Good evening. Welcome to this Tuesday edition of Horizon. I'm Michael
Grant. There is controversy brewing in California. We will take a look at
its proposed cuts in insurance rates and discuss why that movement might
very well find its way to Arizona. Jana Boomers Bach will be along with
her annual Turkey Awards and we will take you to some ancient ruins in the
globe, Miami area. But first consumer revolt in California targeted the
insurance industry. This year. Voters passed proposition 103 which
mandates a roll back of insurance rates. However, it is currently stalled
in the California Supreme Court where it is facing legal challenges.
Legislators and insurance industry officials here in Arizona are closely
tracking the controversial California initiative because cut rate
insurance movement might very well make its way here. Joining me to
discuss what effects proposition 103 may have on the insurance industry
here in our state are representative Peter, good enough of Tucson who is
in favor of a rate cut. And Mike Lowe, former head of Arizona's Department
of Insurance now representing the state's insurance companies. But first
we have this background report,
California is the land of extremes and some people call it a bellwether
for new trends. Now, California voters have narrowly approved the
controversial proposition 103 which would force insurance companies to
greatly reduce their rates. The proposition supported by Ralph Nader and
various consumer organizations was introduced by a group called Voters
Revolt man who wrote Proposition one oh three is with us, Harvey
Rosenfield. Glad to have you with us. Harvey. Same here. So what will
proposition one oh three do once? It is ok by the California Supreme Court.
First of all, it's immediate refund justice after years of being ripped
off by the insurance companies prop one oh three will lower all rates for
auto homeowner business nonprofit municipality. 20% of what they were in
November 1987. So it's retroactive if retroactive cuts back all those
increases in 1988 then takes another 20% off what the rates were in 1987.
Insurers have threatened to pull out of California and California
legislators have threatened to find them if they do. The insurance
companies say they can't do business under 103 13 by itself, we think
would produce an annual loss of $500 million. Currently, we expect to lose
400 million without proposition 103. Currently, Proposition 103 is stalled
in the California Supreme Court. It is being watched carefully here in
Arizona. However, where the state had already formed an official study
commission to investigate Arizona's automobile insurance rates. Asu's
Wilson is on that commission. Well, in the last three years, the best
estimate is that they see the rates seem to have increased by about 85%.
We are thought to have about the fifth highest insurance rates in the
nation. Legislation aimed at controlling automobile insurance was
introduced last year but died. Will the issue be back again this year? The
leadership apparently anticipates some kind of action this legislative
session to deal with the problem. Representative, good enough. What about
it? Will uh Arizona's legislature follow in the foots of feet of the, of,
of California's voters. Well, we're working on it. I was up today uh
talking with staff about just what exactly we want to put into a proposed
bill and we should be pre filing some legislation within a couple of weeks.
Just depends on how quick legislative Council can process the stuff we're
gonna use. Uh California as a starting point, add some in some provisions
of our own and delete a couple of the California provisions we don't think
are relevant. What kind of popular feedback are you getting on this issue
at this point in time? Oh, it's overwhelming everywhere you turn, people
are very, very concerned about their insurance rates. You got to remember
the state mandates that people have auto insurance and everybody's got a
horror story to tell Mike. If Arizona were to pass something. Proposition
one. Oh three, like, would insurance companies flee this state? Well, I
think a one oh three type legislative proposal would be a disaster for
this state. Companies would be forced under proposition one oh three to
essentially write business at a loss and no one's going to stick around
and write business at a loss. I think that what we've got here in Arizona
is an auto insurance study commission already in place. And we'd like to
see that commission finish their job before some precipitous legislation
is considered one. California lawmaker referred to the threats over there
of, we're going to leave if you pass proposition one oh three as terrorist
threats, you get any response to that. Well, it's not terrorists to be
under the gun over there. Like the insurance industry is where they're
forced to actually lose money. You know, I'd vote for something that says
I'd get one month free utilities. Anyone would. And that's the kind of
proposition that passed over there. Is it to a certain extent demagoguery
? I mean, are we playing to passion here? Representative, good enough
instead of sound economic or business sense? Well, we're being responsive
to public concerns. I think that you have to understand that the insurance
business has been controversial for a long time. It's been highly
regulated by the government. But through various political machinations,
the insurance industry has been able to escape a national anti trust
action. There is, there is a state actions only permitted. And as a
consequence, we, a lot of us feel that the insurance industry has not been
very, very honest with the people. It's really a gambling business. If you
think about it, when you buy a policy, you're placing a bet. And as we all
know, the house always wins, Mike, I think one of the problems that people
have with insurance is they see all these big shiny buildings that
insurance companies own and they see, I mean, I think it used to be the
largest owner of real estate in the world and obviously in many respects,
the most profitable industry in the world. Yet they hear these stories
about, well, we're going to lose $400 million this year and those kinds of
things and most people, including myself can't put those things together.
Well, those are all life insurance companies, Mike, we're talking about
auto insurance here. Uh Auto insurance essentially is, is a business
that's what's known as a short tail line. In other words, the claims come
in fairly fast fast. You can't go out and take the premium dollars and buy
real estate. You have to invest in more liquid assets to pay those claims.
So that's really not the situation. I do think there's a certain amount
of demagoguery to get back to this issue though. And I would hope that
everyone would recognize particularly the legislature that's in Arizona's
best interest to study this problem and come up with some real solutions
that can address folks' concerns. You know, one point I'd like to make is
that Arizona has a tremendous swing in terms of premiums right now. And
there are 131 companies actively competing in the market and the premium
spread approaches $800 between the cheapest and highest price policies.
What about that point? Well, I think the thing you have to keep in mind is
that we don't really know what's going on inside the insurance business,
setting aside this business of the rate rollbacks and what not. I think
you have to understand that a key issue is prior approval of rates. The
way it works now is they can just raise a rate and maybe the state can
come in later and try to make them roll it back. What we want to see is
consumer input into the rate setting process. And to do that, we have to
have the insurance companies opening their books, they won't do that and
he talks about how much money they lose. I don't know if that's true or
not. I mean, somehow they seem to be making money. Uh they, they, you
don't see them going out of business that much. And when they do somehow
these guys walk away with the new cars and, and what not. But I mean, to
the extent that we trace that we trust most of our basic product decisions
to a marketplace, if indeed you have 131 insurers here. And if indeed you
have those kinds of swings, the conventional wisdom normally is, well, the
marketplace will set the rates better. And indeed sometimes when
government interferes, you get some rather disastrous results that nobody
can, can foretell can government do insurance rates better than the
marketplace. Well, governments already interfered. They make you buy it,
you're going to drive a car and in the absence of the public of a public
transportation system, you essentially have to have a car and you have to
buy insurance legally and you know, to buy a house, you have to have
insurance. I mean, the fact is you can't live without insurance in a
modern society unless you're going to join the ranks of the homeless. And
so go so government is already there. And I think that that is a key
problem to understand there is no free market. You don't have a choice in
buying insurance, you really have to do it. And so once that's understood
, it's kind of like utilities. I mean, we don't really have a choice of
three or four electric companies or three or four gas companies. And so we
have a history of regulation. Well, the same thing is true here. Do you
need that antitrust exemption? Is there some reason why insurance
companies should be treated differently in that regard? Well, there is
insurance companies historically have pooled lost data with the view that
at least people can then see for those difficult to write lines, what the
loss experience is and that permits smaller companies to actually compete.
Also, you pool together and join underwriting associations so that the
insurance companies can then write those difficult to place risks. We've
got J U A s here operating in the state of Arizona who would not have
coverage but for that type of antitrust exemption. But I really think the
issue that folks need to consider is there is tremendous competition out
there and the market should be operating. Maybe there's some fine tune
adjustments. Maybe there's a need for greater oversight on the part of the
department in terms of reports, monitoring, getting information, but I'm
not sure they would wait in all of California disrupt the entire system. I
think they're going to be paying that price over in California for 2 to 3
years politically though are insurance companies sweating bullets. Seems
to be a pretty popular phenomenon. I don't know if they're sweating
bullets, but I think a lot of folks are concerned about the fallout from
prop 103. Do you have to represent a good enough address? Both sides of
this equation necessarily both looking at some of the things which have
been around the horn here in Arizona, their claims experience, whether or
not our legal system is out of control. You got runaway juries, I don't
know, slap whatever terms you want on this do you need to get a more
comprehensive look than just the right side though? Well, I think first
off have to understand that the study committee is an ancient political
gimmick for stalling and that's what's going on. Now, that study committee
was put in place of a bill that would have mandated prior review of rates.
And as I understand there, it's studying things like the economic impact
of a right turn on a red light. I think that you have to understand the
political process conclusions on that. Well, supposedly it makes more
accidents. I don't know, it also has an air quality bonus, but that's,
that's another story. I think you have to understand that the political
process is just that it's a process and Mr Lowe is going to come in and
he's going to bring in his figures and the consumers will come in and
bring in their figures. We will be making decisions based on what is
presented to us. And right now it's very clear that the insurance industry
has not been terribly honest with us. After all, the attorney general of
this state, a very conservative Republican has joined a lawsuit, a
national lawsuit against the insurance industry. I think there may be some
racketeering going on in some of these things. Some of the stories I get
from people the way they've been treated by their insurance companies.
It's real close to criminal, I think. Representative. Good enough. Thank
you. For joining us, Mike. Our thanks to you as well. I have a sneaking
suspicion. We'll probably be back to this thing before the sessions. The
Arizona Auto Insurance Study Commission would like your comments on this
issue. A public hearing is scheduled for Friday, December 2nd at 10
o'clock in the morning. That hearing will be held at the State Capitol in
house hearing room number three. Or you can write to the Arizona
Department of Insurance 81 East Jefferson, Phoenix 853. Still to come on
horizon. We'll find out why these ancient ruins in southeastern Arizona
may revive the economy of nearby communities.
If you've ever wanted to be Indiana Jones, you can live out your fantasy
at Besh goa an archaeological park in Globe, Arizona. Besh Bago means
place of metal in the Apache language. It's what the apaches used to call
the city of Globe and said he hopes that Besa will mean Globe to a lot of
tourists in the near future. Globe is counting on the park to help revive
its flagging economy. As we see in the following report,
a Salad Indian ruin overlooking the city of Globe. Arizona is attracting
an increasing number of tourists these days. I'd like to welcome you to
this morning. My name is John and I'm the director has been partially
restored and reconstructed and it offers visitors intriguing views of life
in a wealthy prehistoric town. Then they made what we think a single entry
way basically to control access in and out of the site you think in fact,
be be was probably a regional trade or market center where a lot of
commerce went on prehistorically. And another thing you want to do in a
commerce center like that is control access to that marketplace. The 14 th
century builders of Besh Pago may have wanted to keep people out. But
today, the cities of Globe and Miami are inviting them to come on in
Sheldon Miller heads the chamber of commerce like a tour bus coming into
town that may bring 50 people in usually means $3000 recycled money into a
community. When archaeologist John Homan first visited the Besh Pago site
six years ago, it was neglected and nearly forgotten. And as we were
wandering around the ruin, a member of the Globe City Council came up and
asked us what we were up to. We told them we were looking at this
archaeological ruin and he said, gee we didn't realize that's what this
was. And we have this city park complex being developed around it. And
they were thinking of just taking all these rocks and pushing them off the
edge of the mountain. And I said, well, maybe we could do something else
besides that. The city and county decided to make the ruin into the focal
point of the City Park complex. The first part of the program was the
actual work at the site and museum complex itself where we would apply for
funds and grants as a job training program. That is a way of alleviating
some of the unemployment in the community and retraining highly qualified
individuals into new areas of work and productivity for the community. And
then at the same time, the actual building of the site as an
archaeological park would make it a cornerstone in an expanding program of
tourism and economic development for that community and region area.
Probably the only access out of here was perhaps maybe a ladder out of
the main room studies done by the National Park Service and other agencies
show that the main reason tourists come to the American Southwest is to
enjoy our region's archaeological heritage in GOA. We've focused it in on
not only seeing all the artifacts that have been recovered throughout the
years of excavation and discovery at and see rooms, even rebuilt rooms
with roofs on and artifacts back on the floors as they were being occupied
prehistorically. And you can even climb up to the upper story portion of
the room. So you can climb and have a hands on experience that way as you
walk through different parts of this very large prehistoric site. But
you're actually going to see archaeologists at work. You're actually going
to see new rooms being excavated and new discoveries being made every day.
And we expect comparing other Indian ruins with this one that eventually
when the word gets out. This should draw between 80 and 100,000 people to
our community with me tonight to discuss the best go a park and how it's
impacting the economy of Globe is Robert Hickman, the mayor of Globe Bob.
Welcome to the show. Thank you, Mike. Now mayor, assure me that you
weren't one of the people who were gonna push these rocks off the side of
the. No, I, I took office about six months ago. I'm not sure who that
gentleman was. I get you what made Globe decide to get into this area to
actively develop that site as part of its park complex? Well, I think it
was approach to the archaeologist, but a gentleman, I think it was Louie
Gary who was a councilman and vice mayor at that time. I think he was the
one who picked up the ball and, and carried it on down the road with the
help of that mayor at that time, Hank Williams. How successful is a
tourist attraction has it been to date? Well, it's hard to tell about
three months ago. We had the grand opening Governor Mofford came up and uh
so we haven't really been able to tell too much at this time. What's up
there? Are there new attractions planned for the park? And then obviously
we got a good look at the fact that you can tour the facility. Is there
more to it than that either presently. Offered or on the drawing board.
What's unique about this site is that it's a constantly growing changing
site. They, they're working it all the time. Whenever you go to visit,
there's either an archaeologist on staff there or an assistant working the
site, it will be constantly changing. You can go back year after year and
see something new and different. You know, one of the things that I was
amazed by, in fact, we were talking about it is we were watching the
report, obviously, the thing must be in pretty good condition because it
was supporting people climbing up to the, to the second story. And uh and
, and walking around was, is there a lot of uh 20th century in that or, or
is, is it still in that kind of condition after 700 years? Uh No, it's uh
actually it was a pile of rubble when they first went in there and all
this has been built back up. There's a few 20th century nuts and bolts to
make sure the ladder holds people. But uh most of the work is as it should
have been or would have been back then. What about the estimate that we
heard in the report of of uh annual visitation of 82 to 100,000 people.
What do you think about that? We took a survey of the other archaeological
sites around to National Monument,
Casa Grande ruins over in Coolidge and we went from there. And we came to
an average of, we figure we can draw 80,000 people. This is a much closer
to the road than some of the others are. And it's handicap accessible for
one thing on the lower levels and more active touching site. And I think
once the word gets out, we'll have those 80,000 plus. I was just gonna ask
you, do you have any feel for how long it takes, for example, to get the
word out on, on something like this to become, uh for example, a Montezuma
or I guess classic. Classic obviously is the Grand Canyon. But how long
does it take to get that as part of the public's awareness in this case?
Well, right now, our, our uh chamber of commerce is working real hard to
get the word out. One of the things is being here on this program. We're
appreciative of that. Well, we've got a lot of circus out. We've have
people that have come in from uh Austria that came in and heard about it.
They've taken the word back there. People are coming seeing and taking
the word and that's helping. I think that's gonna be the best
advertisement we can get and the economic impact translates to what you're
gonna feel for that. Well, we, we figured with 80,000 people, you're
looking at a $3 million impact in a year's period on the economy and this
basically is uh spend spending food, lodging, um, fuels, things such as
that and I suppose, direct employment opportunities associated with the
site in those cases. That's true. Ok. Fun. Hopefully, while they're there
, they'll see the other sites. We have, we have an historic downtown
district with 1800 early 1900 architecture and uh our mountains are five
miles down the road. Beautiful mountains. Ok. It's a good, uh, beautiful
place to be Bob Hickman. We appreciate you being here. That's a neat site.
Thanks for discussing it. Thank you. Thanksgiving is just a couple of
days away. Now, while some observe the holiday by cooking a turkey or
watching football. Jana Boomers back takes a different approach in honor
of Turkey Day and its bird of honor. Jana Bestow is a group of special
awards in tonight's commentary.
My only concern is that I'm about to libel the poor miserable turkey. This
dumb animal doesn't have a thing going for itself. It spends a boring life
and then gets butchered and we make jokes about really stupid things being
a turkey. So as I give my annual Turkey Awards, I do want to say, I feel
sorry for the bird, but not sorry enough to eliminate my awards for
behavior. Befitting the designation of Turkey. So here we go. First. I
want to give a truly special award entitled, you must think we're all
Turkeys. This year's honors are shared by none other than Charles Keating
and Kemper Marley, both of whom are trying to convince state tax officials
that they aren't developers. They are farmers keating in the most
outrageous nose thumbing. I've seen says he deserves to pay the low farm
taxes on his commercial land in Mesa because he's growing barley now. He
doesn't have water rights on that land so he can't irrigate the crop that
needs oh 25 to 30 inches of water a year. No, Charlie says he's going to
dry farm the land, plant it and let Mother Nature water it. Of course,
nature only gives Arizona seven or eight inches of water a year. Meanwhile
, Kemper Marley has rented a couple of cows and put in water tanks on his
land in Scottsdale so he can continue paying virtually nothing on his 12
square miles of prime land. He claims he's been running cattle on that
land all the while. But if he just put in the water tanks now, well, if
Charlie Keating and Kemper Marley keep getting away with cheating Arizona
, this way I propose we all refuse to pay our property taxes. Otherwise we
all will be Turkeys. Next. We have the Turkey brain award. It goes to
someone who like a turkey has none. The hands down winner is Keith Keith
wanted to be a county supervisor so badly. He took to lying about his
opponent, Carol Carpenter when that wasn't enough. He said fellow
republican George Campbell was opposing him because Campbell was brain
damaged. Well, the voters weren't barely 30% of them displayed the Turkey
like behavior of voting for Keith Carpenter won by the landslide she
deserved. Do you think that Turkey's political career is over? That brings
us to the deserving Turkey award? This one has to go to the Phoenix
Cardinals. You know, they're tied for first place. The players might be
perfectly neat guys, but they've got a real Turkey foreign owner, Bill
Bidwell came to Arizona to gouge us. He's charging the highest ticket
prices in the entire national football league. Some say that's ok because
the Cardinals are tied for first place. Bidwell doesn't have a signed
contract with the city of Tempe yet. Although Tempe is spending millions
building him a training center, some say that's fine because the Cardinals
are tied for first place. They even serve lousy hot dogs at the stadium.
But people say it's worth it since the Cardinals are tied for first place.
But you know what? Everybody is tied for first place. Big deal. You know
, there is no dumber Turkey than a football Turkey unless it's Jerry Lange
who wins this year's obnoxious Turkey award. Jerry says he'll move his
Phoenix sons out of Phoenix if the city doesn't build him a new downtown
stadium, a stadium he claims will bring great economic benefit to Phoenix.
All that can be said to that is Turkey. Every study says Lange is making
up this stuff about his stadium, helping us all that is a proper way to
spend taxpayers' money because it will benefit taxpayers in the long run.
It will benefit Jerry Colangelo and his partners. Period. And these
threats about give me what I want or I'll take my ball and play some place
else. I hope Mayor Terry got it in the Phoenix City Council calls his
bluff. You'd rather be the mesa sons. Fine with me. Are the Tempe sons
great. How about the Buckeye Sons and finally the Golden Fleeced Turkey
Award. This award doesn't go to the person who said these words, but it
goes to every fool who believed them. The words are read my lips. No new
taxes. Happy Thanksgiving. If you have any thoughts or comments about
Jana's remarks or would like a transcript of her commentary, right to
Boomer's Box byline channel eight television tie 85287. That is Boomer's
Box byline channel eight television tie 85287. Tomorrow Horizon will be
pre empted for a special program called the Parenthood Game. A look at how
animals cure and nurture their young. We'll be back Thursday for a
Thanksgiving edition of Horizon and this Friday Phoenix Cardinals owner,
Bill Bidwell and Phoenix Suns owner Jerry Colangelo are going to be here
to discuss the state of the professional sports market in Arizona. Hope
you will join us for the rest of the week. Thanks very much for being for
being here on a Tuesday. I'm Michael grant. You have a pleasant one. Good
night.
If you have comments regarding this evening's Horizon program, send them
to Horizon Channel eight Television, Arizona State University. 10 P 85287.