The joys of big government and labor unions

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Sure, a public sector union can negotiate great retirement deals but will the entity you worked for have those funds when you are ready for your pension.

Things are not so good  in Illinois - home of big government - from Bloomberg:

Illinois Towns Drowning in Pension Debt From Hundreds of Funds
The pension-funding crisis undermining the stability of Illinois and Chicago is rippling through hundreds of smaller governments, squeezing budgets as officials prop up teetering police and fire retirement funds.

The eastern Illinois border city of Danville has reduced its firefighter ranks by 27 percent in five years to lower retirement costs. The tiny Chicago suburb of Stone Park sold $2 million in bonds last year to bolster the police pension, which had just six cents for every dollar owed retirees.

“Most communities in this state are in no position to continuously meet the pension requirements,” said Tom Weisner, mayor of Aurora, the state’s second-largest city, with a population of almost 200,000.

The squeeze comes from about 650 police and fire pension funds and is largely overlooked in the deepening Illinois and Chicago pension crises. The state is saddled with $111 billion in unfunded liabilities. Chicago and its public school system, with a combined shortfall of almost $30 billion, face the prospect of bankruptcy.

The mayor of Aurora, the state’s second-largest city said the following:

“I firmly believe our police and firefighters should enjoy a good pension, certainly at a higher level than mine,” Weisner said, “but they are reaching well beyond the level of sustainability.”

I agree with him - these people are putting their lives on the line and they deserve to be compensated for it but it needs to be a rational measure. The unions negotiate for the highest they can and the city managers yield knowing full well that they will be out of office when it comes time to pay the piper.

The article goes on to mention that they are having to raise property taxes and cut back on services because of this overextension. Direct result is people moving to different states.

Unions had their place when nobody moved from one city to another and there were only a few employers in each city. The bosses had the workers over a barrel. Unions were great then. Things have changed and unfortunately, unions have not. They only represent less than 5% of the US workforce.

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This page contains a single entry by DaveH published on August 27, 2015 7:25 PM.

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