It’s All About the Benefits
Reading article after article about the budget crises facing state, county and municipal governments, and one culprit becomes clear – budget busting benefits. When people in government find themselves furloughed or worse, they ought to take a moment to consider they may be the victims of their own success. Think I’m exaggerating? I’m not. Consider the courts:
Now, Metro Court employees are looking at furloughs for the first time, while 2nd Judicial District Court employees are likely to go from the equivalent of about half a week a year to a total of about eight days unless more money is found somewhere.
“Ninety-five percent of our budget is people — salary and benefits,” state District Court executive officer Juanita Duran said. “There’s only one answer: furloughs.”
Of course, the benefits problem is not just limited to the courts. Schools have the same problem:
One reason for the Albuquerque school district’s budget crisis: Officials miscalculated the amount of money needed for employee salaries and benefits during the past two years.
Superintendent Winston Brooks announced last week that the district must cut $43 million from next year’s budget, likely requiring hundreds of layoffs.
About $24 million of the required cuts is due to a reduction in state funding.
The remaining, however, is to make up for nearly $20 million in underestimated employee salary and benefit costs over the past two years.
Every time their unions sat down to the bargaining table, they pushed for increasingly more attractive benefit packages. And, when the financial screws are turned, they do everything in their power to protect those unsustainable benefits:
The teachers’ union and other advocates are exhorting state lawmakers to repeal state income tax cuts passed earlier this decade — and to pass other tax-side measures – rather than rely on cuts and the increased contributions law to address New Mexico’s budgetary shortfall. Recent projections show the state with a $441 million shortfall for the year that ends July 1, 2010.
Of course, this problem is not limited to state provided benefit entitlements. We’ve known for years, and are now reminded with increasingly frequency, that nearly every entitlement program introduced at the federal level is unsustainable:
The trust funds for both Medicare and Social Security will run out of money earlier than expected because of the recession, the trustees reported today. The Medicare Trust Fund will run out of money by 2017 two years earlier than forecast last year. The Social Security Trust Fund’s life has been shortened by four years and is expected to run out by 2037.