Wasn’t this a great song by Dionne Warwick? My other favorite line is “And all the stars that never were, are parking cars and pumping gas”. I guess they landed some Obama jobs? No wonder why Obama’s approval rating on the economy is tanking to George W. Bush levels.
Anyway, this classic song came to mind because the public unions of San Jose are in court, battling Democrat Mayor Reed and 70% of the voters of this fine city, who supported and passed pension reform last year. Talk about thwarting the will of the people, no?
“San Jose’s pension reform, which has not yet been adopted because of the lawsuit, does not reduce benefits already earned by employees, but would require them to either pay higher contributions to maintain current benefits or receive lower benefits.
It also requires new city employees to split pension contributions evenly with the city. San Jose, which has two pension funds, currently pays $8 toward pension benefits for every $3 contributed by its employees”.
San Jose was one of two major California cities where voters overwhelmingly approved pension reforms in June 2012. San Diego’s Proposition B called for replacing pensions for all new hires except police with 401(k)-type retirement savings accounts, and a five-year freeze on current employees’ pay that would count toward their pensions. San Diego has since negotiated the five-year pay freeze and put new hires on 401(k)-type plans after defeating unfair labor-practice challenges”.
Why is San Jose so in debt with legacy costs? If you guessed too much austerity, you would be wrong. “The average San Jose police officer and firefighter who retired in the past decade, and worked for 26 years, gets an annual pension of $100,000,” So the solution is either jack up the taxes or cut services even further or a “blended approach” like pension reform. It’s not math, it’s arithmetic, as Ed Markey famously said. The unions in San Jose feel disrespected, site state law guaranteeing these pensions (although federal law trumps state law, but don’t tell them this).
These ticking time bombs are not isolated to California, or decaying cities like Detroit. New York City has an unfunded health care liability of $90 Billion, $20 Billion more than its entire budget. Throw in the pension obligations, and “the total liabilities of NYC now exceed its total assets by $125 billion, a condition referred to as balance-sheet insolvency”. No need to fear NYC, Anthony Weiner will solve this pending financial crisis, right?
Now I understand why Pres. Obama isn’t flying Air Force One into Detroit. If we bailout Detroit, are we not obligated to help the rest of the cities and towns across the entire nation? Senator Rand Paul put it best when asked if the federal government should bailout Detroit, he said “over my dead body, why should people in Iowa pay for the mess in Detroit or even California, where they have over 100,000 retirees making more than $100,000 in pensions”.
Good luck San Jose, but if you lose, I know a good bankruptcy attorney in Detroit.
http://www.reuters.com/article/2013/07/22/us-san-jose-pensions-trial-idUSBRE96L11720130722
Swish! Nothing but nut.
DFTT
How many do you have, less than 10?
Is everything in your world rainbows and gumdrops? Where you aware of the pension reforms and court battles in San Jose. Since you already made a comment, whose side are you on?
Do you believe the media is helping NYC focusing on Weiner’s sexting? Lots if info in this diary to chew on.
n/t
Do we have strong public unions with pensions? We don’t have $20 billion in unfunded pension and another $20 billion in unfunded health care?
Perhaps San Jose and San Diego are templates for what we should do? Perhaps a question to ask those running for governor. We are not immune to fiscal disaster, unless you feel we can tax our way to prosperity.
So, are you arguing for the best and most logical solution to this issue?
Single Payer.
I am on the record from last year, supporting single payer, even if quality takes a hit. I asked this on RKO to a health care expert, would single payer offload all these legacy costs, he said my question was a very good one.
So, if we get single payer, would Waltham’s $500 million unfunded h/c obligation, just go away? Would NYC wipe out its $90 billion debt?
The answer to your rhetorical question obviously depends on the details of what “single payer” means.
In any case, it is pretty clear we are not going to get single payer anytime soon.
If you think there is a general problem w/ pensions in MA, then by all means please cite in detail the relevant data and make your case.
Don’t waste our time with lazy cut-and-paste jobs. This is not a news clipping service.
If I didn’t site my sources, then everyone would scream where I’m getting my facts from.
Pensions and health care obligations an concern in MA? How about each resident of Waltham owing $13,000 just to cover legacy costs, that a problem, or not high enuff?
Is there in fact really a problem in Waltham? Where does that $13,000 number come from? Where is your analysis of Waltham’s budget and revenues that shows that there is in fact a problem? Why does mismanagement in San Jose in any way imply that there is mismanagement in Waltham or anywhere else?
And what the hell are you proposing to do about it, if there is a problem?
We all have better things to do than worry about things that may not actually be a problem in our own communities.
Now if you want to write a post that details concerns you have about Waltham’s finances, by all means go ahead. But please cite your sources, since there is no point in having a discussion over made up numbers.
You don’t see a common thread with cities and towns trying to contain legacy costs, due to unfunded pensions and health care obligations? $13K per person owed to cover Waltham’s unfunded h/c and pensions is….not a problem?
My solution would be, just spit-balling here, is to have a single payer health care, paid for by a national sales tax. Everyone pays, no free riders, even tax exempt organizations pay the tax.
254 Mass cities and towns have accumulated $26 billion in unfunded healthcare obligations for public retires. This doesn’t include pensions. Still don’t think San Jose and Detroit is related to us?
http://m.bizjournals.com/boston/blog/bbj_research_alert/2012/11/unfunded-promises-what-mass-cities.html?page=all&r=full
When you use terms like “Democrat Mayor Reed “, it detracts from the points you want to make. I think I have a reasonably thick skin about posts from folk with whom I differ, but the conservative tendency to use “Democrat” as an adverb or adjective is irritating.
was simply to point out this reform didn’t occur b/c of a Republican mayor who hates unions. The fights we’ve seen over the years were Republican leaders battling the unions, like Christie and Walker.