by Jay A. McCalla
We are not in this together and we will not pull our own weight. That’s the message sent by Council President Darrell Clarke and his members over pension changes proposed by the Kenney Administration.
Mayor Kenney’s team negotiated a new labor contract with AFSCME District Council 33 that requires members pay a bit more towards their pensions. The union agreed, in part, because there’s a broad understanding that our pension fund teeters on collapse. Under funded by $5.7 Bil, it can barely cover 45 percent of its long-term obligations.
Unions tend to want “gains” for their members, but there is a crisis and DC 33 understands the need for compromise.
So, the administration prepared legislation that would enact the new contract and decided to include elected and appointed officials in the plan to modestly increase pension contributions. Shared sacrifice is always a welcome theme.
Council had zero problem with the concept of sacrifice, but had a hissy fit at the notion of “shared sacrifice”. Clarke refused to introduce the Kenney plan unless references to “elected officials” was removed.
What followed were some petty comments from members who were plainly concerned with their own pocketbooks. Curtis Jones complained that the increase in contributions would amount to a pay cut for council. Clarke was sensitive to earlier increases in pension contributions for council members. Of course, both politicians insisted the preponderance of their concerns were high-minded and noble. (Please permit me a chuckle.)
In a city where the median salary is $55,000 and 27 percent live in poverty, it’s uniquely jarring to see elected officials connive and whine to avoid paying the same increase as everybody else.
Councilpeople choose their own compensation packages and haven’t scrimped on the “bennies”. At roughly $120,000 annual salary, they have free, full-time use of a city vehicle and summers off. Making 2 ½ times the average Philadelphian, one might think they’d be a tad less naked in their self-interest.
Clarke and Jones may be the ones who’ve stepped forward, but a quick look at the remaining 15 members reveals NONE OF THEM is willing to speak out in the name of shared sacrifice & problem solving. Even Allan Domb, who doesn’t accept a salary, has refrained from calling for council to participate in the new pension plan. He may not want to alienate his greedier colleagues.
From their dubious (often duplicitous) grab for DROP pensions, to the pernicious, non-transparency of “Council Prerogative,” council has demonstrated a growing isolation from the general welfare of the city. They manage to save their bacon without a second thought for the city’s bacon.
I would describe Kenney’s efforts to fix the pension as half-hearted and halting, but they barely rise to that level. A miniscule portion of the infamous soda tax was earmarked for the pension fund, but even that was reversed. While he plainly isn’t “on fire” to save the pension, his modest efforts deserve support.
Another obvious, but impossible avenue, is to obtain competitive bids for the services of investment managers and dump those that underperform. I say “impossible” because investment managers are typically chosen based on campaign contributions. There is no more sacred relationship than that between a pol and his donor.
Our politicians are happiest and function best when they have someone to blame. Five years ago, they blamed Gov Tom Corbett for education cuts to Philly. Corbett is gone and they now blame the legislature. Housing shortages, poverty and homelessness are routinely blamed on the federal government.
The pension fund, however, is undeniably our responsibility. There’s no other entity to blame or to which we can appeal for help.
Mayors, over decades, decided to defer pension contributions, using the accounting method of “robbing Peter to pay Paul”. Councilmembers blissfully looked the other way as unfunded obligations mounted in the billions. The “dirt” we’ve swept under the carpet now stands as tall as the sofa.
Shared sacrifice in the form of increased pension contributions won’t have decisive impact on the almost $6 billion hole, but it’s a beginning. We must not cut pensions of current retirees. Such would be a terrible breach of faith resulting in some number of elderly being pushed into the ranks of the poor.
It would be great if our politicians, as they inevitably seek reelection, could tell us about the solid plan they are pursuing that will solve our crisis. Tell us they can see the light at the end of the tunnel. Because, unlike some of our other problems, they are the only ones who can solve this.
Jay A. McCalla is a former deputy managing director and chief of staff for Philadelphia City Council. He does political commentary on WURD900AM and contributes to Philadelphia Magazine. He can be followed and reached on Twitter @jayamccalla1.