December 20, 2010

"The Day of Reckoning"

It's funny...when you talk to members of public sector unions, you've either got to be with them or your against them. Considering that we regularly tee off on them, I guess it's safe to say we're against them. But we're not against them as people - I'm sure they're very nice on an individual basis. What we have a problem with is the never-ending sense of entitlement that they collectively have.

They're never willing to budge an inch in negotiations. Even locally, I can recall when the county legislature asked the unions for $600,000 in concessions in order to keep Mt. View open. Not only did they refuse to come up with the $600k, which essentially amounted to a two-year wage freeze, they came back with an offer that required an even greater subsidy from the county. Subsequently, as we all know, Mt. View closed and 200 union jobs went with it. The only ones who caused Mt. View to close were members of the union leadership who failed to properly represent their employees.

Across the country, public sector unions are putting local and state governments on the verge of bankruptcy. Within New York State, the Empire Center estimates the New York State and Local Retirement Systems are $71 billion short of what is needed to fund pension obligations, while the state retirement system for teachers has a funding shortfall of $49 billion.

If you think this isn't affecting you, you're dead wrong. In Niagara County, the tax rate is going up 1.9% in 2011. That equates to about $1.5 million. This year alone, Niagara County's contribution to the state's pension is increasing $3 million, for a total of $11 million for 2011.

Local governments are being forced to subsidize an out of control and unsustainable pension system. Why? Because state officials have been unwilling to challenge the all-mighty public sector unions and their lavish benefit packages. To make matters worse, state pension costs are expected to double over the next five years. You and I will be paying that bill.

We are talking billions of dollars. Now, I understand that because Obama tosses around the term "billions" like it's nothing, the word has been severely watered-down. But the reality is that these dollar amounts are staggering. If states don't start getting a handle on them, local governments, after taxing homeowners right out of their homes, will face bankruptcy.

The below video from last night's 60 Minutes is entitled "The Day of Reckoning". It talks about the the costs associated with public sector unions and the inability or unwillingness of states to deal with them, as well as the future ramifications of not addressing the impending disaster. It is an amazing segment that is well worth your time.

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