Unsustainable Benefits and Entitlements
Teachers are being laid off. People are having fewer children and enrollments are declining. That, together with state revenue cuts, is forcing a RIF - a “Reduction In Force.” Now, the detested (by me) teachers’ unions are applying their cherished (by them) contract rules so that younger, lower-salaried, and often more-effective teachers will get the ax, while older, higher-salaried, and, oftentimes, sclerotic teachers will not. It’s “last-hired, first-fired” regardless of the effects. All of us - students, parents, administrators, and teachers - know who the good teachers are and who the bad ones are, but thanks to the unions, little of that knowledge will apply in the RIF.
As the most-senior teacher in my school district with 33 years of service, my position is safe. I’ll decide whether to continue teaching year-to-year and, as of now, I’m planning to sign a contract for September, 2010. One factor in my decision about retirement will be whether I can depend on the Maine State Retirement System I’ve been paying into for more than three decades. I simply don’t think I’ll be able to rely on it if I live to be 78, or whatever the average life expectancy is for heterosexual American white guys like me.
Why? Because the Maine State Retirement fund has declined with the economy, just like everyone’s IRA has. Public employee retirement in Maine and other states is guaranteed by the taxpayers if the fund is insufficient to meet the “defined-benefit” obligations to people like me. Therein lie my doubts. If I retire at 60, I’m supposed to get around $40,000 a year and a third of my individual medical insurance premium until I’m dead. That’s not too good compared to what public employees in other states and in the federal government get, but very good compared to what the average Maine taxpayer can expect. Maine is not only one of the poorest states in the country, it’s also one of the highest-taxed. That’s not a good combination. How long will Mainers be willing and able to continue supporting retirees like me and my fellow baby boomers should the retirement fund run out of money? Not too long would be my guess.
Governments at every level are rapidly reaching the point where they cannot continue to deliver what they’ve promised, and millions of people have, unfortunately, learned to expect. It isn’t just me and my pension. It’s Medicare for everyone. It’s Social Security. It’s disability payments, welfare payments. All of it. We know this, but we pretend not to. We put off the day of reckoning as if maybe it won’t really arrive. Rather than cut back on entitlements before the system collapses completely, we increase them. We borrow money from a country like China, which can’t afford to provide these benefits for its own people. Up to now, they’ve lent it to us because we obviously can’t afford it either. Lately, however, they’re getting reticent. They see that we’re printing money so they’re abandoning the dollar along with everyone else in the world.
While the number of students in my school district has remained fairly constant over the past three decades, the number of employees has about doubled. We’re looking at layoffs for next year, but around the country government jobs are increasing rapidly while private sector jobs decline. Government employee unions are now bigger and more powerful than private sector unions. One big reason General Motors and Chrysler went bankrupt is because they couldn’t pay the generous benefits of retired United Auto Workers, which amounted to almost $5 billion in 2006 alone. For every active worker, General Motors was supporting 3.8 retirees and dependents. President Obama and congressional Democrats took over the auto companies to protect bloated union contracts, not to help our economy. Now taxpayers are on the hook for them.
States and cities are going bankrupt. Government unions are strangling taxpayers just as private-sector unions have strangled stockholders. Unsustainable entitlements are growing and Democrats are trying desperately to prop it all up while blaming Bush for it all. Ordinary Americans, however, are seeing through that. The growing Tea Party movement represents grass-roots citizens who want to stop the madness before the whole country goes over the cliff. The November elections are going to be very interesting indeed, just as special elections in New Jersey, Virginia and Massachusetts have been.
Since I can’t expect government to take care of me, I’m being a lot nicer to my children. Meanwhile, I anticipate that I’m going to have to keep working until about five years after I’m dead.