Mitch Daniels: lying then, or lying now?

The Louisville Courier Journal’s Lesley Stedman Weidenbener first pointed out on her twitter account that IBM’s lawsuit against the state (PDF) used Governor Mitch Daniel’s’ own words against him. Sure enough, here’s a bit from the first page of the complaint:

For two years, the IBM Coalition and the State jointly tackled the problems of the old welfare eligibility system, and rolled out a new, modernized system to 59 Indiana counties serving 430,000 social services clients. In public statements by Indiana officials, including the Governor, the State consistently commended IBM for its role in this project and for the improvements it made to Indiana’s previously fraud-ridden and inefficient welfare eligibility system.

And the state continued to praise IBM throughout the duration of the contract:

On August 1, 2008, in a report to the federal government, the FSSA stated that “[t]he Eligibility Modernization Project is in its second year and has already made substantial progress toward its goals and objectives."


In fact, the FSSA attributed its prompt disaster relief assistance to the IBM Coalition’s efforts: “The ability to mobilize multiple state agencies and provide computers and phones for Hoosiers to apply for state and federal assistance was made possible by the infrastructure already in place a s a result of eligibility modernization.”


On October 15, 2009, Governor Daniels held a press conference to announce that the State was terminating IBM’s involvement in the Modernization Project […] During the course of his remarks, the Governor commended IBM for its work, citing a litany of benefits that the IBM Coalition had conferred on the State […]

Reading through the lawsuit, it’s apparent that despite Daniels’ current protestations, the state got exactly what they wanted from IBM – a system that virtually eliminated face to face contact:

In fact, the only things that Governor Daniels offered as reasons for the termination were two “fundamental flaws’ in the basic concept of the Modernization Project: “saving welfare applicants the burden of a face-to-face meeting” and breaking up the determination process into “discrete tasks… done by specialists.” However, these “fundamental flaws” were key objectives of the State identified in its own RFI, RFP, and inter-agency Review Committee report.

So for Indiana to win its case against IBM, we essentially have to argue that Mitch Daniels was lying to Hoosiers and to the federal government about what was going on at FSSA. The alternative isn’t much better – that he’s only lying now to do some political posturing before the 2012 Presidential race heats up.

The Star’s Bill Ruthhart and Mary Beth Schneider report “there may be a political price for Daniels.

He came to office in 2005 as a champion of putting public business in private hands wherever it seemed to make economic sense. Ignoring critics who argued that welfare wasn’t the right venue for such changes, and the fact that similar efforts had failed in Texas and Florida, Daniels announced the contract with fanfare in late 2006. Now, the episode threatens to be a blot on his legacy as governor, and could tarnish his luster as a potential Republican candidate for president.

It’s also important to remember that this isn’t just a matter of financial mismanagement, incompetent governance, or even political costs. This debacle had a real human cost as well.

Medicaid cut off to a Hoosier who missed her welfare appointment — because she was hospitalized with terminal cancer. Welfare benefits denied to a deaf person — because she couldn’t do a telephone interview. A nun who lost Medicaid benefits and was deemed uncooperative when she missed a telephone interview because she had to play the organ on a Holy Day — though she repeatedly tried to reschedule.

And that’s not even getting into the fact that multiple courts have found that FSSA’s "modernized" system violated the law.

But like my state representative told the Journal Gazette, I hope Indiana prevails in this suit – the last thing we need to do is give more money to IBM after all these years of Mitch Daniels’ financial incompetence.

Rep. Peggy Welch, D-Bloomington, said she is glad the state is standing up for itself: “I don’t want us to roll over. Unfortunately, the state of Indiana rolled over for too long with IBM and let IBM call the shots. We’re not doing that anymore. If that means a legal battle, then so be it.”