Providence update – big union concessions prevent bankruptcy
I’ve written numerous times over the past two years about the horrible fiscal mess David Cicilline (D-RI01) left behind in Providence when he was Mayor, and how he concealed the problem from voters during his 2010 congressional race.
The city has been teetering on the verge of bankruptcy, but a tentative deal just struck with city unions likely will prevent a bankruptcy through union pension concessions and by moving retirees to Medicare:
Under the deal, automatic pension increases would be suspended for a decade, future pensions would be capped and the most generous pension plans would be eliminated. The deal would also move retired city workers ages 65 and older into Medicare.
The changes are expected to help the city save $18.5 million next fiscal year….
Paul Doughty, head of the local firefighters union, called the agreement “a bitter pill to swallow” but better than bankruptcy….
Under the proposal announced Wednesday, all cost-of-living increases would be suspended until fiscal year 2023. Future pension increases would be capped and only some retirees would be eligible.
The agreement ends a lawsuit filed by retired police officers and firefighters that attempted to block the city from shifting retirees to Medicare coverage to save money.
The city aims to save about $40 million over the next 10 years by moving retirees over the age of 65 to Medicare. Under the agreement the city would agree to pay for some Medicare benefits.
Now that the City is savex, expect Cicilline to try to take credit, as if his lies about City finances have been washed away by his successor’s success.
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to the full extent allowed by law.
This is all to typical of the abhorrent disgusting political slime that flows in America’s seats of power in States Gov. mansions, Cities City Halls, and even the White House and Congress, from Bell Calif, to Providence RI..
All this does is to help speed up Medicare’s demise.
The Road to Serfdom: it is being paved for the children whose mothers did not abort.
” Medicare spending is growing faster than the rest of the federal budget, and it’s the main cause of America’s long-term deficits. As Nix and Fleming show, Medicare’s costs are projected to shoot through the roof, surpassing Social Security, Medicaid, Obamacare subsidies and all other non-interest spending by 2050. Want more proof on how bad the situation is? By 2040, Medicare’s shortfall will account for 81 percent of the federal deficit.
Here’s another disturbing fact: The number of workers per Medicare beneficiary is falling dramatically. Back in 1965, there were 4.6 workers contributing to Medicare for every person receiving benefits. Today, there are only 3.3 workers, and in 2030, that number will fall to 2.3. That falling ratio is leading to the program’s insolvency. And with longer life expectancy (which of course is a good thing), seniors today are collecting benefits for almost three times as long as when the program first started. That means the program is paying more benefits than ever before.”
That’s the democrat way… Kick that ol’ can down the road until it falls into the abyss and takes the rest of us with it.
It just proves the point that government does little very well and much very badly. Politicians in charge of monetary affairs are akin to arsonists running a fire department.
LBJ raided the SS trust fund to pay for the Great Society and War on Poverty, Clinton started taxing SS benefits and the current administration reduced the payroll tax which is yet another negative.
I’m well into retirement and collect from both programs. Well SS anyway as most of my health care needs are provided by the VA. In fact in my first seven years of retirement I have collected well less than $1000 from Medicare.
The future bodes well for no one. Our politicians have squandered the national treasury and we are left holding the bag.
A pox on all of their houses…
I would bet that bitter fireman has a better pension and health plan than 95% of the people who pay his salary.
The city will spend more money on their retirement than they ever did in their 30 year career.
Wow, some unions actually realized that the well is dry. Better late than never, I guess.
“Now that the City is saved…”
…look for the *very first* upward twitch in city income to bring out the Unions biting and clawing for those COLA’s back, along with back-payments, comp time, free health care,….
Since the Cicnci Admin signed off on Compounding Cola’s This is as close to reform as the City has ever been. Cicilline will find a way to claim victory. COnsider the Irony of the Democratic party in Rhode Island. As former Mayor of Providence David Cicilline leaves the City’s finances circling the bowl, Incoming Mayor Tavares in the course of shoveling the train load of Horse —- that Cicilline left behind, Tavares Endorses Cicilline in his re-election bid…