Tag: Tom Ridge

GOVERNMENT PENSION TAPEWORM WILL KILL US ALL

It sure is easy for politicians to make promises. It just ain’t easy to fullfill them. The story below is about the Pennsylvnia  state budget. It is the same story across all states. Politicians sign legislation giving out goodies to get re-elected. The time bomb doesn’t explode for a decade or more, after the slimy politician is running the Department of Homeland Security or being paid as an Obama shill on MSNBC. The lack of courage, fortitude, honesty and intelligence extends across both parties. Tom Ridge signed legislation in 2001 that provided gold plated pension benefits to government workers and the slimy politicians that voted for the legislation. Ed Rendell further extended and increased these benefit promises. You can see from this chart that PA is not even the worst offender.

A recent study estimated that the unfunded pension liabilities for state government workers exceeds $4 trillion. In classic government fashion, Governor Corbett of PA is being branded a scrooge for drastically cutting spending and impoverishing school districts across the state. That is humorous since this year’s budget is $27.3 billion and next year’s budget will be $27.7. Only in this land of delusions could a $400 million increase be described as horrific cutbacks in government spending. There is never a mention about the fact that every school district in the state went on a spending spree in the mid-2000s because the real estate taxes from the housing boom were rolling in like waves on the ocean. Well the waves have receded from the shore and a Tsunami of unfunded promises are about to wash over the delusional morons who spent all the money and made all the promises to government employees.

The wailing and grinding of teeth over this year’s budget is laughable when you consider what is coming. The taxpayers must foot a $1.2 pension expense for the government drones this year, or 4.3% of the state spending. These pension payments are on automatic pilot. In 2016, the taxpayers of PA will be on the hook for $6 billion of pension expense, or approximately 20% of the state spending. This is called math. Either the taxpayers of PA will have to pay a whole lot more in taxes or drastic spending cuts will need to occur in other parts of the budget. There are 5.2 million households in PA. Each would have to pay over $900 more per year in taxes to pay for the pension promises made to government union drones. We all know that the FSA in Philly and Pittsburgh don’t pay taxes, so the average hard working middle class schmuck would have to ante up over $1,200 more per year to satisfy the insatiable appetite of government union workers.

This tapeworm was introduced into the digestive system of Pennsylvania by a Republican governor in 2001. He’s rich. He earns money for speaking engagements. He started our beloved DHS. This brilliant guy even invented our color coded terrorist warning system. We are now at Shit Your Pants Yellow alert. By 2016 we’ll be at Commit Suicide Red.

Will any politicians have the guts to confront the government unions and kill this pension parasite before it kills us all? I doubt it. There are elections to be won and promises to be made. That tapeworm looks harmless.

Funding Pa. pensions is ‘tapeworm’ in budget talks

Wednesday, June 6,2012

It’s crunch time in Harrisburg. In other words, it’s budget time.

As school districts across the state reel from the effects of an austere spending plan put forth by Gov. Tom Corbett, Republicans in the state Senate have created their own budget and restored many of the cuts proposed by their fellow Republican governor. The state House is expected to vote on that version this week, possibly as early as today. Then both sides likely will hammer out a final version with the governor.

Here’s the good news: Some education funding is likely to be restored, in particular when it comes to higher education.

Here’s the bad news: It won’t necessarily solve the fiscal woes afflicting school districts.

Now here’s the really grim news: None of this even addresses the elephant in the room, the biggest budget crisis in the state.

That, of course, would be the ocean of red ink inundating the state’s two large public employee pensions, those covering the bulk of state government workers and public school teachers.

This year the state’s on the hook for $1.2 billion in pension payments. That increases to $1.6 billion next year and an astronomical $6 billion by fiscal year 2016-17.

Kaboom!
Perhaps that is why Corbett is reluctant to start restoring money to the budget. He refers to the pension crisis as “the tapeworm” in state budget talks.

The pension crisis has been exacerbated by several factors. First, while enjoying a bullish ride on Wall Street for years, the state and districts looked at more rosy predictions and cut their contributions to the fund. Then the market tanked.

Also crucial was a deal cut by former Gov. Tom Ridge back in 2001 that boosted the payouts for pols and teachers while cutting taxpayer contributions.

Now the bill is coming due, and it’s a whopper. It won’t solve the current dilemma, but some denizens of Harrisburg with an eye on the future are offering an important change.

State Senate Majority Leader Dominic Pileggi, R-9 of Chester, is proposing legislation that would derail this gravy train for all future public employees. Instead of the defined benefit plan those workers now enjoy, they would instead join the rest of us in a defined-contribution plan, similar to a 401(k).

It’s a common-sense move that is long overdue. Sure, it would be easy to harpoon Pileggi and several other Republicans for cutting someone else’s retirement benefits while theirs remains intact. It won’t change the fact that the current system is unsustainable.

More importantly, it does not address how the state is going to fund its current pension woes.

What almost no one in Harrisburg is willing to say is the very real possibility of someone actually proclaiming what many are thinking – that as currently constructed the system, will not be able to pay out what was promised.

One possible solution would be to reconfigure pensions to their pre-2001 levels. That no doubt would be met with catcalls from those approaching retirement.

The move to get public employees out of defined-benefit plans is a start. But it must be accompanied by a solution to the more immediate problem — that $6 billion tab lurking in the distance.

One thing we’re sure of. This tapeworm is hungry. And it’s not going away.

— Journal Register News Service

BIPARTISAN SCREWING OF AMERICA

I got up this morning and just wanted to relax, read the paper and drink a couple cups of coffee. Then I open up my local paper and read the story below. By the time I was done the story, I thought my head was going to explode as I was cursing politicians across the land. When is this country going to wake up and realize this two party system of government is a joke? It is nothing but a game to distract the masses as both parties jointly screw the citizen taxpayers of this country.

This story proves my point. Just read the first couple sentences and you realize this country is doomed to economic collapse. The public school pension obligation in my state of PA went up 100% in the past year and will go up another 50% this year. That is mind blowing, but no one cares or even understands the implications. HOW COULD THIS HAPPEN?

Well the bastion of GOP conservatism, friend of George W, and the first generalisimo of DHS, Tom “Code Orange” Ridge signed a law in 2001 that guaranteed 50% pension increases for most legislators and 25% increases for more than 300,000 state workers and teachers. He didn’t give a fuck about the future. He was moving on to bigger and better things creating a new agency to strip Americans of their freedom and liberty. This REPUBLICAN dirtbag sentenced the taxpayers of PA to funding massive future deficits to pay union government workers’ outlandish gold plated pensions.

The next governor of PA was the ultra-liberal slimeball from Philly, Fast Eddie Rendell. You certainly couldn’t expect this tax and spend DEMOCRAT to ever cut anything. Just before he left office he signed another law that used the old tried and true method of not funding the pension obligation with cash until after 2030. Just extend and pretend. The American way.

Well, here is some news for the 300,000 government drones. You will not get those gold plated pensions. Promises do not equal cash. The money is not there. It won’t be there when you retire. The taxpayers will not be ponying up to fund your retirement. You’re as screwed as we the taxpayers are screwed.

The politicians of both parties are responsible. They are liars, thieves and traitors. It will get nasty when the clueless masses finally get a clue. The money is all gone.   

Pension costs a big worry for Pa. public schools

By MARC LEVY
Associated Press
January 14, 2012

HARRISBURG, Pa. (AP) — A spike in pension obligations could hardly come at a worse time for Pennsylvania’s public schools.

Gov. Tom Corbett, who has pledged to oppose any tax increase, will be proposing his second state budget on Feb. 7, and public school officials are worried about getting more bad news after working through the most difficult budget year in just about anyone’s memory.

The Corbett administration is projecting that its school employee pension obligations will rise by $320 million next year — or more than 50 percent — after more than doubling in this fiscal year.

Meanwhile, public schools are suffering through cuts of more than 10 percent to state aid. The cuts, approved by the Legislature and Corbett, fell most heavily on Pennsylvania’s poorest school districts, which officials argued get the most state aid.

It seems that no one in the public school community expects Corbett to propose more money for public schools next year, and he may even seek another round of cuts in light of his administration’s projection of a year-end deficit and rising costs in other parts of the budget, such as Medicaid and debt service.

Thomas Gentzel, executive director of the Pennsylvania School Boards Association, said Corbett administration officials have told him that they didn’t plan to cut public school aid again.

“But the question is, what are they counting?” he said.

If Corbett counts pension dollars as part of the state aid that helps keep the lights on and teachers in classrooms, then “there could be some significant cuts in major funding areas, although the overall funding may not be going down,” Gentzel said.

Corbett’s top budget adviser, Charles Zogby, declined to comment.

Rising pension obligations are being driven, in part, by lackluster investment performance on the money being paid into the system and a 2001 law under then-Gov. Tom Ridge that guaranteed 50 percent pension increases for most legislators and 25 percent increases for more than 300,000 state workers and teachers.

There’s not a whole lot that can be done about it.

The state constitution bars curtailing pension benefits for current or retired state employees and teachers. Meanwhile, a 14-month-old state law signed by then-Gov. Ed Rendell is designed to blunt the severity of the pension cost spike by deferring some payments past 2030.

That means that pension obligations shared by the state and school districts will jump to 12.4 percent next year, rather than 29.7 percent — a difference of about $2 billion, according to the Public School Employees’ Retirement System.

This year it is 8.7 percent, which still comes as something of a shock to school budgets after paying under 5 percent for much of the last decade and as little as 1.2 percent one year. School employees pay above 7 percent of salary, and have done so for much of the past decade.

This year, school districts are absorbing the rising cost of pensions while weathering sluggish tax collections and the loss of about $850 million in state aid for instruction and operations. To balance budgets, districts are laying off staff, freezing wages, closing buildings, renegotiating contracts, tapping reserves and using textbooks and computers longer.

In the Brookville Area School District in northwestern Pennsylvania, district officials are projecting a $400,000 increase in pension costs next year — or almost 2 percent of this year’s anticipated revenue from tax collections and government aid — to split between the district and the state. That will be compounded by increases in costs for employee salaries and health insurance premiums, out-of-district placements and cyberschool tuition, business manager Jason Barnett said.

This won’t be the last time school districts must wrestle with pension costs: The school employees’ retirement system estimates that the cost to the state and school districts will triple in four years and then stay at that level until 2035.

If there’s a silver lining, it’s that some school boards began saving for a spike in pension costs that they thought would be higher and come sooner. But because of the Legislature’s efforts to blunt the spike, some districts may have a little surplus cash to help absorb more losses in state aid next year.

“The good thing is they have that cash to weather this storm a little bit,” said Jim Buckheit, the executive director of the Pennsylvania Association of School Administrators. “At least, many have it.”