Saturday, July 2, 2011

SB5 and the Cincinnati "Ring of Fire."

In a previous post, I talked about the economic reality behind Ohio's Senate Bill 5. The most critical issue from my perspective is the fact that the salaries of and benefits enjoyed by school district employees and teachers appear to be very generous. To have the average Ohioan, who makes around $40,000 for a full years worth of work pay for these salaries and benefits from his tax dollars is outrageous. When Sherrod Brown says that he is "passionate about fighting for the middle class, is he talking about the whole middle class, or only those who are unionized and contribute to his reelection?

Unlike private sector employee who negotiate (if he can negotiate) with his employer for salary and benefits (which are paid of of profits), school district employees and teachers salary and benefits are paid for by the taxpayer. My question in this debate is "Who is at the negotiating table representing the taxpayer?"

This week, I will focus on the Cincinnati school districts. As mentioned in the past post, Obama talks about this process as an "Assault on Unions," and Sherrod Brown added that "Hitler didn't want unions, Stalin didn't want unions, (former Egyptian President Hosni) Mubarak didn't want independent unions." That's what the Democratic party wants you to think about SB5 and other state initiatives across the country, because it's a system that has funneled more and more money into the education unions so they can help get more Democrats elected to help keep the money machine running.

A Wall Street Journal article shows the argument to be a canard.

Here are some excerpts from the article:

In New York, the state's largest public-worker union agreed to a salary freeze and other give-backs earlier this week in exchange for a no-layoff pledge.

Connecticut is poised to lay off thousands (7,500) of people after unions rejected a similar deal.
And in New Jersey, the Democrat-controlled Legislature this week passed comprehensive cuts to pensions and health-care benefits pushed by Republican Gov. Chris Christie.

The article also outlines the issues at hand: The financial crisis laid bare a simmering resentment private-sector workers had been feeling toward their neighbors on the government payroll, who had been rewarded in prosperous years with pension boosts and pay increases.

The Wall Street Journal also reported:

Heavily Democratic Massachusetts on Friday became the latest state to curtail public workers' collective-bargaining rights, as lawmakers approved a $30.6 billion budget that gives cities and towns greater leeway to force employees to pay more for their health care. House Speaker Robert A. DeLeo, a Democrat, said after Friday's vote that "this common-sense reform will save $100 million for cities and towns.

What is most instrumental that this isn't a political attack is the fact that Rahm Emanuel's handpicked school board voted to cancel the 4% raise for members of the Chicago Teachers Union. The move was justified by a school budget deficit put at more than $700 million. Remember that Emanuel was Obama's Chief of Staff for over two years,

Below are charts that use data from the Buckeye Institute. To see a larger, more clear chart, click on the graphs. With respect to these charts, the Buckeye Institute notes that "For those non-teachers working for more than 185 days per year, the pro-rated pay calculation does not apply.

Note: The vertical axis was truncated. The Cincinnati City Schools have 63 employees that make over $100,000. I limited the vertical axis so you can see the details of the other school systems in the Cincinnati area.

Highest Salary in the District

Annual Equivalent Salary based on Highest Salary in the District

Lifetime Pension Liability Estimate for Highest Salary

If you want to know why Liberal/Progressive Democrats are so ticked off with SB5, look at the largest contributors to Democrats - it's unions! They are afraid that reforms similar to SB5 will give public employees the option to not join a union, cutting some of the funds for unions to get special treatment by elected Democrats. I know I don't want my tax dollars essentially making political contributions to Democrats. This in addition to maintaining the generous salaries and benefits that the unions have won from Democratic politicians. It's time to have give the average Ohioan get a break from paying for these compensation packages. SB5 gives school districts the tools to provide this break.

Yea or Nea, you will have the opportunity to express your opinion on the SB5 referendum.

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