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State of the Union
Those wishing to understand the full power public employee unions hold over state government — or who simply feel too good about life in general and want to come down a few notches — ought to peruse today’s new Legislative Analyst’s Office report titled, The Governor’s Employee Compensation Proposals. It starts off pretty easily, with the stat that the state pays rouhgly $24 billion in payroll each year and the view that the LAO itself “believe[s] that employee compensation reductions are necessary due to the magnitude of the budget problem.” But then it’s all doom, all the time from then on… * On the governor’s proposal to increase employee pension contribution rates by 5 percent of pay: “Pension Contribution Shift Is Very Risky. There are serious concerns about the legal viability of the Governor’s proposed 5 percent shift in pension contributions from the state to employees — particularly if the shift is accomplished through the legislative process, instead of through collective bargaining.” * On the governor’s proposed 5 percent salary reduction: “Under the current budget climate, with state employee unions at odds with the Governor… and given the unprecedented level of personnel cost cuts sought by the administration, it is virtually impossible for the administration and state employee unions to reach the level of savings assumed in the Governor’s budget through bargaining… With about a $20 billion deficit, the state has little of value it can give now.” * On the governor himself: “In the last year of his term, the Governor is in a poor negotiating position with state employee unions.” * On the several dozen pending lawsuits challenging worker furloughs: “The furlough program is credited with over $2.5 billion of state savings over [2008-09 and 2009-10], most of which has been credited to the General Fund. If the state ultimately loses these lawsuits, it might have to pay several hundred million to billions of dollars in back pay and penalties.” Seriously, I’ve got stop reading these things when I first get to work. -Anthony Pignataro
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February 07, 2012
The LAO is non-partisan. Facts are stubborn things.
OC Right (aka CalWatchdog) will never be confused by the facts. In OC Right’s world, you begrudge public servants every dime they make in salary or pension benefits. But not a word about obscene bonuses to Wall Street executives and big bankers. Take away the pensions of state workers, but keep the tax breaks for large corporations. Throw thousands of state employees out of work, but don’t think about taxing oil production. Thank God OC Right is still in the minority.
1. Mr. Stevefromsacto might have noticed that this is a site about CALIFORNIA. But for the record, it was wrong for both Presidents Bush and Obama to bail out the big banks, allowing the banks to shovel massive amounts of cash in bonuses to their executives. The banks should have been allowed to go bankrupt, then be taken over by more solvent firms, as Ron Paul and Peter Schiff recommended.
2. Nobody here is talking about “taking away the pensions of state workers,” just shifting new workers them to a system in which they pay some of the costs of contributing to those pensions, as do most workers in the private sector who pay the taxes for the government workers’ pensions.
3. California’s biz taxes already are the 48th most burdensome of the 50 states, driving out the businesses and jobs that pay the taxes that support the government workers. (Source of ranking: http://www.taxfoundation.org/taxdata/show/22661.html)
4. Thousands of state employees are going to be thrown out of work no matter what by the next governor, because there just isn’t enough tax money to support such a high level of government. Blame Gray Davis for boosting state spending 15% a year for two years straight during the dot-com boom — a level that since then has proved unsustainable as we have gone through two recessions (the Dot-Com bust and the current Bush Depression, as I call it; see, we’re not OC Right; we call ‘em as we see ‘em on both right and left).
5. Taxing oil production would raise gas prices for drivers, while reducing jobs in the oil industry. Isn’t raising the car tax enough?
6. As Mr. Maviglio says, facts are stubborn things.
- John Seiler