A perfect storm

Published 12:00 am Tuesday, February 22, 2011

As riots continue to erupt throughout the Middle East, America has its own internal issues causing the national tension to reach the boiling point. The protests in Wisconsin over the disagreements between the unions, budget deficits and a clash of political ideologies is sure to spread to other states in the union. Some may look at this tension and disagreement as a bad thing for the country and those involved. However, I propose that this argument over the fiscal direction of our nation is not only healthy; rather, it is necessary if we are to remain relevant in the global game of economic power.

The numbers being discussed are staggering no matter how you look at them. The problem: billions in unfunded pension liabilities in several states totaling $1-2 trillion nationally. Let’s put that into numerals: $1-2,000,000,000,000.  The possible solutions: drastically cutting public payrolls, stripping public employees of many of their benefits, cutting services to the public or insanely large tax rate hikes. None of the solutions are pretty, yet they all cannot be avoided if our federal, state and local governments are to remain solvent. Governments declaring bankruptcy would start a negative domino effect in the bond market which has typically been a safe haven for investors to hedge against as they made other riskier investing decisions.

Tough decisions will have to be made at all levels in our country. Louisiana sits as the 11th worst state when unfunded liabilities are concerned with nearly $11 billion unfunded —  that number grows daily. Here is the dilemma facing the politicians from sea to shining sea: if we cut services to the people they will throw us out of office; if we cut the payrolls by thousands, then the unions will throw us out of office; if we cut the pensions of the public employees in order to save thousands of jobs, then the unions will throw us out of office; and if we don’t cut the number of jobs or the pensions of public employees, then the citizens in the private sector will throw us out of office. See the problem? This is the epitome of a lose-lose situation.

Nevertheless, the decisions will have to be made. America cannot afford the promises made by decades of politicians to their employees and their related unions in the form of pay increases, job protection and limitless benefits. None of this would be a problem if the necessary amount of money had been set aside as the promises were being made. However, surpluses were spent on one-time wants while unfunded needs were staring everyone in the face.

Get ready for a roller coaster of a year across the nation and in Louisiana in particular. In Louisiana, we have redistricting, budget deficits, and an election year all colliding in a political perfect storm.

The last bite…

Last week, I attended the Greater New Orleans United Way’s annual “Got Gumbo?” fundraiser at the Royal Sonesta Hotel in New Orleans. Over 30 gumbos and desserts were served by the finest restaurants in the city. All you could eat! Needless to say, I enjoyed myself. My favorite of all the gumbos was Palace Café’s backyard gumbo. This amazingly wild gumbo had squirrel, rabbit, and duck served on top of a boudoin balls and topped with duck cracklin’ crumbs!  I give the entire event 5 crumbs! (out of 5)

Buddy Boe, a resident of LaPlace, is a former parish administrator and is well known on the local political (and food) scenes. His column appears every Wednesday in L’Observateur.�