I went to a teacher retirement seminar today with my wife, and a speaker for the PSEA (Pennsylvania State Education Association) retired members began to criticize the massive budget cuts proposed by Governor Tom Corbett which will lead to large scale teacher layoffs. The liberal bias against Tom Corbett was predictable and he was speaking to mostly a Democrat crowed, but I don’t think he was expecting me to publicly interrupt him, taking umbrage at his assumptions and his attempt to use a retirement information seminar to promote a political agenda. However, I spoke with a former legislator at the seminar, Steven Nickol, who confirmed my assessment: since 1998, the state and the school districts have failed to contribute an adequate amount to fund their pension liabilities of the retirees in the state, both teachers and other public employees. In fact, former Governor Rendell took a budget surplus and blew it on pet projects, stadiums, and mismanaged transportation systems in Pittsburgh and Philadelphia instead of using that surplus to shore up the state employee retirement benefit system. So, for the last two democratic administrations, Rendell and Casey, persistent financial mismanagement of state and municipal retirement pension systems has led to a massive budget shortfall. These democratic administrations did not require the school districts to stay current with their retirement contributions either, leaving the state system with a large unfunded liability. This shortfall has forced school districts and the state into such a deficit that severe cost cutting is required. In fact, because the school districts have to make up their shortfalls and because the state cannot bail everyone out, many teachers are going to be laid off. But it is not only unjust but disingenuous to blame Corbett for this situation. He inherited the consequences of years of financial mismanagement. You might even say that the layoffs, and the budget crisis that is affecting the school districts, are the direct result of democratic administrations’ fiscal irresponsibility for the past twelve years.
So now someone has to be the adult in the room and tell all the children that they cannot have everything they want. It is very painful. It is going to hurt teaching. It is going to be a real problem. But when you have been living on credit card debt for years and the repo man comes to take your stuff away, you are forced to cut back whether you want to or not.
Now I agree with the PSEA head. You cannot ask the teachers to take a pay freeze, when the legislators are voting raises for themselves. That will not fly. But I don’t think blaming Corbett for being forced to put the fiscal house in order is either fair or just. As Margret Thatcher said, “The problem with Socialism (liberalism) is that you eventually run out of other people’s money.” The state has to make up the difference and put the retirement systems back in order, or they face bankruptcy and the failure of their obligations to the citizens who have put their lives and their money in trust with the state.
My fear is that in order to make up this shortfall at the state and local level, they school districts will have to raise property taxes to such a level, and the state will have to raise income tax to such a level, that we will have to flee Pennsylvania to go another state that does not tax us into poverty.