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Economic reality catching up with public sector

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POSTED September 25, 2009 1:41 a.m.
The professor was indignant.

“The state should be ashamed of themselves,” she told the TV news crew. “They need to find some other way to make cuts.”

Another University of California employee – a custodian – got students who were worked up about tuition topping $10,000 a year and staff being cut to let out loud whoops of approval when she said the university had the “audacity” to lay off a quarter of the people who keep the buildings clean.

Audacity indeed.

Anyone watching TV news in California is treated with an almost nightly barrage of indignant public employees from the state level on down howling at what they are faced with – non-paid furloughs and pay cuts – and even some who are losing their jobs to layoffs.

It is a reality private sector workers have faced for decades.

Their temperament is decidedly different than NUMMI workers or a host of others you see that lose their jobs in the private sector whether they’re being interviewed by news crews at the unemployment. office or leaving work on the day they got their pink slips.

The public workers oftentimes are outraged about what is happening to them. It’s in sharp contrast to private sector workers hit with pay cuts or layoffs.

Welcome to the real world.

Unemployment in California is at 12 percent. Almost all of that out-of-work in that number reflects private sector workers.

It is old hat for many of the private sector workers who have had to experience the collapse of various employment sectors in California from aerospace to the flight of major financial institutions to the South.

Public sector workers have essentially been isolated from the cold realities of economics for generations. They also – in many cases – wrongly hold onto the myth that they are making a trade-off for “lower paying jobs” in exchange for job security. Public sector pay has significantly outgained private pay in San Joaquin County over the last 12 years. Public sector retirement packages are solid gold compared to the private sector.

Salaries and benefits account for as much as 85 percent of government budgets. With revenues dropping significantly due to the mortgage meltdown and general economic slowdown, there is little wiggle room left. It is - to borrow one of Dilbert’s favorite phrases – right sizing employees. Government is matching expenses with revenue and when 85 percent of your expenses are employees you have no other choice but to do what is now being done throughout California.

It may sound cold but there is no other way to do it.

No one is taking joy in this - not I or any other private sector worker. It’s just that the money isn’t there.

In many cases public employees in California are being given a choice between pay cuts or being laid off. I’ve been there before and it isn’t fun. Personally, I opted to take a 33 percent cut in pay instead of losing my job especially considering at the time we had just bought a house. It took years, severe spending cutbacks, odd jobs, and increasing credit debt to get out from under and recover but in the end it happened.

If I’m angry about anything it is how tens of thousands of bureaucrats in Sacramento – as well as higher education employees – were living on borrowed time by the state swiping local money which in turn is jeopardizing everything from parks and streets to police and fire protection.

Yes, a $10,000 a year UC tuition sounds like a lot but there are options for students who can take longer, delay entry or – heaven forbid – accept the fact they may have to pay more for student loans. One student protestor said education should be a right and not a privilege. I agree – but only for kindergarten through 12th grade. Most people go to higher institutions not so they can become an American Mother Theresa or stateside Dr. Albert Schweitzer but so they can make more money.

Yes, a lot of the blame for our current mess rests squarely on the shoulders of the California Legislature whom many taxpayers believe is beholden to powerful state employee groups. However I didn’t hear very many public sector employee groups telling the governor et al that they were hiring too many people, paying too much money, and had benefits that were too generous when the money started slowing down a few years back. Correct me if I’m wrong but state unions simply said they “wanted more.”

Now the chickens have come home to roost.
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