Sunday, August 08, 2010
Yes, we have accumulated a delicious glop of gritsy tabs while on vacation here in Carolina. Eat them with bacon and eggs this morning.
The coming battle royal between tax payers and retired public employee pensioners. Much of the political question will come down to this: Do you think public employees generally "serve" in some way that is more meritorious than private sector workers, or do you think they chose the life of "soft America" because it is, well, softer?
More on New Jersey's Governor Awesome. Highlight reel:
It was supposed to have been the biggest fight of Chris Christie’s young administration: a May showdown over what Democrats in Trenton were calling the “millionaires’ tax,” designed, like each of the 115 statewide tax increases of the last decade, to paper over a small part of a yawning structural deficit by soaking the rich, one last time. Never mind that half the filings and a third of the revenue from the tax were to come from New Jersey’s business community, already battered by a perfect storm of overtaxation, capital flight, and recession. The Democrats were loaded for bear, and had the legislative majorities in place to pass the measure, having spent all winter threatening a government shutdown should Christie use his veto pen.
Democratic senate president Stephen Sweeney had even admonished, in a turn of phrase eminently Trentonian in its sheer backwardness, that “to give up $1 billion to the wealthy during this crisis is just wrong.” He promised that the millionaires’ tax was where the Democrats would “make our stand.”
The tax passed on party-line votes in the assembly and senate on May 20. Sweeney then certified the bill and walked it across the statehouse to Christie’s office, where the governor — who had vowed to balance the budget without raising taxes, and who’d developed a bewildering habit of keeping his promises — vetoed it. The whole thing took about two minutes.
“We’ll be back, governor,” Sweeney told Christie on being dispatched with the dead letter.
“All right, we’ll see,” came the reply.
And just like that, the biggest obstacle standing between Christie and the realization of his sea-changing, fiscally conservative first-year agenda was gone.
“We have not found our footing,” Democratic state senator Loretta Weinberg later said, still reeling from the decisive defeat. “I think a lot of people underestimated Chris Christie.”
The linked story also includes a nice history of New Jersey's mismanagement. If you live in one of the other 45 or so better-managed states, you would do well to read it so you can stand guard against the same thing happening to you.
Uh, maybe women don't work longer hours than men.
"The equalization of resources in which success is punished is part of the plan. It's a feature not a bug."
Iraq forces take over duties from the last American combat brigade. When will they call it victory?
The latest sea ice news. Yes, Virginia, when the page turns on the boreal summer -- we mix metaphors like a banshee around here -- the forecasts of doom will again have been wrong.
Our new strategic partner: Vietnam.
Cold War enemies the United States and Vietnam demonstrated their blossoming military relations Sunday as a U.S. nuclear supercarrier cruised in waters off the Southeast Asian nation's coast — sending a message that China is not the region's only big player.
A rumor that all responsible people should hope is not true.
Damned good question.
New Yorkers cut back on the sugary soda, but still do not earn a pass on the hectoring.
In perhaps unrelated news, an animated map of the spread of obesity in the United States over the last 20 years.
Why do you keep posting links on sea ice to a derivative site? Try to go to a site that is nearer to the actual data.
I quote: "Arctic sea ice extent averaged for July was the second lowest in the satellite record, after 2007."
"The linear rate of decline of July ice extent over the period 1979 to 2010 is now 6.4% per decade."
In my opinion, there are good business opportunities investing in shipping companies which could use the North-West Passage. Perhaps not so good as the opportunities for investing in fusion power, but less risky.
Re: taxpayers vs public employees
Unfortunately, if you frame the issue as who "serves" more ... then public employees will use those in essential services -- e.g., firemen, cops and teachers -- as their poster children. We'll never hear about the government employees in the soft positions. Already it's the former that get the layoffs, to make us citizens scream. Corollary -- things like parks and libraries are the first things to get closed, even though they don't cost much.
What's a more compelling approach is dollar and cents: threaten that if states go "broke" all bets are off. Retirees lose future pension funding. Union contracts get abrogated.
(At some point, this is not just a threat. If things get bad enough, we'll all be equal pigs).
If you put in hard caps on tax raises, then you can have principled bargaining.
We can't have federal bailouts of states, as it undermines this.
We need limits on public employee unions, if not outright bans.
Unions will also have to pick between their working members and retirees -- I don't know from labor law but my sense is that older members and retirees have too much advantage over younger union members.
We need a state to go broke, unfortunately. I'm rooting for Illinois.
"In perhaps unrelated news, an animated map of the spread of obesity in the United States over the last 20 years."
As usual, the data excludes any reference to illegal aliens as if they do not exist. Without letting us know if they included the illegal aliens or not there is no way to know if what we are seeing is Americas problem or something to do with the countries the illegal aliens are from. 12-20 million people is a significant percentage of our population.
"global cyclone activity is on track for a historic low year."
That's good news.
All these figures go up and down like mad from year to year. This is why you have to average over at least 15 years, and preferably 20, to detect a trend.
Temperatures can go up or down by several degrees from day to day, whereas global warming so far is less than one degree, and in the worst long term prediction six degrees C. So you are looking for a weak signal against a very noisy background.
In icy regions, the crucial figure may be how many hours in the year the air temperature is above freezing.
"We need limits on public employee unions, if not outright bans."
That sounds like the USSR to me. I thought the USA was supposed to be a free country?
I know China has no free trade Unions and is growing its economy, but do you really want the US to be run like China?
FDR adopted the Wagner Act to empower unions. Without this and other laws many things unions do would be illegal restraints on trade, etc. The Wagner Act also ties the hands of employers, etc. There are many coercive aspects to how unions operate -- if your employer has one, you have to pay dues, etc -- employers have to collectively bargain with mandated arbitration, etc. The Wagner Act was drafted with big industrial companies in mind, and so is antiquated in many respects.
Public employee unions raise additional issues, particularly their ties to state legislatures. A lot of the big media buys funded by these unions is funded with our tax dollars, one step removed. In New York State -- to name one -- there's well-known corruption. Shelly Silver is our "Speaker of the House," the most powerful guy in the state, and very tight with our public employee unions. You bribe Shelly by hiring his law firm, an activity conveniently exempt from disclosure laws.
In practice, many unions operate for the benefit of a subset of their members. The old are favored over the young, for example. There are some clear conflicts that should be addressed. This could be a good target for needed reform. If there were periodic re-certification votes, the old wouldn't have such a lock on power. It'd make for more sensible negotiation.
One of the bullshit mantras of the left is that "we're all in this together." But go look at one worker's paradise ... Michigan. It's dying to support a food chain that puts UAW retirees on top. But doesn't Jennifer Granholm look cute.
That's where we're all headed if we don't stop it. The longer we don't deal with it, the more radical an outcome we'll get.
Comparisons to the Soviet Union, China and Britain don't fit here.
Speaking from my side of the political fault line -- I didn't wake up one morning to say "let's screw government workers and pensioners." Instead I -- and 300 million other Americans got a big problem dropped on us. The demographic / economic math doesn't work -- not even close. To deny this is to invite disaster.
I don't expect "those who get government checks" to be rational about this, so expect this to get nasty. We need a state bankruptcy or two without bailout to create the necessary teachable moment. Then maybe we'll fix this like grown-up Canadians.
Re: public sector employee pensions. It is not just the pensions. Public sector employees are not part of social security nor subject to the health care changes. They enjoy whatever their unions can extort (not a hard sell) from politicians.
Chimpy the Kenyan and his fellow rats could score points between now and November by simply mandating that ALL government employees would be covered by the new Obamacare and have social security pensions.
If it isn't good enough for my Congressman and all the bureaucrats that work for him, why is it good enough for the peasant tax-payers?
such a nice story......
Stimulus could only bailout states for so long, so we're about to get a $26 billion straight-to-DVD sequel: the "Education Jobs and Medicaid Assistance Act". The Senate has already approved, Pelosi has called back the House to vote tomorrow. Expect Obama to sign immediately after.
States face budget shortfalls of $84 billion right now, so $26 billion is only a stopgap until November. At the height of Stimulus, $26 billion would only have been a month's mad money for Nancy. But this kicks the can into December.
The "Education Assistance Act" is being sold as preventing teacher layoffs, paid for "with cuts elsewhere." Many news accounts are picking up the "cuts elsewhere" mantra. But the "Education Assistance Act" is budget neutral only because it's making changes to how multinationals determine their foreign tax credits. That's a "tax raise," not a "spending cut." Increased taxes on multinationals could be used for any purpose, of course.
Now I'm in full paranoid mode: My day job has made me good at finding things like the full text of the "Education Assistance Act." In my professional opinion, the full text of this Act has been purposefully buried on both Congress's site (thomas.gov) and the White House site. If you search by the bill number (HR 1586), the real bill is "lost in the deck" with unrelated filings before and after and misleading titles. Even more deliberate is the use of a blanked out "short title": "This Act may be cited as the `XXXXXXAct ofXXXX'" instead of its proper title. This frustrates the thomas.gov search engine. They did the first trick with Energy, the latter is a new one.
Here's the actual full text, which took me 15 determined minutes to do what normally I can do in one or two: http://www.thomas.gov/cgi-bin/query/D?c111:4:./temp/~c1111kla6o::
"Comparisons to the Soviet Union, China and Britain don't fit here."
How did Britain get into this list? Britain is still a relatively free country, in which Trade Unions are free to operate. There is an uneasy alliance between the Labour Party and the Unions - uneasy because when Labour is in power, it is in effect the employer of many Union members.
Note that paying union dues is only compulsory if there is a closed shop. At least in the UK, this is now rare.
Where independent Trade Unions are not allowed, disputes are more likely to lead to strikes and violence as there is no regular negotiating setup.
"How did Britain get into this list?"
Because you're equating "trade unionism" with "freedom", which is more a British perspective than an American one. The two can go together, or not.
"Where independent Trade Unions are not allowed, disputes are more likely to lead to strikes and violence as there is no regular negotiating setup."
Used to be more true. Doesn't happen as often in the US today. The only strikes I've seen lately are by public transit workers.
"Note that paying union dues is only [rarely] compulsory [in Britain]."
In the US, if a union gets voted in you have to pay dues even if you don't join.
Once a union gets in place in the US it often gets co-opted by a self-perpetuating faction. The faction often stays in power by favoring some of its members over others. "Old v young" is too often a fault line. If you decertified the union and started over again, you'd get something very different.
There are younger auto workers for example who get paid a fraction of what the older guy standing next to them gets. How do you justify that? This kind of thing is rife in the public sector unions.
I'm not anti-union per se. But public sector unions have been (and still are) out of control. They own the Democratic party, which is the mother of all conflicts.
"...The coming battle royal between tax payers and retired public employee pensioners..."
In a rare burst of intelligence, the Congress moved Federal Employees from CERS to FERS back in 1986 (backdated to cover 1984+ hires), so almost all Federal Civil Service now are on a three part retirement system. They pay into Social Insecurity, their FERS pension plan, and X% of their income (matched up to 5%) into an extremely conservative 401K type retirement fund.
The FERS system is (mostly) stable, self-sustaining, and not subject to the wacky benefit boosts that state and local pensions are struggling with right now. Thank God for Bob Dole (at least for this), can you imagine the impending crash if the Feds were in this disaster too?
The part that frosts me is that states and localities who were conservative with their spending, and responsible setting up their pension systems, are going to wind up paying out the (censored) to cover the spendthrift idiots who set up Ponzi schemes, and then retired under those same schemes on our dime.
My proposal would be any state or locality with financial issues would have the authority to immediately freeze all salaries and pensions at *last* years level, along with being forced to publish *all* salaries being paid for with public funds. Step two would involve a great number of pink slips, retirement renegotiations, and salary changes. Downward. Plus a 5 year freeze on all COLAs. And I'd need armed guards :)
I think next to the obesity animated map you should include the unemployment animated map too. It is only from 2007 but these things tend to go hand in hand: