Mitch McConnell, Senator from Kentucky, says that the federal government should let the states go bankrupt.
Workers in McConnell’s home state, his own constituents, would be grievously harmed. So would public sector workers in every other state that was forced into bankruptcy by the costs of the pandemic.
David Sirota wrote this article. He was a speechwriter for Senator Bernie Sanders. Please consider subscribing to his newsletter. He is a seasoned investigative journalist. Readers of this blog may remember when Sirota embarrassed PBS into returning millions of dollars to billionaire John Arnold, who had used his money to persuade PBS to run a documentary about “The Pension Crisis,” which is Arnold’s bete noir (he believes that public sector workers with their big pensions are bankrupting the country). After Sirota’s expose, PBS returned Arnold’s money.
Sirota writes about McConnell’s evil intentions here:
It’s not every day that a U.S. Senator explicitly enriches his out-of-state Wall Street donors while telling his own constituents to drop dead. Usually that kind of behavior is somewhat obscured by legislative machinations and spin. But if there was going to be any lawmaker who would be unabashedly blatant about it, you had to know it would be Mitch McConnell.
The Senate Republican leader just finished up shoveling trillions of dollars of federal largesse to businesses and billions of dollars of tax cuts to the super-rich. Having allocated all that cash to the interests that bankroll his political career, McConnell is now taking a hardline stance against a modest amount of aid to states because he says he doesn’t want resources used to prevent cuts to government workers’ retirement and health benefits.
“There’s not going to be any desire on the Republican side to bail out state pensions by borrowing money from future generations,” McConnell said.
His goal is to use the coronavirus crisis to realize one of the most radical long-term goals of the conservative movement: empowering states to break existing contracts and slash previously pledged pension benefits for teachers, firefighters, cops, first responders and other public-sector employees.
In a half-assed play to avoid looking like he’s deliberately enriching his elite financiers and starving the peasants, McConnell cast himself as a principled opponent of “blue state bailouts” — a seemingly shrewd anti-coastal framing for his own potentially difficult reelection campaign.
In reality, though, McConnell’s opposition to pension aid is even worse than a pathetic Gerald Ford impression. It is him giving the big middle finger to hundreds of thousands of his own constituents whose Republican-leaning state is now facing one of America’s worst pension crises after McConnell’s Wall Street courtiers strip-mined Kentucky’s public retirement system.
Kentucky Fried Pensions
That’s right: for all the talk of pension shortfalls in blue states like Illinois and California, the bright red state of Kentucky has one of the most underfunded pension systems in the country. The gap between promised benefits and current resources has been estimated to be between $40 billion and $60 billion. One of the state’s pension funds is less than 15 percent funded.
Those shortfalls are not the product of Kentucky’s public-sector workers being greedy or lavishly remunerated — Kentucky teachers, for example, are paid 23 percent less than other workers with similar educational credentials, and they do not receive Social Security benefits.
No — the shortfalls are the result of 1) state lawmakers repeatedly refusing to make annual contributions to the system, 2) investment losses from the 2007 financial crisis and now the COVID downturn, and 3) especially risky hedge fund investments that generated big fees for politically connected Wall Street firms, but especially big losses for the state’s portfolio. (Executives from some of those specific firms are among McConnell’s biggest collective donors, and those firms could be enriched by other parts of McConnell’s federal stimulus bill.
The pension emergency in Kentucky has become so dire that teachers staged mass protests last year, resulting in national headlines and a PBS Frontline special, and a court case that ultimately overturned the Republican legislature’s proposed pension cuts, which the GOP literally attached to a sewer bill.
Typically, a state facing this kind of budget catastrophe would be psyched to have its senator in a prime position like Senate Majority Leader, so that it could have some extra special leg up in securing federal assistance to prevent cuts to pensions and other basic public services.
But McConnell isn’t typical — he is as close to a comic-book villain as has ever occupied an office in the highest ranks of America’s legislative branch. And so rather than taking up Democrats’ offer to work on a bipartisan aid package, McConnell is positioning himself to block the very aid that would especially help hundreds of thousands of his own constituents during his state’s dire emergency.
Empowering States To Use Bankruptcy To Crush Workers
Instead, McConnell is proposing to empower states like Kentucky to declare bankruptcy — a financial maneuver that in practice could allow states to reverse their promises and slash retirees’ promised health benefits and subsistence income.
For retired teachers in Kentucky, a state declaration of bankruptcy and subsequent reneging on promised benefits might mean huge cuts to fixed incomes and medical coverage in the middle of the pandemic.
While retirees struggle to make ends meet, Republicans continue to depict government workers as greedy pigs getting rich off taxpayers. That portrayal is designed to create political support for letting states use bankruptcy to fleece workers — a top consevative movement goal for at least a decade.
“A new bankruptcy law would allow states in default or in danger of default to reorganize their finances free from their union contractual obligations,” wrote Jeb Bush and Newt Gingrich in a 2011 op-ed that explained the overall scheme and demonized public employees. “In such a reorganization, a state could propose to terminate some, all or none of its government employee union contracts and establish new compensation rates, work rules, etc…The lucrative pay and benefits packages that government employee unions have received from obliging politicians over the years are perhaps the most significant hurdles for many states trying to restore fiscal health.”
This is not the entire article. Open the link to read it all.
McConnell is fleecing the people who elected him.
He will be on the ballot in November.
If you live in Kentucky or if you have friends there, please send them David Sirota’s article.
The people of Kentucky need a Senator who represents them, not Wall Street.
The Kremlin’s Agent Orange + Moscow Mitch = the 2nd Dark Ages, the collapse of civilizations and the rise of the Billionaire Lords of Darkness
I just can’t believe Republicans have any credibility at all on budgeting.
They blow up deficits and debts every time they are in power. Every single time, my entire adult life. For some reason, this fact doesn’t matter at all and we’re all supposed to listen to them incessantly scolding others on balancing budgets.
They’re terrible at balancing budgets. Absolutely reckless spenders and borrowers. Over and over and over.
When Trump is gone the next President will be tasked with cleaning up this mess. The least Republicans could do is get out of the way while someone else fixes their latest disaster.
Amy McGrath is running in opposition to Moscow Mitch. She is running hard and gathering supporters.
If Mitch wants Kentucky to be bankrupt he should help the state do that. Then let him fly a US flag with a hole in it, removing one star.
He is sounding as crazy and dumb as Trump.
I saw Betsy DeVos was scolding public schools again yesterday.
A member in good standing of the Professional Public School Critics Association.
We’re paying thousands of ed reformers in government who contribute absolutely nothing to public schools or public school students other than criticism from afar.
Is this a good use of public funds? What if we instead hired people who supported students and schools and actually worked to improve them?
Maybe, for example, the thousands of ideological ed reformers we’re paying in the Trump Administration could actually perform some work during this crisis.
I would suggest getting internet access to underserved students. Do they have time left over after the daily public school bashing to do some productive work, or is that too much to expect?
Even in a crisis where schools are closed they can’t put aside their ideological opposition to the existence of public schools and pitch in, and we’re paying thousands of them. What a waste.
While retirees struggle to make ends meet, Republicans continue to depict government workers as greedy pigs getting rich off taxpayers.
I wish the members of Congress who consider us retirees as ‘greedy pigs’ would live on the average teacher pension salary for one year. These wealthy pigs have no idea of what it’s like. What I don’t understand is why anyone would vote for Trump or McConnell.
I just sent a donation to Amy McGrath, who is running against McConnell in November. I will post fundraising appeals for her as soon as I get a copy.
https://amymcgrath.com/join-the-team/
Thank you, Laura.
I can’t even post here what I would like to see happen to Mitch McConnell. This man is so vicious, toxic and destructive of the democratic process. He obstructed Obama’s administration from day one and blocked the hearings of Merrick Garland for the SCOTUS. Pure theft.
The teachers pay into the pension fund with each and every pay check during all the years of their careers. That is their money, it is not some gift; the teachers are being blamed for the nonfeasance of the politicians. It is hideous that Kentucky teachers don’t even get Social Security.
If states go bankrupt, the damage to pensions won’t be limited to Kentucky or to teachers.
Illinois teachers don’t get social security either even when they have worked in the private sector long enough to get substantial benefits. Even spousal benefits are reduced by as much as 2/3 of whatever your teacher’s pension is.
I hope McConnell is committing political suicide by conducting a war on state workers.
Mitch reminds me of some of the kids from my high school. The students who liked to sit in the back of the class and throw erasers at the students doing their work and studying. Then when caught and challenged on their actions would cry out “You better leave me alone! I will tell on you!” Tell you what Mitch, you like to call yourself the Grim Reaper? Do yourself, and the rest of the country (No, make that the rest of the entire universe) a humongous favor. Shoot up some bleach into your wife’s veins and then directly into your veins. (Bleach may actually work in Mitch. Someone who looks like they are already filled with embalming fluids for the past twenty years probably has a strong defense system against bleach hurting them.) The first two bottles of bleach are on me. I promise to send flowers to the funerals.
Mitch is 78.
He is running for re-election against Amy McGrath.
We all must help her eliminate the Grim Reaper from the Senate.
He is a national problem, not just a Kentucky problem.
He’s coming for your pension.
Mitch is a plague on America. It will be a new day if he and Trump are given their walking papers in November.
Trump Is Claiming Coloradans Are Showering Him With Thank You Notes for Ventilators
four hours ago
President Donald Trump was up early Saturday morning taking credit for sending a few ventilators to Colorado and thanking all the people in the state who allegedly sent him “thank you” notes for his benevolence. He also tagged Sen. Cory Gardner, a Republican up for a tough reelection race this year, who he has previously credited for helping with the ventilator acquisition.
But as the Denver Post has pointed out, thanks to Trump, the state actually got 400 fewer ventilators than it would have if the administration hadn’t meddled in its procurement process.
In early April, Gov. Jared Polis, a Democrat, had arranged for the state to buy 500 ventilators when the Federal Emergency Management Agency grabbed the shipment instead. Polis complained to the Post that the federal government was leaving the state high and dry. “We can’t compete against our own federal government,” Polis said. “So either work with us, or don’t do anything at all. But this middle ground where they’re buying stuff out from under us and not telling us what we’re going to get, that’s really challenging to manage our hospital surge and our safety of our health care workers in that kind of environment.”
A few days later, Trump tweeted that he was sending Colorado 100 ventilators thanks to a request from Gardner, despite the fact that Polis had been begging the feds for weeks for more medical supplies…
https://www.motherjones.com/coronavirus-updates/2020/04/trump-is-claiming-coloradans-are-showering-him-with-thank-you-notes-for-ventilators/