Pickpockets
reality
The WSJ has a piece on Vallejo and the grasping city and state employees.
Before that, in 1999, state lawmakers had adopted a measure called “3% at 50″ that allowed local and state police officers and firefighters to retire at 50 years of age with 3% of their highest annual salary — multiplied by the number of years served. The legislation granted thousands of public-safety workers a retirement payout of 90% of their former salaries for life. The benefit, bolstered by post-9/11 recruiting, swiftly became a major staple for most California cities.
Those full-natured benefits created a bidding war among Northern California cities, and Vallejo negotiated lucrative wage increases with police and firefighter unions to stay competitive. Three years ago, the city agreed to a 20% pay increase between 2007 and 2009; an average police officer now makes $121,000. When benefits are included, the number rises to more than $190,000. By 2007, 80% of Vallejo’s budget was dedicated to police and firefighters.
And that is just the police - the firefighters are even more expensive. It is going to be interesting to see how this plays out as revenues shrink. Note that the 3% at 50 has been extended to almost all employees. And then there is the disability racket, which most of these folks claim (and are more discreet than the idiot in the story linked to - but not much). Then the income is tax-free to boot. Aren’t you sorry you didn’t follow through on the childhood wish to be a fireman? Not that you could have - you’ve got to be connected.
California’s budget deficit could reach nearly $28 billion over the next two years unless drastic steps are taken to stem the fiscal bleeding, the nonpartisan Legislative Analyst’s Office said in a report released today.
Look, I have some sympathy for the police, it is not an easy job many places in California. I have virtually none for the firefighters, who spend most of the time loafing or running their side businesses and much of the rest standing around while the paramedics work. If they didn’t go out when the paramedics were called, the lack of demand for their services would be visible. It is quite bizarre that many communities can apparently get along just fine with volunteer firefighters, while in others the politicians feel the need to pay vast sums. Yes, someone needs to fight the wildfires. But there’s no reason not to use private contractors, in fact homeowners in at-risk areas are increasingly contracting with private services to protect their properties.
And yes, this makes me angry.
Posted in Government, The Fisc |

November 12th, 2008 at 12:49 pm
You have hit on the key issue - not only were the financial institutions (and many related financial “products”) improperly rated by Moody’s/S&P, but the ratings of municipal and state bonds are equally incorrect and have not yet been revised despite ballooning obligations and contracting revenues. There is significant risk of a collapse of the credit ratings of many towns, cities and even states. As money has moved out of equities, where has it gone? Most of it to fixed income including various types of munis. The retirement capital of the baby boomers is about to take a second very significant hit.