I don’t condone bailed out companies getting their bonuses…BUT….let’s remember a few things
1)Fed did force banks to take TARP, regardless they needed it
2)All that money in theory is a loan..In theory, the bank(s) are suppose to pay them back…with interest…..which, sorry to say, in the banking industry is entirely feasible..
3)Companies like GM/Chrysler should have never been bailed out, because there no way they are ever going to be produce/sell enough to ever pay tax payers back. Ditto could be said by Fannie/Freddie, though tecnically they weren’t loaned money, but simply “federalized”…I guess housing being an inherent fabric of the U.S. economy I guess one could argue it needed to be federalized.
In the case of the public sector…We tax payers aren’t “loaning” any money..It’s gone, and it’s a perpetual “leak” for which money going out will continue to leak versus money coming in…Those pensions aren’t going to credit us back in case their rate of return is greater than expected. And worse, if there’s any sort of underfunding, we’re on the hook for it. And this “leak” is only going to get worse as more and more people retire and collect…You folks think social security and medicare is bad…just look at what’s happening at the city/local budgets….
All these entitlement programs are eventually going to blow up (or else, everyone else is going to be on the hook for huge taxes)…It’s a no brainer.. You have one of the largest baby boomer populations heading for retirement eligible to collecting all this deferred compensation at all levels…You have a much smaller younger generation that will be paying for these baby boomers, arguably with less opportunities and less “real” wealth versus previous generations that in addition to having to struggle with higher prices in terms of housing/inflation/etc are going to be footing the bill for all these entitlement programs….And you won’t ever get a vote to cut these entitlement programs unless you also somehow find a way to disenfranchise the baby boomers, because obviously they will be voting with their interest in mind…And generation y’s/millienium obviously don’t think about these things to vote against such things…Which leads us to the few generatio x’s that do care but nevertheless that are going to be outnumbered in the polls.
Short of allowing unlimited immigration to people that could produce an income that we can tax(and cutting welfare programs), we’re going to keep borrowing and borrowing and borrowing until eventually this is all going to blow up sooner or later, though me thinks it’s going to blow up at the local/state level much sooner…
Personally, I’d say if the reset button is going to be reached eventually, we might as well do it sooner versus later…So, again, I don’t think these folks expecting a pension understand that the question of getting $0 versus something is a lot sooner than one thinks…
I think where there’s a disagreement on is that some folks here think that if we don’t give these older folks their entitled pensions, we won’t be able to get other people to work in these positions. Imho, we have the opposite problem…By actually paying these promised benefits, we won’t be able to afford to hire people to replace those that retire, even if there are people that want to work. Given the choices, I’d prefer the retiring folks get the partially shafted versus the people starting now, or the people that depend on these public services…Crappy? Yes…But what other choice is there?[/quote]
TARP is only the tip of the iceberg. We had 11 TRILLION dollars allocated and **at least** $3 TRILLION dollars already invested in bailouts in Q4 2009. You think we’re going to get this money back? No way. These bank bailouts are far worse than any pension problems (though the lack of bailouts would affect the pensions as well).
I don’t think housing is any more important to the “American fabric” than public safety. If we can print up money for housing, we can print up money for public safety personnel.
The truth is, pensions are in a senior position if any entity “goes bankrupt.” They will be one of the first to get paid off. Public workers will not get zero, no matter what.
Again, if we preach austerity everywhere else (banking, housing, backroom deals with private corporations, etc.), it would be one thing. But public employees are standing there watching everyone else (in junior positions) get bailed out, so they aren’t going to stand for cuts to their pay/benefits while the Fed prints up money that dilutes the value of their pay/benefits anyway. One or the other. If we inflate, let’s inflate everything. If we deflate, everything can go as well. We can’t keep bailing out those who gamble on housing and other “investments” and expect people who actually improve our quality of life to suffer for it.
One or the other. Is it inflation, or deflation? Somebody has to choose, and it has to be across the board (bankers, home “owners,” investors, public servants, etc.).
