Let’s look at another health care problem, of which we were reminded at a recent Statehouse hearing before the Public Service Committee. To his credit, Gov. Patrick has been working to address the costs of state and municipal employee health insurance, among the highest in the states and, according to Secretary of Administration and Finance Glen Shor, “more generous than 90 percent of employers in the commonwealth.”
The governor’s new bill, HB 59, would change public employees’ eligibility requirements for retiree health benefits, that are creating a $45 billion to $50 billion unfunded liability over 30 years. The combined pension and health-care liabilities are the states’ version of the national debt -- and all of them are unsustainable. Nevertheless, the public employee unions are strongly opposed to the reforms.
Well, the piper will be paid when the chickens come home to roost. In Massachusetts, property taxes are limited by Proposition 2½, but the Massachusetts Taxpayers Foundation testified that employee benefit costs “are growing faster than municipal revenues.”
At all levels of government, the choices are grim. Tax increases to cover the government debt would drive the economy into depression. One alternative, major service cuts, could cause civil unrest. The other alternative, reform with better management of priorities, is becoming hard to imagine.
Barbara Anderson is president of Citizens for Limited Taxation and a regular contributor to the opinion pages.