Do You Think WikiLeaks Has Caused Damage?: Not the State Departement

The damage caused by the WikiLeaks controversy has caused little real and lasting damage to American diplomacy, senior state department officials have concluded. It emerged in private briefings to Congress by top diplomats that the fallout from the release of thousands of private diplomatic cables from all over the globe has not been especially bad.

via WikiLeaks has caused little lasting damage, says US state department | Media | The Guardian.

View: State Debt, Pensions, and Retiree Health Costs Create Unnecessary Alarm

Thanks to this reference by Paul Krugman (New York Times), a fairly long, technical analysis, in which it is argued that the state and local financial problems are greatly exaggerated.

What I don’t see is that if it is recognized that there is a major problem in the localities piling on more taxes now just when people can’t afford them.

A spate of recent articles regarding the fiscal situation of states and localities have lumped together their current fiscal problems, stemming largely from the recession, with longer-term issues relating to debt, pension obligations, and retiree health costs, to create the mistaken impression that drastic and immediate measures are needed to avoid an imminent fiscal meltdown. The large operating deficits that most states are projecting for the 2012 fiscal year, which they have to close before the fiscal year begins on July 1 in most states, are caused largely by the weak economy.  State revenues have stabilized after record losses but remain 12 percent below pre-recession levels, and localities also are experiencing diminished revenues.  At the same time that revenues have declined, the need for public services has increased due to the rise in poverty and unemployment.  Over the past three years, states and localities have used a combination of reserve funds and federal stimulus funds, along with budget cuts and tax increases, to close these recession-induced deficits.  While these deficits have caused severe problems and states and localities are struggling to maintain needed services, this is a cyclical problem that ultimately will ease as the economy recovers.Unlike the projected operating deficits for fiscal year 2012, which require near-term solutions to meet states’ and localities’ balanced-budget requirements, longer-term issues related to bond indebtedness, pension obligations, and retiree health insurance — discussed more fully below — can be addressed over the next several decades.  It is not appropriate to add these longer-term costs to projected operating deficits.  Nor should the size and implications of these longer-term costs be exaggerated, as some recent discussions have done.  Such mistakes can lead to inappropriate policy prescriptions.

via Misunderstandings Regarding State Debt, Pensions, and Retiree Health Costs Create Unnecessary Alarm — Center on Budget and Policy Priorities.

Volsky on Coral Gables Mayoral Debate

GEORGE VOLSKY

SLESNICK DEFENSIVE, SHELLACKED IN DEBATE

Mayor Don Slesnick was shellacked at Tuesday night’s mayoral debate in which he confronted two serious, well qualified opponents: former diplomat James Cason and attorney Tom Korge.

It was a shame that the Coral Gables TV station did not broadcast live the Congregational Church debate – the city has purchased expensive equipment for it – because it could be the only one before the April 12 election.

About 150 people watched the exchange of views about Coral Gables’ past and present problems and its future travails. At the outset, it appeared that the majority of them were supporting  the mayor. But as the debate progressed and became more animated, the volume of applause indicated a decisive change in favor of his opponents. Significantly, a proposal that Coral Gables rescind charging parking fees until midnight – for which Slesnick is principally responsible – was received by shouts of approval and thunderous applause, the biggest of the night.

In the verbal match, the mayor was constantly on the defensive and thus repeatedly bruised. No knockout punches were scored, none were expected. Cason and Korge  could have seriously blooded the mayor, who until quite recently assured everybody and his uncle that after 10 years in office he would not run again, but they were rather gentle with him. In their opening statements and comments later, both pointed out to the financial morass that originated and deepened under Slesnick’s leadership, without mentioning that of his 10 years in City Hall eight were the nefarious David Brown administration, called by many in City Hall “the Slesnick-Brown mess.”

Only Carson referred to Brown once, saying that the disgraced former city manager had brought “disrepute and shame to Coral Gables.” Pointedly, Slesnick did not defend his erstwhile close ally who left the city unscathed with a golden parachute.

The debate did nor generate groundbreaking news items, except perhaps Cason’s statement that the current debt in the city’s pension fund – close to $200 million – is per population the second worst in Florida, after the impecunious city of Medley.

Slesnick’s opponents, while looking more “mayoral,” certainly more knowledgeable and decisive, suggested a different concept of leadership. Reading  his opening statement, Cason was polished and intellectual. He bemoaned the lack of transparency in the city and said that as a relatively recent resident he would look at issues with “new eyes and ears” and be a full-time mayor.  Korge spoke often extemporaneously at the opening, trying to convey to the audience the idea that he was like one of them, locally experienced to mend the Slesnick-authored mismanagement,  especially the finance-killing pension shortfall.

Both accused Slesnick of sweeping serious city problems under the rug. Cason pointed out that a 2004 study which detailed serious dysfunction in the Building and Zoning department, copy of which Slesnick presumably had received, was hidden from residents by Brown.  Korge reminded the audience that during the Slesnick mayoralty residents had four property tax increases.

Accusation of these and other administrative and financial failures that took place under the Slesnick leadership were  not disputed by Slesnick. Time and again, without expressing a single “mea culpa,” he attributed those problems to failings in the nation’s economy. He said that administratively and economically things are improving. He did not say the improvements were due his or the city commission’s actions, but rather to measures undertaken by the “new city manager.”

(This struck some observers as odd. Most people in City Hall aver that Slesnick and City Manger Patrick Salerno are not always on the same page. The most serious and dividing issue was Salerno’s openly critical opinion of the professionalism of the former city attorney, the mayor’s favorite.)

But during the 60-minute debate (originally scheduled for 30 minutes more which the moderator Elliott Rodriguez cut without explanation) Slesnick was Slesnick. He made a number of misstatements that need to be corrected:

1.  Social Security, he said, is underfunded like the Coral Gables pension fund. Not true: S.S., according to government data, will have a surplus until about 2040, if not longer. (Our fund was current in 2001 when Slesnick became mayor.)

2.   “We picked the new operator for the Country Club.” Not true. Nick Di Donato, President and CEO of the Liberty Entertainment Group of Toronto, chose Coral Gables. His company was the only one that wanted to invest in our previously mismanaged club.  Yet he was treated with discourtesy by the mayor during a commission’s meeting.)

3.   The function of the city attorney is to “coordinate” actions by outside lawyers. Not true. According to the job’s description,  that  official has to perform all legal functions in the city.

4.  The city attorney’s office in recent years spent less on outside lawyers than appropriated. Not true. Between 2006 and 2009, these expenses were over-budgeted by  $1,055,000.

5.  In the last several years, Slesnick said, city employees have not had salary increases. Most of them had. His own, $34,123 in 2009, increased to $35,778 in 2010.

Most important, what indisputably emerged from the debate, is that Coral Gables has a series of difficult problems that originated and were exacerbated during the last 10 years – the decade of the  Slesnick leadership.

The central question, therefore, is whether the city can afford to continue under the same leader, or whether on April 12 the residents should chose a new mayor.

Let the Coral Gables Unions Beware: Time of Change

This is a Democratic Governor and this is a small sign that the days of out-of-control pensions and public employee unions is coming to an abrupt end.  Let the Coral Gables Commission and Mayor get the message.

The retirement age for Massachusetts state workers would be raised to 67 for new state employees and incentives for early retirement would be eliminated as part of a pension reform package announced by Gov. Deval Patrick.

The proposal, announced Tuesday, would also reduce by 0.5% each the 9% contribution rate for new employees and 11% contribution rate for teachers, according to a news release from Mr. Patrick.

The current retirement age for state employees is 60; current employees’ retirement age would not be affected.

Also included is an anti-spiking rule to limit annual salary increases that would count toward a pension to no more than 7% of the average earnings over the last two years plus inflation.

The proposal would ban elected officials who previously retired as state employees and are receiving a state pension from collecting the pension while in office.

via Massachusetts governor proposes pension reform – Pensions & Investments.