Government of the unions, for the unions, and by the unions
Nothing exemplifies the vileness of big government like the special relationship between politicians and labor unions.
By Luis R. Guevara at The Americano
Nothing exemplifies the vileness of big government like the special relationship between politicians and labor unions. The recession has brought to light the immensity of government debt across the country. State and local governments have been forced to lay off employees and cut cost at an alarming rate as a result of the recession. One of the worst problems that has arisen is the reckless way in which local governments have indebted themselves in order to fund government employee pension funds. For decades, State and local officials have been pressured by government unions to increase their retirement benefits and salaries at the expense other pressing economic needs.
According to the Chicago Booth School of Business, the total unfunded liability of all 50 states’ pension funds is about $3 trillion. States like Illinois have unfunded pension obligations of $80 billion and unfunded retiree obligations of $40 billion more. According to another report authored by Northwestern and Rochester universities, an analysis of the 50 largest cities and counties concludes that the unfunded liability of pension funds for those municipalities is $574 billion. Cities like Boston, Chicago, Cincinnati, Jacksonville and St Paul have pension assets that can pay for benefits only through 2020. For Philadelphia, the current assets only cover pension expenses through 2015.
In California, bastion of strong liberal activism, retirement accounts guarantees are of $1 million to public employees who retiree as early as age 55, which equals to a monthly payment of $3,000 for the rest of their lives. In 2003, the California assembly passed another law allowing government employees to purchase additional high yielding retirement annuities, exacerbating the debt problem. In New Jersey, benefit packages for state employees are 41 percent more expensive than those offered by many fortunes 500 companies.
The problem here is that if state and local officials are forced to spend more money on pension and retiree funds, governments will have fewer resources to spend in much needed programs such as, police protection, education, parks, libraries, and infrastructure and so on. How this came about is a typical story of government unions and willing politicians creating grand expectations with other people’s money in order to retain support or placate government workers for their support come Election Day.
The main culprits for the gathering storm of unfunded pension funds are public employee unions, who for decades have had their way in manipulating state and local governments to create an unrealistic scheme of ever increasing benefits to give their support on the ballot box. So afraid have politicians become of the wrath of government unions that they have time and again caved to their irrational demands. In California, for example, state police officers enjoy 90 percent of their salaries once they retire at age 50. California spends more on its prisons than it does on schools; much of it is due to the $70,000 a year that the average corrections officer makes. As Arnold Swatzenegger wrote on the Wall Street Journal, “Sacramento legislators don’t want a government of, for and by the people but a government of the employees, by the employees and for the employees”.
As Daniel Salvo explains in the latest issue of National Affairs magazine, the proximity to lawmakers and the immense amount of funds that public sector unions contribute during elections gives them tremendous power and results in allocating more funds and influence to unions at the expense of the public at large. In fact, the cozy relationship between democrats and government unions cannot be denied when, according to the Center for Responsive Politics, the American Federation of State, County and Municipal Employees (AFSCME) spend, from 1989 to 2004, $40 million in federal elections, almost all of it going to democrats.
Because these unions use their bargaining power to look after their own interests in the form of higher wages and benefits, their demands to lawmakers almost always results in an increase of taxes and spending by government. This is particularly offensive given the fact that lawmakers and public employees get paid and put in positions of power by the taxpayers who they are supposed to be serving. Liberals love to vilify Wall Street for their greed while ignoring the massive greed and licentiousness that typifies the government unions who support them. Examples of such overreach by government are a main reason why liberal politicians will be joining the ranks of the unemployed on November 2nd.
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