Posted on 04/28/2013 4:53:01 PM PDT by SeekAndFind
Last week, as Philadelphia’s Mayor Nutter held an unprecedented closed-door session with a number of investors looking to raise money to help fix the city’s troubled finances, popular economist and blogger Michael Shedlock predicted that Philadelphia is effectively bankrupt.
It does not take a genius to figure out what is going on here. Philadelphia is bankrupt. Without even seeing the details, it is safe to assume untenable union wages and pension benefits are at the heart of it all. A 47.6% funded pension is rather telling in and of itself.
As a lifelong resident of the area, a native of Germantown, a product of the Philadelphia public schools, a supporter of Mayor Nutter, and a huge fan of the city, I hope Shedlock is right. Mayor Nutter should move the city into bankruptcy. He would be doing its residents, the region and the entire country a favor.
Of course, the media reaction would be brutal. It’s not every day that a city goes bust, particularly the fifth-largest city in the country. The Mayor, who proudly leads the U.S. Conference of Mayors, would be subject to harsh criticism from his opponents. Those on the right would cheer the Mayor’s courageous fiscal stand, while those on the left would lament the potential effects on workers and retirees. Our region would be the topic of jokes on late-night TV. It will not be pretty.
Philadelphia’s story is the same story that’s been told about American government for the past 30 years.
It’s a story of how our elected leaders over the past three decades have mismanaged public funds.
It’s a story of how the unions won negotiation after negotiation—and never had the self-discipline to confess that what they were taking from the public now would hurt the city in the long run.
It’s a story of how the public ignored the problems and hoped that they would all go magically away.
Nutter shares in the responsibility. So does Street, Rendell, Goode and other mayors and union bosses before them. We all share in the responsibility. Everyone is to blame for this mess. It’s a local problem. It’s a national problem.
But there’s now a unique opportunity to fix these problems. If only our Mayor is brave enough.
In California, the city of Stockton reluctantly declared bankruptcy and because of a groundbreaking ruling by a federal bankruptcy judge, the city’s pension and other entitlement liabilities are now subject to re-negotiation. What would happen if the city of Philadelphia did the same? What would happen if other cities in the country that find themselves in a similar financial predicament would do the same? Or states?
Here’s what would happen: Pensions, health benefits, sick days, vacation time, salary increases, retirement payouts and other entitlements that were all negotiated in good faith by the unions and agreed to by former city managers would now be up for re-negotiation.
Is this fair? No, it’s not fair. Many of these people work hard, and a deal really should be a deal. But there’s also reality, and that reality is that sometimes deals change. In the past 19 years of running my own small business I’ve learned that a deal is never a deal until the cash is in the bank.
A bankruptcy filing would change (not eliminate) entitlement deals and bring significant benefits to the city. It would send a message to our future politicians that they cannot borrow and spend the public’s money without affecting their own legacy. It would also remind the leaders of our labor unions that grabbing too much for their members today could very well hurt those same members (and their children) in the future. The experience would force both sides to understand that in a good deal, everyone wins. And even the best deals don’t last as long as planned.
A bankruptcy would force us all to look at how we fund our schools. Instead of punishing good teachers and children to make ends meet, a renegotiation of entitlements may help our leaders weed out the unproductive and unworthy collectors of payroll and retirement benefits who would no longer be protected by their unions. It may even encourage soliciting funds and partnerships from our city’s business community. Both political and union offices would be forced by the courts to come up with new ideas and create a better balance between public and charter school and online education options.
The bankruptcy of the country’s fifth-largest city would set a precedent for other local governments. If done right, it would restore faith in the municipal financing market so that mayors don’t have to have closed-door meetings with investors to plead for funds or be forced into fire sales.
With the recent events in Stockton and our city’s precarious state of finances, why not go bust? It’s a chance for Philadelphians to make amends for the past, clean up our act, and courageously show the world how an American city can re-invent itself for the next century.
So this Nutter supporter blames himself in part for the state the city is in....No doubt a Democrap rube, who will go back to voting for leftists in the next election. I wonder when he’ll learn to do the math on welfare recipients as well.
Isn’t it funny how all the heavily infested liberal municipalities are going bankrupt? Hmm I wonder why?
Possibly setting a new record for naivete.
ping!
We need some bold and innovative solutions.
Whew! I know I feel better now, how ‘bout you?
They had an article months ago by the Philly libtard rag that the entire metro city voted for Odumbo close to 100% and there are no registered Pubbies’ in the city.
When libtard infested cities go bankrupt, they automatically raise taxes. Gotta keep the EBT’s flowing..
“Is this fair? No, it’s not fair. “
It’s fair to the taxpayers.
Say you run a waste collection company and give cash to politicians in exchange for a city contract. If you get caught, you’re all in big trouble.
At the same time, a public employee union hands a politician campaign cash. The pol repays the union with fat raises and pensions... but it’s all perfectly legal?
Bribery is illegal. And cities are bankrupt. And bankruptcy protects taxpayers from debt slavery, just like it protects consumers.
Face it, public employee unions across the country: taxpayers have figured it out. No more high wages. No more fat pensions. These dirty, stinkin’ contracts obtained by naked bribery are going to be thrown out by bankruptcy courts. START LOOKING FOR JOBS!
Philly is a corrupt, union goon, high tax, trial lawyer paradise, democrat/socialist hellhole.
There is a reason why Philly has lost HALF of its population in the last 30 years.
Let it go bankrupt.
Hard to imagine the very ideas of American liberty and freedom started there.
I think the City operates under some sort of State over site. A Law designed and passed in the 80’s.( I think). Adding to my lack of knowledge on this, if I’m correct is exactly what this Mayor could actually do on his own. I know something is in place..
Philadelphia - bankrupt already just waiting for the lawyers to handle the case. It won’t get much better for many other liberal cities. Bad things are coming...
Not intended to defend the City or the MAyor, just say’in.
Frankly, if I’d say why have a Mayer on Council if some “Board” did exist. Could have maybe saved on that sex change BS!
Politically speaking there is no hope for Philadelphia or Harrisburg. The majority of people elected to city council and the mayor's office are minorities that lack basic education. They are products of city schools. They are products of the Democrat party. They are products of unions.
What is so hideous is they are unable to even investigate the root causes of successful communities near them, let alone emulate them. They look to Chicago, Detroit and Los Angeles for more liberal programs that will never cure their ills. In the mean time, refugees from Philadelphia and Harrisburg migrate to the suburbs looking for safety. But they are still liberals and they infect every place that they go. The results are simple. Each day in the places that they move more resemble the places that they came.
I can't wait to leave where I live today before it becomes a hell hole. There is little that I can do that is legal to stop the influx of Rats.
Mayor Nutter... I really find his name hilarious. Sorta describes the folks who repeatedly voted for him.
“We voted for the politicians who promised us something for nothing. Things got bad so we voted again for the politicians who promised us something for nothing. We laughed at those old cultures that believed in magic, but we kept voting for the politicians who assured us they had found The Philosophers Stone.”
How are they going to pay for those sex change operations they just approved if they are bankrupt.
Philadelphia had an unprecedented economic boom during WWI.They were begging people to come to live and work there(very similar to the present oil-boom in The Dakotas).Philadelphia produced a huge amount of war-material and helped us win.The problem with Philadelphia is simple.The Unions took over and The DemonRats.They promised the moon and couldn’t deliver the stars.!!!!!!!!!!!!!!!!!
As Obongo would say:”Philadelphia Doesn’t Have A Spending Problem;They Have a REVENUE Problem”.This is like an alcoholic(when he’s on his last bottle)saying that he doesn’t have a drinking problem!!!!!!!!!!!!!!!!!!!!!!!!!!!
Resume enhancer for liberals.
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