There’s more good news on the pensions front: today Gov. Schwarzenegger’s office announced tentative pension rollback agreements with two more unions: the Union of American Physicians and Dentists and the International Union of Operating Engineers. Like agreements announced earlier this month between the administration and four other unions, this means employees will contribute 5 percent more to their retirement funds and gain an unpaid leave day each month. Newly-hired employees will also have to work longer to receive their full retirement benefits.
These are not devastating sacrifices, or even tough changes. They are just slight, common sense modifications to the current system that will save the state a great deal of money in the long run. As Schwarzenegger has done a tremendous job highlighting, California’s pension system has spiraled completely out of control over the last 10 years, to the tune of 2000% increases and $500 billion in future debt.
I applaud the Schwarzenegger administration for working with these unions to reach these agreements, and I applaud him for almost single-handedly bringing the pensions crisis—a once obscure news story—to light.
But I want to also send kudos to these unions who have come to the table for putting their members first and coming to an agreement that makes sense and avoids more drastic measures like layoffs or slashing workers’ pay to minimum wage. These unions did not get rolled, but made a great deal that their members should be happy with, especially since so many of these changes apply only to new members. Even with these changes, state workers will still enjoy highly generous pension programs that exceed almost anything in the private sector.
If I were a member of the CCPOA or SEIU unions, who are refusing to even give an inch, I would be calling my representatives and offering them smelling salts in hopes that they will wake up to the realities the state faces and follow the lead of these other six unions. Unfortunately, the bosses of those unions just want to score political points by standing firm and taking shots at the Governor, and it is their members who will soon pay the price for that partisanship. (This is of course a reason why the Legislature should actually formally reform pensions and not just wait for all the unions to do it on their own.)
It would also be wise for these public employee unions to remember that a lot of people out there, including me, advocate dumping the antiquated model of "pensions" for public employees all together — moving to 401k style retirement systems, to mirror the private sector. So before you scoff at the Governor’s reasonable efforts towards reigning in some pension costs, remember that those of us that you consider to be "unreasonable" are only gaining steam with the voters for more extreme reforms, and your (SEIU, CCPOA, etc.) unwillingness to come to the table aggressively is our best ammunition for real chance, and an end to public employee pensions all together.
The writing is on the wall that it’s time to make some logical pension reforms—will everyone see it?
NOTE: You can call CCPOA’s Sacramento office at 1-800-821-6443, or SEIU’s at 916-442-3838, to tell them how you feel.