NEW YORK, N.Y. Sept. 26 (DPI) – Detroit’s public pension system routinely paid out extra cash awards – nearly $2 billion over 23 years — the latest evidence of fiscal recklessness and political corruption in the city, which filed for bankruptcy in July.
This recent revelation – unearthed by The Detroit Free Press and picked up by other news outlets this week — prompted hundreds of online posters to collectively say they’ve lost any remaining sympathy for the city. Detroit has an estimated $3.5 billion in unfunded pension liabilities, so the excess payments to retirees dramatically worsened the city’s fiscal situation. Still, the pension liability is only a portion of the $18 billion in total liabilities that the city faces.
The political fallout could be wide-ranging: Democrats closely allied with public employee unions will likely try to survive by distancing themselves from a once-core constituency. Certainly there will be renewed pressure to limit the role of the public worker unions in financially supporting the same politicians who enable fiscal mismanagement.
Readers meanwhile excoriated the corrosive dynamic at work in Detroit: Public pension fund trustees, often union-aligned, vote themselves special and excessive benefits simply because they can, with no opposition from political leaders they control. Many readers predicted that similar activities would be disclosed in more cities in the years ahead.
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“Just another corrupt Democrat administration padding the wallets of its union members and even granting payments to members not yet retired! You can’t make this stuff up. If this was a Republican city the complaints from Democrats would be deafening. But it’s business as usual for the Democrat cities of the northeast and rust belt. Will the Obana Justice Department and Attorney General Holder investigate and prosecute? Don’t hold your breath.”
“Well, there went my sympathy for Detroit.””
“Why is it that the Unions are always so much at the heart of corruption scandals? Unions, especially public service unions, seem like an inherently flawed cancer on society.”
“Disgusting! Public service unions need to be abolished.”
“It should have been apparent to all that the “enemies” of the people are the public employees (represented by their unions) and their co-conspirators, the politicians. Together, they funnel taxpayer funds by the hundreds of billions nationwide into the selfish hands of the public employees whose #1 priority is their own wallets. All the while they claim and pretend they are public “servants”. the reality is that they are the public’s masters.”
http://dealbook.nytimes.com/2013/09/25/undisclosed-payments-cost-detroit-pension-plan-billions/