Friday, April 18, 2014

No Way This Could Go Wrong...

#1 Blogdaughter sends in this story. The term "Robbing Peter to pay Paul" comes to mind...

Unions want $100M in federal money to aid Detroit pension deal
Union leaders in Detroit want $100 million in federal funding earmarked for homeowner assistance to help make up a $3.5 billion shortfall in the retirement system for city workers, The Wall Street Journal reported Wednesday.

Under the plan being discussed by federal and state officials, Michigan would give Detroit $100 million earmarked for the state from a U.S. Treasury Department fund established in 2010 to provide relief to struggling homeowners in the wake of the housing crisis, according to the report.
So, basically, unless I'm missing something, the unions are extorting money from the state that was obtained to help homeowners to funnel into pensions. Okay then. Now, I'm not entirely unsympathetic to the workers here. They were sold a bill of goods when they took their union city jobs, that they would have a fat pension at the end for sticking it out. Nowhere in the fine print did it state "Unless the state runs out of money."

There's a number of factors at work here. First and foremost, why is there a $3.5 Billion shortfall? Did the number of pensioners grow unexpectedly? Were they all living exceedingly long lives? At some point someone had to have done the math to realize the money was going to run out - but then what? It's not like the city can just say, okay, anyone hired after such-and-such a date is not getting a pension.

But just taking federal money earmarked for another situation entirely? Isn't that, oh, stealing? I'm trying to figure out how on earth they think this is going to fly. Because if I were in charge of distributing federal money, I would make sure this state never got a single red cent ever again, because obviously they can't manage their money to save their lives, and anything that flows into the state will wind up in union coffers.

At some point, you run out of Peters to rob...

That is all.

4 comments:

Dave H said...

Once politicians found they can buy union votes with sweet pension deals, it was the beginning of the end. They get a large block of voters right away, but they'll be out of office when the pensions come due. Then it's somebody else's problem. But ultimately it's the taxpayers' problem.

AndyN said...

I'm sure there were a lot of unrealistic assumptions used with a wink and a nudge when they calculated those pension payouts. That said, I don't think anybody taking a city job in 1980 when the population was 1.2 million expected that today their benefits were going to be supported by a population of less than 700k, a lot of whom aren't contributing anything because if they could afford to they would have joined the exodus.

What amuses me is that even if this goes through they're only fixing less than 3% of the pension problem. And I can't work up even a little bit of sympathy over the fact that they're taking money that was meant to prop up people who bought houses that they couldn't afford. How about if we just tell the unions and the underwater homeowners to get bent and give all of that $500 million back to the taxpayers?

Cargosquid said...

That 3% will allow the union LEADERS to keep THEIR pensions...probably, if they run true to form.

Let them twist in the wind.

the band-aid bandit said...

Chances are, the situation is the same as with the funds for the Social Security Administration. People pay in, and the .gov raids the funds to pay for their pet pork projects.