As local & state governments teeter on financial disaster which entity refuses to help out and avert disaster?

Yes! You hit the nail on the head!

Last year I sent this to the California legislature and our governor. I also posted it on various blog sites. Sorry, it's way too long for here...

A GENEROUS BUT SENSIBLE BUDGET FOR CALIFORNIA

Governor Schwartzenegger and the California Legislature seem unhappy with the voters these days. We’ve spoken on propositions 1a through 1e and now it’s payback time. We’ve been warned that we’re going to have to live without CalWORKS, Healthy Families, Cal Grants and 80 percent of our State Parks, but are we really? The California State Prison system will unlock its doors and hardened criminals will spill out onto our streets, but is that truly necessary? Tens of thousands of government employees will loose their jobs, including teachers, but does that really need to happen?

Everyone knows that things have been rough in the private sector since early 2008. Small business revenues are down 20 to 40 percent in most industries, and some are in even worse shape. Employers have been forced to cut hours, cut wage rates, cut benefits and all too often let people go. The businesses that remain open are surviving because they are learning to live on less. What choice do they have? During a normal economy, companies have options for dealing with a budget shortfall. They can sell more, sell at a higher price, borrow money or reduce expenses. Today, borrowing is virtually out of the question. The companies most in need of borrowing are the least likely to qualify in the new tougher world of credit. In the current economic climate, selling more and raising prices are both out of the question as well because people are buying less and going without the things that cost too much. These are facts today. Learn to live with it or go the way of the Dodo, or the Chrysler.

Our state’s government is now facing the same dilemma as the business sector. When companies aren’t making as much money, they don’t pay as much tax, and the same holds true for individuals when they file their state income tax. Everyone in the private sector is sending Sacramento less money. Hence, our government is faced with the same problem the rest of us are faced with: Not enough money to go around. The disconnect between Sacramento and the rest of the state was ever apparent with the May 19th request for a substantial tax increase. We’re dying on the vine out here in the private sector but our government wants us to pay more taxes? We told them in no uncertain terms, NO. But their response to our vote still shows a significant disconnect.

In simple terms, we reminded them that we have tightened our belts on a citizen-by-citizen basis, and we’re telling them it’s time to do the same.

Is there also a disconnect between Sacramento and common sense? Our governor suggests that we close the CalWORKS program. The San Diego Union reports, “The administration has proposed eliminating CalWORKS, the state's welfare-to-work program, which provides more than 500,000 families an average of $526 per month. The state would save $1.3 billion but would forgo $4.2 billion in federal matching funds.” Let me make sure I understand correctly. The federal government pays for 75% of this program for us, so this is the one we want to scrap? Shutting down CalWORKS is going to rescue us? Really? The federal government injects 4.2 billion dollars into California’s economy every year, and we really want to give that up? The administration also suggests gutting Healthy Families, but again from the S.D. Union “Schwarzenegger also seeks to cut health care coverage for nearly 1 million low-income children under the Healthy Families program, saving roughly $250 million for the year. That could cost the state roughly $500 million in federal money.” When searching for programs to cut, do we really want to cut one that the federal government funds at 66 percent for us? Do we really want to cut programs at all? Some of us do, and some of us don’t.

Democrats, Independents and Republicans all live together in California and we are ideologically different to be sure, but we all have one thing in common if we work in the private sector. We’ve been forced to tighten our belts. Maybe it’s time for government to tighten theirs! Maybe they should tighten their belts 20 to 40 percent like the rest of us? Actually, that’s not necessary. If the members of the state government only tightened their belts 15 percent, our budget would nearly balance through 2010.

To put some perspective on this suggestion, individuals use their income in two ways. One kind of income is forwarded immediately to pay for services such as the loan on their house, the electric bill and the phone bill. The other type of income is spent on themselves. When individuals are faced with a budget crisis, they decide whether to shut off services such as cable TV or phone service, or instead to spend less on themselves. They might decide to eat out less often, buy the bargain brands at the grocery store, or skip that trip to Bora Bora this summer. They have to either shut off services or stop spending directly on themselves.

Our state government doesn’t seem to correctly identify the two choices. California collects taxes, then they pay some of the money out in services such as schools, highways, social programs and they keep some of the money for themselves in the form of wages and at least 30 other forms of personal compensation. Our governor wants to cut services while at the same time protecting and in some cases even increasing the money they keep for themselves. I’m sure they simply didn’t think this through because Californians working for our government wouldn’t intentionally be so completely unfair with Californians living and suffering in the private sector. California’s government employees are not selfish.

If Jeff Tedford, University of Berkely’s head coach, could live on $849,000 per year instead of $999,000 total cash compensation…

If John B. Ehnes, in charge of teacher retirement, could live on $581,845 per year instead of $684,523…

If Christopher J. Ailman, chief investment officer, could live on $565,635 per year instead of $665,453…

If Christian Kitchin, a Special jail nurse, could live on $297,775 per year instead of $350,324…

If, on the other end of the state employee compensation scale, a $36,000 per year state employee could live on $30,600…

We could nearly balance our budget without cutting a single job or service!

According to the latest study by the Public Employee Post-Employment Benefits Commission, we have approximately 1 million current state employees in the CalPERS pension system. Average income for California’s public sector employees is most likely a little more than the federal government’s average of $72,000 per employee per year, but using the fed’s number (because an actual state number doesn’t seem to be available) we spend 72 billion per year on state employees. An across-the-board 15% reduction in wages and other compensation would net 21.6 billion that could be put toward the 24.3 billion deficit our governor has projected through 2010.

With a 15% cut in pay, no state employee needs to lose his/her job. No state employee’s retirement or health care benefits need be eliminated. No percentage of pension pay-outs need be taken from retired government employees.

We still need another 2.7 billion in cuts though…

We could save another 2 billion off the 5 billion spent each year on the posh health care plans our state employees enjoy today by simply purchasing plans that are more in line with what Californians in the private sector are accustomed to using. As the third largest purchaser of health care in the country, behind the federal government and General Motors, California has some bargaining power with the insurance industry. If California’s government can’t get a good solid 80/20 PPO plan for $3,000 per year, per employee, they need to bring in some better negotiators.

We still need to cut $700 million more to be in balance.

Maybe we should end the practice of pension spiking? California employees receive 2% of their pay for each year they work up to retirement. State workers starting at 25 years old and retiring at 65, will receive 80% of their highest pay level for the rest of their lives. Retirement benefits are calculated as a percentage of the “final compensation” that has been reported to CalPERS. So-called spiking is the intentional inflation by the employee of “final compensation” in order to increase retirement benefits. There are 30 ways for a state employee to figure then spike their pension benefits, and it’s legal:

Regular base pay

Overtime hours

Workers comp temp disability

Shift differential

Special pay allowances

Incentive pay allowances

Miscellaneous allowances

Management differential

Retirement offset

Leave balance usage

Insurance subsidy

Insurance subsidy offset

Mental health retention

Disability pay

Pay in lieu of temporary disability

One time bonus

7/12 work shift

Standby pay

Food allowance

Clothing allowance

Equipment allowance

Animal allowance

Auto allowance

Vacation cash-in

Payoff of vacation beyond maximum accrual

Bargain purchase of service years

Reinstatement of service

Retire then go to work for a 1937 entity

Opt out of employer provided health insurance in final year

End of career promotions for upper management positions

The list of ways California employees can beef up their retirement income is extremely generous but fiscally irresponsible. Most of the pension spiking tools should be eliminated. There is no cost analysis in the Commission’s report for how much pension spiking costs the California tax payer each year, but it’s potentially sizable. Deduct the savings from the remaining 700 million dollar budget shortfall and any remaini

Well, in Mass unions have accepted pay cuts. But overall, the unions are only shooting themselves in the foot by not bending with the times. If the money is not there, the money is not there and that's why the unions in Mass. went along. They wanted to keep some of the jobs.

Also, a lot of reform has to be done in these states regarding unions. No doubt.

you are so correct. I have always believed that the Unions were at the core of all these failing operations....no business can pay "$25+ an hour but take in $4 per hour"..... and who calls who stupid?

One note: not every firefighter dept - police dept - teachers - etc are unionized around the nation.......there are several states that unions do not rule and those states are not in near the trouble that the states that have Union controlled operations

That's how unions function. It's by monopoly and extortion. On their side I think other pork barrels should emptied before theirs is, and all the feel-good programs cut. Spoiled citizens demand every luxury service they can get. We got into this mess because those couldn't be sustained after the grossly overpopulating cultures swamped the labor market so much wages were cut and whole industries were sucked away to their homelands.

For the most part I am convinced that at least 80% of the Republican Party has no grasp of what Socialism really is. I think they equate it to Hitler or Mao/Stalin but that is not true. Socialism equates to a lot of things, like highways for example. I know the South likes their horses but I don't think they are truly willing to trade their truck in for a saddle cross-country--especially when winter hits and they are forced to trek it through a New England Lake Effect Blizzard. There is lots more to talk about but that would turn my answer into a wall of text. =3

"And in 5 years, you're gonna be blown away." - Gov. Granholm (D-MI), State of the State January 2006.

The time of career politcians is over in Michigan. It's time for a nerd.

http://www.youtube.com/watch?v=_ro5iGShcV4

Pay cuts while every day the news carries stories of million dollar bonuses for bankers and insurance execs.....NO THANK YOU...Now even the Supreme Court has weighed in and said to big business go ahead and use their wealth to buy elections.

The members of the trade unions are the tax payers.

Wake up and smell the coffee.

Kool-Aide is bad for you.

This is a typical Republican point of view.

Bail out wall street, but lower the standard of living for educators and first responders to "fix" the deficit.

It amazes me that people will vote for you greedy mofos.

Yep, the liberal entitlement mentality of the unions is causing the liberals to bleed their neighbors dry.