Monday, August 03, 2020
Miles from the Mainstream
D. R. ZUKERMAN, proprietor

Pensions and the Common Good

August 1, 2013 --

If a municipality -- let's call it Detroit -- files for bankruptcy, should the bankrutpcy could maintain pensions and face value and approve cuts in municipal services?

An editorial in The Wall Street Journal, July 22, asserted: " For years Detroit has been gutting services and sucking taxpayers dry to finance retirement and debt obligations".

Service cuts include a 40 percent reduction in the police force. The editorial noted: "About 40% of revenues go toward retirement benefits and debt...."

A New York Times editorial on Detroit, July 23 remarked: " officials should resist the idea of cutting pension payments to the city's public workers, which averages $19,000 a year."

The Times argued that reducing pensions "will...hurt" the Detroit economy because retirees would likely spend their money locally.

And what if a Detroit municipal pensioner relocated to Florida or Arizona or California?

LPR wonders if the common good is served by honoring full value for pensions while reducing city services for the people still living in Detroit.

Does that qualify as the "ambitious sacrifice of the many, to the aggrandizement of the few"?