Union advocates continue to argue that compensation, especially pensions and benefits, have little to do with state and local fiscal problems.I travel around the country (metaphorically speaking) in my latest City Journal article to point out just how much pressure local governments are under from rising compensation costs, especially pensions.
One city I mention is San Jose. Now the mayor has stepped up with an opinion piece in the Sacramento Bee that lays out all the gory details of how rising pension costs have squeezed the city's budget over the past decade. His tale, similar to the problems many other cities, towns and school districts face, is not simply about how to pay down future unfunded liabilities. Instead, it's about the very real impact rising pension costs have already had on city services, and how much worst the pinch could get without reform.