Archive for category Unions
State Bankruptcy Law Needed, Likewise an Amendment
Posted by Tom in Bankruptcy, California, Congress, Constitution, Federalism, National Character, National Debt, State Finances, Unions on November 14, 2010
Fehrenbach’s San Antonio Express-News post in RCP today scared me. In discussing the states pension ponzi schemes, California and New York worst among them, he concludes: “When they go broke, no way will the federal apparat, Democrat or Republican, let them wreck the American economy through bankruptcy. Not the American way. We’ll print money, bail them out, while they re-elect the same folks who led them into Red Sea waters.” While this is contrary to the hope expressed in my recent post, it presents a stark warning that demands prescriptive action.
No one doubts that several states are de facto bankrupt. Their current expenses exceed their receipts. Their long term liabilities are unfunded and in most cases unrecorded. The assumptions for these long term obligations are unrealistic. Their public employee unions will not relent in demands for increases nor will they ever consider givebacks. Their liberal politicians will not cut government services since to do so will offend public employee unions. And while those politicians will raise taxes, to do so is to drive out taxpayers and taxpaying businesses who can vote with their feet. Finally, their credit ratings continue to deteriorate bringing these states ever closer to the financial precipice. Only last year California was issuing IOUs to suppliers.
The U.S. Bankruptcy Code provides for bankruptcies of municipalities, cities, counties, etc. but does not provide for the bankruptcy of states. This needs to be remedied immediately.
First, the new congress should pass legislation providing for state bankruptcy. There is no other logical way to reform state obligations.
Next, the new congress should also propose a constitutional amendment prohibiting the federal government from bailing out states that face bankruptcy.
The combination of these two measures if adopted will lend added force to political solutions necessary to reform these spendthrift states. Finally, this is a necessary step to a long needed return to the federalism this country was founded upon.
The United States simply cannot afford to bail out the bankrupt states. The federal government itself is close to bankruptcy.
California Bail Out?…….Not!
Posted by Tom in California, Democrats, Politics, State Finances, Unions on November 8, 2010
I hope the recent Republican tsunami in the U.S. House and state governments, and the Senate pick-ups will put the brakes on the leftists’ natural urge to bail out California and reward spendthrift socialism. It certainly looks that way.
In the recent election, California continued its profligate ways by electing Democrats across the board. It rewarded Governor Moonbeam, Jerry Brown, once again with the top slot on the ticket. Recall that it was he, thirty odd years ago, that gave public employee unions collective bargaining rights in the state. For the unschooled, this is called “watering the tree!” Well, the tree has grown up and now controls the state and elects every Democrat to every major office year after year. Old Jerry was certainly smart in providing for his own re-re-election!
Birkenstocks-shod, Allysia Finley, assistant editor of OpinionJournal.com, herself a left-coaster has a wonderful op-ed piece in today’s WSJ, California: The Lindsay Lohan of States. With acerbic wit she blasts the state for its tax/spend addiction.
“After enjoying ephemeral highs and spending binges, you suffer crashes that culminate in brief, unsuccessful stints in rehab. This cycle repeats itself every five to 10 years, as the rest of the country looks on with a mixture of horror and amusement. We’d feel sorry for you if you didn’t constantly flip us the bird.”
The outgoing Terminator’s budget compromise with the Democrats assumes Federal bailouts. Allysia points out that the next four years will show $80 Billion in budget shortfall! There’s a point at which the costs of doing business in the sunshine exceeds the benefits thereof. That would be when the bills come due and businesses forced to pay them can no longer compete internationally. What do they do but vote with their feet!
For fiscally smart states like Indiana or Wisconsin, California bail outs are a non starter; why should their citizens pay for the California entitlees to bask in the sun. For Republicans in the House, don’t buy the argument that California is too big or too important to fail. Only by failure will our other costal states get the message that spending and promising beyond your means leads to bankruptcy and that public employee unions should be outlawed.
Finley does the nation a service by quoting the new Lt. Governor Gavin Newson, the former mayor of San Francisco, reflecting on his election: ”We’re nothing but a mirror of our consistent thoughts. You tend to manifest what you focus on. If you look around for what’s wrong, you’ll find it. But as all we know up here in San Francisco, when you focus on what’s right, you see it all around you. . . . There is absolutely nothing wrong with California that can’t be fixed by what’s right with California. . . . If you’re from another state, you’d love to have the problems of California.”
Yeah….how about that! I guess this is how you get elected in the land of the fruits and nuts!
How Your Tax Dollars Are Spent
Posted by Tom in Business, Democrats, Entitlements, National Debt, Stimulus/Bailout, Unions, Welfare on October 3, 2010
Obama and his socialist Democrats are on a spending spree, spending future tax dollars, generating piles of debt that will bury us, our children and our grandchildren and condemn them to a lower standard of living. The bulk of the spending goes to entitlements, Social Security, Medicare, Medicaid and the new killer, Obamacare. A significant chunk of the spending goes to support government workers who job it is to redistribute our tax dollars to the non tax paying “entitlees.” The inefficiency and waste attendent to government operations and giveaways are always rampant but there are some things that are particularly bad.
GM, that is Government Motors, is majority owned by the U.S. taxpayers; a significant minority block is owned by the UAW. In practice the UAW calls the shots, since it controls Obama/Democratic votes. Government Motors flushed out its creditors in bankruptcy. So the bondholders got screwed and the union got control. (Those bondholders by the way are the IRAs and pension plans attempting to provide retirement security for the taxpayers financing the government.) So Government Motors operates without the typical burdens of private companies like, say Ford Motors.
One of the ways it spends it’s taxpayer provided largess is to lobby the government that owns it! Yes, that’s right, taxpayer dollars are being spent to influence government officials, the same officials who allocate those taxpayer dollars! This is like Milo Minderbinder in “Catch 22″ taking money from the Germans to strafe his own USAF base in Italy. Truly bizarre. The WSJ calls it “Fannie Mae Motors” after the Barney Frank supported fat cat that spent taxpayer supported money lobbying who but Barney Frank!
Now you can argue about stupid government spending and policies like ethanol, solar energy credits and cash for clunkers, but some things just really piss you off! They are not only stupid but immoral. Bad thing is that our grandchildren will pay for this stupidity.
Going Postal!
Pricing power, the ability to raise prices without concern of competition, is rare in the marketplace. It is EARNED by those who have advantage because of technological, productive or investment excellence; and it is often short lived in a competitive marketplace.
Well, the USPS has pricing power, unearned pricing power. It’s raising it rates once again. According to Monday’s WSJ editorial ‘The Post Office Hustle” the price of a stamp will go to 46 cents. Prices here have increased at four times the increase in the CPI. The post office lost $3.5 Billion last quarter alone and is expected to have cumulative losses of $238 Billion in the next decade! Operational efficiency is obviously not its strong suit!
Strange isn’t it that Fed EX and UPS seem to be profitable. Of course they don’t employ non-productive government workers. Postal employees earn an average of $83,000 per year in salary and benefits. And the APWU is demanding more! Seems that the union is in charge.
How do you want your tax dollars spent? How much benefit subsidy do we need beyond that stamp price? Oh yeah, and while you pay for your stamps, Harry Reid, Nancy Pelosi, Dina Titus and the rest of that ilk send their mail for free using the franking privilege! Yep, in some small way, your tax dollar is paying to get them re-elected!
Don’t you just love monopolistic pricing power!
One Dynamite Cartoon by John Trever
While aimed at Cuba, it portends the future for the United States.
Ever heard the expression, “the wheels are coming off?”
Transparent Nevada, an NPRI Jewel
If you look to the right side of this page, you see our BLOGROLL and on that you see Nevada Policy Research Institute, a public policy think tank based in Las Vegas. I was formerly on its advisory board and can attest to the excellent work it produces.
One such public service is “Transparent Nevada.” This website publishes the most current available information on: salaries, official opinion, contracts, congressional voting, and finance reports for the state and its municipal subdivisions. It also has a blog on treating current NV topics. The home page ulr is: http://transparentnevada.com.
Perhaps the most hits are directed to the salaries page. We’ve heard of Bell California and the outrage generated by exorbitant public salaries. Well, we have pretty rich salaries in Nevada. And as we know the salaries are only the tip of the iceberg, the rich pension benefits will leave our grandchildren with unsustainable taxes to pay for the gross unfunded liabilities related to those pensions. Here’s sample of the salaries data:
Of course, it goes without saying that public employee salaries and benefits far exceed the salaries and benefits in the private sector. The private sector’s taxes pay those rich salaries. Unfortunate truths are that: there are no checks and balances on these salaries, no market efforts at efficiency, and no constitutional efforts to preclude public employees from participating in the Nevada legislature. Over 50% of NV legislators are public employees or their family members!
I heartedly recommend your support of NPRI.
Schwarzenegger on the Public Pension Time Bomb
Posted by Tom in Democrats, State Finances, Unions on August 27, 2010
Arnold’s op-ed in today’s WSJ is worth the time. Basically he contrasts the unionized public employees with the poor unemployed working stiffs who are expected to support them through taxes. A couple of charts are telling:
![[schwarzenegger]](http://sg.wsj.net/public/resources/images/ED-AM115B_schwa_NS_20100826182703.gif)
He highlights the games played: phony portfolio return assumptions, “spiking” promotions, and retirement at 55. Points out the fact that private employees make less and have less retirement security–their 401k s have declined 20% in value since 2007 while state employee pensions have grown during that period. The public employee effectively has $1 Million in retirement savings!
He calls for a stop to taxes and borrowing to fund pensions. He wants a reversal of the massive retroactive pension increases passed eleven years ago. He wants greater employee contributions to the pensions.
Unfortunately, he fails to call for a constitutional amendment prohibiting public employee unions. This is the only effective way to break the unholy alliance between the democratic legislators and the public employee unions that get them elected. Until that is ended the dirty money game between the two groups will continue.
I commend a full reading of Arnold’s call for reform. Note that it comes from a RINO, and that is a positive step indeed.
Finally A Stimulus That Has Its Intended Effect
Posted by Tom in Deficit, Democrats, National Debt, Nevada, State Finances, Stimulus/Bailout, Unions on August 11, 2010
What is this latest $26 Billion stimulus, is it number 5 or 6? I’ve lost count. But this one you can bet will work effectively to accomplish its intended purpose…..to buy votes for Comrade Obama and his leftist cronies. It goes directly to the public employee unions, specifically the teachers. That increases union dues which in turn increases political donations. This stimulus rewards spendthrift states–takes from fiscally responsible states like Indiana and gives to bankrupt states like New York and California. Seems we find the most registered Democrats in those fiscally irresponsible states!
Today’s WSJ pens a great editorial on the subject, “Stimulus Pushers.” As the title suggests, Hussein Obama is the dope pusher further addicting these leftists spendthrifts with a high powered dose of bailout. The addicts don’t care about the hidden costs or the consequences; they just want the fix.
A few principled governors like Haley Barbour of Mississippi are pushing back. The federal government is hijacking state budgets. Rick Perry of Texas is in disfavor with the DC crowd so Texas gets penalized in the legislation. What’s astounding in this is the sheer hubris, the sheer abuse of power with the simple justification that the leftists have the power.
Two points are clear: One, this stimulus only postpones the day of reckoning for these bankrupt states. And, two, these parasites if left unchecked will eventually kill the host—the private sector that pays taxes will no longer be able to afford the excessive pay and benefits sucked up by the public sector. Atlas will indeed shrug!
For Nevadans, Reid must go, and the Pelosi’s democratic lackeys must be defeated. By piling up deficits and debt they are stealing from our children and grandchildren, the height of immorality!
Damn Musicians’ Union
For those of you who missed this year’s Pops on the River, you missed one of the really great guest conductor performances in the history of the event. Our own Laura Herring bid $2500 to conduct the Sousa March. She did so with such zest that the standing ovation exceeded any other applause that evening.
Here’s an abbreviated look to which the YouTube detail states: “Laura Herring bid on and won the chance to conduct. She did so with such enthusiasm. (We had to cut this video short. The musicians’ union prevents us from publicly showing videos of the RPO longer than 2 minutes. The applause Laura Herring received was amazing!)”
So here’s a quick look at Miss Personality, er Miss Enthusiam!
Union rules may have a place……………but to cut this short?
Unions and Human Nature
When read that Andy Stern head of the SEIU one of the largest public employee unions is retiring from his $306,388 -a-year job and is likely to be replaced by one of many high paid union bosses, I question the need for unions, particularly the public employee variety.
The days of sweat shops, 12-hour days and child labor have long since passed. Admittedly, industrial unions served an important social purpose. Working conditions and job safety have dramatically improved as a result of their efforts. Those improvements have beed legally codified long ago.
On the public employee side of the workforce no such social ills or physical dangers prevailed. The supposed “evil” for public employment was the “spoils” system: to the victor goes the spoils. When the city hall changed hands politically, so did its workforce. This enabled machine politics to prevail with ward bosses calling the shots from New York to Kansas City. The “reform” here was the civil service system in which competence and merit assured job security.
So what do unions do today? In my opinion, they promote mediocrity. They create work to create new members. They create fat cat union bosses. And, they foster “rent-seeking” behavior by attaching themselves to politicians who are more than willing to trade laws and regulations favorable to unions for membership money and membership votes.
- Mediocrity: All of us are equal thus it would be wrong for some of us to try to excel, do a better job, be more efficient, work smarter and faster. Lets all be the same because in numbers there is strength. So let’s not resent the slackers, let’s keep our mouth shut about our fellow worker who knows how to “work the system.”
- Make work: The more work there is the more workers that are needed. That means more potential union members, more dues and more pay for the bosses and more money for compliant politicians.
- Union Bosses: Guys like Andy Stern are the ultimate salesmen. They separate union members from their money and big money it can be. What benefit do the union members get for those dues? Not much.
- Political Symbiosis: The unholy alliance between fat cat union bosses and fat cat politicians is well chronicled. It’s self perpetuating. Who pays the price? The union members and the public.
My take, unions harm their members and society in general. Mediocrity is not in the fiber of human nature. In fact it is opposite the natural human spirit to compete and excel. We strive to better ourselves. Nor is the unfairness implicit in mediocrity part of human nature. We strive to be just. We resent slackers we resent the inability to demonstrate our excellence. Likewise we tend to resent the waste implicit in union make work programs and featherbedding; in a general sense human nature is economic. Human nature is indeed social but it is also naturally competitive and just.
Would excellent teachers favor merit pay? Do they favor keeping notorious deadwood on the job simply because the deadwood belongs to the union. Would union members prefer to make or not make political contributions on their own rather than have the union bosses decide where the money goes? Do union members like being told how to vote?
As a young man working my way through school I was a card carrying member at different times of three building trade unions. The work was good as was the pay, but the pace was regulated be other members. I can remember being told to slow down! Older now, I have a broader perspective about unions effect on our society, our government and our economy. To see fat cat Andy Stern plunk down $60 million to put Barack Hussein Obama into the White House really turns my stomach.
Reform is needed particularly in the public employee sector and part of that reform is to expose the fat cat union bosses and how their interest differ for the interests of the membership.