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Financial Literacy for Legislators (Editorial)

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Financial incompetence is not a crime, but desperate people do desperate things. It’s why businesses often seek credit histories on job applicants who will have access to money.

The Arkansas Democrat-Gazette’s report of the first day of testimony in the corruption trial of former state Sen. Jon Woods suggests that financial literacy for high school students — an urgent need that our state is inching into — should be expanded to include lawmakers.

It’s demoralizing to think that someone charged with drafting, assessing and voting on laws affecting all Arkansans had a negative balance in all four of his bank accounts. And, a decade after graduating from college and six years after being elected, still needed someone to co-sign for a car loan of less than $10,000.

Meanwhile, the Springdale Republican had a nicely furnished apartment in Little Rock, full of necessities like a baseball bat signed by Pete Rose and a signed picture of Michael Jordan. That kind of disposable income caught the eye of Micah Neal, the former state representative who, having pleaded guilty to his own corruption, was the star witness against Woods.

Neal, it seems, was having trouble making ends meet on income of $125,000 or more — top 10 percent in Arkansas and more than twice the national median. So he was receptive when — according to his testimony — Woods offered to cut him in: steer General Improvement Fund money to certain nonprofits, and get a piece of the action on the flip side.

This trial helps explain a couple of other things: When he was in the House, Neal sponsored legislation that exempted hotel and restaurant tax data from the state Freedom of Information Act even though Springdale, where he owns a restaurant, doesn’t levy such a tax. And Woods was instrumental in making the “ethics amendment” of 2014 less about ethics and more about paying legislators more for longer.

Their own financial insecurities are now enshrined in state law.

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