Reading last Sunday’s Page One story about the exorbitant raises slopped up by a goodly number of Mahoning County government employees brought to mind one of the most memorable lines from the movie “Wall Street”:
“The point is, ladies and gentlemen, that greed, for lack of a better word, is good.” — Gordon Gekko, the main character in the 1987 hit.
Yes, greed is good — if you’re fortunate enough to be on the public payroll. Why? Because the greedier you are, the better off you’ll be when you retire.
It’s all about the public pension system. The more a public employee earns, the more he’ll receive when he retires. Think “three high,” the main ingredient in a ridiculous formula used to calculate the pensions. It refers to the average of the three highest years of salary. The formula also takes into consideration the age of the worker and the number of years on the public payroll.
So, while last Sunday’s story in The Vindicator focused on the 700-plus raises granted in 2013 and this year to a whole bunch of employees — some with obscenely high salaries — the underlying reason for the boosts needs to be emphasized: pensions.
Another memorable line
In keeping with the movie theme for public-sector compensation — greed — here’s another widely repeated movie line.
It’s from “The Godfather” and is spoken by Santino “Sonny” Corleone about a meeting his brother, Michael, is to have with the head of a rival organized crime family:
“What did he say, badda-beep, badda-boop, badda-boop, badda-beep, he wants us to send Michael to hear the proposition, and the promise is the deal is so good we can’t refuse. Ha.”
“Badda-beep, badda-boop, badda-boop, badda-beep” well describes how the public pension system works. You suck up as much money as you can while you’re on the payroll and “badda-boop” you have a vacation home in Naples, Fla.
Meanwhile, the poor slobs in the private sector who keep paying through the nose to bolster government pensions spend their retirement years as greeters in the big-box stores.
Yes, this writer is obsessed with the public pension system — as evidenced by many columns warning of the financial ticking time bomb — but there are other columnists who also see the system blowing up in the faces of private-sector taxpayers.
Consider this piece by The Boston Globe columnist Jeff Jacoby, a well- respected, veteran scribe. It’s headlined, “Public pensions are eating taxpayers alive,” and starts off thus:
“Some of my best friends, to coin a phrase, are lifetime government employees. When they stop working, their pensions will put them among the highest-earning retirees in the country. On a personal level, I’m glad my friends’ retirement will be so comfortable. But as a taxpayer, I know that their good fortune, multiplied by hundreds of thousands of government workers like them, will only worsen a swelling political and fiscal crisis.”
By some estimates, according to Jacoby, the long-term unfunded pension liabilities in states throughout the country add up to more than $4 trillion. (That’s trillion with a T).
In May of 2012, this writer pegged the unfunded liabilities of Ohio’s five public pension plans at $66 billion. Since then, the General Assembly has taken steps to deal with that crisis. To their credit, Gov. John Kasich and the Republican-controlled General Assembly made it clear that the shortfall would have to be dealt with by the public-employee pension systems and not the private sector taxpayers.
Hence, the statutory requirement that public employees pay their contributions toward their pensions, rather than the money coming out of the public treasury.
But as the obscene pay raises in Mahoning County have shown, requiring the employees to pay their fair share, without boosting their compensation through raises, would mean a reduction in their wages.
And that’s a no-no when it comes to ensuring that the “three high” salary average remains as high as possible.
That’s why the exorbitant pay raises, and the many not-so exorbitant, but nonetheless obscene, increases were granted.
It’s about the pension.
In the words of Gordon Gekko in “Wall Street,” “The point is, ladies and gentlemen, that greed, for lack of a better word, is good.”