August 20, 2006

The Mindset of the Complicit

Justin Katz

I wonder how public union employees feel when they read such pieces as this editorial in the Providence Journal:

Taxpayers may face a daunting future because of the pension benefits that politicians have promised public employees.

States and cities across America confront huge liabilities, with shrinking assets, and the shortfall threatens both to hammer taxpayers and to hurt public services, The New York Times reported this month ("Public Pension Plans Face Billions in Shortages").

No one knows precisely how much has been promised to public employees or what it will cost the taxpayers; statistics are not kept uniformly. But estimates of the liabilities range from about $375 billion to $800 billion. That's a lot of money for state and local taxpayers to pony up.

Sadly, I don't suspect most of them struggle with the guilt of being complicit in one of the major problems looming over our state and nation. More likely, the majority's reaction is, "They'd better not take away my benefits!"

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Let's break this down a little.

State legislators sell their soul to public labor unions, promising them gold plated pensions (and health benefits). Then, instead of properly funding those pensions, they spend the money on unjustifiably generous social services to buy the votes of another special interest group.

This is not spin, this is straight up: every current and future recipient of a public pension needs to hope that Don Carcieri is elected. Because the only way even a portion of those pensions will survive is if someone gets serious about fixing them.

That ain't Charlie Fogarty - if he's elected, he'll only continue to do what he's always done: promise them anything but give them Arpege.

And some of us prefer to let the whole thing crash and burn, feeling no obligation to carry out promises made by politicians under the fumes of campaign contributions that they themselves did not see fit to honor by properly funding.

Carcieri got a good start rectifying the badly broken pension system.
I'll be voting for DC for other reasons - and, frankly, despite the fact that he will be trying to save these overly generous pensions.

When public pension recipients walk into that voting booth, they only need to think about one thing: who is going to get real about honoring the state's obligation to them.

Posted by: SusanD at August 20, 2006 9:13 AM

Had a good laugh the other day when I saw a pickup truck on 95 that had two bumper stickers, one said Fire Cicilline (obviously a Providence firefighter) and the other was a Charlie Fogarty bumper sticker.
The humor and irony is if Fogarty is elected governor that will guarantee Providence firefighters are stuck with Cicilline (plans to run for governor) as mayor for at least eight more years.
SusanD, there is a legit reason why many union members have the reputation for not being very bright.
They're not!
They wouldn't know "big picture" unless someone colors the big picture page in their coloring books. lol

Posted by: Tim at August 20, 2006 11:27 AM

Okay, from now on, 401(k)s for new employees - let them slowly build a next egg like I am.
Let's make a deal: the next generation gets 401(k)s instead of pensions. In return, the bitchfest about unions ends.
Deal?

Posted by: Rhody at August 20, 2006 11:35 AM

Nice try Rhody,
Do you think that is all the unions plague us with. How about the concept of seniority that teachers unions worship? Suppose the NE Patriots preached that same nonsense - we'd have Drew Bledsoe as quarterback and, in turn, a team that is a loser. But, in some strange way, that concept is OK when it comes to teachers. It is a system for losers, not winners. No wonder our schools are failing so miserably.
It is high time that our government schools were radically overhauled. The first meaningful move would be to eliminate teachers unions.

Posted by: Jim at August 20, 2006 11:55 AM

You are all describing different parts of the elephant. The big picture is that the system itself is collapsing. Either our social welfare spending must be cut, public sector retirement benefits must be cut, or taxes raised through the roof (primarily property taxes, because that base shrinks less than others when rates are raised). Absent major changes in the General Assembly, it is hightly doubtful whether the first two changes will happen -- just look at how they gutted Carcieri's proposed social welfare reforms this year. That leaves sharp tax increases, which would only speed the decline. Ultimately, Rhode Island seems destined to end up in a fiscal collapse, and plowing new ground in the constitutional vagaries of state bankruptcy. And speeding up this process is simple: just elect Fogarty and approve the casino.

Posted by: John at August 20, 2006 12:43 PM

Jim, go to 401(k) first. Then we can sort out the seniority/merit issues.
Who decides who gets the merit raises? The only way you can do this fairly is have teachers teach to a test - whoever has the highest number of students pass gets the biggest raise. Not sure that's the best thing for the kids, and the political can of worms you open...
In a perfect world, we wouldn't need unions. If you want to believe eliminating unions would make the world perfect, be my guest, and pass that big joint down to me when you're done...

Posted by: Rhody at August 20, 2006 1:49 PM

Complex issues deserve close thinking and careful scrutiny.

Like everyone else in the capitalist world we live in people generally try to get the most they can for their time, energy, effort, etc. Typically the market controls the value of those things. But in RI (and DC too) other powers are at work.

If I had a gas station that sold gasoline in Warwick today for $2.00 a gallon it would be big news and there would be a line to buy gas.

If I had the same station selling gas at $4.25 a gallon the only person who might buy it would be the poor soul who happened to run out right in front of my station.

The State and most cites and towns do not operate like capitalists when it comes to their employee unions. Teachers, fire fighters, police and public service employees are all unionized and therefore operate in the political not the business arena.

This may sound over simplified but the problem isn't with the unions its with weak or even corrupt elected officials. The government just pays the $4.25 and then raises taxes.

Look at what Steve Laffey did in Cranston. He recognized the nature of the problem. Took appropriate action. The union bosses fought hard but lost because they had used the system (with wrong intentions at best) to get what they wanted and the taxpayers (finally with a Mayor who fought for their best interests) put Laffey back in charge for two more years. The city now boasts an investment grade bond rating, a surplus, co-pays on health insurance for city workers (including the police), and a lowered tax rate (the only city to do so this year).

The people knew who was working for them (Laffey) and who was working against (union bosses) them.

Until the government we elect takes the same position Laffey (and others) took en masse things will continue as they have until the system implodes. Like you, me, and most normal people, we seek to buy low and sell high. Government is supposed to work by the same rules but it does not. It is afraid to take the tough stand necessary to fix the broken system and in many cases (at least in RI) it works against the taxpayers for its own self interests. These people must be removed.

Cranstons upcoming election for Mayor will say a lot about the intelligence of the electorate. If Allan Fung beats Napolitano (handled by Trafficante, et al) then the people of Cranston have learned something. If not, they deserve what they get.

J Mahn

Posted by: Joe Mahn at August 20, 2006 2:33 PM

Dear Mr. Mahn,

There's only one problem with your little story:

Mayor Laffey spent more fighting, especially going to court, then he ever saved by winning any of those fights. Cute for headlines, not so great for budget savings.

The overall problem can be dissected very quickly:

Benefits are more expensive than salaries. However, politicians over the last twenty years decided that since benefits got paid "down the road", even at an 840% difference, and salary increases made headlines, it was better to give away the store on benefits.

All union negotiators, as are corporate talent agents (having been one), are taught to negotiate the value of the whole package. Some of the folks who get elected are very transperent about what they would like you to ask for. My friends in the unions just take the easiest road as any of us in a negotiation would do.

Sorry to dissapoint some of you, but unions aren't going anywhere. If you want something back, you must give something away. I can tell you, without getting involved in tales out of school, that if you keep the total package competitive, many union leaders understand the relationship between benefits and overall cost. They would happy to roll things back a little in exchange for salary modifications except for one little thing:

His name is Don Carcieri. He has compared teachers to dogs. He has called Frank Montanaro "the most corrupt person in RI". Mr. Carcieri's mouth continues to get in the way of all of us working together to solve the problem. Whenever the choice is hard work or ego, his current ad backs his job pledge down from 20k to 15k, he chooses ego and everybody on the Hill knows it.

When you understand he is at the wheel while your party drives off the cliff, look at the Laffey/Chaffee mess, look at how betrayed Kerry King feels now, look at the possible Doomsday scenario where you lose all the Statewide Offices and still lose up to 10 seats in the Assembly, look at the small number of candidates he developed (and he needed Harwood's help just to do that), then you will be on the way to recovery.

Posted by: Bobby Oliveira at August 20, 2006 6:35 PM
I can tell you, without getting involved in tales out of school, that if you keep the total package competitive, many union leaders understand the relationship between benefits and overall cost. They would happy to roll things back a little in exchange for salary modifications...

That's a nice tale, Bobby, but forgive me if I don't trust the unions, based on their history and their current leverage with those in our government. If they were interested in ignoring their imbalanced strength so that we might all sit down with strokes and giggles and resolve the state's crises, they'd put forward the impetus. (And I can't help but laugh bitterly at the idea of keeping teachers' packages "competitive." With whom?)

Personally, I've a feeling the party-hack lines aren't going to work for much longer. It won't be long until only the most partisan don't understand that the phrase "Doomsday scenario" implies doomsday for the entire state — Democrats and Republicans. It won't be long until Democrats can no longer distract from our crumbling situation by trying to blame the handful of Republicans.

So why don't you look at your own party, Bobby, so that we might all head toward recovery?

Posted by: Justin Katz at August 20, 2006 8:03 PM

Dear Justin,

When in doubt in politics, I was always told to look forplaces of agreement; therefore, let me pose a few questions:

1.) Is a teacher the equivalent in some respects of a corporate trainer?

2.) Do you agree with me that contracts are somewhat subject to market forces?

3.) Do you agree that cost of living is one of those forces?

4.) Can you understand why I trust management to about the same level that you trust labor?

5.) Do you realize that in many communities, public sector union representatives, especially those involved in the teaching profession, have been the first to suggest collaborative bargaining in order to avoid conflict?

6.) If the insurance companies were more regulated, I don't like the thought at the same time I think it may be necessary, especially with regards to pricing, would we even be having this conversation?

7.) Since we are no worse off than a lot of places, who don't face our cost of living and infrastructure challenges, could the whole "crumbling" message be just another invention? We've heard forever that we are the most corrupt place on the planet and that's not close to true.

8.) How does Don Carcieri plan to win an election with such a mixed message on so many fronts (Gambling, General State Direction, Jobs, et cetera)?

By the way, I don't pose these thinking in terms of right or wrong. Just wanted to know what you thought.

Posted by: Bobby Oliveira at August 20, 2006 8:15 PM

1. I'm not sure what you would include under "corporate trainer." Based on my experience, I envision more of a freelance role, which is entirely unlike public school teachers. Even a full-time role strikes me as substantially different (at the very least in the way that continuing ed differs from grammar school). But the question is sufficiently out of left field that I'm sure you've further argument on this one.

2. Yes.

3. Only indirectly. The cost of living will determine how much the employer must pay in order to attract applicants and how little applicants are willing to take before looking elsewhere.

4. Sure. I'm on the losing end of labor's gall and management's spinelessness. You (or at least those on whose behalf you're arguing) would be on the losing end of the opposite situation.

5. I'm not aware of any mystical power attributable to the phrase "collaborative bargaining." Especially in Rhode Island, it's easy to imagine circumstances in which case the taxpayers are well served by conflict.

6. It depends.

7. As one who gives every indication of being an insider, you wouldn't be expected to feel the state crumbling. As a man who must every day convince himself not to move somewhere that talent, intelligence, and a strong work ethic are actually sufficient to ensure a living, I've somewhat of a different view.

8. I can't speak for Mr. Carcieri, but I imagine he's counting on there being enough people in the state who realize that he's the sort of man we need in the governor's chair.

And on further consideration of your previous comment, I'd add that I think union members would be wise to begin questioning whether taxpayers who want "something back... must give something away." The unions have, for years, operated in awareness of the fact that they were negotiating indirectly with the people who actually must pay the bill that they demand — and with representatives whose survival is based on a broader field of issues than the negotiation at hand.

There would be, no doubt, legal difficulty were the taxpayers to insist that their representatives take back what they've promised, but that doesn't mean it can't happen. That's particularly true if staple taxpayers (and/or their children) continue to leave the state and the representatives simply cannot squeeze any more blood from those who remain.

Posted by: Justin Katz at August 20, 2006 8:50 PM

Bobby:

Wrong again.

Laffey did in fact not spend more than he gained by going to court. Its never been about the headlines, its about the money. Headlines follow success. Lots of success = lots of headlines. More power to him.

Crossing Guards: Won in court with public policy issue. Management rights of Mayor and Council restored. Savings=$500M per year. This victory also served notice to every public union in the city and statewide that reform is on the way. This victory alone paid all the legal bills and then some. (You really need to do your math homework.)

School Budget: Won this one too. Saved six to ten million over four year term. Again short term gains turn into different decisions going forward. Continued resolve saves millions more in years to come. Also helps empower other municipalities to follow suit.

Pension Liability: Put $33 million in. Fund was at $8 million about to go to $0. No court. The firemen may think they have an axe to grind, but Laffey added where the fools before him raided. Laffey did go to court to reverse some of the damage done in the past with wholesale giveaways on retired fire and police COLA and other benefit increases.

City Worker Contracts: Co-pays in place for: City Hall and Public Works employees (Teamsters); Police; Teachers and Fire will fall in line. Savings in the millions. No Court (yet).

Borrowing/Bonds: Bond rating to investment grade. Will save the taxpayers millions of dollars due to low interest rate savings. This is due to best practices in budgets, audits, collections, and spending.

You sound like a reasonable person. This is only the tip of the iceberg. Say S U R P L U S ! The rainy day fund is back too.

Again, if Cranston elects anyone but Allan Fung Mayor they are inviting the crooks and morons back into city hall. GO Cranston!!!

J Mahn

Posted by: Joe Mahn at August 20, 2006 10:25 PM

"He has compared teachers to dogs." Whatever.

Most people like dogs -- Lassie, Toto, Snoopy, etc. Well, at least dogs aren't robbing us blind!

I have very little sympathy for all so willing participants in an almost entirely corrupt system, that puts teachers first and kids dead last. Believe it or not, there is a finite amount of money that gets spent on education. The more you suck out of the system, that adds no value to the education of anyone's child, the less that is being spent on the children themselves. There is no reason at all that kids shouldn't get new textbooks or adequate supplies, but that teachers should get guaranteed pay increases, virtually free health care, three months off in the summer, and an extravagant pensions at our expense.

You could have a much better product (educated children), at a far lower cost to their employer, the taxpayers, if they were simply treated like what they are -- our employees. The alternatives to the monopoly already exist; they're called private, parochial, and charter schools. The less children we have going to public schools, the less power that the public sector unions will have to buy-off politicians or to extort taxpayers. It would also have the net effect of reducing class sizes at the public schools, and reducing the necessity for the public to maintain numerous buildings.

No one prior to 1984 probably thought breaking up "Ma Bell" was likely either. I think we can break up the government education (using the term loosely) monopoly, and put the focus back on teaching children, so that they are able to compete in a global ecomomy, instead of treating them like a byproduct. It might not happen in Rhode Island, until its too late, due to the depth of the influence peddling by the unions, but I think it will happen elsewhere in the country, where people place more value on educating children, instead of using "the children" to extort largess from the general public.

PS I went to public schools K-12, and had the option of going elsewhere for junior high and high school, but elected to stay in the public system. I've often wondered, if given the choice, if I'd do it again.

Posted by: Will at August 21, 2006 1:36 AM

The November election will show who is in the majority today in Rhode Island: people like Bobby, who are blind to the accelerating self-destruction of the current system, but just want a bigger piece of the action for themselves. Or people who realize that without difficult, painful reforms, fiscal collapse will be the inevitable result. Call them "Corzine Democrats."

One thing is for sure. If it turns out that the Bobby's still run the state, Paul Arpin, U-Haul and other moving companies are going to make a lot of money in 2007. Rhode Island is at a tipping point. And more and more people realize it.

Posted by: John at August 21, 2006 6:50 AM

Bobby,

You've got your lies all mixed up. Didn't Carcieri called Montanaro the dog? lol Bob if I were you I'd be a lot more concerned with the messages Charlie Fogarty is projecting to people in the state. His corruption commercial is one of the worst but funniest political ads ever made.
"It's as simple as that". lol

Posted by: Tim at August 21, 2006 7:19 AM

Do I applaud Jon Corzine's budget victory in New Jersey? Yes (and a friend of mine who is a unionized probation officer there backed him all the way, too).
Did Corzine call teachers dogs, throw around union-bashing rhetoric every chance he got and drive people apart instead of together?
This state needs a Jon Corzine badly. Unfortunately, Don Carcieri is no Jon Corzine.

Posted by: Rhody at August 21, 2006 11:08 AM

>>This state needs a Jon Corzine badly. Unfortunately, Don Carcieri is no Jon Corzine.

Achorn got it wrong about Corzine.

The July speech by Corzine was SPIN (to put it mildly). The largest public sector union in NJ is CWA. Corzine has been (and still is?) romantically involved with the head of that union!

Corzine's speech came just after HE shut down NJ state government to push through a sales tax increase, bringing it to 7% (so that it now equals RI's for amongst the highest in the country).

A couple of weeks ago Corzines signed an "executive order" gift to the unions - recognizing daycare workers as "employees" able to "collectively bargain" with the state (i.e., Corzine just cooperating in pulling the same stunt that SEIU tried to pull here - though thank goodness Governor Carcieri managed to kill it).

Governor Carcieri is the real thing. Better yet, as far as we know he's not sleeping with Marcia Reeback either!

Posted by: Tom W at August 21, 2006 11:46 AM

Bobby Oliviera,
Your comment "Mayor Laffey spent more fighting, especially going to court, then he ever saved by winning any of those fights" is a big fat lie. I would say it is simply untrue if I didn't think that you knew better. But, I know you do. Yet, you continue to put forth something you know is not true. That is termed a lie, and that is just waht you are doing - lying. But, why do you lie?? That is easy to answer. You lie because if you did not, you would have nothing to support your argument. And that is just what unions do all of the time to hoodwink the public. They come up with all kinds of misleading monikers to hide what they are really doing. Case in point - WorkingRI. More like PorkingRI.
Bobby, you know that Laffey getting rid of the crossing guards saved Cranston more money than was spent on all the legal fees for all the court cases he got involved with. Oh, and another little one - when he took the School department to court, he saved $3,200,000! That's for just the first year! All gravy, baby!
Bobby, I expect much more from you. You are being brainwashed by the unions.

Posted by: Jim at August 21, 2006 6:47 PM

Let's take some of these in reverse order:

Jim, you only made 2 mistakes.

First, on the crossing guards, the savings and the lawsuits had nothing to do with each other. Yes, the savings happened. However, had Laffey not gone to court, the savings would have happened anyway when the clock ran out. The case he did win produced absolutely no changes during that contract or fiscal year.

Second, it was the school department that took the city to court; not the other way around. Just about every other School Committee told them not to. Yes, the savings occured. However, the law firm of Jim, Bobby, Margot Kidder, and Bobby's turtle could have one the same case just as easily.

That's ok, I'm still rooting for you on the 12th.

Posted by: Bobby Oliveira at August 22, 2006 12:08 AM

Bobby,
You continue to put forth falsehoods. You know damn well that if Laffey didn't take the crossing guard case to court, when the contract ran out he would have been sued for " not negotiatng in good faith". This would have gone on indefinitely and all the while the crossing guards would have gotten paid. Now come on, Bobby, I know you know how this stuff works.
Secondly, let's say you are correct on this point. That would mean that when the firefighters, or teachers contract expired Laffey could have simply gotten rid of them, too, huh? Don't I wish you were right.
Bobby, have you heard the saying "better to be thought a fool, than to open ones mouth and remove all doubt?"

Posted by: Jim at August 22, 2006 6:31 AM

Dear Jim,

Facts are stubborn things. The court case had nothing to do with "pattern and practice" as was testified to during the court case. At the end of the contract there was no negotiation; rather, there was a discontinuation.

You can still consider Laffey to be the "brave warrior standing up to the mighty union horde" if you like. You Laffey folks are tending to be a tad sensitive. Lighten up, this is supposed to be fun.

Posted by: Bobby Oliveira at August 22, 2006 7:51 AM

The sky in an interesting color in Bobby's world. Not at all blue.

Posted by: Greg at August 22, 2006 12:41 PM

Dear Justin,

There is no "further argument" on the first question. It's just my attempt to make sense out of it all.

Usually, you can take a position in government, compare skill sets necessary, look at equivalent work tests, study budget controlled and number of employees supervised and you can make a reasonable guess as to what the private sector "matching" role would be.

In most cases, to do the conversion, the government employee gets paid less than the private sector counterpart but the beneits are much better. Overall, the total package is within 10% of being a wash.

Unfortunately, when it comes to teachers, what is the equivalent role? If it's truly a "training mission", then it should be trainers. However, I think you would agree, it's more than that.

By the way, I will concede that part of the problem is we have an educational system overall designed to fit the needs of an agricultural/industry model that existed 2 centuries ago.

Posted by: Bobby Oliveira at August 22, 2006 1:01 PM

BO said: "Lighten up, this is supposed to be fun."

Bobby you're the joke, and we're laughing at you not with you.

As previously stated (with no rebuttal from you) Laffey changed the game in Cranston. He beat every odds maker in Vegas, on the Hill, and at the Statehouse. I know it, you know it, his friends know it and his enemy's know it. Hes the can do Mayor.

Face reality. He's going to be your next US Senator.

Good government is coming whether you like it or not.

J Mahn

Posted by: JOE MAHN at August 22, 2006 11:26 PM

-This state needs a Jon Corzine badly. Unfortunately, Don Carcieri is no Jon Corzine.-
No-but Good Time Charlie is. Get ready for 9% sales tax if he gets in.

Posted by: Mike at August 23, 2006 10:31 AM