Entries by Mike Shedlock

Scranton Residents Plead for Bankruptcy vs. Higher Taxes

City officials in Scranton Pennsylvania have ignored pleas from residents pleading for bankruptcy. Instead, the city raised property taxes and trash fees nearly 60% and tripled rental registration fees. The city’s school district, which faced a $4-million deficit, raised taxes 2.4%. The City Council, which in 2012 passed a 5% amusement tax on live entertainment, […]

Massive Disability Fraud Uncovered in New York

Editor’s Note:  As the author points out in the report to follow, this may just be the tip of the iceberg. For more on what public employee retirement disability fraud could be costing Californians, please refer to our 2011 California Public Policy Center study “The Impact of Tax Exempt Disability Pensions.” In what I believe […]

Detroit’s Emergency Manager Threatens Pension Fund Takeover

Detroit’s emergency manager Kevyn Orr says a pension fund takeover is a “right, if not an obligation” after Orr learned of extra, unwarranted pension payments. Please consider Emergency Manager Weighs Pension-Fund Takeover. Kevyn Orr said in a recent interview that at the current pace, the city’s General Services System pension fund could lose its ability to […]

Pension Battle Shifts to San Jose, San Bernardino, Stockton

Now that a federal judge in Michigan has properly ruled pension obligations are not sacrosanct (see Lesson for Union Dinosaurs) the spotlight is once again on union dinosaurs in California. Bankrupt San Bernardino foolishly did not attempt to shed pension obligations in bankruptcy, but perhaps it can now reconsider. What about Stockton and Vallejo? On April […]

Why Raising Minimum Wages Does More Harm Than Good

On Friday, Salon reported Breaking: Massive Black Friday strike and arrests planned, as workers defy Wal-Mart.  Defying the nation’s top employer and a business model that defines the new U.S. economy, Wal-Mart employees and allies will try to oust shopping headlines with strike stories, and throw a retail giant off its heels on what should be its happiest […]

Proposal: A Fair Public Union Pension Settlement

Numerous cities have filed for bankruptcy in recent years, and many more cities are on the brink. The reason is untenable union wages, and more importantly untenable pension promises. Sampling of Bankruptcy News Vallejo, California March 2009: Judge Rules Vallejo Can Void Union Contracts Los Angeles, California January 2010: Mayor of Los Angeles Says “Bankruptcy is Not […]

Desert Hot Springs, California, Facing Bankruptcy

Add Desert Hot Springs, CA to the list of California cities in dire straits due to poor management, union wages, and ridiculously unaffordable pension promises. Please consider Another U.S. city mulls bankruptcy due to soaring wages and pensions A resort town in California warned on Tuesday that it will run out of money by March due […]

Scranton Faces Bankruptcy, Unions Want to Raise Taxes

It is truly pathetic watching politicians flop like fish out of water trying to prevent something that was clearly inevitable long ago. Please consider Moody’s warns of bankruptcy in Scranton as city faces $20 million budget gap.  Moody’s warned investors that Scranton could be facing the threat of default or bankruptcy thanks to a $20 million […]

Union Controlled Illinois Politicians Consider Tax Increases to Fund Pensions

Editor’s Note:  This post by regular UnionWatch contributor Mike Shedlock documents the latest bad news for the Illinois Teachers Retirement System. And of course, union-controlled Illinois politicians have a solution: More taxes in one of the most overtaxed states in America. Like many if not most pension reformers, Shedlock advocates a scrapping of defined benefit […]

BART Transit Strike Begins in San Francisco Bay Area

Editor’s Note: UnionWatch contributor Mike Shedlock provides some perspective on the BART strike that began today, their 2nd this year. One impasse relates to the refusal of management to submit to binding arbitration on the remaining areas of dispute. Good for management. The possibility of getting an even worse result in binding arbitration is the […]

Vallejo Faces 2nd Bankruptcy Because They Didn’t Restructure Pensions

Editor’s Note:  An article published today in the Stockton Record’s reports “Deis: City won’t tackle pension reform.” Bob Deis is Stockton’s city manager. Apparently he doesn’t want Stockton to be the first to fall. As soon as one city restructures their pensions, every city and county in California will follow, because the alternative is a […]

Illinois Unemployment Exceeds California’s

The one state arguably more troubled than California is Illinois. Unions, union sympathizers, socialists, and tax-hike proponents are strongly in control of both states. Is it any wonder  that perpetual economic difficulties and insurmountable pension underfundings face both states? Via email, Ted Dabrowski at the Illinois Policy Institute writes …  Unhappy Anniversary Six months ago, Illinois overtook […]

Scranton, Pennsylvania Careens Towards Bankruptcy

With public unions threatening to seize Scranton assets including fire trucks, how long will it take for Scranton to do the smart thing and declare bankruptcy? The Times-Tribune reports Scranton police/fire unions get $21M judgment against city; may seize assets to collect.  Scranton’s police and fire unions have received a judgment against the city for the […]

Tough Commute? Scrap Davis-Bacon Act

Liz and I traveled this past Labor Day weekend. We drove from Crystal Lake, Illinois to a golf resort in Manistee, Michigan. Traffic was bad in the Chicago area as expected, but exceptionally slow traffic continued all the way through Indiana, and even into Michigan, all along I-94 until we reached Michigan 31. M-31 breaks off from […]

Lowering the Cost of Living is Better than Raising the Minimum Wage

Editor’s Note:  This post by Michael Shedlock explains quite well why significantly increasing the minimum wage is a terrible idea. If the union’s new “Fight for Fifteen” (dollars per hour) campaign were successful, it would increase unemployment, and unleash a round of price inflation that would in-turn require government entitlement payments to increase. This is […]

Detroit Bankruptcy Protection Affirmed by Judge

As hoped and expected Detroit Bankruptcy Protections Affirmed, Snyder Shielded.  Detroit can enjoy the protections of bankruptcy, including immunity from lawsuits related to the case, a federal judge ruled, extending that shield to Michigan Governor Rick Snyder. U.S. Bankruptcy Judge Steeven Rhodes in Detroit today blocked lawsuits by public employee groups and pension funds who alleged […]

Detroit Files Chapter 9 Bankruptcy; Oakland, LA, Others on Deck

In an inevitable, anticlimactic decision today, Detroit files for bankruptcy.  Detroit became the largest US city to ever file for bankruptcy on Thursday, seeking protection from its creditors as it restructures more than $18bn in debt. Richard Snyder, Michigan’s Republican governor, said in a letter included in the filing. “Detroit simply cannot raise enough revenue to […]

D.C. City Council Proposes “Living Wage” of $12.50 an Hour

Editor’s Note: A push to dramatically increase the minimum wage isn’t limited to Washington DC. Earlier this year, Los Angeles mayoral candidate Wendy Gruel promised to push for a minimum wage of $15 per hour in that city. This report by UnionWatch contributor Mike Shedlock explains the impracticality and unintended negative consequences of mandating a […]

New Actuarial Rules Will Force States to Admit Pension Problems

Editor’s Note:  This post by UnionWatch contributor Mike Shedlock covers familiar territory. Our parent organization, the California Public Policy Center, has published detailed analyses of the new GASB and Moody’s rules, including: “Moody’s Final Adopted Adjustments of Government Pension Data,” “How New Rules from Moody’s and GASB Affect the Financial Reporting of Pensions in Seven […]

Where is Public Education Money Going?

Given the constant chatter from the Obama administration and from teachers’ unions on the need to spend more for public education, let’s address the question “Is the US spending enough on education?” I propose we look at the stats in graphical form starting with charts of population and total spending, culminating with education spending per […]