Absolute Fecklessness
I am still reading through the Detroit Free Press report on Detroit's financial history and it is really amazing. All the stuff you expect to see is there -- over taxation, over regulation, crony gifts, huge government pay and pensions, etc. But this was new to me, and even worse than I expected:
Gifting a billion in bonuses: Pension officials handed out about $1 billion in bonuses from the city’s two pension funds to retirees and active city workers from 1985 to 2008. That money — mostly in the form of so-called 13th checks — could have shored up the funds and possibly prevented the city from filing for bankruptcy. If that money had been saved, it would have been worth more than $1.9 billion today to the city and pension funds, by one expert’s estimate.
Outright gifts of taxpayer money to government workers, even beyond their already rich salary and pensions! Folks on the Left from Paul Krugman to Obama are trying to portray Detroit as the innocent victim of economic and demographic exogenous forces beyond their control. Don't let them. The exodus from Detroit and the destruction of its economy were not random events the city had to endure, but self-inflicted wounds.
morganovich:
oh come now, that 13th month thing worked great in greece!
oh, wait...
September 16, 2013, 10:39 amnorse_dog:
One major problem with all of these schemes: there can be no accountability due to the way they are regulated. The culpable parties as well as the recipients of unearned wealth are not liable, so this is guaranteed to reoccur frequently.
September 16, 2013, 10:42 ambobmark:
This has happened in our state pension fund, politicians giving extra money to retirees to help with inflation while not adding money into the fund to pay for it. A fixed pension is supposed to be fixed, not ad hoc inflation adjusted.
September 16, 2013, 12:20 pmMatthew Slyfield:
Alas, I have only one up vote to give.
September 16, 2013, 12:27 pmNehemiah:
But you forget that every $1 of bonus money paid out had a multiplier effect of 2 or 3 to one. Just like extending unemployment benefits. Pelosi said that was the best form of economic stimulus. I'm sure the bonuses had the same impact. Pretty sure, maybe.
September 16, 2013, 12:37 pmmarque2:
If you were really dedicated, you could create multiple accounts or log in as different guests.
September 16, 2013, 8:15 pmmarque2:
Inflation adjustments is one thing. Adjusting for inflation and then just giving away more is another. Usually pensions are adjusted for inflation.
September 16, 2013, 8:16 pmMatthew Slyfield:
Sorry, I can't do that. After all, I'm not a Chicago Democrat. :)
September 16, 2013, 8:32 pm