Kill 3-High formula for pensions
Don’t look for Republicans in Columbus to fast-track legislation dealing with public employees’ pensions and health insurance. They can smell victory in Ohio in next year’s presidential election and aren’t about to risk inflaming a formidable political force — the labor unions — as they had done earlier this year. That dust up resulted in a major defeat for the GOPers in the November general election.
The reluctance to act expeditiously on legislation that private-sector taxpayers would enthusiastically embrace is unfortunate. Republican Gov. John Kasich and his allies in the General Assembly could have ridden the tidal wave sweeping Britain as a result of the Conservative government’s taking aim at public-sector employees.
The government says the nation cannot afford the lucrative pension benefits and has proposed major changes.
The one that would be an easy sell in Ohio — at least with private-sector workers — has to do with the formula for calculating benefits. Currently, a pension is based on final-salary contortions, but the British government has come up with a brilliant idea: Base the pension on a worker’s average pay throughout his working life.
Average highest salaries
The effect of this is plain to see. In Ohio, public employee pensions are determined by taking the average of the three highest years of salary — commonly referred to as “3-High” — and that has led to the corruption of the system.
As a worker approaches retirement age, he looks around for a job that would boost his salary. More often than not, such a promotion is not based on qualifications or experience, but on political connections and personal relationships. In other words, it isn’t necessarily the cream of the public work force that rises to the top.
Then there are the elected officials who also spend their time trying to figure out how to boost their own pensions. They troll for other elective offices that pay higher salaries, or get themselves appointed to boards or commissions that are financially lucrative.
In addition to changing the way the average salary is calculated, the British government also wants public employees to work several years more than they now do before they retire, and to contribute more for their pensions.
In Ohio, polls show broad support for those on taxpayer-supported public payrolls to contribute at least 10 percent of their salaries toward their pensions, and a minimum of 15 percent of the cost of their health-care coverage.
That message came through loud and clear during this year’s battle between the public-sector labor unions and the Republicans over the collective-bargaining-reform law. The measure was pushed through by Gov. Kasich and the GOP controlled General Assembly and was designed to strip the more than 300,000 public employees of many of the workplace rights they have enjoyed for almost three decades.
The unions, along with the Ohio Democratic Party, launched an all-out battle to stop the law from taking effect. They succeeded in putting it up for a referendum vote in the November general election and were able to persuade Ohioans to reject the law.
The defeat of State Issue 2 was a major blow to Kasich and his allies.
However, the governor said he would push for legislation to change the pension and health insurance contributions to reflect what is going on in the private sector.
But now, the word from Columbus is that the Republicans aren’t going to tackle this political hot potato any time soon. Why?
Because the GOP thinks that 2012 will be a political home run for them.
Low approval rating
With President Barack Obama unable to gain traction in public opinion polls — his approval rating has remained below 50 percent for quite some time — and with Democratic Party insiders warning that his presence on the ticket could be disastrous, the Republicans nationally see an opportunity to not only win the presidency, but to take over the Senate. Republicans now control the House.
Republicans have also glommed onto a New York Times column in which writer Thomas B. Edsall revealed that the Obama campaign has decided to abandon the white working class. A sizable number of Ohio Democrats fit in that category, particularly in heavily Democratic areas like the Mahoning Valley.
With union workers not being courted by the president, Republicans will be trying to curry favor with them.