Rendell Colludes with Unions to Avoid Cutting Wasteful Spending

Trumpets blared last week as Governor Rendell announced an agreement with state employee unions to “save” $200 million by temporarily reducing payments by 20 percent to their benefit fund. This will prevent the need to consider employee furloughs – for the time being. However, the agreement only further shows the reluctance of Rendell to address the real root of Pennsylvania’s budget deficit–wasteful spending.

Taxpayers don’t save any money from this deal, which amounts to nothing more than a multi-million dollar shell game. After 15 months, the state will reimburse the union benefit fund for the full amount of supposedly “saved” money. The true winners are Rendell, who avoids cutting wasteful spending, and the unions, who avoid a potentially costly furlough (even though they received back pay during the 2007 furlough). House Minority Leader Sam Smith’s assertion is right, far from being a compromise this is “a concession-free agreement.”

Rick Dreyfuss’s latest policy brief has more on the unsustainable employee benefits demanded by unions.