A Refreshing Grown-up Moment
Tuesday, June 21, 2011
Gov. Lincoln Chafee and Gen. Treasurer Gina Raimondo’s recent announcement that they will work together to forge a comprehensive solution to our serious state pension system problems was a refreshing and all too infrequent grown-up moment in our politics. It provides a glimpse at the potential for a different and more constructive kind of politics—one where elected officials rise to the occasion and solve big problems—as opposed to blaming the other guy and kicking the can down the road.
Chafee, an independent, and Raimondo, a Democrat who has been mentioned as a possible Chafee opponent in 2014, are staking their political credibility on solving the thorny and difficult issue threatening the fiscal future of our state and squeezing the budgets of our cities and towns And they’ve shown they mean business by setting a deadline for submission of the proposal to the legislature for a special session this October.
Raimondo has set the right tone by outlining the scale of the problem and the importance of action now — without the usual finger pointing that gets in the way of building the support needed to get a solution adopted. Her just-the-facts style treats the electorate and the key interests as grown-ups and fits today’s difficult times.
RI will owe $600 million
Further, disturbing developments such as Moody’s downgrading the outlook for Rhode Island bonds and that over $600 million will be needed in next year’s budget to fund the retirement system have created a political environment that can move us towards a solution. After all, Rhode Island’s total unfunded pension liability is nearly $10 billion and this doesn’t include an additional $4 billion for health care and other retirement benefits.
However, there is much hard work ahead before a solution can be adopted. It was good to see the appointment of a Pension Advisory Group that includes representatives of impacted unions as well as pension experts and CEOs. Still, Raimondo and Chafee must continue to build public support for the changes ahead so that legislators know that there are political consequences for taking no action or enacting half measures. Any comprehensive solution is likely to mean some significant sacrifices for state and municipal employees as well as teachers—and as a result generate strong opposition.
Total unfunded liability of 50 states $1.3 trillion
Rhode Island faces one of the more serious pension problems, but it is far from alone in this mess. The numbers provided by the 50 states show that combined the unfunded pension and other retirement benefits liability they face is $1.3 trillion. Experts believe a more accurate accounting could mean that the unfunded liability is closer to $2 trillion.
As a result, contentious political fights over how to fix this mess are breaking out all over the country. For example, in New Jersey, a strange coalition of Republican Governor Chris Christie, the Democratic Senate President and key Democratic Mayors and powerbrokers are pushing a series of reforms, including a freeze on cost-of- living-adjustments for current retirees. All this has come over the strong objections of other Democratic Leaders and the public employee unions.
Thanks to Raimondo and Chafee, Rhode Island has now made a great beginning towards solving the pension problem—and perhaps in a less contentious manner. Over the next few months, our state can emerge as one of leaders on this issue. This would send a great message to new businesses and entrepreneurs that we are getting our house in order and most importantly, provide a model of a new grown-up way to address the other big challenges ahead.
If you valued this article, please LIKE GoLocalProv.com on Facebook by clicking HERE.
Rob Horowitz is a strategic and communications consultant who provides general consulting, public relations, direct mail services and polling for national and state issue organizations, various non-profits and elected officials and candidates. He is an Adjunct Professor of Political Science at the University of Rhode Island.
Related Articles
- The Internet - Bringing Us Together or Pulling Us Apart?
- Democrats - We Can’t Party Like It’s 1996
- Public Sides with Unions over Wisconsin Governor
