Tuesday, September 27, 2011

Rhode Island retirees win round one.

For those following the pension crisis in Rhode Island, I am happy to say that the employees and the retirees won the first round in court. Now the issue goes directly to the RI Supreme Court. Judge Taft-Carter, in a well thought out argument sided with the workers and retirees. Your pension is in fact a contract!! It is therefore, unconstitutional to change the system for those fully vested employees and the existing retirees. Furthermore the judge ruled that the COLA was in fact part of the contract.

This is not stopping our not-so "Democratic" Treasurer, Gina Raimondo from pursuing her Republican agenda of screwing people out of their hard earned pensions. I have written her office on multiple occasions and have received no confirmation. I even went as far as offering possible concessions (if done right) but made it clear that we have a contract. She still intends to pursue a bastardized pension system of 401K and defined benefits for current employees. This strategy is pure Republicanism. Her intent is to eliminate the COLA for retirees for a period of time until the system is deemed healthy again. Can you see a future politician going before the public and saying; "I'm in favor of re-instating the retiree's COLA"? What kind of drug is Raimondo on?

Let's say that she is successful in removing the COLA. What does that mean for me personally? In my case, I will lose about $2000 per year. My taxes go up, my food costs go up, my fuel costs go up etc. I guess in year one I will make the following changes to my life style: No more Providence Journal rag ($440 savings), We eat out twice a week if not more often, so I will no longer have 2 drinks at dinner only 1 ($500 savings), I'll reduce my Cox cable subscription ($500 savings), I'll reduce charitable contributions ($500 savings). I have now made it through year one and largely maintained my standard of living.

Let's go to year 2. I'll need to economize by another $2000. I guess we will only eat out once per week ($3200 savings), but we still have to eat at home but should be able to count $2000 in savings for year 2.

What about year 3? No more dry cleaning my clothes ($700 savings) (I hate the idea of hurting Barry, my friend), we reduce our trips to the movies to once per month ($700 in savings), no more security system on the house ($480 savings) (Sorry Roger, I love you man, we go a long way back to when you were just a kid) and I'll kill a few magazine subscriptions. I'm by year 3.

What about year 4? I'll still need to find another $2000. Now it is time to really attack the charitable giving by gutting donations and my family Temple membership. Wow! That's great, I got through year 4.

Do you think the COLA will return? Dream on! I'll need to find another $2000 to keep up with inflation. I'm starting to run out of ideas. Maybe it's time for the big move. We could sell the house in Rhode Island where we pay $9,000 annually in property taxes and move to the Cape. A home in Mashpee at comparable value is currently taxed at around $3000 annually (Wow, a $6,000 annual savings). Not only do I save here, I will no longer have to pay income tax on my state pension to Rhode Island ($3000 in savings). I can start to collect my social security and my disposable income has now skyrocketed. I can eat out twice a week, hell four times a week. I can have 2 drinks at every meal and I can go to the movies whenever I want.

Let me see? There are currently 60,000 citizens in Rhode Island that share my predicament and many of them are certainly married. That means that 100,000 people could seek similar solutions.

I feel bad for my favorite restaurants and the wait staff, local businesses that I frequent and the charities that I have faithfully supported. If only the state would return to the tax rates for the wealthy that existed before Republican leadership and tax the yachts that line Narragansett Bay, maybe then the state could acquire the financial resources to meet its' obligations to contracted retirees as required by the state's Constitution.

Here's the final kick: Aren't you glad we have such astute businessmen, brilliant politicians and an exceptional Media rag in the State of Rhode Island?