"Because California’s municipalities have squandered so much of their budgets on government workers and retired employees, they haven’t been able to provide the essential services that justify government’s existence. Stockton is a case in point. Bob Deis, who took over as city manager in 2009, told reporters recently that the city’s finances resembled a Ponzi scheme. He had never seen the kind of unaffordable health plan that Stockton employees receive: complete medical care for the employee and spouse for life, available after only a month on the job. “Employee costs are weighing down the city in the wake of a recessionary slump in revenues,” City Journal’s Steve Malanga observed last week. “Stockton has spent the last two years trying to reduce its budget to avoid insolvency. The city has cut about a quarter of its police, but rich pension and health benefit deals still make it difficult for the city to pay its bills. . . . Employee costs make up 81 percent of the city’s general fund spending
.”
Great foreshadowing here. Will politicians choose voters or continue to feather the nests of themselves and employees. Another point to consider, will Obamacare penalties on Cadillac healthplans allow rollbacks here? I am predicting the courts will tell cities to honor those deals. Especially since judges are plan members too.
Thomas Sowell: There are no solutions, just trade-offs.
We will see more and more of this going on- and it may be a good thing. As government spends more of our money on entitlements, less and less money is available to perform it's core functions.
Eventually- trying to justify government’s existence becomes harder and harder as people realize that the job is not getting done. Then it's time to slash and burn as people would rather do for themselves instead of support an ineffective, bloated and corrupt system.
Stockton is the poster child for the housing bubble. Prices there tripled in about 7 years - now they have some serious, serious problems. Last year, Forbes gave it the title of "Most Miserable U.S. City".
