Every day I read on the web about how the states and local municipalities are in the hole for hundreds of billions of dollars for the promises that they made to their employees when the times were good and now when it is payback time, they are unable to meet their payments. I don’t understand this situation, promises are meant to be kept and if you can deliver on your promise then why do that in the first place. Did the government know that the good times will keep on going on? Did they not read the history of the economy with its recession and recovery periods? I would not for a second promise somebody these kinds of pension increases when I know that the tax payments will be lower in the future. I mean there are projections out there to find out how much you can get in tax revenues.
But now that they have promised it, they hide it from their real budget and put them off books for some other politician to take care of. Some of the states have not been putting their own share in the pension plans and have been putting it off every year since it is easier to show that you have balanced your budget for the current year. If only we can be realistic about our economic situation and stop promising raises in salaries if we can’t deliver it (which we cannot honestly).