Monthly Archives: January 2012

When the same person cuts and serves the cake

A story out of Britain’s Daily Telegraph reveals not only that public servants there receive higher wages and higher pensions, but that a government plan to reform the pensions that was sharply criticized by unions may actually have raised them for many government employees. MSNBC reports on a new American government study that while public servants there get slightly higher wages, generous pensions make their total compensation considerably higher. And in Canada, public sector unions are forming a circle and growling at suggestions the government might try to do something about their lavish and badly underfunded pensions. Just coincidence?

No. It reflects an important and, you’d think, fairly obvious principle of political economy that if you let the same people cut the cake and then hand out the slices they’re quite likely to give themselves one of the big ones. And another, that if you’re spending other people’s money (as those who negotiate with public sector unions are) you’re more likely to try to buy your way out of trouble than if you have to reach into your own pocket.

To acknowledge these and other home truths does not eliminate all room for debate about where our policy problems come from or how to fix them. But if we do not get general assent to this sort of generalization, we have enormous difficulty having any sort of rational conversation about what’s happening to us and why.

So I ask you: Among those now sitting in Parliament, how many would assent to those two propositions? Moreover, how many would not only assent to them in principle, but would agree that between them they explain why public servants, and legislators, get such generous pensions?

Gov’s budget book not a budget, but it should be

Once Parliament returns next week, its main business should be scrutinizing the budget expected by early March. It’s going to be a mess: way too much spending, borrowing and handouts through tax loopholes. But they won’t scrutinize it unless we make them. And by accident or design Canadian government budgets are almost impossible for citizens to understand.

Click here to read the rest.

Madely in the morning, January 27