Seems to be an obvious focus for the upcoming Republican Congress to focus upon – starve the beast, drown it in a bathtub, right?1
There’s no question that Republicans have introduced a bill which would require more transparency on state public pensions, and that they hope this would provide a road map in the states for where they can cut budgets; namely, on the backs of public employees. That doesn’t mean it will happen in exactly that way, however. And the idea that the next Congress will overhaul the 30s-era law allowing states to go bankrupt seems fanciful to me.
But I don’t think states or municipalities need much help from the federal government in their desire to rewrite public employee union contracts. There has been a concerted effort for years to demonize and delegitimize public employee unions, from both Republican pols and the media in general. This has left a distorted impression about greedy union contracts and well-paid government functionaries. So the new class of Republican governors would certainly want to capitalize on that by pleasing the public, who now favor things like wage freezes (which Obama just instituted at the federal level) and furloughs and bigger pension contributions, punishing those workers. And they are animated by a general hatred of unions, which have maintained their strength in the public sector while fading away in the private sector.
Alongside that, there are legitimate budget problems in the states. The National Conference of State Legislatures estimates a $118 billion dollar shortfall in state and municipal budgets in 2011. And there are certainly some states and municipalities with currently unfunded pension liabilities. While federal aid could offset some of that, there’s no chance it will happen – expect the House to pass, early next year, a resolution basically forbidding “bailouts” of the states. At that point, state governments will either have to cut spending or raise taxes to balance their budgets, which almost all of them are constitutionally required to do. With public employees – or rather, cops, firefighters, nurses, teachers, the people who prepare your state tax refund, the people who get you your driver’s license, the people who get the roads and bridges fixed and basically secure your safe passage through the commons – seen in a negative light, they will in many states be lined up for cuts.
(click to continue reading In Unfolding War on Public Employees, State Lawmakers and Media Likely to Do the Work Themselves | FDL News Desk.)
HAMTRAMCK, Mich. — Leaders of this city met for more than seven hours on a Saturday not long ago, searching for something to cut from a budget that has already been cut, over and over. This time they slashed money for boarding up abandoned houses — aside from circumstances like vagrants or obvious rats, said William J. Cooper, the city manager. They shrank money for trimming trees and cutting grass on hundreds of lots that have been left to the city. And Mr. Cooper is hoping that predictions of a ferocious snow season prove false; once state road money runs out, the city has set nothing aside to plow streets.
“We can make it until March 1 — maybe,” Mr. Cooper said of Hamtramck’s ability to pay its bills. Beyond that? The political leaders of this old working-class city almost surrounded by Detroit are pleading with the state to let them declare bankruptcy, a desperate move the state is not even willing to admit as an option under the current circumstances.
“The state is concerned that if they say yes to one, if that door is opened, they’ll have 30 more cities right behind us,” Mr. Cooper said, as flurries fell outside his City Hall window. “But anything else is just a stop gap. We’re going to continue to pursue bankruptcy until the door is shut, locked, barricaded, bolted.”
(click to continue reading In Michigan, Hamtramck Pleads for a Bankruptcy Option – NYTimes.com.)
and in Hamtramck, MI, the city certainly wants to focus cutting the budget on public employees:
Here, the urgent search for services to cut has turned all attention to a realm that is also emerging at the center of budget debates in cities and states around the country: the costs of salaries, benefits and pensions of public workers.
Mr. Cooper, the city manager, says that everything else that could be cut already has been, while the city goes on spending 60 percent of its total general fund to pay for its police and firefighting forces — 75 current police officers and firefighters and about 240 former workers and spouses now on pensions. Mr. Cooper said that an entry-level police officer costs the city about $75,000 a year in salary and benefits, and yet repeated efforts to renegotiate contracts have failed.
“They kind of have the Cadillac plan,” Mr. Cooper said, “and we’d kind of like the Chevy.”
The police and firefighters question whether the city’s bankruptcy talk is really just a scare tactic for negotiation. Earlier discussions with city officials, they say, have urged them to accept pay cuts, layoffs, increased worker payments to pensions and even a suggestion that officers might pay for part of their own bulletproof vests — all this while the city has opted not to increase taxes.
“Nobody likes the police until you need them,” said Jon Bondra, the incoming president of Hamtramck’s police union.
So we’ll see…Footnotes: