Wisconsin wasn’t the only place in America voting on the blue social model last night, and Wisconsin wasn’t the only place where the blue social model took it on the chin.As reported here yesterday, voters in San Diego and San Jose, California (both among the largest ten cities in the United States) had referendums on the ballot that would cut pension costs.The results of those votes are in this morning, and both measures were passed by overwhelming majorities. In San Diego, 68 percent of voters supported the cuts. In San Jose, 71 percent voted against Big Blue.It’s easy to understand why. Over generous promises made in the past were not adequately funded, and suddenly both cities have been hit with massive pension bills that have forced service cutbacks. As the AP reports:
San Diego’s payments to the city’s retirement fund soared from $43 million in 1999 to $231.2 million this year, equal to 20 percent of the city’s general fund budget, which pays for day-to-day operations.As the pension payments grew, San Diego’s 1.3 million residents saw roads deteriorate and libraries and recreation centers cut hours. For a while, some fire stations had to share engines and trucks. The city has cut its workforce 14 percent to 10,100 employees since Sanders took office in 2005.San Jose’s pension payments jumped from $73 million in 2001 to $245 million this year, equal to 27 percent of its general fund budget. Voters there approved construction bonds at the beginning of the last decade, but four new libraries and a police station have never opened because the city cannot afford to operate them. The city of 960,000 cut its workforce 27 percent to 5,400 over the last 10 years.
Put this news together with the Wisconsin results, and it’s easy to see that the public sector unions face huge problems in this country. Voters are unwilling to pay the taxes or accept the service cuts required to keep unionized civil service workers in the lifestyles to which they have grown accustomed.There are going to be lots of court cases in California and elsewhere as judges sort out the legalities of pension obligations, but Via Meadia‘s advice to public sector workers remains unchanged. If your pension looks too good to be true, it probably is. You should not believe either the union officials or the politicians who tell you not to worry. These pension plans are not safe, and those affected should begin, now, to make changes in spending and saving patterns to guard against sudden and unpleasant shocks that are all too likely to be heading your way.Change is coming, and faster than you think. America is reinventing itself to retool for the 21st century, and many of the assumptions and institutions of 20th century politics are fading away.