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Unions cry foul over benefit cuts

Mitchell Hartman Jun 29, 2010

Unions cry foul over benefit cuts

Mitchell Hartman Jun 29, 2010


Bill Radke: A fight is brewing in Baltimore over efforts to cut the pensions of police and firefighters. There are similar struggles are happening across the country. City and state governments want to balance their budgets — retiree benefits are a juicy target.

Marketplace’s Mitchell Hartman reports
public-employee unions are crying foul.

Mitchell Hartman: The battle in Baltimore comes down to a few sentences in the city code.

BOB SLEDGESKI: Article 22, Section 42.

Bob Sledgeski of the Firefighter’s Union says it means his members have a binding contract for retirement.

SLEDGESKI: And the benefits that exist when they enter into the contract can’t be changed.

But last week, the city council increased the required years of service and cut pension pay and cost of living increases. It’s a pattern being repeated all over the country, says Sue Urahn of the Pew Center on the States.

Sue Urahn: Policymakers have too often kicked the can down the road, not making required payments and increasing benefits without considering the price tag.

Urahn says nationwide, the funding shortfall now tops a trillion dollars. To make it up, governments are cutting benefits previously promised to workers. That doesn’t sit well with Bob Sledgeski.

SLEDGESKI: I’m starting to get pretty sick when I read what’s going on around the country where people just say it’s OK to break a promise.

Expect union lawsuits in Baltimore and elsewhere to block these pension grab-backs.

I’m Mitchell Hartman for Marketplace.

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