Mayor William M. Manzi III invites the residents of Methuen to participate in the Annual Spring Neighborhood Clean up on Saturday, May 7, 2011, 9:00 AM – 12:00 PM, with a cookout for participants to follow from 12:30 PM – 2:00 PM at The Tenney Grammar School playground. All participants will receive a free Methuen t-shirt. Take pride in your community…your neighborhood, your street, your city! For further information contact Jill Stackelin at 978-983-8578.
Salem Mayor Kim Driscoll announced today that she would not run for the Democratic nomination for U.S. Senate in 2012, choosing to concentrate on her job as Mayor of Salem. She released a statement:
“Plain and simple, I do think the seat is winnable, but there is a time and place for everything and I have simply come to the conclusion that for me, at this time, I enjoy my job as Mayor of Salem and I believe my work here will require my full attention,”
Mayor Driscoll is an up and coming star in the Democratic Party and would have been a great candidate. If Congressman Tierney’s seat opens she would have to be considered a favorite if she chooses to run. For now the people of Salem are fortunate to have her continued service as Mayor.
Today is the day that Paul Ryan will unveil the House budget for FY2012. He has released this video, which shows some of the numbers that should be of great concern to all. He is taking some incoming flak, although counter-proposals from the Democrats seem scant. Ezra Klein has been a critic, pointing out that Ryan’s plan, which does nothing to stop the rapid increase in health costs, achieves savings through cuts, not reform. He posits that since Ryan cuts benefits without addressing the underlying issues of health care costs, many will be left behind.
In both cases, what saves money is not the reform. It’s the cut. For Medicare, the cut is that the government wouldn’t cover the full cost of the private Medicare plans, and the portion they would cover is set to shrink as time goes on. In Medicaid, the block grants are set to increase more slowly than health-care costs, which is to say, the federal government will shoulder a smaller share of the costs than it currently does. The question for both plans is the same: What happens to beneficiaries?
The answer to the question posed by Klein is that without additional revenues dedicated to medicare and medicaid many beneficiaries will eventually have a much more difficult time affording health care. It is cost shifting, pure and simple. But the question that needs to be asked is, if not Ryan’s plan then what? I do believe that Ryan’s numbers as to where the budget is going in the years to come are correct. So we either need to cut system expenses (either via cost shifting or reforms that try to tackle the growth in health care inflation) or we leave the system where it is and raise sufficient revenues to address the massive systemic financial problems of the entitlement programs. Ryan opts for cost shifting. The Main Event is about to begin. Read the Paul Ryan op-ed Wall Street Journal piece here.
The Republican response to President Obama’s re-election announcement has been somewhat predictable (maybe another post on that later) but Tim Pawlenty made a little news with the release of another slick video that manages to say just about nothing. He did include New York Times columnist Paul Krugman in the video, which drew a strong rebuke from Krugman.
Wow. So Tim Pawlenty is using something I said on yesterday’s This Week in a new ad.
So, to clarify: nobody in Washington is doing anything about job creation. However, Republicans are working quite hard on job destruction.
And Pawlenty — who knows so little about the whole subject that he fell for a well-known zombie claim (killed by facts, but still shambling along) about soaring government employment — is hardly qualified to lecture anyone else on the issue.
Pawlenty is considered by some to be one of the Republican’s serious candidates. This ad has to make you think about that claim.
While Congress continues to battle over this years budget, with a potential shutdown looming Friday, Rep. Paul Ryan was on Fox News talking about the House budget for the next fiscal year, which he will unveil Tuesday. Ryan appears ready to take on the entitlement issue head on, telling Chris Wallace that he will propose over $4 trillion in program cuts, including the conversion of medicaid and medicare to block grants. While the specifics will wait until Tuesday Ryan indicated that he will also recommend tax code changes, but appeared to rebuff the notion that these changes will require anyone to pay more than they do today. He hung his hat on the Bowles-Simpson report, which he voted against as a member, to lower rates while closing tax loopholes. It appears that Ryan would like to lower rates, but seemed reluctant to talk about the closing loophole portion.
From what I take out of the interview Ryan will propose changes in the following areas:
1) Discretionary Spending: President Obama has called for a 5 year cap on discretionary spending. Ryan agrees, but wants the number to be set lower than the Obama threshold, mentioning 2008 figures as a baseline. He also talks about “statutory caps”, which would use hard numbers, not percentages, as a ceiling under law for this spending. Exceed the limit and the option would only be to cut spending elsewhere.
2) An overall spending cap, set as a percentage of GDP, that would be enshrined in law. Ryan was coy about what that number will be, but I would guess it will end up at about 18% of GDP. It is around 25% today.
3) Defense??? Did not hear a lot about defense spending, which divides Republicans. Any attempt to impose budget discipline on the domestic portion of the budget while exempting defense, in my opinion, makes the entire exercise suspect. Lets wait to see what the Ryan budget does in this area.
Ryan hit the President pretty hard, talking about the lack of a plan for deficit reduction, and accusing him of punting on entitlements. He also admitted that his plan will draw plenty of flak from Democrats, allowing them to accuse him and Republicans of targeting elderly and the poor. He can count on that.
I have attached three documents. One is the Rivlin-Ryan plan itself, the CBO evaluation of the plan, and a link to the Center on Budget and Policy Priorities evaluation of the plan.
Ryan will need to address many questions, but one major issue, in my mind, is how you hold down medicaid and medicare spending to the Ryan projections without dealing with overall health care costs. That issue is dealt with in the Center on Budget piece. Not sure that the Ryan plan will work without addressing the rate of increase in health care costs without leaving gaping holes in coverage for the most vulnerable part of the population.
Ryan will take plenty of heat, and much of it will likely be deserved. But he is putting forward a plan, and so far the Democrats are limited to sniping at Republican proposals. Yes, the Democratic complaints about the Republicans ridiculous position on revenue is justified, but you cannot simply say that there is plenty of revenue at the top to cover EVERYTHING. Democrats need to produce plans to deal with the deficit, and explain to folks what is needed to keep entitlement plans going in their current form. So far they have produced nothing, and the entire framework of the debate now favors the Republicans. Criticize him or not Ryan is producing a plan that reflects Republican orthodoxy. He has had the courage of his convictions. Where is the Democratic alternative?
Ezra Klein talks about the similarities between Rivlin-Ryan and “Obamacare” here.
http://video.foxnews.com/v/embed.js?id=4624119&w=466&h=263Watch the latest video at video.foxnews.com
Here is the letter of March 30th sent by the MMA to the State Legislature on municipal health care.
Dear Representative,
On behalf of the cities, towns and local taxpayers of Massachusetts, the MMA strongly urges you to
support H. 2964, legislation to provide communities with the tools to manage and control skyrocketing
municipal health insurance costs. Local officials and the MMA have been supporting and calling for reform for seven years, and, unfortunately, the problem has become worse with each passing year.The time for action has come.We urgently ask you to support reform legislation to give municipalities greater control over their
health insurance costs. This vital reform would simply give local officials the same power the state has to shape employee health plans, and save taxpayers up to $100 million a year. This call for plan design reform has been embraced by municipal leaders from across the Commonwealth, and by leading organizations, including the Massachusetts Taxpayers Foundation, Associated Industries of Massachusetts, the Boston Foundation, the Greater Boston and local Chambers of Commerce, and many others. Every news organization that has editorialized on this issue has supported providing municipalities with full plan design control.Total municipal aid is $416 million lower than what it was three years ago, and the Governor’s
budget proposes a further $65 million reduction. Communities are in fiscal crisis, and health insurance
reform offers meaningful relief that taxpayers deserve. We cannot afford to keep the unique and special veto power that municipal unions hold over health plan changes – this veto power is costing taxpayers millions of dollars a year, forcing cuts in essential municipal and school services that are crowded out by soaring health costs, and forcing the elimination of teachers, firefighters, police officers and other key employees. Without real reform, taxpayers will continue to pay millions more for health insurance than they should, which will force even more service cuts and layoffs.The state has been able to moderate the cost of employee health benefits by implementing increases
in co-pays and deductibles, just as the federal government and private employers have done. But
communities have been blocked by the Chapter 32B bargaining mandate, and are trapped in outdated plans that are too costly. When municipal leaders ask for plan design authority, the purpose is to preserve services, protect local taxpayers and prevent the elimination of more police officers, teachers, firefighters and other key workers from local budgets.H. 2964, sponsored by Rep. Stephen Kulik, would eliminate the double standard in state law, and
give cities and towns the same power the state has to implement necessary cost savings in municipal health insurance plans. This is a very focused and moderate proposal, offered in a spirit of compromise to find meaningful middle ground while achieving meaningful reform. Under the bill, municipalities would still negotiate any changes in the employee-employer premium share, giving municipal unions more bargaining authority than state unions. Municipalities would be able to modernize the health plan design outside of collective bargaining, with a guarantee that all municipal and school employees would still have health plans that are the same or better than what state employees receive, meaning no municipal plan would have higher co-pays or deductibles than the state. Any higher co-pays or deductibles would have to be approved in collective bargaining. The bill simply gives plan design parity to cities and towns.In short, the legislation saves taxpayers money, protects municipal union jobs, guarantees equity with
state employee health benefits, and still leaves municipal unions with more bargaining power than state
unions. This is a balanced, meaningful, fair and transparent reform.In the 2000s, the Commonwealth, the federal government and private employers increased co-pays
and introduced deductibles in order to reduce the cost of health plans. This happened without any collective bargaining. However, with cities and towns chained to Chapter 32B, Massachusetts municipalities have been forced to seek union approval to change co-pays and deductibles that were not negotiated in the first place. Any plan design changes that have been instituted at the local level have come at a great cost, in the form of higher pay increases or benefit enrichments that the state, federal and private employers did not have to offer or award. This unfair system has placed a huge burden on local taxpayers, and blocked reasonable efforts to right-size plan design features to match what all non-municipal employees receive. This is why cities and towns respectfully ask for limited plan design authority outside of collective bargaining, and strongly resist efforts to require sharing of any “savings” in the form of other benefit enhancements. Any money that communities save through plan design will be used to preserve services and prevent more layoffs. Job protection is the ultimate benefit of plan design reform.Cities and towns are locked into overly expensive health plans because they cannot gain the required
union approval to implement cost-savings, while the state has exempted itself from this mandate, and
routinely implements basic decisions on health insurance outside of collective bargaining, such as increasing co-pays and deductibles to lower the cost of their plans. The state must end this double standard by giving cities and towns the same authority to design health insurance plans outside of collective bargaining. We estimate that most cities and towns would be able to lower their health insurance costs by 4-6%, or as much as $100 million statewide. This is fiscal relief that taxpayers deserve, and employees would share in this savings because the premiums they pay would be lower and their jobs would be protected.Municipal Union “Framework” Falls Short – No Reform and Little Taxpayer Relief
Earlier this month, several municipal unions wrote to you claiming that they were offering a proposal
to address this issue. Unfortunately, their effort is nothing more than a repackaged framework that includes no new proposals and little in the way of reform or taxpayer relief. Their framework would retain full collective bargaining over plan design changes through “Section 19” coalition bargaining, require at least 50 percent of any savings or avoided costs to be redirected to increase health or other employee benefits, impose binding arbitration that would allow an outside unaccountable arbitrator to impose costs and health plans on cities and towns, even though the voters repealed binding arbitration as unaffordable in 1980, and then sunset the entire framework after 3 years and place all future health insurance matters in full collective bargaining.Here’s how their “proposal” falls short:
• Section 19 coalition bargaining is a flawed process that has helped to create this problem – the
coalition bargaining requirement has made it impossible for many communities to join the GIC, and
has blocked common-sense proposals to update co-pays and deductibles to match what the
Commonwealth of Massachusetts offers its employees. A voluntary Section 19 model has existed for
many years, but only a few communities opted in because it gives one or two unions the power to
block any change. Those who opted in have had a considerably mixed experience and most are very
unhappy. For example, the Town of Framingham has a home rule petition to escape from Section 19
coalition bargaining because it has been impossible to achieve relief, and the community pays more
for insurance than nearly any other city or town.• Further, a Section 19 mandate would be exceedingly harmful to those communities that participate in
successful regional purchasing groups. Approximately 150 communities have joined regional groups
(such as the Hampshire County group in western Massachusetts, the West Suburban group in the
Metrowest area, the Mayflower group in Plymouth County, the Cape Cod group and others), and any
measure to require that participating communities engage in Section 19 coalition bargaining regarding plan design changes would be impossible to implement – imagine 40 communities in one region trying to reach an identical agreement with over 200 different unions.• We ask that you reject the demand for diverting any portion of the savings to other benefits. Because health care costs are rising every year, most of the taxpayer relief will come in the form of avoided cost increases, and will not generate revenues or money that can be used to pay for additional benefit enhancements – besides communities will direct the financial relief to protecting municipal jobs and services, and diverting this savings to other benefits would only increase layoffs. That’s why the
state has never bargained over or offered additional benefits or wages as part of any GIC plan design
changes.• And please don’t be misled by the modest-sounding description of a “neutral individual” who would
make the final decision on plan design changes and other benefit enhancements that the unions seek.
This is binding arbitration. Binding arbitration was repealed by the voters as part of Proposition 2½ because it was unaffordable for taxpayers. Even voluntary binding arbitration carries great risk, as
evidenced by the outrageous decision last year in the Boston firefighter contract dispute. Binding
arbitration allows an unelected, unaccountable person to impose costs on local taxpayers – a failed
system that should not be imposed on local government.• Further, the municipal unions’ plan also sets a dollar benchmark for health plans that would block
reform and relief in many parts of the state, such as western Massachusetts, the south coast and other regions where hospital and medical costs are below greater Boston levels. The only real benchmark that is viable and will lead to real reform is based on the co-pays, deductibles and other benefits of the health plans – making sure that the plans are comparable.• We also oppose the demand that would outlaw mid-year plan changes by the Commonwealth’s GIC,
and give labor 50% of the vote on the GIC board, essentially handing over the power to block any
change or recommendation regarding state employee health plans. This element of their proposal would impose unprecedented management restrictions on the Commonwealth.The bottom line is that the framework is not a compromise, and it does not offer the necessary reform. The proposal would actually expand union leverage in health insurance bargaining, would not provide local taxpayers with the relief they need, and would force communities to cut services or lay off employees to fund the added benefits and costs.
Communities are experiencing extreme fiscal distress. This is the time for real reform and real action. This is the time to pass plan design reform – the most flexible, transparent, and effective way to immediately achieve meaningful and lasting reform and savings. Further delay will only serve to hurt taxpayers, municipal employees and the public. We ask you to support this straightforward and necessary measure.
The war between labor and the Republican Party has heated up again, with Republican Governor John Kasich of Ohio signing into law a bill that restricts the right of state and local workers to bargain collectively. The Ohio bill adds police and fire, exempted in the Wisconsin bill, to the mix of unions who will see a host of new restrictions on their collective bargaining rights.
The Republican moves against unions have put the unions on a war footing, with recalls being launched in Wisconsin against eight Republican state senators, and with a statewide referendum being planned in Ohio. Both Politico and Chris Cillizza over at the Fix have some interesting tidbits about this political battle.
Politico focuses in on unions that have, in the past, been strongly supportive of many Republican candidacies, the police and fire unions. Even in Wisconsin where Governor Walker exempted them from the new law, they have turned on Republicans, joining the protests against the new restrictions on bargaining rights. The support that Republicans have received in the past from these unions seems to be gone, replaced not only by hostility but by a new wave of political activism by public sector unions that could bring some real benefit to Democratic candidacies in the next cycle of local, state, and federal elections.
After the Politico story Chris Cillizza brings the theory around to the practical, highlighting the special Wisconsin election for Milwaukee County Executive to fill the seat of (you guessed it) Scott Walker. This is a rubber meets the road match that will be closely followed to see if all this talk about backlash against Republicans will translate. Republican Jeff Stone, who led in the open primary with 43% of the vote, is facing Chris Abele, who has unleashed an expensive ad campaign trying to exploit the connection between Governor Walker and Stone. Abele finished 18 points behind Stone in the primary, but is poised to spend a million dollars of his own money to try to capitalize on the declining poll numbers of Governor Walker, and link the Governor to Stone. The strength of the so called “backlash” will be put to the test here, with the winning side able to claim that public support on the union issue is with them. Abele has to contend with the fact that Scott Walker handily won this seat three times (1 special and two regular elections). I see Abele closing the gap, especially with all that money, but victory will be difficult. If he does pull it off then the Republican state senators better start sweating, because the bell will be tolling for them real soon.
With all of the political heat and coverage being generated by the collective bargaining issue there has been some lack of (national) coverage of the budget issues facing both Wisconsin and Ohio, and what relationship the budgets have on the local unions. Both Governors are submitting austerity budgets, with Kasich in Ohio proposing cuts of 25% in local aid. Governor Walker has also proposed steep cuts in local aid. These cuts, and their impacts to local services, including education, will be severe. And yet the choices being made through these cuts are honestly not being discussed at all. As I point out to my union friends frequently if this is how local government is going to be funded in the future then there will be NOTHING really to fight about. Massive job losses and cuts in service will occur, and the existence of collective bargaining rights will not have much impact on that fact. You may be able to protect some of what has been won at the bargaining table, but without funding it is all a moot point. The local aid proposals of Governors Walker and Kasich not only cut local aid but try to restrict the locals from purchasing more and better local services through higher property taxes. The fiscal realities are stark, but when voters see that class sizes will balloon, essential fire services will be cut, and that proactive policing will be a thing of the past there is going to be hell to pay. Every layer of government can and should be more efficient. The excesses (and they are NOT outliers) of some public employee contracts and workplace rules must be dealt with, but cutting funding to the locals to this extent MUST result in greatly diminished services in local government. That is a choice for the public and its elected representatives to make. But the idea, sold for years by politicians of all stripes, that Americans can have a full array of services without paying for them is about to be shown for the hokum that it is.
A Massachusetts panel discussion on the movie “Waiting for Superman”, including educational leadership of the State Legislature.
http://c.brightcove.com/services/viewer/federated_f9?isVid=1
Bill Manzi.com 