Remedy for Fiscal Irresponsibility

For forty years the Retired State, County and Municipal Employees Association of Massachusetts has provided retired public employees their own voice on Beacon Hill.

As the legislative session wound down last week, a bill to provide a special cost of living raise to state retirees was passed on a voice vote with no debate. While supporters of the bill were quick to point out that this increase amounts to only $10 per month per pensioner, the total cost of this increase is $1 billion. Actually, the cost would be "only" $1 billion" if the legislature stepped up and funded the increase in the current budget. As is noted in an editorial in TODAY's GLOBE, the legislation provides a funding schedule that is worthy of a Ponzi scheme:

"The problem is that the legislation puts off even beginning to pay for the pension increases until 2024. That is just as the state's current large unfunded pension liability is scheduled to be retired. The Legislature's proposal would delay that date by three more years - long after most of today's legislators are safely out of office. It is irresponsible to saddle future generations of taxpayers with debt - estimated at more than $3 billion - to gain a political benefit today"

In a recent GLOBE ARTICLE, Ralph White, President of the Retired State, County and Municipal Employees Association of Massachusetts, cited the lack of legislative opposition for the bill:

"In the Legislature itself? No," White said yesterday. "There were varying opinions but no one opposed it. I think we did a god job of lobbying, truthfully."

Who was lobbying for the taxpayers against this bill that the Boston Globe says "is just too expensive for the state to afford?" Moreover, pumping up its unfunded liability weakens the pension system itself.


If, as reflected by the lack of opposition, or for that matter, any debate, this increase was in the best interest of the people of Massachusetts, then it falls to the legislature to first of all recognize the significant costs involved, and second, review the rest of the budget and delete enough spending so as to fund the increases and balance the budget. Since the state budget is already way out of balance as we are already in the hole for items like road and bridge repairs, this would be some heavy lifting, not the type of work the legislature likes to perform. Instead, increased pensions have been given to some 100,000 retirees and the cost is pushed off on future taxpayers. Yes, it is an election year, but it makes you wonder if the Solons have any children who might be among those who they just saddled with $3 billion of future debt?

This is exactly the kind of fiscal irresponsibility that is fuelling the initiative to eliminate the state income tax. When both the Boston Globe and the Wall Street Journal both contain editorials criticising the fiscal ineptitude of Massachusetts government on the same day, perhaps the stars really are aligning for a big change. In today's WSJ editorial, the stage is being set for a battle between embattled taxpayers and the entrenched special interests that feed at the public trough. To wit:

"The forces of the tax and spend status quo will descend on this initiative like British troops after the original Boston tea party, but someone has to make an effort to stop the relentless growth of government."