Wednesday, March 30, 2011

You Are kidding...right?

  My Union Leadership sent me an article the other day to keep me informed on the current budget issues facing, not only my State but all the States of the Union. I was excited to read it, as I have been asking for a more detailed explanation of the current budget crisis, and how it affects me as a public employee.  The article was written by the Center on Budget and Policy Priorities (CBPP). It is titled GOVERNORS ARE PROPOSING FURTHER DEEP CUTS IN SERVICES, LIKLEY HARMING THEIR ECONOMIES – LESS HARMFUL ALERNATIVES INCLUDE REVENUE INCREASES AND RAINY DAY FUNDS. (dated March 21, 2011).  Yeah, I was taken aback by the title as well.  Not just for its length, but the fact that it made a policy statement in the title, I thought that was interesting.  But wait, that’s not all.  You see, I speak “liberaleses” and I caught the code words right away.  I was not to be deterred however and sat down to read the 23 page report, not once or twice but thrice.  For those of you who do not speak “liberalese” let me translate a few phrases. “Revenue increases”, “Raising new revenue”, “increased federal aid” and “revenue raising measures” all translate to “TAX INCREASES”.  Let’s see if I can break down their 23 page article into a paragraph, maybe two.
    It is a pretty complicated scenario so I can see why it took so much space to explain it, but I am going to give it a try.  States that elected conservative or republican governors, get this, want to cut spending. Sates that elected liberal or democratic governors want to, wait for it, raise taxes, uh, ops I mean want to “raise new revenue”. Whew! that was tough, I was not sure I was going to get that into one paragraph.
    The bias in this article was clear even to a layman such as me. It literally jumps right of the page at you.  So I began to think, who is the CBPP?  I bet they are one of them 501 c 3 type nonprofit organizations I am always hearing about. You know what else I heard them there type organizations’ have to file tax returns.  So I jumped on that there information superhighway that Al Gore invented and in a few clicks I was looking at their tax returns for 2007, 08, and 09.  Yep I guessed right they are one of them 501 c 3 nonprofit type thing a ma whats its.  Wow that’s quite an operating budget for a nonprofit think tank, I wonder who some of their donors are. So I began to think to myself, self, who would fund a left wing, liberal think tank, that would be disseminating information out to little ol’ me, the dues paying member of a union.  In just a few clicks I was looking at the tax returns for Open Society Institute (OSI) and the Tides Foundation. Wouldn’t you know it, the CBPP has received 2.5 million dollars from these to organizations from 2007, 08 and 09.  2010 numbers are not yet available.  So what. Oh yeah except the OSI which funds the Tides Foundation and then in turn they both fund CBPP, what was I saying?  Oh yeah that’s that multi -multi billionaire left wing, progressive, new world order, one world socialist government guy, George Soros.
   So I want to thank the guys that we pay a very handsome wage to look out for our interest, for taking the time actually do some research and well, look out for our interest.  I sure would hate it if they were just passing on some left wing propaganda handed down from, uh, uh, oh never mind.
  While researching this “article” I did however stumble across some other very interesting material about the stability of our pension funds that requires a less sarcastic response.  So till next time……

Are Pensions Worth It?

   I began my career in the fire service at 22 years of age. Therefore, to say that I had a great understanding of life and how it works would be a serious stretch.

    One thing I have noticed over my career is that in America, pensions are a lot like gambling. For those who have been lucky to reach retirement during good economic times, it has worked out for them. Their 401k's were moved out of the stock market at just the right moment. But what of the many who haven't been so lucky? The many who have approached retirement age during an economic down cycle? What about them? What about those who have retired confidently only to find out the company paying their pension was now folding up shop? What about them? What about the many public employees, myself included, in state retirement systems the taxpayers fund? These have been historically safe retirement plans, but now we are learning that even these come with great risks. Among those risks, the potential the taxpayer may not have the money to sustain such a system.

    While we watch the debate unfold before us between the public and private sectors, it is only natural for us to get caught up in it. After all, we do have a vested interest in its outcome. But as each side continues to fight for its own survival in acquiring what it needs, the real issue becomes clouded. The real question ignored. Are pensions even worth it? I do not believe that they are.   
    In early February of 1775, Benjamin Franklin wrote, “They who give up essential liberty to obtain a little temporary security, deserve neither liberty or security.” From this, I have learned that I am responsible for myself. The successes and failures I experience throughout life from the time I leave the care of my parents, until the time I die, are my own. What I have also learned is that anytime we give away any part of that responsibility, we assume risk. These risks however, have appeared to pay off for the last few generations. Risk though, inevitably has a downside. A downside that conflicts with what we have been told for years. Throughout my career I have believed that if we ‘invest’ our money in the company we work for, or in the state run pension system, for twenty years or more of labor we could then draw from an account that has been managed in our behalf. This account would sustain us throughout our lives or until it runs dry. This whole system has led to a fundamental change in American behavior. We have become less independent and less frugal, and in turn, become more dependent on the companies and governments we work for. We have effectively given up some of our freedom for ‘security’.  We can see clearly now that those who have done that have neither.  That is why the words of Benjamin Franklin have endured for so long, because they ring true.

    Now that the failures of these systems are laid bare in front of us, it gives validity to some other words that have proven to be true. “But let each one examine his own work, and then he will have rejoicing in himself alone, and not in another, FOR EACH ONE SHALL BEAR HIS OWN LOAD “ emphasis added. (Galatians 6:4-5)

    If I had known then what I know now, instead of a pension system, I would have wanted that money in my salary, to secure my future, as I deemed appropriate. However it was I invested, whether it was real estate, the stock market, or under my mattress, it’s my choice, and I alone bear the responsibility for that choice. If I didn’t understand the stock market and choose to “trust” someone else to do it for me, then that choice of trusting someone else rather than educating myself is still my choice and I bear the responsibility.

    The reality is I did not know then what I know now, so what are we supposed to do? A reformed drug addict, who teaches his children not use drugs, may in fact be a hypocrite, but it does not make him wrong. Learning from our past mistakes and trying to fix them for the future may make us hypocrites, but it will not make us wrong either.

    To quote an early 1990’s movie, “we have been hoodwinked, bamboozled, lead a stray” this system will not sustain itself. That does not change that we have “invested” our money into these systems and we trusted that it would be there. We worked honestly, and fairly and do deserve what we have rightfully earned. It may be to late for us, but not for our children. We must teach them to be frugal, and to save, and to be responsible for themselves. I do not have the answer for what to do about us yet. This is the discussion we need to be having, not trying to protect what we have at all cost.
   According to the US Department of Labor’s (USDoL) Bureau of Labor Statics (BLS), in 2010 less than 12% (11.9%) of the wage and salary earners in the US were represented by a union. As a work force public employees were unionized at much higher rate than the private sector, 36.2% versus 6.9%. An important fact to point out here is that it is only for wage and salary earners, meaning it does not represent the unemployed, currently 8.9%, or those who are self employed. So what does the USDoL say about self employed Americans? According to the USDoL’s Office of Disability Employment Policy (ODEP) the self-employed are the small business owners and represent 99% of all employers and 52% of the private- sector work force.
     What is it we should extrapolate from this data? It shows that as union members we are a very small portion of our society and of that small portion, we are mostly public employees. When you do things like our labor leadership is doing in Wisconsin, we are not standing against some “evil corporation” we are standing against our neighbor, our fellow Americans. Our fellow American who is already crying out about being taxed too much, who is already watching their dollar pay for less and less. You are standing against your neighbor and saying, screw you, pay me. This is not a path to victory; this is not even a path that will secure what it is you are fighting for.
    As we move forward in an honest discussion without all the hyperbole and scare tactics I suggest a few guidelines. What ever we decide to do, we cannot pass debt onto our children; reforms must be based in personal responsibility, and if there is pain to be suffered let it be on us and not our children.