Tag: Albany

If you haven’t already, you should download this spreadsheet linked in the first paragraph of this post and print out the “local output” and “state output” tables, before reading what I have written here. The data shows that according to public employment data from the Governments Division of the U.S. Census Bureau, there were 3,980 full time equivalent local government workers per 100,000 people in the United States in March 2010, about the same proportion as in March 2002. In 2010 local government employment was somewhat higher relative to population in New Jersey at 4,414, and substantially higher relative to population in New York City at 5,135, and in the rest of New York State at 5,084.

New York City’s higher local government employment is explained by the broad range of municipal services provided here, including public water, public sewer, public transit, professional fire protection, municipal garbage collection, and extensive public housing, hospitals and social services for the poor. The city’s local government employment, moreover, was slightly lower relative to population in 2010 than it had been in 2002. Extensive services are much less of an explanation for the high level of local government employment in the rest of New York State, since not all areas of the rest of New York State have all these services. Local government employment in the rest of the state, moreover, has been soaring for two decades, with increase from 4,683 per 100,000 residents to 5,084 just over the eight years in the table.

The governments division of the U.S. Census Bureau has released state and local government employment and payroll data for March 2010. I’ve compiled it for New York City, the rest of New York State (by subtraction), New Jersey and the United States, along with some related and relevant private sector data, and added 2002 data for comparison. Due to technical difficulties, the spreadsheet is located off site at this location. Follow the link to download it and save it. The “local” worksheet (see tabs at the bottom) shows data for local government, and includes a four page (hopefully) printable table. The “state” worksheet includes data for the State of New York and the State of New Jersey compared with the total for all state governments in the U.S., and prints on two pages.

The rest of this post is a discussion of how the data was compiled (mostly copied from a post on a similar exercise for the March 2008 data). I might follow this with a couple of more posts if I can, but I spent a lot of time compiling the information and wanted people to have it now.

Those of you who have read my posts on Room Eight over the years, and/or might have read essays I produced previously, know that generational equity in public policy has been a recurring theme – and a theme that in my view has been virtually ignored in political discourse and the media. For 30 years, I find, virtually every major fiscal decision has provided more benefits in good times, and no reduction in benefits in bad times, for older generations – those now 55 and over. And every reduction in benefits and well-being has applied to future generations only. When I write about generational inequity, I don’t write about policies that transfer resources from working age adults to the elderly in a broad general sense; these can be justified as long as the transfers are sustainable and those who sacrifice when young can expect to receive the same benefits when old. As I showed in my general overview of what the government does in August 2007, in fact, the majority of U.S. government activities transfer resources from working age adults to the young (public schools and universities) and the old (Social Security, Medicare, nursing home care under Medicaid). I called this the lifecycle of need. When I write about generational inequity, on the other hand, I refer to public policies that have left younger generations worse off than those who came before at every point in their lives, from childhood through middle age, with the worst damage likely to occur when they themselves are old.

That is public policy. I have also noted that in the private economy for most (the non-rich) earnings per worker peaked nearly 40 years ago, with the effect on the typical standard of living covered over first by more hours worked (as women entered the workforce), then by the loss of compensation to be paid out in the future (pension and retiree health insurance) which did not affect current spending, and then by borrowing. This post is about the family. Like our federal, state and local governments, families transfer well-being from working age adults to dependent children and seniors. How have the collective personal decisions of those now age 55 and over, whom I have come to refer to as “Generation Greed,” differed from those who came before, and how do they compare with their collective decisions in public policy? How have those coming after been affected? And, returning to public policy, what will happen as those in Generation Greed reach deep old age when many will require custodial care, which is either extremely personally draining or extremely expensive to provide?

There is a question about New York’s pensions I’ve been asking for years, but no one has been able to answer. Most objective analyses will tell you that the New York State pension system, which also includes all the local governments outside New York City, is in the hole, and residents of the rest of the state will face diminished services and higher taxes for years as a result. But those same analyses will also tell you that the New York State pension system is nonetheless one of the least underfunded among all public employee pension funds in the U.S. Comparative analyses of local government pension funds are rare, because there are so many and most are small. But according to those I have seen, which analyze large local pension funds along with the states, the separate City of New York pensions funds are among the most underfunded in the U.S. New York City residents, already faced with a higher overall tax burden and service cuts, will suffer even more as a result.

Why the difference? Why is the New York City Teachers Retirement System so much worse off than the New York State Teacher’s Retirement System, the New York City police and fire pension plans so much worse off than the New York State police and fire pension plans, etc.? How long has this been true? Are the benefits that much different? Has New York City never gotten out of the hole it got in after the Lindsay pension deals in the 1960s? Why didn’t various Comptrollers, actuaries and Control Boards require better of funding of the city’s plan in the years since? And if the city has been in the hole all along, how come the state legislature continues to impose pension enrichments on the city that are greater than or equal to those for the local governments in the rest of the state and the state government?

NYC Comptroller John Liu recently released a report and started an initiative to assure everyone that New York City’s public employee pension funds are fine. “Retirement Security NYC is a major initiative launched by Comptroller John C. Liu to protect the retirement security of public employees while ensuring the City's financial health,” with the retirement security portion intended to gain the support of public employee unions in a campaign for Mayor and the financial health portion intended to assure the city’s bondholders and wealthy and business taxpayers there is a limit to the extent to which their ox will be gored. The latest report is called Sustainable or Not: Pension Cost Projections Through 2060.

I have read the report, and have several problems with it. First, Liu piles up one rosy assumption after another. Next, his claims in big print in the front of the report, and in press releases, are much rosier than the detailed tables in the back of the report, even given the rosy assumptions. Third, those detailed tables lack the details required to figure out how the numbers were calculated. Finally, Liu endorses the Generation Greed position that it is perfectly wonderful if retroactive pension increases for those cashing in and moving out are offset by lower pay and benefits for future public employees. I get the feeling that the only way these reports can achieve their political objective is if no one actually bothers to read them, and write a post like this one. Or nobody bothers to read this post. My objections are detailed after the break.

The U.S. Census Bureau has released its education finance data for FY 2009. I'm compiling it as I have the time, and will write about it when I'm done. But this year, no one should have to wait for, or rely on, me. As they said they would do when I attended a symposium a year or two ago, the Bureau’s Governments Division is releasing more “derived data,” that is data that has been tabulated to be more comparable. For example, its current report features extensive revenue and expenditure data per $1,000 of local residents’ personal income and per student, with data per student by category. In fact, spending per student by category is available not only for states, but also for individual school districts with more than 10,000 students. Including, of course, the City of New York.

I’ve seen two MSM discussions of this data. The New York Times did not see fit to write about how much is spent in its own home city and state, but did write that nationally school spending wasn’t going up as much. And WNYC mentioned total per capita spending for the U.S., NYC and New York State, but not spending by category. But the MSM could look at that PDF report and write a comparison of spending by category right now. Yet it hasn’t. Instead, the dishonest, self serving propaganda about the proposed NYC budget by various self-interested groups has been duly reported on, on a “he said she said” basis. Is there something is that data that no one wants to talk about? Or is the problem that the Census Bureau doesn’t have a staff of flacks writing press releases that, combined with a quote in opposition from one of the usual suspects, constitutes a story? The actual NYC story is laid out below.

The New York Times is reporting that New York City Transit's operating cost recovery ratio has reached 64.0%. I'll bet that recovery is far, far higher for the subway and lower for the bus; the separate MTA Bus Company (former private routes) only covers about 40.0%. Meanwhile, the Wall Street Journal reports that bus ridership has been going down since 2005, as subway ridership has going up. Bus ridership had been going down long term, too, before the free transfers with Metrocard caused a short term turnaround.

A variety of explanations is given for the fall in bus ridership. One that isn't mentioned is the increase in bicycle transportation. Take it from me, almost no one who has actually tried getting around by bike would choose a bus instead, unless they were physically unable to ride. Bus trips tend to be shorter than subway trips, either to the subway or in directions the subway does not go. Bikes are faster, given you don't have to wait for them, and no less confortable in inclement weather, given that wait for the bus is outside. And with the fare increases, biking is a lot cheaper too.

The MTA website used to contain financial indicators that showed just how much of its operating costs, and its overall costs, were covered by fares. It also included performance and safety indicators.

In the new format, the performance and safety indicators are there. But the financial indicators are gone. A year and a half ago, when the MTA was slashing bus service, it showed extensive service usage and cost per rider information by bus line. I had hoped this would be expanded upon. Instead, information that was there is no longer there. Hopefully it is coming. I'll wait a couple of months before screaming bloody murder.

Not that it bothers those who are doing it, but it would certainly bother me to be in a situation in which other members of the community had to be deceived for me to avoid being despised. But those who have been getting richer over the past 20 years as everyone else has gotten poorer, as a result of their manipulation of our public and private institutions, have that sort of deception as their stock in trade. So the most likely outcome of the property tax cap debate is to enact a cap that is a fraud, so those who have been taking more and more in exchange for less and less can wail they had sacrificed, while they do nothing of the sort. Kind of like the “sacrifice” made by existing and retired public employees by agreeing to lower pay and benefits for future public employees, followed by the argument that all public employees should do a less good job because they are underpaid. Or the “sacrifice” of layoffs, which unions love, because they provide less in public services in exchange for the same or slightly more money, rather than the same public services in exchange for a lot more money. That is a sacrifice, in their view, compared with less in public services in exchange for a lot more money, which is what they have provided to New York City for the past four years.

If Governor Cuomo agrees to allow school districts outside New York City to not pay required pension contributions in excess of 8.6% of payroll, even as New YorK City’s pension contributions for teachers soar above 30% of payroll (and that probably isn’t enough), he’s just like all the rest. In two years, those school districts would claim they couldn’t pay the pension funds back without “devastating” cuts. And the legislature would offer Cuomo two options. Raise taxes, some of which would be collected in New York City, to pay for the pensions of those who worked outside New York City (even as city services are gutted to pay for its own, separate pension system), or cut New York City’s share of state school aid to pay for the pensions elsewhere.

Over the past 20 years, while local government employment has fallen in New York City, it has risen by 130,000 plus future pension recipients in the rest of the state. New York City public services are already being cut back due to is own irresponsibility, and the irresponsibility the state government forced on it, and now the even more irresponsible local governments in the rest of the state want New York City to pay for that too. And the members of the state legislature who proposed this are the moral equivalent of the federal government’s Paul Ryan, who wants even more spending on senior benefits for those 55 and over with massive cuts for those younger. They are members of Generation Greed, and among its worst members.