Don Roach

Union leaders are now saying that Rhode Island’s wealthy need to pay for the broken pension system. According to the Projo:

Union leaders proposed raising the income tax on wealthy Rhode Islanders Thursday as a means of offsetting the burgeoning cost of retiree benefits crippling cities and towns.

Really? So let’s get this straight, bad pensions negotiated by previous legislators should be paid by wealthy people who are most likely not part of a union….and this is what is called fair?

I don’t think so.

Union leaders juxtaposed raising taxes on the wealthy against the state reneging on contract pension benefits of union employees. Ok, let’s go there. Would a multi-millionaire be significantly hurt if they paid an extra 1-2k per year in taxes? No. Would a typical union retiree who isn’t getting double/triple pensions significantly be harmed if they lost 1-2k in pension benefits? Possibly, but certainly more likely than a rich person paying an extra 2k.

However, what union leaders are forgetting is that is not the paradigm. The paradigm is can the state and its cities and towns afford to support the current pension system as is? That answer is a big he– no!! So, go ahead raise taxes on the rich today, you’re going to continue to have to raise them again and again and again if the system is not fixed. Adding an influx of cash today only delays tomorrow’s pension liabilities.

Thus, the solution is not to further tax the rich. The solution is figuring out how to ease the burden on the state and easing that burden will likely require change in benefits.

Because the real paradigm is not who can afford a tax increase versus a benefit decrease. No, no my friends, the real question is will the state and cities and towns be able to pay 1 dollar of pension costs if the system goes unchanged? I’m sure retirees would rather receive 95% of their benefit today versus zero, no?

I think union leaders need to come to grips with that likelihood. If they don’t they’re in for a rude awakening.

What happens when you don’t have enough money to pay your bills? You stuff gets repoed, your credit gets shot to H-E-double hockey sticks, and things you enjoyed before mostly like get cut. Facing a governor who was (finally) willing to say, “We can’t afford everyone, we either are going to have to ‘cut’ certain employees or you take this deal”, the Council 94 finally blinked and faced reality.

On Wednesday, the presidents of the 23 local unions within Council 94, American Federation of State County & Municipal Employees, rejected Carcieri’s proposal, urging the governor to return to the bargaining table.

But Carcieri refused, saying he had no alternative but to begin wide-scale layoffs. And on Thursday, the leaders of the state’s second-largest union — the Rhode Island Alliance of Social Service Employees [Local 580] — agreed to allow their members to vote on the proposal, putting pressure on Council 94 to reconsider in the face of hundreds of potential layoffs.

On Rhode Island’s best known liberal blog, RI Future, you can probably see the ever ‘interesting’, Pat Crowley, going bananas as Council 94 recognizes that it’s better to have a job than no job at all in a very poor economic climate.

Now the issue goes to the union members whom I hope will chose this plan over not having a job. It’s unfortunate the economy is this way, but it is what it is. The only thing you can do when you don’t have enough money to pay is cut out some of your spending. The union now has the choice of taking some paper cuts or facing the machete called wide-ranging layoffs.

I know what I would choose.