RSSFinancial Stupidity In Pennsylvania And Pittsburgh
J.J. Jackson | December 29, 2010
The City of Pittsburgh is but one of hundred of cities, municipalities, townships, parishes, etc. around the country feeling the pain they have brought upon themselves through years of unreasonable promises. Pittsburgh, my home town, has been getting a stark lesson in economics for the past several years and they have tried everything under the sun, except learning and accepting economics, as the solution to their problems. They have given companies tax breaks to come to downtown only to watch them leave at the earliest opportunity when it became clear that there was not enough business to support themselves. They have dumped millions into infrastructure projects which have left downtown streets (especially those near the Point) looking like a war zone for years.
And through all this here is the reality of the City of Pittsburgh; at 5:00 PM every evening 90% of the storefronts close up when those businesses remaining downtown end their day and those working for them hightail it out of the city for greener pastures. Walk the streets on a blustery December evening at 6:00 PM just before a Penguins home game for and the place is a ghost town except for the few bars and restaurants within two blocks of the new Consol Energy Center.
Abandoned buildings are everywhere. And what is worse is that they are for sale, but with extravagant price tags hardly warranted by the current situation within the city.
Tax revenues are hurting and the city’s pension fund is severely underfunded. How underfunded is it? Don’t laugh but it is at 29.3%. Yes, only about 1 of every 3 dollars required to pay city pensions is accounted for as I speak. The city is required to get to 50% which would require about $220 million more dollars to safe from a State take over on Friday.
Now, considering a pension fund funded at just 50% as OK is laughable I know, but that is the deal apparently. And some people have tried to solve the problem. Our boy wonder of a mayor, Luke Ravenstahl, actually had a legitimate proposal, if you can believe it, which involved leasing city parking garage assets to a private contractor. City Council however would have none of that and rejected the proposal which would have brought in some money to help the situation. City Council doesn’t like the idea of a private company coming in and showing up the city workers apparently.
City Council has countered with earmarking money from parking rate increases to solve the problem with the pension funds. However the Parking Authority here has debt of its own and needs all the money it can get much less have to worry about funding city pensions. Mayor Luke doesn’t support that idea.
Meanwhile the City of Pittsburgh continues to rot while the tax payers of the Commonwealth fret over whether they will be stuck with the tab.
Think about this from a purely mathematical standpoint and using the numbers previously put forth. The pension fund is 29.3% funded. To get to 50% we need $220 million. So that mean that $220 million is about 20.7% of the pension funding needed. How much are we short in total? Well, the total is going to be $220 million divided by 20.7% or approximately $1,062,801,932. Right now we have $311.4 million meaning we are about $751 million short of having enough money to pay all the promises government has made over the years.
But hey, that’s what you get when you elected economic ignoramuses to political office who are more worried about paying off their political cronies and constituents than they are keeping the house, a house they are supposed to be caretakers of, in order. This should have never come to this if intelligent people had been elected by intelligent voters. But like the politicians they elected, the voters were more concerned with how well their palms were being greased than anything else. Especially if they worked for the city or had someone in their family that did.
Copyright © 2006-2010
J.J. Jackson is a libertarian conservative author from Pittsburgh, PA who has been writing and promoting individual liberty since 1993 and is President of Land of the Free Studios, Inc. He is the Pittsburgh Conservative Examiner for Examiner.com. He is also the owner of The Right Things - Conservative T-shirts & Gifts. His weekly commentary along with exclusives not available anywhere else can be found at LibertyReborn.com (Digital Fingerprint: libertyreborn123456789)
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