That is, in general, true. One of the foundations of a civilized society is the respect for contracts. Where would we be if an employer promised a worker $100 for a day's work, then was allowed to pay him just $75 at day's end?
That being said, the current public employee payment system is simply not sustainable. Perhaps each state needs some sort of limited bankruptcy option, which would allow for a limited reset of salaries.
But I'm guessing that things would have to get much worse for that to happen. Politicians today just won't risk losing votes to do it. Easier to kick the can down the road a bit.
I see this points, and I agree with the premise of unsustainability, but I'm irritated quite a bit about what's happening and so my rant just comes on automatically...:
This respect for the contract should go out the window when it turns out that the whole idea is founded on receiving taxes to pay for it, and the unions help elect the people who negotiate for the gov't. There's too much conflict of interest to make it a fair contract. We probably ought to demand that such deals, sweetheart or otherwise, be founded on annuities that are funded up front, and under the joint governance by the union and the gov't, with no future obligation of indenture for future generations of taxpayers.
Of course some gov'ts will just float bonds to keep the whole scheme working. That's fine as long as the risk is not subsidized. That means the bond must be honestly contracted with actual risk associated with how it's funded. For example a bond founded on the repayment by sales tax at a certain rate must only be paid by the identified sales tax, not indefinitely, and if the tax flounders then too bad for the bondholders, not too bad for the taxpayers. As it stands right now a whole lot of risk is completely subsidized on the backs of future generations, and that's reason enough to say these are dishonest contracts.
Dishonest contracts made with the government should be dishonored.
You’re right. It is just very frustrating to see perfectly healthy 55 year olds retired, having two homes, tennis membership, new SUVs, and complaining about contributing more to their healthcare!