Thread: Protesting in Wisconsin....Just the beginning?

Originally Posted by ChrisL

Here's the only problem I see with what you've said: Public workers get pay raises at the expense of taxpayers. I guess I don't understand why the average tax payer would be happy with public workers "raising the bar for everybody" when the money is coming out of the pocket of the tax payer.

Chris L

This wouldnt be a problem if the taxpayers manufacturing jobs hadnt gone overseas. Also before the legislature asks them to pony up the concessions maybe the legislature should make some concessions of their own for the sake of the public pocket book, lead by example.

I don't think the problem is in the manufacturing jobs. The fact of the matter is that these jobs do not require as high qualifications as they may have in the past, therefore they correspond to a lower standard of living and end up in countries where people are more willing to accept such a standard.
It's analogous to the industrial revolution, when a machine can make something much faster and much better than a human with rudimentary tools, these old jobs become redundant.

Then with globalization americans also face more competition, so it seems reasonable that in the bigger pool you may end up being a smaller frog.

Of course, there's also the problem of businesses externalizing costs and selling it to politicians for money and to the joe-six-pack as anti-regulation and pro-business. And government waste appears to be only wasteful when it doesn't benefit the person making such determination.

The nature of free market is that it is conductive to creating big economic disparities. And, sadly, a lot of voters are pretty easy to manipulate with ideological propaganda, and don't understand that at the end of the day the more important thing in their life is the nature of the society they live in.

The american political system though is designed from day one to be based on elitism. But there is also the feedback from those not in power, who are the vast majority. As long as they are wiling to accept the way they are being ruled, that's how it ends up being (the congress reelection rates are around 90%, same as always). Unfortunately it seems to be often producing the worst of both worlds - corrupt establishment and incompetent populists.

It's always interesting to look at the polls who ask the quality questions without trying to bias them with ideology, e.g. what do they think is the level of economic disparity and what do they think it should be. Vastly different results than if you ask about tax cuts.

On the TV news tonight I was told that the average public/government employee in Wisc is paid 4.something percent less than the private sector. As a national average it is around 7% less. Gotta do more research but food for thought.

Tim

Originally Posted by 32t

On the TV news tonight I was told that the average public/government employee in Wisc is paid 4.something percent less than the private sector. As a national average it is around 7% less. Gotta do more research but food for thought.

Tim

I doubt they're factoring in benefits, etc. Take home pay is only piece of the puzzle. When I worked a municipal job I had free healthcare, paid holidays including the government holidays that no one in the private sector gets off, two weeks paid vacation, roughly the same amount of paid sick days, automatic guaranteed "cost of living" increases, taxpayer contributions to my retirement fund, free access to higher education class opportunities while on the clock. It all added up to much more than what my actual hourly wage was (which was also easily equal to the private sector).

One more than one occasion while I worked there an employee would leave for what they thought were greener pastures in the private sector. In most of those cases, those employees would come back asking for their job back.

Chris L

That is exactly correct it is the benefits that are costing so much the legislation adjusts those areas to closer to private sector jobs. And the reason for removing collective bargaining is to fix it long term not just untill the next contract when they would just get it all back and more.

On another note Gov. Walker was just on the local news stating There will be layoffs starting on Monday if this bill is not voted on. Up to 1500 workers. He is not kidding money needs to be saved. You wanna have your cake and eat it to but the budget does not allow for it.

Money does need to be saved and unnecessary costs eliminated. Why in MN if one were to eliminate all (100%) of state emmployees you'd save a whopping 4% of the budget. Were those employees needed or not, you could save on a grand scale by getting rid of them, union or no union.

Eliminating unions is a poor choice as it completely emasultes (defeminizes?) the work force who have to deal with those in power. Don't forget that the individual without collective bargaining now must deal with those who make laws and regulatlion and can call the police forces out to bust uncooperative heads. Remember too that when the labor contracts were approved, they were approved by that same government which now decries the wages and benefits that were negotiated and accepted.

When I retire, I will have a pension that I contributed to. That plus Social Security, to which I also contributed, may be enough to live on. I will have to pay my own health insurance, probably several thousand dollars a year and I will have to pay tax upon tax to very hungry governments who wish to absorb moneys much and greatly.

The government (choose your level) has enormous power and will prevail. Why my house belongs to the government; I only rent it. Oh, I've fully paid for it, but if I stop paying property taxes, it will be seized and I'll have to find a cardboard box and a comfortable bridge.

One other thing, the same government which approved those labor contracts is the same government, through its poor and short-sighted planning, that got us into the financial fixes where we now find ourselves.

There really is no hope be you liberal or conservative them what gots, gets.

Originally Posted by 32t

On the TV news tonight I was told that the average public/government employee in Wisc is paid 4.something percent less than the private sector. As a national average it is around 7% less. Gotta do more research but food for thought.

Tim

I wish I had access to the contracts.
A classic difference is that pay is less but retirement
is at 20 years and the pension rate is 80+% of wages
combined with a rich health plan.

So a private sector dude makes 4% more but has to work
for 45 years and then retires with his 401K or just social
security and must depend on Medicade....

This is a lifetime problem.

Worse in the northern climates those that retire
migrate to the warmth of Florida taking their
cash flow with them. Thus the retirement wages
from Wisconsin do not get spent in Wisconsin
but with a big sucking sound flow south.

Again this is a lifetime problem and the entire
span of a working lifetime must come to the
equation.

Then there is the issue of double dip. After 20 years
at one job many "retire" and take another position exchanging
their municipal job for a state job or a county job... Again
20 years later fully vested he retires again.
Now with two pensions that each pay 80% of his base
plus medical come together and retirement is 160% of
his 'highest' paid years adjusted up for inflation.

Without breaking these insane contracts and renegotiating
sane terms the entire game will end badly.

Originally Posted by niftyshaving

I wish I had access to the contracts.
A classic difference is that pay is less but retirement
is at 20 years and the pension rate is 80+% of wages
combined with a rich health plan.

So a private sector dude makes 4% more but has to work
for 45 years and then retires with his 401K or just social
security and must depend on Medicade....

Right, so the comparison has to be made w.r.t the total. Of course, there are more factors, so here's a study I found that gives a lot more details. (Different numbers from the same study are quoted by either side as justification that the public employees are more compensated, or less compensated than their private counterparts, so it's best to look up the meaning of the quoted numbers at the source)

http://epi.3cdn.net/9e237c56096a8e4904_rkm6b9hn1.pdf

Originally Posted by niftyshaving

Then there is the issue of double dip.

I don't understand how this is an issue (other than 'these people are making a lot of money'), whether the pensions for those two separate jobs are paid to one person, or two people it is the same amount that is being paid. I suppose that there is a saving in health benefits are if they go to the same person instead of two different people, since one person can't charge twice for the same medical bill.


I didn't know that the public employees get to retire after 20 years on the job, I thought that's only for law enforcement/military type and if they pick that option the retirement pay is 50%, not 80%.

Originally Posted by gugi

Right, so the comparison has to be made w.r.t the total. Of course, there are more factors, so here's a study I found that gives a lot more details. (Different numbers from the same study are quoted by either side as justification that the public employees are more compensated, or less compensated than their private counterparts, so it's best to look up the meaning of the quoted numbers at the source)

http://epi.3cdn.net/9e237c56096a8e4904_rkm6b9hn1.pdf


I don't understand how this is an issue (other than 'these people are making a lot of money'), whether the pensions for those two separate jobs are paid to one person, or two people it is the same amount that is being paid. I suppose that there is a saving in health benefits are if they go to the same person instead of two different people, since one person can't charge twice for the same medical bill.


I didn't know that the public employees get to retire after 20 years on the job, I thought that's only for law enforcement/military type and if they pick that option the retirement pay is 50%, not 80%.

The retirement age and retirement qualification/vesting age is all
over the map. I just know that a couple high school pals of mine
retired twice. Once at 20 years and later when they hit 60 and
qualified for early retirement.

The link above is a good one -- it does not list the future value
of vested retirement. It does list the single year earning tables
and does show that on a given work year it public service folk
are not overpaid. However I could not see an accrual for retirement
and health insurance in the link.

I know of a computer company in Wisconsin that pays very well
but has zero retirement. Employees are on their own with
a 401K and Social Security.

So retirement pay of 50%+insurance for 20 years is a
a BIG tag along payment. Page 8 says...
"Retirement benefits also account for a substantially greater share
of public employee compensation costs: 8% compared
with 4.6% in private sector organizations with more than
100 employees." But does not state that this larger retirement
benefit is "deferred". It also does not say that it is "nearly double"
the private sector.

One thing that is hammering local governments is this "deferred"
payment. Private companies today shake your hand and
say good by at retirement. State and local employers shake your hand
and then sign 'em up for the plan.

I suspect the above pdf was well researched to make the
point of one side. I suspect there are more facts to consider.

The least of which is that our elected officials have been running
a Ponzi scheme by not funding their retirement plans.

And little of this matters if the insanity in the mid east
erupts into a big oil fueled fireball and we continue
to outlaw coal and more....
Invest in insulation if you have not already.

Right, the issue with the retirement is not very clear. From that paper it appears that there is 8% (or whatever number for the corresponding education bracket) in benefits and that would go into a pension account from which the future pensions would be paid.

That would be what makes sense. If that is true, the problems seem to be (1) poor management of those pension funds, so they actually do not make enough to cover the promised benefits; (2) the government just issues an IOU instead of actually contributing that portion (we know this was/is the case in NJ where it was highly publicized); (3) the government just takes money off that pension fund to pay for other things (seems to be a favorite thing in NY).

All these are chronic problems happening for decades and the problem is with all the politicians during these decades, which tend to keep being reelected. So, if the voters leave things go bad for that long, at some point they ought to suffer the consequences of being that stupid. And when the state goes bankrupt the government employees who hold all these IOUs get to forfeit their benefits as well, or at least large portion of them. I mean they certainly weren't too smart either if they relied on a contract with a government that doesn't appear to have the means to honor it. The same as if you contribute to a private pension fund that just goes bankrupt (or invested yourself in stocks that plummeted), the money is not there, so you're screwed.

That's the scenario I already described in my earlier posts.

In the private sector one instance of the same thing was the so called 'housing bubble', a couple of financial institutions went bankrupt, and many others would've gone too, but under the threat of destroying the whole economy they got bailed out.

At the end of the day those with money/power, on average, always do far better than those without, and that's exactly what the free market is all about, both in economics and politics.

Whether the majority of people without much money/power (who hold the final say via voting) can influence a more pragmatic middle ground solution is yet to be seen. Looking at the news, or even at political threads on SRP, it doesn't seem promising right now.