This blog was granted permission to post this private response to Ruth Tighe’s On My Mind Column from 5/18/12. It provides a different take on the Chapter 11 Bankruptcy Filing:
Ruth -
A core function of the U.S. Trustee is to preserve the integrity of the U.S. bankruptcy system. I am surprised that you would elevate expediency (and the expediency of Fund trustees at that) over the rule of law by touting Chapter 11 as the only prospect for salvation for the Fund.You are right that the Fund faces imminent disaster. But that disaster was entirely predictable. It was predictable 18 years ago [<-snip->] the unfunded liability of the Fund stood at $200 million and growing. From 1994 to 2000 [<-snip->] consistently warned that the unfunded liability would grow to $600 million. It most certainly was predictable three years ago when the NMIRF and the executive branch left no gun muzzled (and no expense spared) in their efforts to prevent appointment of a federal equity receiver.
If the Fund were actually an eligible debtor, it would have petitioned for bankruptcy three years ago instead of employing a cornucopia of delay tactics in the Roe/Doe litigation. If bankruptcy really was the only (or even merely the best) way to address what needs to be addressed, it should have been deployed three years ago when there was a lot more time to effect remedies before implosion. A big reason this did not happen (and why the NMIRF did not embrace appointment of a federal equity receiver and Federal court oversight) was that it is not what the Government of which the NMIRF is an instrumentality wanted.
Do you really think it is mere coincidence that the Fund chooses bankruptcy just when the CNMI runs out of ways to continue to stall the Roe/Doe lawsuit?
The present crisis is 100% the consequence of the addiction of Fund trustees and political “leaders” in the CNMI to expediency. Do you really believe the best prospect for a sensible, effective, fair and appropriate solution to the problem is to leave central authority and control in the hands of the same institutional actors as “Debtor-in-Possession”?Ask yourself this question: What were the missing slides in the Funds pre-petition presentation?
Where was the slide that would show the effect of capping retirement benefits at $50,000 per annum?
Where were the slides showing all the benefit enhancements enacted by the Legislature since inception of the NMIRF without funding, and the effect on the Fund of removing each of these enhancements from benefit computation?Where was the slide showing the effect on the fund of removing the 30% ” ‘early’ retirement bonus” from the benefit computation, particularly since only some — not all — recipients of this bonus got a benefits enhancement from it?
I am sure we could come up with some more slides that should have been produced, e.g. the selective enforcement of the anti-double dipping rule, the negligible benefit to the Fund of so-called overpayment recoveries, the negative effect on Fund life expectancy of it expenditures on attorney fees in the past five years, etc..
Generally, I am not in favor of pursing recovery of funds already disbursed, except disgorgement of fees collected by professionals counseling (and helping execute and defend) frivolous and foolish courses of action.
The remedies affecting Fund members, retirees, and their families should be prospective only, not retrospective and punitive.
Regards (all the best),
XXXXXXXXXXX
blogger – it’s hard for me to read, understand or sympathize with your writing. this is why:
you use questions as statements and that makes them hard to understand and respond to since you aren’t actually making statements. i’d rather hear you just make a statement.
you repeat your questions in a way that reminds me of a parent chastising a child. the repetition also sounds like a writer who is getting upset, emotional and attacking. that is off-putting.
your words, “I am surprised that you would…” is a disapproving ad hominem attack, albeit a mild one. the fact that you disapprove isn’t the point and distracts from whatever facts you might have.
you sound like a smart and knowledgeable person. i think if you change your style a little to make it a bit less forceful it would be better received, at least by me.
Best regards,
john
Hi John,
this post above was not written by this blogger. it was an email sent by someone else who shared it with me and told me that it would be alright for me to post so long as the identity was removed.
this letter is a response to Ruth Tighe’s On My Mind Column (5/18/12). you may read her column here: http://net.saipan.com/cftemplates/omm/index.cfm?view=yes&RefNo=979
i did not get the same feeling reading it. i thought it was clearly written and contained some very valid points.
i think the mild ad hominen attack you mention may be one of the writer’s point. Ruth is writing a blog and a column for public consumption and she has amassed a following. because of this i believe the ‘surprise’ the writer felt and his/her acknowledging it was somewhat warranted.
i must say, i read Ruth’s column this week and found that to be pretty harsh.
Thanks Glenn, two people thought it was my response to Ruth’s blog and this helps to straighten things out.
john
i also think at this point many people (aside from Ruth) are also entitled to feeling pretty upset at the mismanagement of the NMIRF and the lack of payment by the central government.
i personally do not understand how the Fund fought against a federal equity receiver for the last 3 years (in the Roe/Doe case), stating that the federal forum was not necessary and then out of nowhere turned around and hired high priced attorneys and filed Chapter 11 (conveniently stalling the Roe/Doe case).
the questioning by the writer does display some frustrations but to me they are legitimate questions. Ruth has made her points and those points raise some serious questions.
one that always comes to my mind is what did the years in Superior Court accomplish for the Fund?
to the anonymous writer:
thanks so much for this response. you have made some very good points. i have felt exactly the same way about the stalling of the NMIRF in the Roe/Doe case. i also was amazed at the simplistic slides presented that were all very skewed. i also fear the “debtor-in-possession” that Chapter 11 provides keeping the same hands at the wheel.
as far as the same hands at the wheel, i believe that there is a way that we can move to have Judge Feris appoint a Chapter 11 trustee to replace the Board and administrator? i have been reviewing this option and think it is more than fitting. here is a bit of info on that:
here is an excerpt on that process:
just a side note, i am still very disappointed that a few folks (especially those with the NMIRF and those in support) are still saying that receivership is akin to liquidation. i believe that is a fear tactic used to justify why they fought against federal receivership for the past 3 years. i understand that both Chapter 11 bankruptcy and receivership could possibly result in liquidation but nothing i have read appears to state that either is akin to liquidation.
Hi,
I was discussing with my friend the fate of retirees and their families who are on medical and are in the Mainland. We are in Boise because the medical condition in Saipan is bad. Not by choice but to survive. If my wife is in Saipan, she will be dead by now. At times, there is no pharmacist to mix the chemo; no chemo drug, and the private pharmacy did not order our chemo drug. I appreciate all the assistance that CHC provided us. I have high respects for the doctors at CHC especially Dr. Smith and the oncology nurses; but we have to go Guam to see the oncologist (Dr. Friedman). It is expensive and I understand we have to pay our own trip and expenses now. I understand Dr. Smith is leaving CHC.
My friend who I will not mention share the same problem. If our benefit is cut 54%, it will be very difficult for me and my family. My friend said that his wife will just have to stop medical services.
Can you imagine yourself doing that? Your wife is dying and no money. Just because our leaders failed us…. We worked hard so that we can retire; now they are saying no money and our benefit will be cut 54%.
I understand that there is a move to request U.S. Social Security to take over NMI retirement. I hope this can be done in time to prevent hardship to us retirees…
Fellow retirees, now is the time to join together and speak with one voice…
Let us unite and make political changes at home and make the CNMI the best place to live….
My family wants to go back home; but for now, we have to stay here until the medical services get better.
To all the CRA leaders Larry Cabrera, John Sablan, Oscar Camacho, others and Donna Cruz and others, thank you for speaking up for me and my wife…
God bless us and I hope our leaders will unite and stop bickering over petty stuff and work for our survival and improve the economic conditions at home…
Joaquin and Diane Villagomez
503-839-7522