LehighWeek Volume 02, Issue 22

              IS
LVAIC Adds Cultural Spice 3
Holbert Scholarship Fund Established  3
Enrichment 6
Calendar Of Events.. 8
ii
MR,    PHILI '
l   LIBRARIES
LINDERMAN   LIBRARY
BO
There's an enormous reservoir of good
will toward education on the part of the
American people "
—former education department official Chester Finn
Thrashing, Page
Volume Two,
Issue Twentytwo
^^r~ Lehigh University, ^^       A       ^^   Bethlehem, Pennsylvania
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March 8,1989
Edwin J. Gray, former chairman of the Federal Home Loan Bank Board (left), Carl Beidleman, DuBois professor of finance, and Robert B. O'Brien Jr., '57, chairman of Carteret Savings Bank (at podium) discuss the
nation's savings and loan crisis during a conference at Lehigh last week. The meeting ceneterd on a discussion paper by Eli Schwartz, Macfarlane professor of economics and finance.        photo by Elizabeth keegin colley
Experts Air Views On Thrift Industry Crisis
By Roger Clow
College Relations Officer
A healthy future for U.S. savings and loans lies in
keeping the majority of the mortgage portfolio at a
variable rate, said Eli Schwartz, Macfarlane Professor of
economics, at a conference on the crisis in the thrift
industry held last Wednesday at Kravis Auditorium. The
conference was sponsored by the department of finance,
the Martindale Center for the Study of Private Enterprise
and the Murray H. Goodman Center for Real Estate
Studies.
Schwartz kicked off the conference, which was
attended by more than 200 people, by summarizing his
recent research paper entitled, "The Problem of the
Savings and Loans."
Edwin J. Gray, former chairman of the Federal
Home Loan Bank Board, delivered a scathing indictment
of industry trade associations and Congress in assessing
the events that led to the crisis.
"[The crisis] didn't have to happen," said Gray.
"While some of its principal attributes are corruption,
unbridled power and influence, and massive fraud and
insider abuse, the biggest reason is the failure of Congress and the Administration to see, or even want to see,
where it all might end — and yes, where it has ended: on
the taxpayers' doorstep. The Congress was virtually led,
almost as though with a ring through its nose, by thrift
industry trade associations at the state and national
level."
On President Bush's plan, announced last month, to
bail out insolvent thrifts, Robert B. O'Brien Jr., '57,
former director of the Federal Savings and Loan Insurance Corp., predicted that "most of the sweeping changes
proposed by the Administration will survive and be
adopted by Congress, with some modifications."
John A. Tuccillo, senior vice president and chief
economist of the National Association of Realtors, said,
"Indeed, the most profitable thrift institutions are those
who have 'stuck to their knitting,' i.e., maintained a
traditional home lending business."
Mark J. Boleat, director-general of The Building
Societies Association of Great Britain, and Joe O'Brien,
director of the NHA Mortgage-Backed Securities Centre
of the Canada Mortgage and Housing Corp., offered
British and Canadian perspectives on the crisis.
Following a reception and dinner in the Asa Packer
Room. Nathaniel C. Nash, who has covered the crisis for
the New York Times from its Washington bureau, summarized the viewpoints expressed during the conference
and offered insights into perspectives prevailing "inside
the Beltway."
Selection Of Carrier
For Flex Benefits Nears
By Robert W. Fisher
Lehigh University Writers' Group
The field of 11 insurance carriers who have submitted proposals for the university's flexible benefits plan
will be narrowed down to "three or four" by the end of the
week, according to Edward Maclosky, director of human
resources.
Human resources staff members and representatives
of Hewitt Associates, an international benefits consulting
firm, are scheduled to meet Friday to compare the proposals and identify the three or four that most closely meet
the university's specifications, Maclosky said.
Proposals have been received from a number of major carriers: Aetna Life Insurance Co., Capital Blue Cross,
CIGNA, Equicor, Metropolitan Life Insurance Co., Prudential Life Insurance Co. of America. Provident Life and
Accident, Massacuhusetts Mutual Life Insurance Co.. The
Travelers, and TIAA-CREF, as well as the university's
current carrier, John Hancock.
"The finalists will be invited to campus to make pres-
"The package we have now is based on a
model that is more appropriate to the
family of 20 years ago, with a male breadwinner, non-working spouse, and two or
more kids."
Edward Maclosky
director of human resources
entations and answer questions" from a committee of faculty and staff representatives, Maclosky said. The presentations will take place on March 14 and 15. Panelists will
include Brian Brockway, representing the Faculty Compensation Committee, Sherrill Bushner and Jennifer Vol-
chko representing the Employee Relations Advisory Committee, John Woltjen, vice president for administration
and treasurer, Jim Tiefenbrunn, director of budget, and
human resources staff members.
Final selection of a carrier for the plan will be made
by the end of March, according to Maclosky.
Enrollment information will be sent to all employees
in April, and the new plan will take effect July 1.
The flexible benefits package is designed to allow
employees to select a mix of benefits that more closely
mirrors their personal situations, according to Maclosky.
"The package we have now is based on a model that
is more appropriate to the family of 20 years ago, with a
male breadwinner, a non-working spouse, and two or
more kids," he said. "That only represents about 30 percent of our employees. Our goal is to design a package
that people feel addresses their needs."
The flexible benefits plan will allow employees to
select from several levels of medical benefits and features
options for dental coverage and dependent life insurance,
as well as life insurance and long-term disability.
The plan works as follows: Each employee will be
allotted a certain amount of university-paid dollars to be
applied toward benefits. The employee can choose from
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