STUMP - Death and Taxes Mary Pat Campbell (aka Meep)

Whatever you call it: Campbell’s Law (no relation), Goodhart’s Law, or the cobra effect — when you use measures that are merely cheap stand-ins for a much more difficult result you want to get at, people will start gaming that measure. And you will often get a result you really don’t like.
Episode Links
Wells Fargo News
Bloomberg, Matt Levine: Wells Fargo Mouse Jigglers
In 2016, Wells Fargo & Co. got in trouble for opening fake accounts. What happened was that Wells Fargo’s senior management had decided that it wanted its branch employees to cross-sell products, to push each checking customer to open up a savings account and a credit card and sign up for online banking and maybe get a mortgage, because this would deepen the bank’s relationship with the customer and ultimately lead to more revenue. But instead of hiring and training employees who would holistically assess each customer’s needs and suggest suitable products, Wells Fargo had “strict quotas regulating the number of daily ‘solutions’ that its bankers must reach,” and its managers would “constantly hound, berate, demean and threaten employees to meet these unreachable quotas.”
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Ahahaha come on. You want a lot of mouse movement, you get a lot of mouse movement, but in a bad way. Imagine deciding how to measure and manage the productivity and value added of your wealth and investment management employees while they are working from home. What might you measure?
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Which of those do you think is the best proxy for, like, contributions to Wells Fargo’s return on equity? Which is the simplest to measure? Which is the simplest to game?

CNN Business: Wells Fargo fired a dozen people accused of faking keyboard strokes
See here: Wells Fargo this week disclosed that it had fired more than a dozen employees for “simulation of keyboard activity,” Bloomberg reported, citing filings to the Financial Industry Regulatory Authority. CNN confirmed that multiple people were let go after a review of allegations that they created an “impression of active work.”
In other words, they were faking work, perhaps with the kind of mouse jiggler that you can buy online for $20.
Those devices — which keep your screen active and move your cursor in convincingly random ways — took off during the early days of the pandemic. With employees no longer huddled together under fluorescent lighting, eating sad desk salads, bosses suddenly had to wonder whether their teams were actually working or slacking off.
Even though most workers said they were more productive from home, many executives  adopted “bossware” to monitor their staff’s laptops. (And to be fair, yes — sometimes we did step away, selfishly tending to our own personal business, like walking the dog or staring out the window while contemplating our mortality. We hope you can forgive us.)
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But firing people over mouse movers may not be the best way to foster a culture of trust and inclusion.
“Managers often assume the worst when they see someone’s away, and so they’re looking for any type of data to show that that’s true,” Herd says. “So, team members are going to innovate around that.”
Mashable: Wells Fargo reportedly fired people for alleged 'simulation of keyboard activity'
There are many ways to fake being online while working, including the use of gadgets that imitate computer activity, or "mouse jigglers." Mouse jigglers are pretty easy to get; they're selling on Amazon for under £10 right now. They're mechanical devices that physically move your mouse around to prevent your computer from going into sleep mode. TikTokkers have been recommending these devices for years, while folks on Reddit have shared horror stories of being caught by their managers using them.
It's unclear how the company actually figured out staff were allegedly undertaking "simulation of keyboard activity" at all. An increasing number of companies are surveilling employees since the COVID

Jumping off from a recent story on embezzlement from a Florida Catholic church, I look at past stories of massive frauds, as well as some other failures and successes. I talk about: Rita Crundwell in Dixon, Illinois. Rizzo and Bell, California. The London Whale. And a happy save for TIAA before the financial crisis in 2008.
Episode Links
The Pillar: Massive parish theft calls for more internal control, expert says
The Pillar also has been great in covering the Vatican financial problems. A few sample articles: [all articles are free — some podcasts and other items are for paid subscribers only]
November 2022:
February 2022:
Nov 2023:

Rita Crundwell and Dixon, Illinois
Wikipedia: https://en.wikipedia.org/wiki/Rita_Crundwell
Rita A. Crundwell (née Humphrey; born January 10, 1953) is the former Comptroller and Treasurer of Dixon, Illinois, from 1983 to 2012, and the admitted operator of what is believed to be the largest municipal fraud in U.S. history. She was fired in April 2012 after the discovery that she had embezzled $53.7 million from the city of Dixon for over 22 years to support her championship American Quarter Horse breeding operation, as well as a lavish lifestyle away from work.[1][2][3] Crundwell pleaded guilty to her crimes and was sentenced to 19 and a half years in prison.[4]
Crundwell used the stolen money to turn her Quarter Horse breeding operation, RC Quarter Horses, into one of the best-known in the country; her horses won 52 world championships and she was named the leading owner by the American Quarter Horse Association for eight consecutive years prior to her arrest.[5][6] She spent less than 8+1⁄2 years (43% of her sentence) in prison before being released in mid-2021 to serve the remainder of her sentence in home confinement at her brother's 80 acres (32 ha) farm in Dixon.
Wikipedia: https://en.wikipedia.org/wiki/Dixon,_Illinois
Dixon is a city and the county seat of Lee County, Illinois, United States.[2] The population was 15,274 as of the 2020 census. The city is named after founder John Dixon, who operated a rope ferry service across the Rock River, which runs through the city.[3] The Illinois General Assembly designated Dixon as "Petunia Capital of Illinois" in 1999 and "The Catfish Capital of Illinois" in 2009.
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In April 2012, Dixon Municipal Comptroller Rita Crundwell was indicted by a Federal Grand Jury for embezzlement. She used the embezzled funds to pay for her lavish lifestyle and what became one of the nation's best-known quarter horse-breeding programs, among other things. Crundwell's crimes, thought to be the most substantial municipal theft in U.S. history,[8][9] impacted Dixon's finances severely. Federal prosecutors estimated the amount embezzled at $53 million since 1990.[10] The city sued the auditors who had failed to detect the embezzlement and the bank at which Crundwell maintained a secret account, and received $40 million in settlements.[11] In February 2013, Crundwell was sentenced to almost 20 years in prison.[9][12]
Politico: She Stole $54 Million From Her Town. Then Something Unexpected Happened.
This is a very good, in-depth article from 2023. I used this excerpt:
Another intangible change: Dixon voters didn’t just throw out their council but their form of government itself, separating the legislative role of the City Council from the executive role of the city manager (whom the council appoints). Langloss, the current city manager, said the job functions like a that of a CEO, with a code of ethics not to get involved in politics. “The council really becomes a board of directors and the staff are in charge of running the operation day to day.”
More checks and balances, yes, but still no matter the form of government, someone has to hold power, and there’s no inherent reason an appointed city manager would be immune from abusing it. (The former city manager of Bell, California, was convicted of corruption, along with six other city officials, in 2014

This one is dark, so you’ve been warned. In my post last week on drug overdoses, I noted the great increase in drug overdose deaths during the pandemic, and I address the issue of drug addiction and its relationship with physical pain. Sometimes, there are no good choices.
Episode Links (Updated)
Matt Bivens, M.D. piece:
Drug Overdose Death Stats
Dashboard of U.S. Population Mortality — Opioid Deaths
SOA Research page: U.S. Population Mortality Observations – Updated with 2021 Experience
Historical Items
Laudanum: is a tincture of opium containing approximately 10% powdered opium by weight (the equivalent of 1% morphine).[1] Laudanum is prepared by dissolving extracts from the opium poppy (Papaver somniferum) in alcohol (ethanol).
Innumerable Victorian women were prescribed the drug for relief of menstrual cramps and vague aches. Nurses also spoon-fed laudanum to infants. The Romantic and Victorian eras were marked by the widespread use of laudanum in Europe and the United States. Mary Todd Lincoln, for example, the wife of the US president Abraham Lincoln, was a laudanum addict, as was the English poet Samuel Taylor Coleridge, who was famously interrupted in the middle of an opium-induced writing session of Kubla Khan by "a person on business from Porlock".[14] Initially a working class drug, laudanum was cheaper than a bottle of gin or wine, because it was treated as a medication for legal purposes and not taxed as an alcoholic beverage.
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Ohio State Teachers Retirement System (STRS) is having some drama, as a consulting firm has resigned due to power struggles between competing interests. The plan participants, whether current teachers or retirees, are angry about STRS investment staff getting bonuses while they do not get cost-of-living adjustments for retirement benefits. All of this while in an economic environment of high inflation… they aren’t the first and will not be the last.

Episode Links
Ohio STRS media coverage
1 May 2024, Pensions & Investment: Ohio State Teachers loses Aon as consultant amid board turmoil
Ohio State Teachers’ Retirement System, Columbus, has lost Aon as a governance consultant after the firm resigned from the assignment, according to people familiar with the matter.
The $94 billion pension fund’s board recently tilted to a majority of self-proclaimed reformers who want to gut investment staff and move the pension fund to all index funds, citing a desire to restore a permanent 3% cost-of-living adjustment.
At the April 18 board meeting, Trustee Wade Steen reclaimed his seat after the 10th District Court of Appeals earlier that day ruled that Ohio Gov. Mike DeWine did not have the authority in May 2023 to remove Steen as his appointed investment expert on the STRS board before the completion of his four-year term.
5 May 2024, Toledo Blade: Editorial: STRS got fired
The State Teachers Retirement System of Ohio needs a new fiduciary governance adviser. The $92 billion retirement fund for 500,000 Ohio teachers was effectively fired by Aon Fiduciary Services over the chaos on the STRS board.
When the 10th District Court of Appeals ruled that Gov. Mike DeWine acted outside his constitutional authority in firing his appointed investment expert Wade Steen, there suddenly was a 6-5 board majority in support of reforms first advocated by Mr. Steen.
STRS Board Chairman Dale Price, a Toledo Public School teacher, abruptly ended the April 18 meeting without the procedural norms of a motion to adjourn and a vote that supports the motion. The reform majority on the STRS Board was left to sputter in outrage as Mr. Price raced out of STRS headquarters.
April 2024: Ousted STRS member makes dramatic return to board, armed with court ruling
COLUMBUS, Ohio (WCMH) – The governor overstepped his authority when he removed a member of the state teacher pension board, a court has ruled. 
Ohio’s 10th District Court of Appeals sided with ousted State Teachers Retirement System investment expert Wade Steen on Thursday, ruling that Gov. Mike DeWine did not have the constitutional authority to remove Steen from his position on the pension board. The decision cements a magistrate’s recommendation that Steen be reinstated to the board to complete his term.
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Steen’s presence on the board gave a faction of reformers a majority, allowing them to make desired changes to the state’s teacher retirement fund. But the board chairman called a sudden adjournment of the meeting and left, effectively ending it.
December 2023: Math doesn’t add up – Retired teachers denied 3% COLA increases while some STRS staff get huge bonuses
The images of smiling retired teachers on the screen painted a different picture than the reality faced by Kathy Foster, who retired after teaching 32 years in Findlay.
Despite promises from the State Teachers Retirement System of Ohio, Foster said she has received only one 3% raise since retiring 10 years ago.
“I got one cost of living wage,” said Foster, who lives in Wayne.
Meanwhile, the STRS investment staff has been handsomely rewarded for their work, she said.
“They have gotten millions of dollars in bonuses,” Foster said. “They lost billions of dollars last year, and they are still getting bonuses.”
“We haven’t gotten the money we were promised. I just want the 3% that I was promised,” she said.
STRS is not being good fiduciaries, said Foster, who in retirement has taken on a part-time job at the Wa

Back in December, somebody asked me how many people alive now would be alive in 75 years. The answer: about 15% (for the U.S.). This is not a trivial question — it relates to questions of political decision-making for the long-term, such as public finance. In this episode, I look at the survivorship for 10 years, 25 years, 50 years, and 75 years, and think through what this means.
Graphs and spreadsheet below.
Episode Links, Graphs, and More
Data and Assumptions
Population Estimate
Released 11 April 2024: 2023 Population Estimates by Age and Sex
Social Security Mortality Cohort Projections
2023 Social Security Trustees Report Life Tables, Cohort by Age and Sex, based on the Alternative 2 mortality probabilities used in the 2023 Trustees Report.
Survivorship Projections
First, here are the graphs of the original population in 2023, and how many of them survive to 2033 (10 years), 2048 (25 years), 2073 (50 years), and 2098 (75 years).
This is ignoring any new immigrants or births, just focusing on the current U.S. population and projecting into the future, looking at survivorship.

You can see all the weird peaks, and especially, the steep drops in old age.
But let me simplify the survivorship understanding with this table:
While 15% of the overall population of 2023 makes it to 2098, you can see that is primarily those currently age 20 and younger.
Let’s make it even more apparent:
Again, this is just projecting the current population. In 75 years, of the current population still around, 93% will be those currently 20 and younger, 7% will be 21-40 years old now, and those of us over 40 will have been long gone.
Spreadsheet

Related Posts
May 2015: Illinois Pensions: How Did We Get Here? The 1970 Constitution  
This is the relevant section of the 1970 Illinois State Constitution:
SECTION 5. PENSION AND RETIREMENT RIGHTS
Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.
That section has not been amended since 1970.
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I’ve got five decades on me now, and five pieces of advice/themes to share:
* Be a good animal
* The universe is stranger and more wonderful than you can imagine
* Never pay retail!
* You can try anything once OR Risk is Opportunity
* It’s not about you (or me)
Episode Links
Be a Good Animal
2015 LinkedIn: Best Advice: Be a Good Animal
Battling Cognitive Bias, reprint in 2018
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STUMP - Meep on public finance, pensions, mortality and more is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.




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