Young Research & Publishing Inc.

Investment Research Since 1978

Connecticut: Big Government Utopia Begins to Crack

By

By Jeffrey M. Frank @ Shutterstock.com

After decades of close relationships with the public sector unions working for their towns and cities, mayors are begging to be protected from collective bargaining. With money running out, and undiminished power held by unions, mayors are finally beginning to understand why having powerful public sector unions makes it hard to balance budgets and provide services to citizens.

As negotiations have become deadlocked with public unions demanding more from the ailing cities and towns in Connecticut, the mayors are begging state legislators to change the rules to give them more power in negotiations.

The Wall Street Journal editors write:

Connecticut mayors grappling with rising retirement costs and sinking economies this week issued a distress signal to lawmakers in Hartford: Save us from our public unions.

The state would be in a “stronger position if we don’t negotiate for benefits,” Joe DeLong, the executive director of the Connecticut Conference of Municipalities, told a committee convened by the legislature to restore fiscal stability and economic growth. The conference of municipalities implored the state to end collective-bargaining for pensions and health-care benefits as well as limit binding arbitration when unions and local politicians deadlock during contract negotiations. This usually results in a sweet deal for the unions.

“We’re suggesting it’s very difficult in the state of Connecticut under the current labor agreements and under binding arbitration,” said Waterbury mayor Neil O’Leary, a Democrat. His town’s health care and pension costs make up 30% of its budget.

Gov. Dannel Malloy, after multiple tax increases, last year tried to close the state’s $3.5 billion deficit by shifting teacher pension costs to municipalities. Mayors warned that this would lead to property tax hikes. The legislature punted some pension payments to the future, but mayors are worried that they will eventually be required to pick up more of the bill.

Read more here.

Originally posted on Yoursurvivalguy.com.

The following two tabs change content below.

E.J. Smith

Editor-in-Chief
E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zilldjians. He grew-up worshiping Neil Peart of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West and Paris. Please get in touch with E.J. at ejsmith@youngresearch.com.