Liberal Oregon prioritizes government workers, suffers consequences

The thorough skunking Dane County conservatives took this month in the Spring elections is the direct result of Act 10, Scott Walker, and Donald Trump. 

Trump only upped the ante. The bull was already enraged. Act 10 and its pension and health insurance reforms seven years ago is what salted the earth for conservatives in Dane County, perhaps for a generation.  

tumblr_namg87xiph1t8enq1o1_500Madison’s liberal-progressive-socialist hegemony might want to look to the state of Oregon and its principal city, Portland. The New York Times reports that Oregon’s public sector pension system is devouring funds that once went to public services like street repairs, teachers, and police. “Essential services are slashed” while local governments cannot raise taxes fast enough to keep up.

“Oregon now has fewer police officers than in 1970 [and] is losing foster-care workers at an alarming rate. … Even prosperous communities are being pinched.” One school district outside Portland laid off 75 teachers when its mandatory pension contribution spiked by $14 million. “That was after shedding 340 teachers in 2012,” the Times reports. (“Oregon faces a severe, self-inflicted crisis.”)

Oregon’s pension system guarantees at least 8 percent of every paycheck, no matter what the stock market does. When workers retire, their government employers were required to match the account balances, effectively doubling them.

Oregon’s state supreme court has turned back attempts to reform the system. Government employees were even exempt from paying state income taxes on their largesse. When the legislature required them to pay the state’s 9% income tax, like everyone else, they also increased pensions — by 9.89%!

Since 2003, new hires are enrolled in a more sensible pension program but they haven’t retired yet. 

Oregon’s system differs from Wisconsin, where payouts can rise or fall depending on the performance of the system’s investments in the real-world stock market, smoothed out over several years to cushion annual returns. (Although annuities cannot fall below levels received in the initial year of a participant’s retirement.)

In 2007, for instance, Wisconsin Retirement System annuitants got a 6.6% increase but took decreases for the next five years, including 9.6% in 2012. Last year’s increase was 2.4% despite a 16.2% increase in the performance of its investments. Employee Trust Funds secretary Robert Conlin reports:

While the average funded status of public pension plans nationally hovers just north of 70%, the WRS funding ratio (a measure of whether a pension plan has sufficient assets to pay promised benefits) was 99.1% at the end of 2016.

What was the fuss in 2011 after the passage of Wisconsin’s Act 10? That public employees, once again, would have to contribute to their own pensions. Yes, before that, the government paid both the employer and the worker’s shares.

The NY Times, at one point, acknowledges that “Oregon is a blue state,” then moves on decorously. The truth is, Oregon is one of the most Democrat(ic) states in the Union. Its entry in the Almanac of American Politics relates:

Almost half of Oregon’s population lives in the counties in and around Portland, the city whose hippie-liberal sensitivities are lovingly satirized by Fred Armisen and Carrie Brownstein in the television comedy series Portlandia. 

Oregon’s pension fund is $22 billion in the hole. Other states are in bad shape, as well, including New Jersey, $135 million in the bad, and Illinois “faces a pension crisis.”

Blaska’s Bottom Line: Oregon has not had a Republican governor for over 30 years. Oregon is Bernie Sanders country. 

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About David Blaska

Madison WI
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37 Responses to Liberal Oregon prioritizes government workers, suffers consequences

  1. Batman says:

    I was living out of state at the time of the intense rebellion against Act 10.
    Can someone please explain exactly why there was/is so much resentment and opposition to that legislation.
    Thanks

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  2. AnonyBob says:

    I’m not clear clear on what your point is, Dave. That Oregon’s public pension system is a mess because it’s a blue state? Plenty of red ones are, too. That they have a different funding mechanism from Wisconsin’s? Ok, and…? That Walker salted the earth by unilaterally screwing state employees? Obviously. It’s not that state employees had refused to contribute to their pensions and health care. It’s that they had agreed, and had bargained for it in good faith with the state, that the state would pick up employees’ contributions in lieu of other pay or benefit increases over the years. It was a better deal for the state to do that than increase wages, and employees went along with it. Walker demonized state employees to turn public opinion against them for rank politics and reneged on previous agreements, while busting their collective voice, the unions. He unilaterally cut their agreed to pay and benefits by 10%. My take home pay fell by 10%, because Walker wanted to “drop the bomb.” Was I and am I still bitter? You damnbetcha, who wouldn’t be? I bet if you were still on payroll when that landed you’d be less sanguine about it. You probably wouldn’t be a Republican anymore.
    That, Batman, is what the Act 10 protests were about.

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    • David Blaska says:

      What A-Bob won’t tell you is that few private sector employees have the kind of retirement system, a defined benefit system, that government employees enjoy. You can, literally, never exhaust your benefits. Or the job security. That, plus, the state was broke. It couldn’t afford to pick up the employee share any longer. Couldn’t afford the level of revenue it gave to K-12 school districts, either. Jim Doyle “furloughed” employees without pay, so nacht michts.

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      • AnonyBob says:

        A guaranteed pension (should there be any other kind?) and job security; those were always the trade offs made in exchange for the lower wages of the public sector. Most public employees also saw it as a higher calling, despite the abuse from the great unwashed. I know I saw it that way. Sorry to see you evidently did not. The mystery is not why those “greedy “ state employees have a defined benefit they can never exhaust (because, you know, it IS 99% funded and managed not-for-profit). The mystery is why private sector schlubs are willing to be stuck in for-profit 401k’s that no one really understands, with mystery fee structures that guarantee the fund profits while its customers wonder where their money has gone.
        Once again: most of the rest of the advanced world seems to have figured this out.

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    • AnonyBob says:

      You guys are so easy to bait.

      Like

      • coolkevs says:

        guaranteed pensions – tell that to the guy/gal that works down at the kwik-e-mart or stands on their feet all day at a retail outlet. Bottom line Bob, you are a greedy person willing to take take take from the fair taxpayers of this state or any state and can’t for whatever reason see that such benefits are unsustainable because money does not grow on trees

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      • AnonyBob says:

        That is just silly, Kevs. Dave, do you think you’re greedy because your compensation as a state employee included a pension? Are we all supposed to be minimum wage Kwik-e-mart employees? Are you, Coolkevs?

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  3. old baldy says:

    I don’t know where to start, davey, but you really fumbled this one. To wit: I always paid in to my pension (1979-2012) as a state employee, it all depended where your worked and which bargaining unit you were in (or weren’t). I thought we settled that a couple months ago. Job security you say; folks got let go all the time at the agency where I worked. I even got rid of some myself. And the fiscal troubles were the result of the long reign of your mentor, TGT. Give credit where credit is due. Sure Doyle furloughed us (as did Earl because LSD screwed up the budget), but that was temporary.
    Was “machts nichts what you were looking for?

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    • David Blaska says:

      Yes, Baldy, we did settle that but apparently you have forgotten. Before Act 10 (enacted in 2011), state government employees contributed less than 1 percent of their total pension funding. If you were the exception, that only proves the rule. You forget that your lordly Squire was, himself, once a state employee (among other things). As for job security, talk to the folks at Boston Store and Sears. Once again, I refer you to “Wisconsin Retirement System,” Informational Paper #83, Wisconsin Legislative Fiscal Bureau, January, 2015. Leg Fiscal Bureau

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      • old baldy says:

        And since you were a state employee you should have been aware of that. And that 1% contribution was negotiated by TGT. And, as Bob said, was in lieu of raises to salary. But you just keep on making stuff up.

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        • David Blaska says:

          … and the state could no longer afford it! We were $300 Million in the crapper! The Great Recession was on. What is your major malfunction, Baldy? (R.I.P. R. Lee Ermey)

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  4. GetOverItBOBBY!!!! says:

    Aren’t those now payments all pretax dollars so actually it affected your take home pay but it actually lowered your taxes federally and state taxes. Although I’m sure it did not make up the entire amount withheld for your benefits. Ole Diamond Jim pushed out non paid furloughs did those affect our pay before walker. That mixed with freezes on pay are to make for bad blood. I am sorry you had to start paying for your benefits and did not see much raises after Walker changed things.

    All I know things were surely headed for outhouse when ole diamond Jim said let me up I’ve had enough. All I know if Ole Diamond Jim had taken the tough route and done what Walker did he would be ending his 4th term exalted on high. Even by you ole Bobby.

    Instead he left his position a total embarrassment. state owing taxes to Minnesota, patients victims fund was empty, UI benefits on empty, transportation fund raided, state employees in perpetually annual furloughs, UW system raising tuition during economic crisis, Weac and WEA Trust perpetually raising costs to school districts across the states perpetually during a time of economic crisis. meanwhile school boards were held hostage to these politically powerful monopolies to pay top dollar for benefits that as we found out could be contracted at much better rates and savings. Also the conservatives actually have done countless Audits of the departments and found much fraud, abuse and waste.

    Not all things work out nor were done to my liking. After Act 10 they had billions of surplus dollars, all the things were paid back or off that I listed above. Except the transportation fund dollars, those should have been paid back as well before any tax cuts were passed. Also other state debts should have been retired sooner rather than later. And the rainy day fund should be built up to atleast a billion dollars. WEDC debacle started long Walker and it’s problems remained. Teen prison issues not great and should have been dealt with much sooner than now.

    The state is in better fiscal footing according to Moody’s, 240,000 jobs, lowest unemployment since before I was born high employee participation. ok we are last in startups ok fine you got me their Bobby. Startups downward falling all over the country, Wisconsin has not been a hotbed for startups at all. It would be nice to change that fact but reversing course on all other things that helped straighten out fiscally would be a disaster for taxpayers all over again.

    Tommy G Thompson as much as he was very popular and like-able guy, put the states finances into uncontrolled spending, McCallum was a blip on the radar and Doyle was a gutless partisan hack. So here is to all the rhetoric over Walker.

    Last I checked State Workers are no longer under Furloughs, no longer on a pay freezes, Still have the best health insurance of any employee in the state, have the most secure pensions in the state and almost the entire country. They have many other retirement benefits that are unheard of, banking sick time to pay for healthcare once retired. Incredible benefit. Most incredible vacation and sick time and leave time policies. Oh yeah those did not go away with Walker!!!!

    So you had to pay for those very expensive benefit packages out of your salary, boo hoo. BOBBY

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    • AnonyBob says:

      Is that diminutive “Bobby” supposed to make me feel bad? Why?

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    • old baldy says:

      get:

      Looks like you are no more tethered to reality than dave, but you whiffed on a bunch of your claims.
      “After Act 10 they had billions of surplus dollars” Really? You should tell walker et al. He didn’t get the memo, cuz he is still crying ‘poor house’.

      Like

      • Turd Ferguson says:

        When creating his 2nd budget he cut taxes by a billion dollars at the very least. He has since cut taxes even further. He also change the DOR withholding tables which amounts to a taxcut because instead of money going and sitting at the DOR it was left in people’s paychecks. Since his first budget I have yet to say we are in the so called “poor house” Also Departments would throw in everything from the kitchen sink into requesting dollars for new budgets so that it would gain publicity of the State being in the whole and Walker was doing a poor job of managing the fiscal budgets. I am sorry if that were the case do your will really think Moody’s would have upgraded our credit rating. Something by the way was lowered under Ole Diamond Jim.

        The state is in transition, the money train from all state taxpayers headed directly to money coffers of Unions is over! The state is much better off for it. If TGT, McCallum and Doyle had done their jobs prior to Walker, Especially Doyle, he would be finishing his last term in office right now. Instead he is a blip on the radar in a very uninspired stay at the governor mansion.
        Walker did not create the problems that happened over many generations and as the countries economies changes and technology changed the state of wi had to change as well.
        The state is getting closer and closer everyday of actually be able to centrally manage all state computers from a central location. that is a huge project that predecessors never could get done.

        Also why are leasing high priced properties when land is available everywhere for much better cost savings to taxpayers?
        Bob the mailaise of 70’s and 80’s are over the 90’s were times of transition for the state economy where overspending and overpromising caused the issues we had in the 2000’s and early 2010’s. Cannot wait for the 2020’s when FoxxConn revolutionizes SE wisconsin for generations.

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  5. Act 10 is ancient history and likely will not be a factor in the anticipated November blue wave. Mr. Walker has incurred massive emnity from Wisconsinites and will be sent packing as a result of his defunding of the state parks and large portions of the DNR’s enforcement and regulation functions. Rolling back regulations protecting wetlands, allowing aquifer depletion by high capacity well, facilitating groundwater ruination by greasing the skids for CAFOs and sulfide mining does not endear one to voters. Neither does fighting to avoid holding legally required elections. Neither does presiding over the largest transfer of wealth from taxpayers to a foreign corporation ever. No matter the merits of Act 10, Mr. Walker acted the coward by never mentioning it (or defending it) while campaigning for office, preferring to spring it as a surprise. Likewise Right to Work legislation. An honest politician (apologies for the oxymoron) would run on a platform defending bold reform, not skulk it into law once elected. To the extent conservatism has been lost for a generation in our state, Mr. Walker and his ilk are to blame. It’s a consequence of their awful governance.

    Like

    • David Blaska says:

      Scott Walker was elected twice after enacting Act 10. Then again, Jim Doyle never told us he was going to sell the state to the Indian tribes, raid the Transportation Fund (roads, anyone?), and illegally tap the Patients Compensation Fund.

      Like

  6. David Blaska says:

    And the state employees union, greedy as they were, never agreed to a contract proposed by the Jim Doyle administration. When Walker got elected, they quickly caved and the Dem-controlled legislature voted it down.

    Like

    • AnonyBob says:

      Yep, ol’ Marty Biel bet the wrong way there. But he didn’t expect to be knifed in back by a one vote margin in the person of former union bricklayer, Dem. Sen. Russ Decker. Who was rewarded with a patronage job, to goose his pension, by the new Gov, Scott Walker. Corruption and sleaze, all around.

      Like

    • old baldy. says:

      Here is another example of dave swerving of the rails of truthiness to make a dull point. There are (and were during the Doyle era) a multitude of bargaining units representing state employees, as well as non-represented folks like me. For dave to paint all state employees with a broad brush is just another example of his hidebound ideology and aversion to details and facts. Sure Biel screwed up big time. And Decker became a poster boy for traitors and bribery. But here are somethings dave doesn’t want to admit; the represented staff that worked for me have had only a 1-2% pay increase since walker has been in office, and have taken $4-6000/yr hits on their take home pay due to increases in benefit contributions. That is why experienced employees are leaving state employment going private. Better pay, similar or better benefits, and an employer that appreciates the employee.

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      • David Blaska says:

        Says the guy who contended that state employees paid their share of their pension funds when the truth was that state employees paid 0.3% and the government paid 99%.

        The Policy Werkes cannot criticize any worker who wants to better him/herself in Wisconsin’s booming economy. You may note that state workers are getting a 2% across-the-board raise in mid-2018 and another 2% across-the-board raise at the beginning of 2019. Additional raises for nearly 200 positions that earn significantly less than their private sector counterparts as well as pay-range increases for prison guards.

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      • AnonyBob says:

        Why do you refuse to recognize that state employees agreed to lower pay in exchange for the state paying almost all their pension contribution? You think employees should’ve contributed more? Fine. Boost their pay to where it should have been. Without that, Walker unilaterally reneged on the deal and CUT what employees earned.

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        • David Blaska says:

          A-Bob, it is very likely that employee unions did agree to lower pay in exchange for picking up their pension contribution. (Could you please inform Baldy of that?) No one is contesting that. For your part, do you understand that the contract had expired well before Act 10? So there was no “reneging.” Let me know if you understand that. Also, some basic economics and a little math: state government was $300 million in the hole. Wisconsin taxes under Doyle were some of the highest in the country. Various funds, including highways and the patient compensation fund, had already been raided. Tell us, A-Bob, how much sense would it make to require employees to pick up their fair share of their generous pensions with one hand and with the other hand “boost their pay”?

          Get thee to Oregon, Annoying One!

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      • old baldy says:

        Bob:
        No sense arguing with dave. He told us he is right and we are wrong and we should be happy with that and shut up. Isn’t it amusing that he can say anything he wants to prove a point, but when called on his misrepresenting reality he gets all snippy? Note he doesn’t prove anything I said as being wrong, but slides in some deflection. Maybe all that unruly hair on his noggin prevents the acquisition of additional knowledge, eh?

        On a side note, we got a smidgen over 30″ of snow here over the weekend. I would like to thank all the plow drivers, public safety, and local officials up here for the great job!.

        Like

        • David Blaska says:

          When did you “call me” on “misrepresenting reality”? When I posted the bipartisan fiscal bureau report refuting your lie about state gov’t employees pension contributions? When I pointed out that the state employee contracts had expired by the time Walker introduced Act 10? That Marty Beil’s union never could come to agreement with Jim Doyle, a Democrat(ic) governor? Do some research, Baldy, and you wouldn’t get shown up so often.

          Liked by 1 person

      • AnonyBob says:

        When state employee contracts expire, they don’t just just disappear if a new one isn’t ready. The old one continues in force, much like the state budget continues at its previous levels if the legislature can’t get its act together by its deadline. Instead of negotiating with state employees – who had worked cooperatively, if grudgingly, with previous Governors during budget shortfalls with furloughs and other cutbacks – Walker reneged on the old contract terms with a union-busting sledgehammer and told them to go pound sand. Can you recognize why it felt like a forced 10% cut in take home pay?

        Like

        • David Blaska says:

          The old contract expires at the expiration date. The State administration continues its terms by its own volition. Walker gave notice that he was not going to negotiate a new one, as provided by law. You blame the Legislature, but the unions never agreed to a contract to place before the Legislature until after Walker’s election in late 2010, whereupon said proposed contract was voted down. Again, there was no reneging. And yes, being forced to contribute to the pension and more for health insurance was, indeed, a reduction in compensation. Never said otherwise. Said only that the state was broke and couldn’t afford more. Other states and municipalities about the same time laid off employees; Wisconsin did not. Same economic forces were crippling private enterprise, too.

          Only state government workers and teachers unionists seem to think they should be exempt from economic reality.

          Like

  7. AnonyBob says:

    No argument, in that instance.

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  8. richard lesiak says:

    So; all you people including Blaska are getting a pension check?

    Like

  9. madisonexpat says:

    Why do the public service heathen rage?

    Like

  10. madisonexpat says:

    Oregon credit rating reduced to “Meh.”
    Illinois credit rating went from “Labrador retriever to crack head.”

    Like

  11. Turd Ferguson says:

    What to you mean all “YOU” People!

    Like

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