The Governor and the New York City public employee unions are claiming New York City has a surplus. Where have you heard this before? You might remember all those MTA “surpluses,” which purportedly meant the agency didn’t have to raise fares, could hand out wage and pension enhancements, and didn’t need financial support from the state and city, which allowed tax cuts and more spending on other things. If the MTA claimed it didn’t have a surplus, it was said, then it had two sets of books, because there were hidden $billions. Remember that? Well here we go again.
A surplus means you take in more than you spend, and cover your long-term obligations. If those obligations are growing and your debts are rising, your have a deficit, not a surplus. Period. The real second set of books would have shown the MTA was going broke. And now, despite an increase in the sales tax and a payroll tax to fund it, it is broke. And that’s what those seeking their own interests want to do to the City of New York, before they leave for Florida.
While every other politicians and interest in this state has consistently sought to enrich itself by destroying our common future, Mayor Bloomberg and the current NYC Council have a mixed record. You’ve heard plenty here about the worst of the Mayor’s negatives – it is amazing how no one in the MSM will do an expose on it even as the consequences come due. But on the plus side, he and the City Council agreed to set aside SOME money to pay for retiree health care promises. Not enough. Not enough so the hole didn’t grow. Just some.
We have a history, in this state, of leaders who might have cared about those who aren’t on the inside making deals, and about the future and those who will live in it, caving in when their career goals collide with the need to make tough decisions. Open the door, and the wolves start baying “the party is on!” And their party continues long after those leaders change course and start begging them to stop trashing the house.
An early example was former Governor Mario Cuomo, who had been a responsible governor, selling the future through fiscal tricks to try to get past his 1994 re-election without making painful decisions. But you can’t be a little bit pregnant. His successor went on to sell out the future in good economic years and bad, with the enthusiastic support of state legislature (with which the press reported he was at war.) With a large share of the damage shifted to the MTA and the Transportation Trust Fund.
What we have here is a repeat. Bloomberg himself raided the retiree health insurance fund to get through the worst years of the recession. The New York Post noted that “nobody complained,” presumably because no one at that newspaper reads my Room Eight posts, or because they believe anyone who sticks up for younger generations and the future is ipso facto a “nobody.”
Now tax revenues are up and Mayor Bloomberg has decided he wants to bleed the future a little less, even though the consequences of the past future-destroying he agreed to are coming due. And you get the immediate cry from Albany and the UFT that the “party is on!” They want the city’s schools destroyed so they can have more years in retirement than anyone in world history other than slave owners, and have already achieved this. But they want to keep deferring the consequences, hopefully long enough that people forget the cause. Even if it makes those consequences worse. Because they’ll all be in Florida by then.
They are even willing to sacrifice their own retiree health insurance fund. Some union. Because they know they will still get the retiree health insurance, and the city will be left with even more layoffs and worse schools to pay for it. And even if there is such a reversal of their power that the promises are not kept, they figure retiree health care will be taken away from those still working several years from now, not those in retirement at the time. Because the unions always sell out their future members when times get tight, after grabbing for those cashing in and moving out when times are flush. GOOOOOOAAAL!
That money should never have been touched. Far more should be put in – at least 25 percent of the current cost of retiree health insurance – just to cover the escalation in health are costs and the reality that those who will have to pay tomorrow for the retiree health insurance rights being accrued today will likely be poorer than people today who are not paying. If that isn’t true for New York City, because the city is becoming richer relative to other parts of the country, then it will certainly be true elsewhere – with NYC tapped to pay for it.
The New York City Teachers’ Retirement fund, which for some reason is several months behind publishing its annual report, is so deep in the whole that the City of New York should probably be paying the entire pension outlay out of current revenues so there is some chance for the fund to recover. Anything less is a deficit, not a surplus. And will lead to an ever greater collapse in a future no one seems to care about.
And forget about threatening layoffs. What you are seeing now is just theater. Unions love layoffs, because they mean vastly less in public services provided, because those who do less work are not laid off, and those who are laid off are going and forgotten. The Mayor has proposed a $1 billion increase in spending on public schools next year. And the UFT is protesting that they will offer far less in exchange? That “protest” you saw is actually a celebration. Marching to Wall Street? Hey if Wall Street can get away with this (and it seems they can), why not the New York City public employee unions?
“Two sets of books,” just like I expected. Comptroller Liu, who is carrying water but in this case did not want to lie outright about the purported city surplus, merely said “it’s complicated.” But it isn’t. Just take a look at the MTA. The real books would show Generation Greed is destroying this city, state and country, and not only demands the benefits but also the rationalizations to go along with it, to avoid damage to their self esteem. That protest, those claims of surplus, are rationalizations and nothing more. Fraud. The big lie. Spoken in confidence that no one in power will have the guts to tell the big truth, because it would make them look bad too.