The Regulator: The JFP Interview with Gary Anderson

Photos by Roy Adkins & Adam Lynch

Gary Anderson wants to be Mississippi's insurance commissioner, and he's not pulling any punches in the race. The Byhalia native knows a thing or two about politics: He worked under former Gov. Ronnie Musgrove as chief fiscal officer and served as director of the Mississippi Department of Community Development. He broke ground as the first African American in both those positions. He made similar inroads in his private life, as the first African American to hold the position of senior vice president of Union Planter's Bank, and he put up a hard but unsuccessful fight against Republican candidate Tate Reeves in 2003 for the office of state treasurer.

Many voters were floored when Reeves, a young banker with modest accounting experience, bested Anderson in that election. Anderson himself appeared perplexed and staggered at the loss that election night, but he's back again for another round in a changed political atmosphere. George Dale, the incumbent, who fought a messy divorce with the Democratic Party for the right to stay in the party, is on the ropes. Dale isn't popular right now on the Gulf Coast, where insurance companies have successfully managed to stave off massive hurricane claims pay-outs. He is also being painted as too cozy with the industry he's supposed to oversee: during this year's campaign, he took donations from insurance companies, and a lobbyist for the insurance industry even represented Dale in his court battle with the Democratic Party.

It's good timing on the part of Anderson, but victory has eluded him in the past when the odds were clearly stacked in his favor.

What have you been doing to keep the bills paid for the last few years?
For the last three years, I've been running my own consulting company, The Anderson Company, LLC, which focuses on providing financial consulting services and government relations services.

A lobbyist, eh? What did you do for the state?
My last tour of duty for the state was chief fiscal officer for the state of Mississippi. I was executive director for the department of finance and administration, and I managed Mississippi's $10 billion budget.

How did you get that job?
Gov. Musgrove and I attended college together, first at Northwestern Community College in Senatobia. We graduated together and went over to Ole Miss and went to undergrad there, and he went on to law school and then to grad school. So we did six years of college together.

You've been in a few periodicals. Tell me about some of your recognition.
Back in the early 1990s, the University of Mississippi awarded me the Award of Distinction. I had the privilege of being the recipient of that award along with Ms. Beulah Carter for her work in the Civil Rights Movement and James Earl Jones, the actor. I was in pretty high cotton with those two, but being honored by your alma mater is a pretty high point in your life.

I did also have the privilege, during my time as state fiscal officer, of being selected by the European Union to be a part of a 21-person delegation to go over to Brussels, Belgium, to examine the monetary policy that the new European Union was moving to. They were moving away from their old systems of currency to the Euro.

What was your connection to the Euro?
It was a chance to study the economics underpinning the various economies being balanced in a way to make sure the currency didn't have a lot of inflation pressure behind it. I had a chance to speak with King Juan Carlos (of Spain) and his wife Sofia. I remember asking him what he felt about abandoning his currency, which has his likeness on it, in favor of the Euro. We got a big laugh out of that.

Twelve out of 13 European countries went with the Euro currency, and I think right now there is only one or two who have not adopted it.

What other accomplishments can you speak on?
I really had the privilege of starting my career with Gov. William Winter, and right off the bat there were a lot of changes during the Reagan administration that we had to deal with. There were many programs getting slashed during the Reagan era, and responsibilities were being turned back to the state or its administration. One of the things we did in the governor's Office of Planning and Policy—which was Gov. William Winter's think tank—we developed legislation to present to the (Mississippi) Legislature by way of changes that he thought were necessary. It was in his administration that I got a chance to do some of the real major research in statewide banking.

Give me an example.
In our state at the time, banks only operated within a 70-mile radius of their headquarters. We thought it stifled growth. We believed that, from a position of utilizing—from a capitalistic standpoint—dollars flowing from all over the state meant that all areas of the state would have the resources to bring in new companies. The governor saw fit to do that, and we pushed it heavily. Unfortunately, there was such a strong lobby from the smaller banks around the state that we were not able to pass that legislation, but two years after the Winter administration had passed, statewide banking became law in 1986. I had nothing to do with it then, but that was one of my proud accomplishments, that I put that issue on the table. It gained momentum during the Winter administration and later went on to become the system of banking that we use today.

It sounds like I can thank you for Regions swallowing up my bank a few years ago. Did most states already use that system at the time?
Changes in banking were occurring so rapidly. Banking laws now have been so relaxed that they allow you to go from one state to the next. But this was one of the things that ushered in that kind of banking.

Have you always been a bean counter?
As far as my career goes, I've always had to deal with financial matters in state government. As assistant director and then director of the Department of Community Development, we allocated over $35 million a year around the state to local governments, making sure they were able to make the kind of improvements they needed on streets, water, sewage, drainage, economic development, housing—all those things around the state. During my private sector tenure I was a senior vice president with Union Planter's bank for three years and then went on to own a mortgage company, Barrington Mortgage company, and we operated that for four years.

Knowing all this experience you had under your belt, how did a banker with less than a decade of experience manage to win that position as state treasurer?
We were disappointed in the results of that race, but we know there were a number of things that impacted that decision. President George W. Bush was probably at his all-time high in terms of popularity. He made four visits to our state, and he encouraged a straight Republican ticket.

There were some other things that impacted the race. Haley Barbour took full advantage of the flag issue. He put out signs everywhere saying, "Keep the flag. Change the Governor." That appealed to some people's—I would say—darkest kinds of thoughts, and it caused a number of people to come out who don't normally vote in the elections. The other thing was that my campaign was short on resources. We knew we were running a poor man's campaign. And right at the end, Tate had a lot of money dumped into his campaign. We weren't able to combat that.

You know, he had made a commitment, as we all had, of not going negative in the campaign, but that was the first thing he did, three weeks into October. Just goes to show, you can't trust a Republican.

Looking back, what lessons did you take from that?
I've got a lot of lessons learned. This time, I have a very seasoned staff. I have a very goal-centered approach to the campaign. We have a playbook of activities so that we know what we stand for and how we're going to carry it out to the voters. We also know the things that affect people so dearly. In the treasurer's race, it was more of a popularity contest. Do you like this person versus this other person in terms of managing the state's money?

In this race, voters are making decisions based on who they feel is going to protect their interests. The voters of the state will vote for the person they believe will represent their interest. They're the ones over the barrel and under the gun. (Insurance) is a $10 billion industry, and people of every walk of life are having to pay for insurance. They don't have the time to spend to read all the studies. They don't have the time to read all the nuances of policy. They're hoping there's an insurance commission that is overlooking this whole industry and making sure that it's putting out a decent product on the street, so that they can have a fair deal in insurance.

Is that what's happening? I can only assume that you're running because you don't feel it's working that way.
You can't represent the pocketbooks of the consumers while being in the back pocket of the insurance companies, and we're going to put a stop to that in August.

You sound confident.
Things are looking good. I'm proud to be able to go around the whole state and be so warmly received by people. I'm confident we'll represent people from all walks of life. I embrace people from north, south, east and west of the state, and I believe that they see that I'm a good person in matters that they feel need to be addressed, whether I'm African American or just American.

Idealistically, we would like to think that elections are based strictly on character, but we all know that how you look has a lot to do with it. Race plays a huge role in statewide elections. Do you admit to that?
People make decisions on who they vote for based on any number of reasons: Whether the person looks good in their eyes; whether or not the person is tall or short; and yes, sometimes it creeps in whether or not a person is of a certain color or ethnic background. I realize those are some limitations in the state. But let me tell you this: I also realize that the majority of Mississippians are kind-hearted people who want good things to happen in our state. I believe that the best in the state is to come. We haven't lived our best, yet. We're going to see our best in the future, and I hope to be a contributor to that future when that time comes.

I've been watching you on the trail, and I haven't heard you yet address the very real possibility that you could be the first black to hold a statewide office in Mississippi since Reconstruction. You're not running from the historical significance of this campaign, are you?
It's not something that I ponder every day. That's not the reason I'm in the race. The reason I'm in the race is that I want to represent the people of the state in matters of insurance. I personally feel I've been violated by some insurance issues, and I know a lot of other Mississippians are feeling that way, too. I'm not trying to punish the insurance companies. I just want them to do right by the people of Mississippi and make sure that we have a fair deal. So when I look at this whole matter of race and these other things, I just think that Mississippians are good people, who right now are thinking hard about the insurance industry.

Who are your backers these days?
Let me start by telling you who my backers aren't. I took a pledge to not take any money from insurance companies or insurance company executives. I think that's the right thing to do because I don't think it's right to take money from those who I'll be charged to regulate. Of course, if I'm not regulating you and you believe in the kind of things that I talked about in this race—if you fall into that category—and you think that you can be of assistance to us financially, by all means, please do so.

What are your contributions looking like right now?
Well, it's been a mix. Thank goodness I've had a chance to amass the little $50 or $100 checks. That's from private individuals who really can't afford much but who believe that I'll help them, and I'm grateful for their support. But I've had people giving me $1,000 checks. Many of those people are business-type people, many are attorneys, either defense or plaintiff lawyers. People in the financial community, other than the insurance industry, have been generous.

I've heard your campaign has raised more money than the other guy.
Well, we've been working heard. Commissioner Dale has amassed a huge sum of money, primarily from the insurance industry. Look at his campaign reports. Read his contribution report. If you go to the slot where the contributor is asked, "What's your occupation," you'll find the answer "Unknown." But if you do just a little bit of history of those "unknowns," you'll see they're insurance-related.

Sounds like a serious accusation.
We're just calling it like it is. We're not trying to duck and dodge this issue. We know the insurance industry is financing his campaign. Just last week, I received a letter that one of his close friends in the insurance industry had sent out across the state saying: "We need to stand up for George because George has been good to us. He's been communicating well with the insurance industry." In that letter, this person asked for 200 agents to stand up for George and give $1,000 a piece, and write private checks in the amount of at least $1,000. The letter also asked insurance companies to give corporate checks in the amount of $1,000 to raise the $250,000 that he needs to fight off this Democratic opponent, referring to me. So, you know, when I see letters like that and I hear the commission say he only accepts a little money from the insurance industry, I can't help but think that somebody's having a difficult time telling the truth.

How do you account for making more money than Dale?
We've done some polling, and people are saying that they're looking for a change in the way the industry is handled in the state. On Aug. 7, we'll make that change. People are in a changing mood for the office of insurance (commissioner). They believe that we haven't done all we can to protect the ratepayers, and that's why I think I have so many people rallying around me.

What do you say to the suggestion that Dale's fighting another losing battle with Katrina in this race? I've heard one coastal resident say she'd vote for a possum if it meant getting Dale out of office.
Sometimes it takes a storm to show us the areas where we're weak—especially in state government—and in this case Katrina revealed that we were very weak in the office of insurance, and we were very weak in preparing for crisis situations. We didn't have the forethought and planning. We didn't send (state workers) down to do independent reviews to make sure that things were going according to the way they should go, and we continue to suffer from bad decisions made by the (Insurance Department). Now people are simply reacting to our inability to make good decisions.

What kind of rotten decision would you have made differently?
First of all, I would've been prepared. I wouldn't have gotten hit by a storm like that and not have any kind of plan ready. Secondly, I would have sent my own team of insurance adjusters down there to get an independent read on what exactly was happening there on the Coast.

How big would this team of insurance adjusters be? Let's be realistic here regarding resources: We aren't a rich state with tons of spare manpower in any department, including the office of insurance commissioner.
Dale has over 120 people in his office, and he had the ability to hire people who are in the private sector to do some reviews and that type of thing. I'm just saying the resources were not deployed in a way that made people confident that their insurance situation had been looked at by the (Insurance Department) and that things were being handled properly. During Katrina, Mr. Dale relied upon his friends—and by that I mean his friends in the insurance industry—to tell him that they were doing the right thing, when in many cases they were not. They basically hung him out to dry. "Pick your friends better," I say.

Republicans are probably going to say that you have the backing of every trial lawyer who's ever wanted to fleece an insurance company. What's your response?
That's an untrue statement and an unfair assumption. As I've said before, I enjoy the support of trial lawyers and defense attorneys. Neither one of them has endorsed me.

Insurance-suing lawyers like Scruggs Law Firm aren't playing a big factor in your campaign?
Scruggs has not endorsed me. But the trial lawyers, some of them have given (campaign contributions) to me, as well as some of the defense lawyers.

Do you think you would be this popular if Dale hadn't torn his drawers in 2005?
Mr. Dale ... has struggled on a number of fronts, and his image has taken a hit, and I think largely it's due to his own doing. So, while he has struggled with those issues, I just thank God that people have seen fit to seek out an alternative to the (Insurance Department).

Did you ever flirt with the idea of running for a more local office?
I've had some people call me regarding running for office in the city of Jackson, and it's always good to see people who feel you have something good to give a government, whether it's local or statewide. The same thing happened in this race. I had an outpouring of people requesting I enter the fray in the office of insurance, and I'm pleased to see I have local and statewide support.

Do you feel your background suits you better for this office than mayor?
To be frank, yes, I do. I cut my teeth on state government under Gov. William Winter. I know more about state government than local government, and it'll be my focus to bring that knowledge and my ability to affect positive change to the state.

What makes you a Democrat?
Really and truly, I think the Democratic Party, as well as I can tell, follows more closely to the theme that you have in the Bible. I'm talking about caring for your fellow man, being able to teach—like Jesus did—in teaching people how to do things for themselves, empowering people.

I think a lot of programs sometimes make the wrong assumption that you're supposed to do things outwardly of people, but if you equip them inwardly, the outward things will manifest on their own. The Democratic Party, I think, focuses on the fact that we are our brother's keeper, and to whom much is given, much is required. I just believe those precepts are the things that I embrace. Having brotherly love for one another—that goes a long way. I believe Democrats are the party that is closest to the people, as opposed to the folks in that other party way up on the hill.

I believe the party closest to the people can provide the best solutions. And I'll say this, too: We see in the Bible that the family is in the center of God's creation, and when the family breaks down, our society suffers. We have evidence of a lot of breakdown going on right now.

What do you make of this queer state that seems to vote Republican when the rest of the country is heading toward the center or even the left?
First of all, I don't think the state is so rightward facing. I think the other party has been able to structure a set of peer pressure upon people that you've got to be a Republican to get anywhere. But this state has good people and a big heart, and I think people will hear my approach to the insurance issue and I'll enjoy support across the party lines in November. We had support from both sides last time, but not enough to win.

Is political affiliation even important in this office? It's not like the insurance commissioner is making a decision on gay marriage anytime soon.
I think that when you look at party affiliation here, first of all you obviously align yourself with a particular party in order to get to the November elections, but the issues regarding insurance cut across party lines. When you start administering the programs, and make sure you license the proper insurance companies to operate, and you're dealing with matters of rate increases and all that, it becomes less of any kind of political affiliation. It becomes a people affiliation.

What makes this job better suited for a Democrat then?
This job should be focused on the rate payers of Mississippi. This industry is a $10 billion industry, but no one should be enticed merely by the desire of having to deal with issues that involve a lot of money. It's supposed to be about people and how they are being served. That's why I'm running for it, because I want to restore the focus on the people, on those who are paying the bills and who are anticipating the best out of the insurance company in their time of need.

Dale was ready to run as an independent at one point. What do you make of that?
Well, what can you say to that? Mr. Dale has made a lot of bad moves, and I would categorize that as one of them.

You've pointed to your opponent as being too friendly with the industry. Give me an example.
Look at the rate increase that these companies have enjoyed. Case in point: When Allstate sought and received a 29.5 percent rate increase in March, when the news reporter asked Dale why there was a need for such a high rate increase his response was, "I didn't think it was that high," or something like that. So when the reporter went back to Allstate and told them that the commissioner didn't realize the rate was so high, the Allstate spokesperson said, "We would never have rolled out the increase if Dale had not already approved of them." So, was that deception or confusion or a little of both? Neither one is any good really.

I've heard Attorney General Jim Hood say the insurance commissioner's hands are largely tied by the insurance industry. All they have to do is threaten to pull up their stakes to get what they want.
My background includes economic and community development, and I look forward to marketing this state and its $10 billion book of business for insurance. If a company feels like they have insured enough people and don't want to insure any more, I'm not going to fall down on my knees, beg and plead with them. I'm going to roll up my sleeves and get busy replacing them, getting more companies in here who will aggressively fight for and seek out the business that another company may spurn. This book of business is not as large as that of some other states, but it's still plenty big. We have a lot of good people in this state who are not committing fraud against the insurance company, and the companies should want to do business here.

Yeah, but will you admit that the state's industry has some disadvantages? This is not the biggest market. Insurance regulation in California, like Proposition 103, only worked because California had a market that no insurance company in its right mind was ready to give up.
Yeah, but there are some other things you can do that haven't even been tried by the current commissioner. I look forward to establishing linkages and relationships with other states that wed us together and allow us to create a more intimidating market. I'd rather hook up with a larger state so we can both deal with companies in a more uniform manner.

You were talking about encouraging competition here among other insurance companies, in order to replace the runners who drop the state. How would you go about it?
(I would) let people know that this is a big book of business, that we're no longer trying to protect anybody's corner of the market anymore, that we want everybody to compete fairly, and I believe that natural market forces will allow other companies to come in to play here. A company like State Farm enjoys 30 percent of the market. Perhaps their market should be more like 20 percent, with other companies coming in to grab a stake.

Can that be done in four years time? That sounds like a lot to do.
You're going to see so many changes from a Gary Anderson administration. You know, insurance companies actually train their insurance adjusters—I have proof of this—to practice what they call 'the three D's.' First they Delay you. They make it difficult for you to get through the maze of whatever you're trying to get through in order to get insurance. Then secondly, they'll Dispute what you're doing. They'll say you've got a pre-existing condition, or it's wind versus water or something like that. That's another delaying tactic. Then of course, the third is to Deny you altogether.

I'm going to ask insurance companies to practice the three C's. My three C's are, first of all, they need to Communicate. They need to communicate adequately and properly to the ratepayer. Proper communication always enhances the outcome. Secondly, I want them to be Concerned about the person they've been taking money from and giving insurance coverage to. And then the third C is to Cover the claim. If the insurance policy covered that particular feature then the company needs to go ahead, stop the delaying tactics and cover the claim.

Now if they continue to stick to the three Ds in their business model, they'll have a problem with the Gary Anderson administration.

But that's the nature of the whole industry, nationwide. What's some guy out of Mississippi going to do about a nationwide industry standard?
Whenever, a person has sole rate-setting authority with a given industry, whenever a person has the ability to license every person who wants to sell insurance in the state, then their hands are not tied. We've heard from the current commissioner talking about his hands being tied, but his hands are tied for a different reason than he's letting on. I'm not taking any money from them, so my hands will be free to do the work of the people.

What's your background in rooting out malfeasance? Are you ready to get that kind of job?
When I was over Community Development, one of the things we had to make sure was that programs were being administered properly. If (they were) not, then we would have to hold the local government official accountable, and we would pass on those incidents to the appropriate law enforcement folk. Being over the Department of Finance and Administration, we put a lot checks and balances in place to make sure that, in state government, we don't have malfeasance taking place. So we had double checks to make sure that fraud was not being committed by state employees handling state money. I'm looking forward to applying my talent to the office of insurance commissioner.

Got anything more intimidating on your resume?
Way back in the day, between undergrad and grad school, I was a police officer for the city of Oxford. I do have a little police background in me, and I do understand how important it is to have good law enforcement. When we deal with Medicare fraud, for instance, the (Insurance Department) right now had a fraud unit of one person.

I didn't know that.
I'm sure that one person is a dynamic individual.

He'd have to be, I guess.
Oh, yeah, he's covering the whole state. But when I look around the state and look for who's been convicted of fraud, I can't find anyone.

Is this a recent thing? Like within two years?
In the last couple of years, since this Medicare program has been switched over like it has. That tells me that the focus on fraud by individuals and insurance companies simply is not there.

Are you surprised your opponent hasn't trotted out that Martin Frankel incident? Remember when Dale caught wind of that Frankel guy laundering mob money through the Vatican?
Well, as much as I know about the Frankel case, that was a nasty case. As I understand it, it wasn't Dale bringing charges. It was somebody else. No charges ever came from our state. That showed a very inept effort by the (Insurance Department) to bring people to justice in that case.

Last question: What's your opinion on the Jim Hood lawsuit against some insurance giants?
Let me say this: I'm not a lawyer, and I've not followed every aspect of how Jim has been dealing with the insurance industry. I know an agreement has not been adhered to by the insurance industry. It's hard to understand what role the office of insurance commissioner has played in that. I just think that I'm glad to see somebody in state government willing to stand up for people in this state.

Attorney General Hood believes that somebody has not done the right thing regarding Mississippians. He has taken action, and he's making sure they live up to every agreement at they've made. While not knowing the law or studying this case very closely, I'm glad for him having taken the action he's taken.


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