Thus, state workers are not being asked to simply "contribute more" to Wisconsin' s retirement system (or as the argument goes, "pay their fair share" of retirement costs as do employees in Wisconsin' s private sector who still have pensions and health insurance). They are being asked to accept a cut in their salaries so that the state of Wisconsin can use the money to fill the hole left by tax cuts and reduced audits of corporations in Wisconsin.
He talks about the fact that public unions want future taxpayers to cover expenses private sector workers handle with current savings.
No one is asking public union anything accept to bargain based on current wages and do the saving for future events themselves. He fails the sanity test. What is the loss if public sector workers handle their own future costs? None, according to his calculations, so he argues for Gov Walker, have public sector employees handle their own benefits.
His hidden claim is that Wisconsin intends to stiff the teachers and putting benefits back into the individuals hands is a scam. Wrong again, he is pulling the scam. Teachers have every right to bagain for current wages, there is such a thing as a Due Process requirement. Notice that Krugman and Thoma help Dave in trying out this new scam.
The semantic trick is Krugman, Thoma and Johnson. Let's take Johnson at his word: Tell teachers to cover their own benefits and bargain for increased wages. If teachers do not get the increased wages they think they need, then they can go work elsewhere. After all, according to Johnson, this method works just fine for the private sector.
3 comments:
That you get the economics wrong is not surprising since you made two errors in rendering my name.
And as my column carefully explains, the workers earn the pension benefit, it is not a gift from future taxpayers.
If the state has not put up enough cash each year to cover that year's obligations or has invested unwisely that is a serious, but different issue. But that is also not the default of the workers.
By analogy, if you work and accrue a paid vacation and your boss mishandles the money does he get to say to you when vacation times a year later -- oops, sorry. No he does not.
The concept of a pension is economically sound and you can buy one any day of the week in the market.
As a number of professional economists have posted elsewhere, in various ways, my description of the compensation issue is unassailable.
Not understanding principles often leads to the mechanics being SNAFU.
make that "fault," not default.
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