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Citizens Against Government Waste President Tom Schatz on the impact of Wisconsin’s recall election on unions and public sector pensions.
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Scott wasn't the only place delivering a blow to organized labor last night voters in San Diego and San Jose have given a big thumbs up to cutting -- pension funds for city employees -- just talking about this little that.
All that Al -- plug this big -- and balance the books but will this make a difference I'm joined by Thomas Schatz president Citizens Against Government Waste.
Before we get started what do you think that last debate -- think of his points.
A look this is an ongoing battle that is correct but taxpayers are waking up to the factor that.
The good times have -- when unions made many of these deals.
The returns on investment were up.
Budgets were balanced there was plenty of money around then now.
Everybody realizes that if there's no money for any thing even the unions and the public employees can't get paid.
This is something that people really understand.
-- fortunately.
These quote unquote entitlements are still out there at many levels.
21 states have reduced public employee pensions and a lot of them -- blue new York and there's one in Rhode -- another so this is not political issue it's a financial issue and it's time for.
Taxpayers -- get on board with the kinds of things that Governor Walker and others have done.
-- is it's just say that the -- -- because a lot of people are saying that today and you heard Philip -- definitely didn't agree with that do you think that the tide has turned.
Against pensions and against unions.
I think it's a fairness issue the amount of money -- has got that gets paid in by the unions in some cases either zero or very little.
Those pensions are guaranteed.
People understand that it's a much better deal than they have in their own jobs if they even have a pension.
In many cases they've moved from these defined benefit plans to defined contribution plans you put something and you controlling investments and then at the end you get something out.
Rather than just an open ended commitment we're in some cases the pension budgets outweigh the amount of money being paid to current employees.
Let's -- I gotta disagree with you there because I don't know that you can make it a fairness issue I mean if it's not fair that these people paid into their pensions over time there were promised one thing and -- little they paid.
They entered into an argument -- into an agreement and -- -- essentially not being honored so I don't know that the fairness argument really holds that.
Well then it.
When things started out with everything being kind of up in investment returns -- good -- -- Mayor Bloomberg among others among others has pointed out that the future benefits are based on unrealistic assumptions of an 8% return.
Some states have tried to lower that down even that has been an argument because the money just isn't there -- -- that the governments are broke.
When Harrisburg went broke last October it was a 48.
Local government to go broke since 1980 that means there is no money for anything.
Yep the bottom line is though I mean when you look at what happened in San Jose and San Diego this still doesn't solve the problem.
I mean they still have big budget gaps there what are they have to do now.
-- they have to reduce other expenditures across the board get rid of programs that don't work there are a lot of things that can be done.
They -- the federal level forty billion dollars of duplication and overlap for example the federal government has fifty programs to promote financial literacy.
And of course the government's going broke I don't think they want us there they don't want to be teaching us how to balance our own checkbooks when they can't do it.
So everywhere you can find all of this duplication the governments around the country have been spending.
Instead of saving.
And now it's a big problem because they just don't have enough money coming.
Well you know Scott Walker risked his political life to fix this situation in his statement will be very interesting to see.
If others are now galvanized by that Tom Schatz thanks so much for joining us we appreciate it.
Thank you with.
