Monday, June 09, 2008

A Glimpse of the Future

Vallejo blames bankruptcy on contracts with unions

"Now the city of Vallejo, hit by the slumping housing market and the economic slowdown, says it is in deep financial trouble. It's blaming contracts with public employee unions, much like the city of San Diego.

But unlike San Diego, the Vallejo City Council voted unanimously to declare bankruptcy and ask a federal court to break its union contracts – a move that experts say could set a precedent. "


Of course the Federal Government won't go bankrupt. It will simply print more money and make everyone's pension worthless as inflation eats away at the value of our money in pension funds investments and savings.


"An attorney in Santa Monica who worked on a previous government bankruptcy that also drew national media attention, that of Orange County, said cities and unions will watch the Vallejo case."

“Probably many cities and municipal entities have problems similar to Vallejo, if not to the same magnitude, at least of the same kind,” said Paul Glassman, who represented cities in the 1994 Orange County case resulting from faulty investments."


Many cities and municipal entities definitely have problems similar to Vallejo. As far as I know all of the large cities do.

The politicians have bought the voters of the municipal unions with inflated salaries and promises of unrealistic pension and benefit packages. The managers of these benefits have moved the day when payment is due into the future borrowing against the future and incurring deficits that increase every year until it becomes obvious that choices will have to be made.

Will pensions be paid or will the streets be repaired?

Interminable hand wringing and finger pointing ensue.

Unions blame the cities and the politicians blame the unions.




"Unfortunately, the mayor said, the bankruptcy is necessary because there is “absolutely no other way to pay our bills” in the new fiscal year without getting relief from the union contracts.

Is Vallejo, as some observers are saying, a test case for other local governments that might opt for bankruptcy to get relief from union contracts, including costly pensions and retiree health benefits?"



No, Vallejo isn't a test case, its the future!



"Davis [the mayor] said Vallejo's situation should be cautionary in another way. He said a citizens committee reported in 1993 that if employee-benefits trends continued, they would exceed city revenue in 2010."


But I'll bet that the citizens committee had no idea that the city would be so foolish as to keep raising salaries and benefits.

"The mayor said the warning was ignored by the City Council and city managers. He said the projected day of reckoning arrived three years early, accelerated in part by the economic downturn."



No. It didn't arrive early at all.

"The average police officer will receive a base salary of $121,518 under the current contract, with pension, health coverage and other benefits pushing the total cost to $191,060, said a staff report to the City Council on May 6.

The average firefighter will receive an annual salary, excluding overtime, of $130,112, costing $193,174 with benefits. Ranking officers get much higher pay – for example, a police captain earns a salary of $231,120, and the total with benefits is $347,726."



I don't know for certain but someone that knows told me that firefighters and policemen in Vallejo can retire at 50 and draw 90% of their regular salary adjusted for inflation.

It would take well in excess of $3,000,000 to pay those benefits for one person for 30 years or about the same amount of money, up front, invested, to pay those benefits without destroying the principal.

This same saga goes on in almost every major city in the US.

A very similar game is played by the US Senate and House of Representatives as Social Security and Medicare payments begin to overtake what we pay in.

Vote Democrat and watch the old starve as the Democrats promise you things they can't possibly deliver.

29 comments:

nanc said...

hmmmm...organized slime.

GOOD TO SEE YOU, WARREN!

what say you and i go golfing?

*;]

The Merry Widow said...

What say, Warren and Nancpop, go fishing? At least you can eat the fish.
WELCOME BACK, BIG BRO! You have been missed!
Good morning, G*D bless and Maranatha!

tmw

FJ said...

This must be why it's such a GOOD idea to put everyone on the public dole like the progressives want...

Warren said...

Nanc, how about you put the golf balls up in the air and I'll see if I can shoot them down?

You'll have to yell, "PULL" instead of "FORE". :^)

TMW, I think I'm getting used to working these long days so I'm going to try and post more often. At least here on the blog.

Warren said...

FJ, what in the world makes these idiots believe they can create wealth from thin air. I know some of them believe it, the rest are just con-artists working the typical pyramid/ponzi scheme.

DD2 aka Debonair Dude said...

HALLELUJAH! WARREN FINALLY MADE A POST!‏

LOL
Good to see you back buddy

nanc said...

like this guy, warren?

*;]

Brooke said...

Nice to see you back, Warren! :)

With the gov't, it is all cooking the books and look at the other hand.

It's also NEVER their fault; always something else.

Z said...

'"IDIOTS" who think we can create wealth from thin air?' NOW, Warren...not EVERY one of those who feel that way are idiots! WE have a PRESIDENTIAL CANDIDATE who feels that way, and HE went to HARVARD, Warren! He must know something we don't now! :-)

I'm real glad you're going to be posting more....

Papa Frank said...

Our "savior" Obama will come and wave his magic wand and all will be well with the world!!! BARF!

Gayle said...

LOL! Saviors don't wave magic wands - tooth fairies do. Do you suppose Obama is the tooth fairy? ;)

Brooke said...

A FairlyOddParent? LOL!

Warren said...

Hey DD2.
Guess I was a little overdue for a new post. (by about 5 months!)

:^)

Nanc, that was hilarious, I'd love to be the one with the shotgun!

The looks on some of those faces, LOL!

Warren said...

Brooke,
The politicians wouldn't have anything to do if it wasn't cooking the books. If a private company kept books the way the government does, all the officers of the company and their accountant would be in jail.

Z,
If Obama wanted to impress me he would learn the difference between a breathalyser a ventilator and a nebulizer! He's a typical "Progressive" convinced of his superiority and intelligence. Unfortunately for him, if he can't read it off a teleprompter he starts sounding like porky pig.

Warren said...

Papa Frank,
We have a savior, we don't need a clown. We have a congress full of clowns already.

Warren said...

Gayle,
I don't think Obama has a wand. Can he just wave his ears instead?

nanc said...

well, warren - you'd best have a wide stance if you'd like to keep me from schmacking you upside the head with "big wally" the one wood - i don't take kindly to people making noise while i'm driving!

could you put a silencer on it?

FORE! PUT!

*8]

Warren said...

Silencer???

I put a muzzle brake on mine. A muzzle brake makes it much louder.

I'd have you trained inside of three shots, just like Pavlov's dogs. You couldn't even pick up Big Wally without everyone thinkin' you had Tourettes Syndrome from all the flinching goin' on!

Besides, I bet I run faster scared than you do mad!

:^)

Freedomnow said...

I'll need those Smith and Wesson rebate offers if San Diego goes bankrupt!!!!!!

I know that there is little danger of bankruptcy at this time, but our city council is morally corrupt so thats half way there.

Elmers Brother said...

do you know how many radio stations he picks up with those ears?


good to see you back Sir Warren.

nanc said...

AHA!

i laugh!

...and run - ZOOM!

*:]

Z said...

"LIKE PORKY PIG!" Warren, that is HILARIOUSLY true......'a dub..a dub..uh uh ddddd dub ...that's all folks"
if it ONLY were!

Warren said...

FN, It looks to me like the difference between San Diego and Vallejo is that the politicians didn't want to go to jail for fraud in Vallejo.

;^)

EB, I'll bet that as big as his ears are he gets more stations than my deluxe cable package!

Thank you Bro

Warren said...

No Nanc, you got it backward. "I" run!

It isn't dignified for a golfer to run.

;^)

Warren said...

Z, I'm serious, I listed to a spliced sound track of Obama flubbing around and trying to answer questions without a script and he stuttered way more than porky.

Poor ol' GWB gets made fun of unmercifully and called a moron every time he screws up but Obama is far worse.

Quite frankly, I don't think he's making mistakes, he just plain doesn't know what he's talking about.

nanc said...

ah, but you forget about the unwritten 30 second drill...requires running in a dignified manner. that or you have to take a drop which qualifies for a stroke - smell what i'm steppin' in? i run. at least when my ankle isn't sprung!

ZOOM!

*#}

Freedomnow said...

Ahhhh... so Warren you are talking about the heirs of Valerie Stallings.

Politicians of an unnamed political party convicted for corruption. Unnamed, unless of course to accuse Republicans of wrong-doing because Democrats are convicted of corruption and that must solely be due to a Republican conspiracy.

The irony is that our Democratic Party Activist/City Attorney Michael Aguirre, is guilty of such a partisan act against our mayor.

Its even more ironic that the Republican mayor was cleared of the accusations by CA Atty Gen and leftwing ideologue Jerry "organic poison gas" Brown!!!! (See the Dead Kennedies song "CA Uber Alles") So you know that Aguirre is just a lying SOB.

Free Zucchet and Inzunza!!!

Warren said...

FN,
Its laugh or cry. These things have been escalating for years and I feel they are reaching critical mass.

The pension funds are just one example.

In retrospect it seems possible that your ex-mayor Murphy was being set up to take the blame for something he couldn't do anything about. He might have been very smart to resign.

I think we might have a scandal brewing locally over a proposed new stadium that no one seems to want, but the local Democrats, and their buddies that own the land its to be built on.

Boss Tweed lives!

:^)

Freedomnow said...

When they were building the baseball stadium here in San Diego the sign congratulating Valerie Stallings on the fence of the construction site was regularly defaced.

She is our convicted City Councilwoman from an unnamed political party.