The former Labour Government in Great Britain was in so much financial trouble that it had to cut pensions of people already retired. The Economist recommended that the US federal government and the states do the same. Since then there has been much talk in Congress and in state legislatures by Republicans who want to slashj benefits of public workers nor retired and yet to retire.
There are political and legal obstacles to doing so, but state pension plans are in deep trouble and the time is fast approaching when a choice must be made between raising taxes or slashing pensions.
It is possible that the momentum of the Tea Baggers will continue or increase and that pensioners will be in trouble.
California's Republican Governor Arnold Schwarzenneger is not a member of the Tea Bag wing of his party but he is demanding that the legislature cut the benefits of pensioners and those promised to future state workers.
Conservtives have written and said a great deal about cutting pensions. John Boehneer, the potential next Speaker of the House of Representatives has even said that military pensions might be cut. But he is given to talking first and thinking later. The Constitution says Congress cannot act to diminish the rigfht of contract. Cutting military pensions is not in the near future.
Many state pension plans are near insolvency, as are state backed pension plans for public school teachers.
There hve been many articles saying that public employees are paid much more thatn private sector employees and that they get much better retirement benefits. The truth is that while working they earn considerable less than private sector employees, but the public employees do get better retirement benefits. This was long understood, and people knew this when they decided what to do to earn a living.
Now Republicans, particularly their TEa Bagger wing, are venting about overpaid public employees and demanding pesion cuts.
At the moment, what is happening is that the promised benefits of new public employees are being changed. Moreover, these new employees are
being required to pay more for less covcerage. But this will not fix most pension systems.
At the moment, several states are cutting COLAs for retirees. The Colorado case is particularly intersting because the COLA promise was long a condition of employment. A decision in this case, might be an important precedent.
Some states are pledged to back their pensions and some seem not to have specifically issued that pledge. There have been articles probing how Illinois can duck backing its weak pension system.
In the end, politics and not law will decide what happens. State supreme courts have become extremely politicized. In 16 states, we have seen seats literally bought for judges through masive campaign contributions.
All these judges are elected, and few can resist public demands for long. In Ohio, there is much excitement about pensions, and five big newspapers are trtying to get the records of every public retiree.
At the moment there is much outrage about retirees who managed to "spike" their benefits in their last years, but rage spills over to all public employees who are retired.
The first big assualt will probably be in slashing their health benefits, which cost almost $600 billion a year. These people retired with the understanding that the benefit would increase. For some, they were part of collective bargaining agreements that are renewed every few years.
It is fascinating that the Republicans have calculated that it is best for them to avoid new taxes by alienating rfetired public employees. Doubtless, some of those folks will swallow the cut for the benefit of the GOP. But most will be damned angry.
This suggests that they think the Tea Bagger mania can be extended and increasesd enough to win many new voters.
The Great Bush Recession means there are fewer funds coming in to pay Social Security and Medicare benefits. This means that privatizing Social Security and slashing Medicaid must come sooner than planned.
The very senior citizens who joined TEa Bag protests becaue they wrongly calculated that health care reform would reduce a few of their benefits will join the public pensioners as targets of Tea Bagger anger and Republican efforts to retain benefits for the rich at their expense.
There is no question that the states face huge pension problems or that Medicaid and Social SEcurity become more difficult to fund with each passing day.
The Republicans will nevere slash health insurance company subsidies or act to cut prescription costs. Nor will they cut defense or willingly give up even a small part of the Bush tax cuts for the rich.
The only other choices are to go after pensioners and entitlements.
The Tea Bagger phenomenon has been so successful that we should not doubt that they can make political fundamentalism an even more powerful tool. Nor would one doubt that they have the tools to convince some pensioners and seniors that they should give up benefits to the good of our war machine and the rich.