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FEBRUARY 7, 2012 | Policy Points by COMMONWEALTH FOUNDATION
Pennsylvania State Budget Background & 2012 Preview
The FY 2011-12 total operating budget of $63.4 billion, which included $27.1 billion in General Fund spending, represented the first year-to-year reduction in state spending in at least 40 years. However, as the economy continues to struggle out of a recession and with increasing costs in public welfare, corrections, pensions, and debt, the FY 2
FEBRUARY 6, 2012 | Policy Points by COMMONWEALTH FOUNDATION
Pennsylvania State Budget Toolkit
2012 Budget Resources
The FY 2011-12 total operating budget of $63.4 billion, which included $27.1 billion in General Fund spending, represented the first year-to-year reduction in state spending in at least 40 years. However, as the economy continues to struggle out of a recession and with increasing costs in public welfare, corrections, pensions, and debt, the FY 2
JUNE 21, 2011 | Policy Points by COMMONWEALTH FOUNDATION
Pennsylvania State Government Union Contracts
On June 30, 15 of the state's 19 government union contracts expire, with two more expiring in August. These 19 public sector unions represent 62,271 state employees, whose compensation from taxpayers exceeds $4.6 billion.
Recent Blog Posts
SEPTEMBER 21, 2011
New Polling Shows 72 Percent of Pennsylvanians Support Right to Work
New polling conducted by Douglas E. Schoen, LLC for the Manhattan Institute nationally and in 10 targeted states shows widespread bipartisan support to reduce state government spending rather than increase taxes.
The poll looked at state budget issues and collective bargaining and benefits for government employees. The poll of 400 Pennsylvania voters found:
- To fund our government employee pension/benefits, 49 percent support cutting government spending, 30 percent support requiring employees to contribute more to their plans, only 12 percent support raising taxes.
- As to why the state is in fiscal crisis, only 3 percent suggest the state is not taxing enough.
- 46 percent (plurality) support restrictions in collective bargaining rules.
- 57 percent support limiting teacher tenure.
- 64 percent support moving all government employees to a "401(k) type" retirement plan.
- 71 percent support giving government workers a choice of such a plan.
- 71 percent support giving government workers a choice of such a plan.
- 69 percent say the state government should not collect PAC contributions on behalf of government unions, as is currently done.
- 58 percent think the salary increases guaranteed in the most recent state contracts were too generous.
- 72 percent support making Pennsylvania a Right to Work state.
The state results paralleled those nationally:
- Voters strongly support policies that cut state spending and reduce benefits for current and future public employees, but not for retirees. Voters also believe that employees should contribute more towards their pensions. Voters strongly resist any tax increases.
- Voters acknowledge that the influence of unions needs to be curtailed in order for these reforms to occur. Voters feel there is no absolute right to collective bargaining; rather, it is a benefit that can and should be negotiated. Voters are prepared to accept some restrictions on collective bargaining when states are facing fiscal problems.
Pollster Schoen summarized these trends in a Wall Street Journal column on Monday.
posted by NATHAN BENEFIELD | 11:30 AM | 0 comment
AUGUST 31, 2011
Big Labor's Stranglehold in Pennsylvania
Here's a depressing, if unsurprising, statistic: In a new index assessing whether states favor government union bosses or taxpayers, Pennsylvania ranks 5th worst. The Competitive Enterprise Institute ranked all 50 states on 23 dimensions, including collective bargaining laws, pension funding, government union density and right-to-work laws. Out of a possible 40 points, Pennsylvania snagged only seven. (Tennessee had the best environment for taxpayers, at 36 points, while New York was the worst, with a paltry four points).
The gloomy facts contributing to Pennsylvania's woeful ranking: Half of government workers, which include public school teachers, are unionized compared to 9.3 percent in the private sector. The unions' ability to collectively bargain allows them to maintain a political stranglehold over the use of taxpayer money—and drive up demand for public services.
Unions also fund major political lobbying efforts by drawing automatic dues or fees from workers' pay checks, whether or not the workers are union members (Pennsylvania has no pay check protection law). Decades of bad labor policy is keeping Pennsylvania in the economic doldrums. But adopting several reforms would foster the job creation growing states such as Florida or Texas enjoy.
posted by PRIYA ABRAHAM | 04:33 PM | 0 comment
JULY 29, 2011
Michigan Pension Reform Saves $4 Billion
Before 1997, Michigan state employees (like those in Pennsylvania) solely received defined-benefit pensions in which employees are assured an annual retirement income. However in 1997, Michigan shifted public pensions from the defined-benefit program to defined-contribution retirement plan, like the 401(k) plans most companies in the private sector use.
Commonwealth Foundation Senior Fellow Rick Dreyfuss conducted a study for the Mackinac Center on the taxpayer savings from this shift. Dreyfuss discovered that Michigan saved more than $167 million in its annual funding of retirement benefits and more than $4 billion in unfunded liabilities.
Pension reform also shifted political incentives. In Pennsylvania and other states, legislators are able to increase benefits and postpone payments, driving up future liabilities.
Michigan's reform does not allow for underfunding, as payments must be current into an employee's retirement account, something Dreyfuss argues may be the greatest benefit of pension reform.
posted by JONATHAN HUMMA | 00:17 PM | 0 comment
