This talks about the cost to local economies of states declaring bankruptcy and getting out of the lavish and unsustainable pension promises they made to public sector workers. What about the cost of actually paying those pensions? I don’t get any benefit from the politicians’ promises to teachers unions and the like. All I get is cost and taxes. Less money out of my pocket means more money in the local economy because I’ll have more to spend more.
What we’re really talking about here as with all public benefits schemes is taking money from Peter to pay Paul. Most of us are Peter in this scenario - just regular ole taxpayers. In any event, states are sovereign and are responsible for their debts. There must be absolutely no federal bailouts of insolvent states. Demanding taxpayers in Wyoming and Arizona pay for the lavish pension and healthcare benefits of public sector retirees in California is totally unreasonable. They never had the chance to vote for or against the politicians who made those promises.
Its long past time for public sector workers’ benefit schemes to take a severe haircut so as to be more in line with private sector retirement plans.
I agree, but that is what some states are demanding. Illinois wants $41 Billion and $10 Billion of that for pensions.
New Jersey wants Billions more, as does New York.
Talk about "Taxation Without Representation" if citizens in Iowa have to pay for the pensions in Illinois via a "bailout."