Archive

Archive for March 19, 2013

Euphemism of the Week

March 19, 2013 Leave a comment

illinoispension

[AP Photo/Seth Perlman]

Last week, that is. I’m a little late with this. And on uncertain ground with regard to the facts. Nonetheless, when I read the NYT article a week ago on State of Illinois pension woes, I was struck by Governor Quinn’s use of the phrase “pension reform,” suspecting immediately that “reform” is a polite word for “cuts”.

Are cuts necessary? Again, I’m no expert on this. Clearly the state has made a mess of things. A huge mess. From Mary Williams Walsh’s NYT article:

For the second time in history, federal regulators have accused an American state of securities fraud, finding that Illinois misled investors about the condition of its public pension system from 2005 to 2009.

In announcing a settlement with the state on Monday, the Securities and Exchange Commission accused Illinois of claiming that it had been properly funding public workers’ retirement plans when it had not. In particular, it cited the period from 2005 to 2009, when Illinois also issued $2.2 billion in bonds.

The growing hole in the state pension system put increasing pressure on Illinois’ own finances during that time, raising the risk that at some point the state would not be able to pay for everything, and retirees and bond buyers would be competing for the same limited money. The risk grew greater every year, the S.E.C. said, but investors could not see it by looking at Illinois’ disclosures.

[snip]

The charges put the state’s pension system, generally thought to be the weakest of any state, back in the national spotlight. In his budget address last week, Gov. Pat Quinn, a Democrat, issued a clear warning that the system had to be fixed.

“Without pension reform, within two years, Illinois will be spending more on public pensions than on education,” said Mr. Quinn. “As I said to you a year ago, our state cannot continue on this path.”

[snip]

By 2003, the state was so far behind that it issued $10 billion of bonds and put the proceeds into its pension funds to make them look flush. The main underwriter of those bonds, Bear Stearns, was later found to have made an improper payment to win the business, figuring in the corruption trial of a former governor, Rod R. Blagojevich.

In 2005, the state passed another law, giving itself a holiday from making even the inadequate annual pension contributions called for by its 1994 schedule. It said it would offset the missing money with bigger contributions from 2008 to 2010, but then did not do so. By 2010, the reported shortfall of the pension system was $57 billion, and senior officials were warning that the system was at risk of breaking down completely.

I just wonder if ultimately reform means that employees who have paid into the pension system are destined to receive less than they contracted for. That’s certainly what right-wing Americans for Prosperity has in mind. In his article Fix Illinois Pensions Now, state director Joe Calomino argues:

Generous pension benefits that the State cannot afford are at the root of this problem. While the state took a step in the right direction last year by reforming benefits for NEW government workers, CURRENT government workers continue to participate in the State’s traditional and costly plans.

They can retire at age 55 or 60 and receive generous cost-of-living adjustments each year. These lifetime benefits can be worth more than $1 MILLION for a full-career employee who retires at 55 or 60. They are completely out-of-line with the benefits offered to taxpayers working in the private sector. Yet the 95% of Illinois taxpayers who do not receive such generous benefits will pay higher taxes to pay for the 5% of State residents who do.

Short of the facts though I am, I can at least say that when cutting contractually promised benefits to current employees is called reform, language is being abused.

I know, it’s those lazy, overpaid, underworked state employees who are the problem. They deserve to have their generous benefits cut! As a state employee myself, albeit in another state, I am not a fan of public sector employee bashing. And I can tell you, the two retired friends of mine who devoted their careers to Illinois and its residents could have made far more money in the private sector, but chose instead to do good for the state. It’s a mystery to me what they’ve done to deserve benefit cuts.

Anyway, the pension issues need to be addressed, and maybe Governor Quinn is on the right track. I just object to the changes being labeled “reform.”

Categories: Language, Politics

Georgia Odyssey, 2: Jobs and Environment

March 19, 2013 1 comment

georgiaodyssey

Two days ago, I wrote about Georgia Odyssey, James Cobb’s brief history of Georgia. After quoting from Cobb’s treatment of Georgia’s lynching history, I wrote, “It was a different world. At least I’d like to think so. But when I read Cobb’s account on the introduction of poll taxes and literacy tests to disenfranchise blacks—as well as the Georgia Democratic Party’s move in 1900 to a primary system for selecting candidates, with the added feature of outright exclusion of blacks from participation—I couldn’t help but recognize that today’s Republican Party is in the same business.”

Later in the book, Cobb discusses Georgia’s efforts to attract industry and jobs:

In their efforts to entice industry to Georgia, state and local officials had offered cheap labor and also free and essentially untrammeled access to the state’s natural resources. Not surprisingly, this approach led to some serious examples of exploitation and abuse. When the Union Camp Corporation came to Depression-weary Savannah in 1935, local leaders not only promised nominal rents and protection from competition but pledged as well “to secure the necessary action and, if possible, legislation on the part of the governmental bodies concerned, to protect and save you harmless from any claims, demands, or suits for the pollution of air or water caused by the operation of the plant.” Furthermore, Savannah’s officials agreed that “in case litigation arises or suits are brought against you on account of odors and/or flow age from the proposed plant that the Industrial Committee of Savannah will pay all expenses of defending such suits up to a total amount of $5,000.” …

In 1967, after a fairly strong air-pollution-control measure died in committee, a replacement bill, actually proposed by a Union Camp representative, sailed through the legislature with only a few changes. The new law authorized only such pollution control as was “consistent with providing for maximum employment and the full industrial development of the state” … .

Once again, this sounds familiar, as states continue to deregulate and offer tax advantages in an effort to attract business, other costs (forgone revenue, declining support for schools, eventual need to clean up environmental disasters) be darned.

For instance? Well (and a hat tip to Charles Pierce for bringing this to my attention), let’s have a look at developments in Wisconsin. In Milwaukee’s Business Journal two weeks ago, Jeff Engel wrote:

A bill to streamline Wisconsin’s mining permitting process appears destined for passage after the state Senate approved a bill and sent it to the Republican-controlled Assembly this week, despite Democratic criticisms that it rolls back environmental protections and is a giveaway to mining businesses.

[snip]

The legislative efforts this session follow a failed attempt to pass a similar bill last year, which would have lured Florida-based Gogebic Taconite to begin a $1.5 billion mining project in northern Wisconsin.

[Governor Scott] Walker emphasized that the bill doesn’t approve the proposed mine, it only is meant to streamline the permitting process. …

Walker said that for any other industry, if a company said they would create thousands of jobs, Wisconsin leaders would be “doing cartwheels.”

“Heck, we do cartwheels for a fraction of that, for hundreds of employees, let alone thousands of employees,” Walker told me. “So it just kind of seems out of perspective.”

Walker’s reassurances notwithstanding, here’s additional background from Jessica Vanegeren in The Capital Times, emphasis mine:

With numerous groups already vowing to challenge the bill in court, Sen. Tom Tiffany also acknowledged that changes were made to the legislation to put the state on stronger legal ground to withstand such a challenge.

“The bill reflects the reality of mining. There are going to be some impacts to the environment above the iron ore body,” said Tiffany, R-Hazelhurst. “If the law is challenged and ends up in court, the judge needs to know it was the Legislature’s intent to allow adverse (environmental) impacts. That way, a judge can’t find fault if the environment is impacted.

Tiffany made the admission after being asked Thursday in an interview with the Cap Times how Republicans could continue to claim the mining bill doesn’t risk environmental harm when:

  • It specifically changes the wording of existing state permitting law from “significant adverse affects (to wetlands) are presumed to be unnecessary” to “significant adverse affects are presumed to be necessary.”
  • Bill Williams, present of Gogebic Taconite, which is proposing a massive iron ore mine in Ashland and Iron counties, said in a recent Wisconsin State Journal article that as much as 30 to 40 percent of the 3,300 acres it is leasing could be covered by waste piles if it builds a $1.2 billion open-pit iron ore mine.
  • The land above the rich vein of iron ore contains hundreds of acres of wetlands, numerous pristine trout streams and several small tributaries that feed into the Bad River. The Bad River wends its way to Lake Superior through the Bad River Indian Reservation, which includes culturally and economically significant rice beds.

“We are simply being honest,” Tiffany says. “There will be some impacts but they will be limited. Changing the word ‘unnecessary’ to ‘necessary’ lets the judge know it was the Legislature’s intent that there will be some adverse impacts.

In a legal context, the wording change proves lawmakers knowingly passed a bill that they accepted would cause some harm to the environment, Tiffany adds, making it more difficult for a lawsuit to be successful on the grounds that a mining permit caused harm to the environment.

This is contemporary Wisconsin, mind you, not Depression-era Georgia. And a Republican Party determined to turn back the clock. There may be stalemate in DC, but at the state level, radical change is underway.

Good book, by the way—Georgia Odyssey. I finished it this morning.