Remember back in 2009, when bailed-out financial conglomerates protested that they had no choice but to fork over enormous bonus contracts, that the business world was howling that the law required the enforcement of employment contracts? They had no choice! They would be sued!
And we all know that the profits continue to slush about Wall Street unabated?
Meanwhile, apparently, the sanctity of employment contracts doesn't count when it comes to state workers who make $20K a year.
With Newt Gringrich at the masthead, conservative state governments are whispering about the halls of Congress that states have no choice but to unwind these pension funds through federal bankruptcy. A move that, among other things, will require some very difficult new federal legislation and some tiptoeing around Constitutional separation of powers.
To put it bluntly: someone decided that federal tax dollars were better spent bailing out bonus contracts than bailing out modest pension funds.
Of course, the simplest solution is to allow states to survive a few years with unbalanced budgets. But a workable, practical solution isn't actually the point of all this. And we might remember, at this juncture, that it was the conservatives that boxed states in with their balanced budget constitutional amendments.
The point is to stick it to unions once again. Most union membership in this country -- the pathetic crumbs that remain, at least -- lies with state workers. Ask any state worker and they will tell you that they don't mind the lower government salaries because they were promised a livable pension at the end of their lives. It's called "deferred wages." Now, with those pensions disappearing under the austerity fairy dust, what state employee would ever join a union again?
The point, also, is to pull the rug out under activist union pension funds -- the only voice on corporate boards howling about outrageous executive compensation. The only and last influence working people have in corporate America.
