The Politics of Pensions: Why the Taxpayers Lose

NOVEMBER 14, 2010 | by MATTHEW BROUILLETTE

On Friday's conference call regarding HB 2497, the Union Pension Bailout Bill (because it bails out the union from real pension reform), someone asked why there were so few opposing votes on the proposal when it originally passed the House (only 6 Republicans opposed) and when it was sent back from the Senate (with only 8 Republicans in opposition). The short answer is: Politics.

As we noted earlier, just three government employee labor union PACs contributed over $750 K to the House Democrats in 2010 alone. Of course the union bosses are expecting something in return for their "investment," and the clock is running out on the House Democrats and lame-duck Gov. Rendell for them to be able to deliver. So November 15 is the now the latest do-or-die date for legislation like HB 2497.

In addition to straight-up campaign cash, the politics of pensions is driven by the fear that too many legislators feel from organized labor. We've been told of the hundreds of emails they've received from PSEA-generated form letters, and this has scared enough into doing the politically expedient thing rather than the right thing.

This intimidation is also what influenced these overwhelming votes for HB 2497. Some on our call today were shocked that members of the House originally voted for HB 2497 this past summer because they believed the Senate would either let the bill die or would amend in a defined contribution plan, like SB 566. SB 566 has 18 co-sponsors and, as recently as September, the prime sponsor predicted it could gain sufficient Senate support if brought up for a vote (it never was).

So that seemed to be a reasonable political calculation that House members could tell the hard-lobbying PSEA that they supported their pension bailout while expecting Senate inaction, or action to save them at the end of the day. Others have admitted to being misled by the PSEA's lie that HB 2497 constitutes "savings" to the taxpayer.

So, from hard campaign cash to elected officials to teachers acting as pawns for union bosses, you can see how the politics of pensions means that the taxpayers lose.



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