Municipal budget fire to keep adding alarms

Today’s Opinion

Pensions. Unions. Full-time jobs with benefits. Dinosaurs. What do these four things have in common?

They are all extinct, or soon to be! 🙂

How about the first three? They’re all part of the municipal jobs scene.

We’re confident the City of Oakland employment party is about to end, not with $1,000 bottles of Cristal but in further job slashing, pay cuts, furlough weeks and fee raising. There is a limit though. Homeowners will not be able to pay double what they are paying in property tax. States will not be able to give more money to cities. The Feds, same story in the end.

Politicians are all parents to success, but failures are orphans. Who will our mayor-elect, city council and city residents point fingers at?

 

Today’s News

The Congressional Budget Office helpfully released a report last week titled “Fiscal Stress Faced by Local Governments.”

ZeroHedge has a nice writeup on it.

The two solutions to fiscal stress CBO lays out are, drumroll please… Default and Bankruptcy!

Until then, expect to see fewer cops on Oakland’s streets, more potholes, less street repaving, and more citizen anti-crime involvement.

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2 responses to “Municipal budget fire to keep adding alarms

  1. The cbo article was kinda useless because our biggest fiscal problem are vested retirement benefits, not so much contractual current compensation.

    Until some cities test the limits of Chapter 9 federal judges to reduce vested pensions, it appears that in CA Chapter 9 probably can’t reduce them.

    Recent news reports that Congressional republicans are exploring ways for states to get something like Chapter 9, suggests to me that Congress will have to deal with the muni problem at the same time because the states and city finances are so intertwined.

    Chapter 9 would be useful for reducing fire and police compensation that the Oakland city charter (thanks to JB?) protects with binding arbitration (ie. survey the other comparable bay area depts and match their high pay) but council doesn,t have the backbone to propose repealing.

    Otherwise, the main thing Chapter 9 would do for sure is give our officials political cover to do what they should have been doing as the contracts have come up over the past year: drastically cut compensation.

    But the link to the pension video made it worth looking for the cbo article.

    -len raphael, temescal

  2. agree with u len. unfunded, off the books pension/ss liabilities have always been a timebomb. only prob is you get what you pay for. in our lifetimes we will see how service is provided india or rural cambodia style … not much service for not much money. or in soviet vernacular, they pretend to pay us so we pretend to work.

    everyone will need to downward adjust their expectations about levels of service… and start to provide more of it for themselves.

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