This is what happens when you give the government too many decision making capabilities.
Article:
San Diego faces bankruptcy from lavish city pensions
San Diego faces bankruptcy if it doesn't rein in its lavish pension and healthcare benefits package for city employees.
That was the stark warning issued by Richard Rider, a longtime LP activist and member of the San Diego Tax Fighters, in a December 30 statement.
"We pay our public employees what is probably the most lucrative compensation of any major city in the world," he said. "Our city is heading towards bankruptcy, which, sadly, may be the last and best solution to the dilemma. We San Diego taxpayers are world-class chumps for letting this happen."
According to a series of articles and editorials in the San Diego Union-Tribune, politicians "have deliberately underfunded the $3.03 billion pension plan even as they simultaneously have adopted multiple benefit hikes for city workers."
Thanks to the lavish packages, numerous city workers will receive more than $120,000 in annual pension payments --and some will collect 110% of their salaries when they retire from the city's payroll.
As a result, the pension system's unfunded liability will soar from $721 million in 2003 to $2.03 billion in 2009, and will require an additional $157 million in spending every year by 2009 to stay solvent.
"The pension plan threatens to engulf city taxpayers in billions of dollars of crushing debt," reported the newspaper.
To solve the problem, city residents will first have to "break the power of the public employee labor unions," said Rider. "It is they who run City Hall, not the voters and taxpayers."
Then, the city government should privatize most city services, which would mean that private companies would be responsible for pensions, said Rider.
"Parks and [recreation departments], road maintenance, janitorial services, the planning department, trash collection, motor pool maintenance, the convention center, and lifeguard services can and should all be privatized," he said.
If that doesn't happen, "the only other practical solution is for the city to declare bankruptcy," said Rider.
"And maybe we citizens should not be so adverse to that option," he said. "It would allow renegotiation of the bloated public employee compensation pacts. While embarrassing, it would force new thinking by the politicians -- something that under current conditions is not likely to occur."
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