It was another lousy, shallow, baseless bleed heart about a politician having to deal with bankrupt pensions... So I wrote these few words in response to the author and share here.
Hello Ms. Walsh,
I have read quite a number of articles about the financial mess many states, cities and municipalities are in over the past few years. What I have not read until now, with the exception of the occasional town or municipality that engages in outright fraud, is any decent reporting of the mechanisms that have lead to the financial mess they are in.
I never read about the move of states, cities and municipalities to dramatically increase the salaries of officials in government and government funded organizations like education institutions in the late 1990's to "compete" with the "dotcom" induced high flying salaries paid during that era's economic bubble. I have not read about how, unlike industry, when this bubble burst governments did not ratchet down those exuberant salaries and maintain them to this day. I have not read about how governments wasted or spent unwisely the billions of dollars doled out by the Federal Government after 9/11 to "upgrade" police and other emergency services leaving higher long term costs burdens to the local governments after a short term shot in the arm by the Federal Gov. I have not read about the tremendous waste of opportunity by state, city and local governments to bank the exorbitant amount of money they were taking in during the first decade of this century while the real estate bubble was in full steam and how they unwisely spent it, often on frivolous items and higher salaries while allowing their infrastructures to fail and pensions to go unfunded. I have not read about the dramatic shift in public pension funds during this same bubble to feed tens of billions of dollars into the unregulated hedge fund industries as Wall street ran out of suckers and reached out to pension funds and their low salary incompetent managers as easy takers to fuel the casino going on in the global debt markets. I have not read enough about how many of these local governments became little AIG's by being coaxed into short term funding obligations with long term insurance against rising interest rates which not only did not materialize but "cost" money when these government entities had to pony up money to meet calls against their worthless contracts and how this plays into their financial woes.
In essence, I have not read anything anywhere about the reason America's incompetent governments at every level from county, municipality, city and state (and federal) seem to know nothing about basic economics of running a government, how our education system fails to teach anything about our economic system and how this plays into the ignorance of our electorate and governments alike. I have read nothing about how the financial mess so many governments are in got to where it is in the first place and how much of that reason is directly related to their pension funds investment decisions. I have not read how the financial meltdown on Wall Street as a whole has affected the returns on the pension funds and how many of the pension funds were duped into worthless investments during the Wall Street bubble. I have not read anything about how perhaps our Federal government should have been more interested in securing the savings of Americans and the soundness of their pensions instead of bailing out the Casino operators on Wall Street who already banked nearly $3.5 trillion of profits from the debt induced bubble that took place from the early part of the century till the collapse in 2008.
All I read about is what you and others in your industry have written here, politicians speaking to angry pensioners (um, that is American Citizens who have done an honest days work all their lives while living in modest means) about how they are going to have to take the hit from what? Maybe from all of the things I mention above that are NEVER spoken about on these pages or any other pages in any cohesive way that lays out the reality that at the end of the day; the average working Joe is constantly getting reamed in this global, finance driven economy run by people with an 19th century mindset at best; that all money is for the taking, no matter how you do it; that we still live in an barbaric economic reality and all the attempts by all the people over the last century and a half to make sure working people are respected like the decent human beings they are, are moot when casino economics and corrupt national governments are capable of taking it all away inside of a few years.
How about getting a little creative and insightful next time, it is about time!
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