Thomas Sowell thinks that major American Cities should be allowed to go bankrupt.
Jewish World Review Jan. 18, 2011 / 13 Shevat, 5771
Budget Crisis Rhetoric
By Thomas Sowell
Perhaps the most famous American budget crisis was New York City's, back during the 1970s. When President Gerald Ford was unwilling to bail them out, the famous headline in the New York Daily News read, "Ford to City: Drop Dead."
. . .
What would have happened if President Ford had stuck to his guns and not set the dangerous precedent of bailing out local irresponsibility with the taxpayers' money?
New York would have gone bankrupt. But millions of individuals and organizations go bankrupt without dropping dead.
Yeah, but isn't bankruptcy pretty much always bad? Even if it doesn't actually kill you?
Bankruptcy conveys the plain facts that political rhetoric tries to conceal. It tells people who depended on the bankrupt government that they can no longer depend on that bankrupt government. It tells the voters who elected that bankrupt government, with its big spending promises, that they made a bad mistake that they would be wise to avoid making again in the future.
Yeah, but meanwhile, wouldn't a lot of people be out of work? People like cops and teachers, and . . . oh, I get it. That's the whole idea, isn't it?
Legally, bankruptcy wipes out commitments made to public sector unions, whose extravagant pay and pension contracts are bleeding municipal and state governments dry.
And there it is. See, Tom this is why you're the dick of the day, because nobody does the blindingly stupid/mean combo like you!
It's really the fact that public sector employees make a decent living that is bleeding municipalities dry? It has nothing to do with American companies sending decent jobs overseas? The dwindling tax base caused by off-shoring jobs isn't what's hurting city budgets? And it's not the tax cuts for rich people? That's not it? It's the fact that cops get a decent pension? Not the fact that companies move from town to town based on which municipality is currently leading in the "race to the bottom" to see which city/county/state can offer corporations the biggest tax breaks and the largest concessions in the hope of getting a few of the jobs that aren't going to China and India? No, it's those darn overpaid municipal employees.
I know a very nice couple back in California who are both public sector employees. One works for Alameda County and the other for University of California, and I can tell you that they are not living in the lap of luxury. They have the same trouble keeping up with bills as the rest of us. As a matter of fact, my father worked his entire adult life for the US Postal service, and while I didn't grow up in poverty, I can tell you that my father has never owned a new car in his life. I don't think I ever wore a piece of new clothing until I started working and making my own money. Again, not exactly squalor, but come and say to my face that my father was overpaid. I dare you.
Politics being what it is, we are sure to hear all sorts of doomsday rhetoric at the thought of cutbacks in government spending. The poor will be starving in the streets, to hear the politicians and the media tell it. But the amount of money it would take to keep the poor from starving in the streets is chump change compared to how much it would take to keep on feeding unions, subsidized businesses and other special interests who are robbing the taxpayers blind.
So you would rather give handouts to people who have been reduced to beggary than pay city employees a decent wage for working in public service? That is some world-class assholery.
One of the political games that is played during a budget crisis is to cut back on essential services like police departments and fire departments, in order to blackmail the public into accepting higher tax rates. Often, a lot more money could be saved by getting rid of runaway pension contracts with public sector unions.
Bankruptcy can do that. Bailouts cannot.
Really? The city doesn't have money for cops and firefighters, so they have to cut back on cops and firefighters, and you think that's a game they're playing? If I go to the gas station with ten dollars and I can only get a quarter tank of gas with ten dollars and the station owner says he can fill my tank if I give him more money, I don't accuse him of blackmail. I understand that gas costs money. You know what else costs money? Having cops and firefighters. If the city doesn't have the money to pay them, what are they supposed to do? They can't force them to work for free any more than I can force the gas station to fill up my tank for no additional money.
What the public needs are current policemen and current firemen, not retired policemen and retired firemen, much less bureaucrats retired on inflated pensions.
Yeah, and good luck hiring all those cops and firefighters there in Sowellville once they know that you will use any budgetary excuse to yank their pensions.
Thomas Sowell, Dick of the Day