The latest issue of Hillsdale College’s Imprimis features commentary from News Corporation vice president and former chief Bush speechwriter William McGurn about the impact of public sector unions on politics and the economy.
He cites the positive impact of New Jersey Gov. Chris Christie:
[H]e pushed a reform through the legislature that required public workers to start contributing to their health care and up their contributions to their pensions. It’s not nearly the same percentage as their counterparts in the private sector, but it’s a start.
Mr. Christie also put through a property tax cap that forces cities to go to the people for a vote if they increase property taxes by more than two percent. And just last month, he signed a bill that will allow towns to move their school budget votes to the November ballot—not only saving money, but also ensuring that more citizens vote, not simply those who have a vested interest.
At the same time, Mr. Christie has begun to campaign against abuses using language that people can understand. His most recent target is the practice of awarding six-figure checks to public employees who are allowed to accumulate—and cash out—unused sick pay. In New Jersey these payments are called “boat money,” largely because retired government workers often use the money to buy pleasure boats when they retire. Across the state, cities have liabilities of $825 million because of these boat checks.
And what’s been the opposition’s response? Instead of agreeing to reasonable cuts, the Democrats keep thumping for a millionaire’s tax. New Jersey being New Jersey, the millionaire’s tax aims at people making far less than a million dollars. But even if it didn’t, it’s hard to see how driving millionaires out of the state will help it meet its huge and growing unfunded pension liabilities.
To summarize my second point: You and I make spending decisions the way all households do. We take our income, and we live within our means. In sharp contrast, public employee unions have introduced a whole new dynamic: They negotiate pay and benefits in contracts we can’t rewrite. When the revenues to meet these obligations fall short, they push to raise taxes to make up the difference.
