Detroit makes pension cut deal

It’s in the New York Times:

“The deals, reached after days of intense private negotiations, called on municipal retirees’ pension checks to be reduced 4.5 percent, far less than the cut of at least 26 percent that had been announced by the city, an official with the boards said. Retired police officers and firefighters would see no cuts to their current pension checks, compared with cuts of at least 6 percent that Detroit officials had said were needed. Retired municipal workers would get no cost of living increases, while retired police officers and firefighters would continue to get increases, though they would be smaller.”

The story elides the big legal issue of whether pensions can be cut at all. Evidently the public employees didn’t want to find out in court. In the “ask” part of the bankruptcy process, though, anything is negotiable.

The modest cuts seem like a sweet deal for public employees but, though Detroit is much bigger than Stockton, its retired emploees received far smaller pensions than ours do. But anyway, there’s the precedent: negotiated cuts to  public employee pensions. It was not done in Stockton where leaders reckoned retirees had been skinned enough by elimination of free lifetime retiree medical care. But it can be done.

 

This entry was posted in Uncategorized. Bookmark the permalink. Post a comment

Post a Comment

You must be logged in to post a comment.

We reserve the right to remove any content at any time from this Community, including without limitation if it violates the Community Rules. We ask that you report content that you in good faith believe violates the above rules by clicking the Flag link next to the offending comment or fill out this form.
  • Blog Author

    Michael Fitzgerald

    Mike Fitzgerald is The Record’s award-winning metro columnist. His column runs in the paper three times a week. Born in San Francisco, he was raised in Stockton. His column covers diverse beats including, sometimes, the offbeat. Read Full
  • Categories

  • Archives

  • RSS Related Content

    • 'Flying machine' wowed Stockton, vexed press in 1896
      The mysterious flying craft was made of metal. It stretched around 150 feet, sported two flapping canvas wings and sprouted a rudder shaped like a bird's tail. […]
    • Hell on wheels? Sure, why not?
      Crossing India is an adventure. Crossing India during monsoon season is a punishing adventure. Crossing India during monsoon season in a flimsy motorized rickshaw ... are you kidding? […]
    • Nocetis' conviction on festival admirable
      Kudos to promoters Tony and Carol Noceti for their bold pledge to revive the Asparagus Festival. I wonder if they realize what they are getting into. […]