Friday, February 18, 2011

"Government Union Reform Overdue"

The above link is to a news article relating that the state of Wisconsin is voting on de-linking the state from the collective bargaining agreement with state employees and teachers.  The law passed the legistlative committee and was expected to pass in the state house quickly.  Apparently, during the entire decision process thousands of teachers and state employees packed the state house and surrounding capitol to protest this decision.  It seems the state is asking state employees to boost their contributions to their medical program form .02 (read free)  to 5 percent of the costs and to pay 12 percent toward their retirement fund.  State employees, accustomed to a plush ride on the taxpayer gravy train, are balking.

For anyone who has studied the progressive movement in the U.S. this development is stunning.  Wisconsin was the very heart of the socialist movement fifty years ago with Robert LaFollette leading the charge for the union cause.  What caused such a stunning turnabout in, historically, a relatively short time?

Well, it seems the taxpayers in Wisconsin, and everywhere else in America, have finally decided that they've had enough of throwing billions of their precious taxpayer dollars for teachers that are inept and ineffective, spoiled and overpaid.  Taxpayers are tired of suffering of their own family budget constraints while seeing unionized state employees earning three times what the private sector earns.  The costs of maintaining huge federal and state bureaucracies is staggering and has bankrupted the states.  California is laboring under perennial $25 billion dollar annual deficits and the same burden is being carried by New York, New Jersey, Wisconsin and two dozen other states.  The home state of our President, Illinois, is also suffering from crippling state employment costs but they apparently have enough socialists in the statehouse since they were able to impose a 75% INCREASE IN THE STATE INCOME TAX!



A Modest Scribler said...

The classic example of embedded inflation is the wage-price spiral — better described as wage-price leapfrogging — of the 1970's. Back then, whenever wage contracts came up for renewal, workers demanded big raises, both to catch up with past inflation and to offset expected future inflation. And whenever companies changed their prices, they raised them by a lot, both to catch up with past wage increases and to offset expected future increases.

The result of this leapfrogging process was that inflation became a self-sustaining process, feeding on itself. And ending that self-sustaining process proved very difficult. The Fed eventually brought the inflation of the 1970's under control, but only by raising interest rates so high that in the early 1980's the U.S. economy suffered its worst slump since the Great Depression
(This was actually written by a LIBERAL economist, the NY Times' Paul Krugman.)

Anonymous said...

We need a Constitutional Amendment that mandates all government revenue to be a FIXED percentage of the annual GDP. It should further specify that government expenses (City/County/State/Federal) shall be no more than 90% of revenue with the remaining 10% being equally divided between paying down the national debt and a "rainy day" emergency fund.

Plain, simple, logical common-sense. The politicians would be horrified but the hard-working, honest and ethical American public would go for it in a heartbeat.

Politicians seem to think that taxation is a bottomless well that they can draw from ad infinitum. We have to remember that liquidity is the life-blood of the economy. Take too much money out of circulation, no matter where it is drawn, and the economy will die.