts, the problem would be largely solved.

Instead of being institutionally corrupt, as today’s system is, the elected officials would have greater incentives to serve their voters.

What about campaigns? How would they afford campaigning? A system which is widely used outside the US is that the campaigns are centrally paid by the government (or whichever body they are trying to get elected to). Of course the candidates get a lot less money and will have to do more work themselves, but in order to get their message through to their voters, they have first have to have a message at all (which most candidates here do not have) and second, calibrate this message to their voters needs. This way it will reach them through the media and internet.

I thought this audience might be interested in a recent paper of mine entitled “What is Fair Pay for Executives? An Information Theoretic Analysis of Wage Distributions,” which appeared recently in the on-line journal Entropy. It is available for free downloads from the Entropy site at http://www.mdpi.com/1099-4300/11/4/766. A related story can be found at : http://news.uns.purdue.edu/x/2009b/091103VenkatasubramanianCEO.html

The abstract of the paper is as follows:

The high pay packages of U.S. CEOs in recent years have raised serious concerns about what would constitute a fair pay. Since the present economic models do not adequately address this fundamental question, we propose a new theory based on statistical mechanics and information theory. We use the principle of maximum entropy to show that the maximally fair pay distribution is lognormal under ideal conditions. The theory estimates that the top 35 U.S. CEOs were overpaid by about 129 times their ideal salaries in 2008. We also provide an insight of entropy as a measure of fairness, which is maximized at equilibrium, in an economic system.

Our analysis shows that a certain amount of seeming inequality of pay is inevitable in organizations. Given this reality, the lognormal distribution is the fairest inequality of pay. One may view our result as an ‘economic law’ in the statistical thermodynamics sense. The free market will ‘discover’ and obey this economic law if allowed to function freely and efficiently without collusion like practices or other such unfair interferences. This result is the economic equivalent to the Boltzmann distribution of the energy landscape for ideal gases.

I believe this is the first rational quantitative theory about fair compensation of employees, including executives, in an organization.

I’d be delighted to hear comments on this paper from this group. Thank you.

Best,

Venkat

The bankers of the present are being rewarded by their shareholders for their ability to convince the government of the day to grant them incredible subsidies and bailouts. This is just a different form of investign I think and has earned them substantial benefits for which they should accordingly be compensated. So don’t blame the bankers and shareholders, blame those that made the decision to inflict this sort of moral hazard and bail every man and his dog out.