Offshore Inn for International Real Estate, Overseas Jobs, Asset Protection, Expatriate Resources and Overseas Retirement
It is a peculiar irony. A year ago, the the UK’s Inland Revenue began a crackdown on offshore savings. Banks operating out of the Channel Islands and the Isle of Man had to hand over details of British customers, and depositors who confessed were rewarded with an amnesty. Thousands did and many must have given up on offshore savings. Inadvertently, the taxman’s crackdown must have saved some depositors from the collapse of the offshore subsidaries of Icelandic banks.
Thousands were not so lucky and could now lose most of their savings …
Consider if you will be a sole proprietorship, partnership or corporation.
‘You’re so lucky, being able to work abroad.’ I’ve forgotten how many times I’ve heard that statement.
If you have assets, you are most likely a target. When your assets are visible, you are the bullseye.
Do you need a job? Just got a question? Pop it in here and you’ll get an answer from our Inn Team.
Tip the scales in your favour, protect your home and family with asset protection programmes for partnerships, corporations and individuals.
Jed Graham writing for Investor’s Business Daily says something I have been saying for several months: Extra Stimulus Aid Fuels Sales, But Fiscal Flood Cresting Early
In gauging the economic recovery’s trajectory, you shouldn’t forget that this is not a normal tax season.People who don’t pay income tax are getting an extra $30 billion in refundable tax credits thanks to the Recovery Act, the Joint Committee on Taxation has estimated. Based on the timing of tax refunds in past years, well over half of that has likely been paid out already.
Mark Zandi, chief economist at Moody’s Economy.com, said the extra serving of tax-season cash to modest-income families “helps explain the somewhat surprising strength in retail” in February.
Excluding AMT relief, Zandi figures peak stimulus hits this month or next.
Just how big of a boost will this extra cash provide? If the economic impact came in a single quarter, CBO’s analysis implies that it would hike GDP by 0.6-1.5 percentage points. In all likelihood, the effects will be over a longer period.
Retail Sales Mirage
“I think we are seeing the effects (of Recovery Act tax refunds) on retail sales and spending,” said Allen Sinai, president of Decision Economics.
Same-store sales at major retailers rose 4.1% in February, the best year-over-year gain in over two years, Retail Metrics said March 4.
January 2010 sales were nothing to brag about and February 2010 same store sales will not be either.
February 2009 sales were horrible so year over year comparisons will be extremely easy. Moreover, the whole same store sales methodology is flawed to begin with on account of closed stores, and even closed chains like Circuit City. For details, please see Retail Sales Rise: Where? Let’s Take a Look; Expect Nothing Less Than Panic
Finally, one has to take into consideration favorable for spending income tax returns.
In spite of that, tax collections are down although many states have raised sales taxes. That’s what really matters.
Moreover tax credits for houses have run out of stimulus effect as has cash-for-clunkers.
Expect actual tax collections (reported later) will likely fall short regardless of what the report says.
I am on the road now. The above was written ahead of Friday’s advance sales report.
Addendum:
A quick post before I hit the road returning home.
Bloomberg reports U.S. Stocks Advance as Retail Sales Bolster Economic Optimism
U.S. stocks rose, keeping the Standard & Poor’s 500 Index at a 17-month high as an unexpected increase in retail sales added to evidence the economic recovery is strengthening.Google Inc. and Target Corp. climbed more than 0.4 percent after the Commerce Department said purchases at U.S. retailers increased 0.3 percent last month, compared with a 0.2 percent drop forecast in a Bloomberg survey of economists. National Semiconductor Corp. rose 1.3 percent after the chipmaker forecast better-than-estimated revenue.
“People are looking to buy stocks,” said Mark Bronzo, a money manager in Irvington, New York, at Security Global Investors, which oversees $21 billion. “Risk appetite seems to be growing as people become more comfortable with the sustainability of the economic recovery. Today’s retail sales numbers and the better outlooks from retailers confirm that.”
Please consider the Department of Commerce Advance Monthly Sales For Retail and Food Services for February 2010.
The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for February, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $355.5 billion, an increase of 0.3 percent (±0.5%)* from the previous month and 3.9 percent (±0.5%) above February 2009. Total sales for the December 2009 through February 2010 period were up 4.5 percent (±0.3%) from the same period a year ago. The December 2009 to January 2010 percent change was revised from +0.5 percent (±0.5%)* to +0.1 percent (±0.3%)*.
Note the big downward revision in January. So now February is artificially elevated sequentially.
Also note that economists were surprised by the strength of February sales (that really were not very good in the first place for multiple reasons) even though Retail Metrics said on March 4 that “Same-store sales at major retailers rose 4.1% in February”
You can’t make this stuff up. No one would believe it.
Let’s see how the market closes. A gap and crap on silly misplaced optimism as well as silly reporting from those who do not understand retail sales would fit the bill. But hey, who knows.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
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This interactive guide explores the past, present, and future of nuclear power, focusing on its unique benefits and risks.
Numerous people sent me links to this story involving public schools in Kansas City.
Please consider Kansas City Closing 26 Public Schools
Facing potential bankruptcy, the board that governs the once flush-with-cash Kansas City school district is taking the unusual and contentious step of shuttering almost half its schools.
Administrators say the closures are necessary to keep the district from plowing through what little is left of the $2 billion it received as part of a groundbreaking desegregation case.
The Kansas City school board narrowly approved the plan to close 29 out of 61 schools Wednesday night at a meeting packed with angry parents. The schools will close before the fall.
Emotional board member Duane Kelly told the crowd of more than 200 people Wednesday night, “This is the most painful vote I have ever cast” in 10 years on the board. Some chanted for the removal of the superintendent, while one woman asked the crowd, “Is anyone else ready to homeschool their children?”
Under the approved plan, teachers at six other low-performing schools will be required to reapply for their jobs, and the district will try to sell its downtown central office. It also is expected to cut about 700 of the district’s 3,000 jobs, including about 285 teachers.
District officials face dozens of issues as they begin the massive job of downsizing the district — reworking school bus routes, figuring out what to do with vacant buildings and slashing its payroll.
Superintendent John Covington has stressed that the district’s buildings are only half-full as its population has plummeted amid political squabbling and chronically abysmal test scores. The district’s enrollment of fewer than 18,000 students is about half of what the schools had a decade ago and just a quarter of its peak in the late 1960s.
Simple Question
This problem did not happen overnight. School enrollment is half what it was 10 years ago. So why did it take 10 years for the district to do something?
Please note that Covington took the job in July 2009 according to Wikipedia. On that basis he can be commended for doing a job long neglected for 10 years.
Flashback March 16, 1998
Inquiring minds are reading Money And School Performance: Lessons from the Kansas City Desegregation Experiment.
Executive SummaryFor decades critics of the public schools have been saying, “You can’t solve educational problems by throwing money at them.” The education establishment and its supporters have replied, “No one’s ever tried.” In Kansas City they did try. To improve the education of black students and encourage desegregation, a federal judge invited the Kansas City, Missouri, School District to come up with a cost-is-no-object educational plan and ordered local and state taxpayers to find the money to pay for it.
Kansas City spent as much as $11,700 per pupil–more money per pupil, on a cost of living adjusted basis, than any other of the 280 largest districts in the country. The money bought higher teachers’ salaries, 15 new schools, and such amenities as an Olympic-sized swimming pool with an underwater viewing room, television and animation studios, a robotics lab, a 25-acre wildlife sanctuary, a zoo, a model United Nations with simultaneous translation capability, and field trips to Mexico and Senegal. The student-teacher ratio was 12 or 13 to 1, the lowest of any major school district in the country.
The results were dismal. Test scores did not rise; the black-white gap did not diminish; and there was less, not greater, integration.
The Kansas City experiment suggests that, indeed, educational problems can’t be solved by throwing money at them, that the structural problems of our current educational system are far more important than a lack of material resources, and that the focus on desegregation diverted attention from the real problem, low achievement.
The Kansas City Story
In 1985 a federal district judge took partial control over the troubled Kansas City, Missouri, School District (KCMSD) on the grounds that it was an unconstitutionally segregated district with dilapidated facilities and students who performed poorly. In an effort to bring the district into compliance with his liberal interpretation of federal law, the judge ordered the state and district to spend nearly $2 billion over the next 12 years to build new schools, integrate classrooms, and bring student test scores up to national norms.
It didn’t work. When the judge, in March 1997, finally agreed to let the state stop making desegregation payments to the district after 1999, there was little to show for all the money spent. Although the students enjoyed perhaps the best school facilities in the country, the percentage of black students in the largely black district had continued to increase, black students’ achievement hadn’t improved at all, and the black-white achievement gap was unchanged.(1) …..
Every Child Left Behind For Decades
Throwing money at the problem wasted $2 billion. Now the district faces bankruptcy, and is forced to abandon now decaying schools bought with wasted taxpayer money.
In Kansas City, as in Detroit, every child was left behind … for decades.
Closing schools is the correct decision. Moreover, Superintendent Covington needs to fire every hopeless school administrator as well, which may in fact be almost all of them.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
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Inquiring minds are reading Treasury Yield Curve Near Record Adds to Demand at Bond Auction.
Treasury 30-year bonds gained as one of the biggest yield premiums over 2-year government securities on record bolstered demand at today’s U.S. auction of $13 billion in bonds.“Insurers, pension funds and other investors continue to buy the 30-year because of its outright yield and it relative value attractive against the short-end given the inflation and economic pictures,” said Thomas Tucci, head of U.S. government bond trading in New York at the Royal Bank of Canada, one of the 18 primary dealers required to bid at Treasury auctions. “There is just little value in the front end versus the long bond.”
“If you look behind the trade numbers, exports and imports both fell,” said Kathy Lien, director of currency research, with online currency trader GFT Forex, in New York. “The contraction in imports and exports does not play into the growth story. That’s why risk currencies are selling off and the dollar is rising.”
Today’s auction of 30-year debt followed a sale of $21 billion of 10-year debt yesterday. The Treasury auctioned a record-tying $40 billion of three-year notes on March 9.
The 30-year securities drew a yield of 4.679 percent, compared with an average forecast of 4.702 percent in a Bloomberg News survey of 9 of the Federal Reserve’s 18 primary dealers. Direct bidders, non-primary dealers that place their bids directly with the Treasury, bought 29.6 percent, the highest since at least February 2006.
“The yield pick-up extending out the curve is attractive at these levels,” said Richard Bryant, senior vice president in fixed income at MF Global Inc. in New York, a broker of exchange-traded futures. “Real money will go to work on the long end of the Treasury market. The range that has held on the long end is reflective of the benign inflation environment at the moment.”
Charts of the Day
Tyler Durden writing on Zero Hedge has a pair of interesting charts in $13 Billion 30 Year Reopening Closes At 4.679%, Directs Take Down Whopping 29.7%: A New Record, Indirects Settle For Mere 23.9%
Direct Bidders
click on chart for sharper image
Indirect Bidders
click on chart for sharper image
A Very Good Auction
In contrast to what many think about treasuries ready to blow up because of falling foreign demand, I repeat what I have been saying all along: US demand will pick up.
That aside, it is also important to point out that indirect bidding is related to trade deficits. When the trade deficit is high and rising, foreign buyers step up treasury buying as a purely mathematical function of parking inflows, although there is nothing that forces the buyers to go that far out on the yield curve.
Since the trade deficit is not what it once was, one should expect foreign buying to slow. Thus I do not know what Tyler Durden means when he says “Indirects at miserable 23.9% vs. Avg. 42.32%“.
Here is my intrepretation of the auction: I would suggest this auction went very well as demand is picking up from US buyers, without yields going to the moon.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
A preview of world events in the coming week from CFR.org and Foreign Affairs.
An Israeli announcement of more housing construction in East Jerusalem became the focus of Vice President Biden’s Middle East trip, but CFR’s Jacob Walles thinks the “proximity talks” starting next week are a practical, low-risk way to restart negotiations.
Vice President Joseph R. Biden, in the Middle East to build support for revived Israeli-Palestinian peace talks, issued a strong denouncement of Israeli plans to build another sixteen hundred housing units in East Jerusalem, which Palestinians see as the capital of a Palestinian state. Commentators included those writing about the bad timing and substance of Israel’s announcement; others speculated about Israel’s stance on Iran and the readiness of both sides for real compromise.
New Jersey Governor Chris Christie is doing what he was elected to do, govern. And that means playing hardball with union termites who refuse to give an inch to help the state out of budget problems primarily caused by untenable union promises, union wages, and union pensions.
When unions refused to cooperate, Christie decided to take the next logical step, to privatize jobs. Please consider New Jersey plans to privatize state jobs
Gov. Chris Christie today will create a commission to privatize as many as 2,000 state jobs beginning next January, officials said Wednesday night.As he grapples with an $11 billion deficit in the budget he will present on Tuesday, Christie is also considering invoking the Disaster Control Act to suspend Civil Service rules to make it easier for him to lay off higher-paid workers, according to two administration officials.
The Republican governor today plans to sign an executive order creating the task force to cut the size and cost of the state payroll. Three officials familiar with his plans last night said the commission will identify which jobs or agencies would be operated by the private sector and how that would be accomplished. The officials declined to be named ahead of the announcement.
Privatizing jobs would require layoffs. By beginning them in January, Christie would not be subject to a deal between former Gov. Jon Corzine and state worker unions that would require the state to pay millions in raises to remaining workers if he orders layoffs before then.
Suspending civil service would allow Christie to order layoffs of higher-paid unionized state employees with many years of service, rather than the usual practice of layoffs that affect lower-paid new employees first, the officials said. Currently, workers with more seniority can “bump” less-experienced workers from their jobs.
The privatization effort deals a blow to state worker unions just 48 hours after Christie publicly acknowledged he is bound by the agreement struck by Corzine where state workers would get two 3.5 percent raises in the coming fiscal year Ð one in July and one in January. They deferred one raise and took 10 unpaid furlough days last year in exchange for the no-layoff pledge.
Two days ago when I read that the Union refused to give an inch on a ridiculous contract negotiated by former governor Corzine, I was delighted. The reason is I was pretty sure how Christie would respond. Today he hit a home run.
Moreover, his goal should be to privatize every government job he can. Why stop at 2,000?
Where’s The Leadership?
It’s too bad other governors refuse to follow Christie’s lead by cutting expenses. I talked about that previously in Missouri Budget Overstates Revenues By Up To $1 billion; Indiana Revenue Falls Short; Budget Battles In Washington; Budget Gaps In Kansas
Sadly, the governors in Missouri, Kansas, Washington, and Indiana fail to see the problem or are still looking for “tricks” to postpone dealing with those problems. There are no tricks left in the bag, yet states keep looking for tricks.
Add Virginia to the list of states playing trick-or-treat.
Federally Funded Ticketing Blitz In Virginia
Inquiring minds are reading Virginia State Police Help With Budget Crunch.
A federally funded ticketing blitz in the state of Virginia landed a total of 6996 traffic tickets this weekend. The blitz, dubbed “Operation Air, Land & Speed” coincided with frantic efforts by state officials to close a$2.2 billion budget deficit. Supervisors ordered state troopers to saturate Interstates 81 and 95 to issue as many tickets as humanly possible over the space of two days.Activists with the National Motorists Association pointed out that enforcement efforts may have concentrated on areas where speed limits are expected to rise to 70 MPH following Governor Bob McDonnell’s signature on legislation raising the state’s maximum speed limit (view law). This would mean a significant number of tickets were issued for conduct that will be perfectly legal in a matter of months. The group also indicated that state police tactics may run afoul of state law.
Under the federal grant application process, state officials explained that they would pay officers overtime — at least one-and-a-half times their normal salary — to participate. This special reward for ticketing operation participants appears to violate the spirit of state law.
Message To Virginia Governor
Hello, Bob McDonnell, you are not even in the ballpark with what needs to be done. How about showing some leadership rather that resorting to traffic blitzes to shore up the budget? All you are doing is postponing tackling the real problem, a bloated state budget.
If the state police have nothing better to do than harass drivers in areas where the speeding limit is set to go up anyway, then Virginia should get rid of some of that police force, reducing the budget at the same time.
Brass Balls In Las Vegas
Finally! The mayor of a major city is looking into doing what needs to be done. Please consider Las Vegas Mayor Says City Should Fire All Workers
If Las Vegas can’t get the desired wage concessions out of its employee unions, the city should simply fire everyone and offer to rehire them to work a shorter work week, Mayor Oscar Goodman said Wednesday.“I’m trying to save jobs. I really am,” Goodman said. “If it’s a strong-arm tactic, so be it. “If it’s legal, I’m going to propose it to the council. I think it’s the only way we’re going to save jobs.”
Goodman ordered the city attorney to study the possibility.
The idea didn’t go well with the unions. Several union presidents went so far as to call the mayor a bully. And Councilman Ricki Barlow also said he disagreed with the mayor.
The city faces a $70 million budget hole to fill and most likely a $40 million deficit in the next fiscal year, and the proposed solution to that hasn’t changed — all employees, Goodman said, should forgo their scheduled raises and accept 8 percent pay cuts in each of the next two years.
Or, under his fire-and-rehire plan, a new 37.5-hour workweek would trim costs 6.25 percent, and a 36-hour week would cut costs 10 percent, he said.
“I’ve never been as severely disappointed as this situation has caused me to be,” Goodman said about the unions being unwilling to open their contracts and accept needed changes.
Goodman also called for a study of whether the city should privatize its ambulance services, noting that his fire-them-all approach isn’t applicable to public safety employees.
Hello Mayor Goodman, you have the right idea, so just do it. And when you hire those workers back, privatize every one of the jobs, including police and fire. Don’t wimp out by privatizing just ambulance services. It’s time to show some brass balls.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
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Any economists blaming snow for recent weekly claims reports need to search for additional excuses. Once again, today’s numbers appear like reporting in the movie Groundhog Day.
Please consider the Unemployment Weekly Claims Report for March 11, 2010.
In the week ending March 6, the advance figure for seasonally adjusted initial claims was 462,000, a decrease of 6,000 from the previous week’s revised figure of 468,000. The 4-week moving average was 475,500, an increase of 5,000 from the previous week’s revised average of 470,500.
Weekly Unemployment Claims
The weekly claims numbers are volatile so it’s best to focus on the trend in the 4-week moving average. That 4-week average has not show any improvement for quite some time.
4-Week Moving Average of Initial Claims
The 4-week moving average is still near the peak results of the last two recessions. It’s important to note those are raw number, not population adjusted. Nonetheless, the numbers do indicate broad weakness.
4-Week Moving Average of Initial Claims Since 2007
4-Week Moving Average of Initial Claims Detail
The 4-week moving average of claims for the last four weeks is about where it was on December 5, 2009. By this measure, the recovery has stalled. For more on jobs, please see Bragging About Census Hiring Starts Already; I’ll Take The Under.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
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Inquiring minds are reading Miami-Dade hospital system nears insolvency.
The major hospital network Miami relies on for trauma care is close to insolvency and could be cut off by suppliers. Executives for Jackson Health System surprised its governing board Tuesday by saying the nonprofit is near or already in a “death spiral” as it runs low on cash.Chief Operating Officer David Small says any day he could hear from a surgeon without enough supplies to operate. The hospital system is the only Level 1 trauma center set up to provide emergency care around the clock in Miami-Dade, which is Florida’s most populous county and the 8th largest in the nation.
The hospital system needs a $67 million advance from the county to avoid coming within a day and a half of operating cash by April 5.
County responsible for paying Jackson’s union workers
Here’s an interesting highlight. The Miami-Dade attorney says County responsible for paying Jackson’s union workers.
If the Jackson Health System runs out of cash, the county would be responsible for paying Jackson’s 10,500 union workers, but not necessarily the other 1,500 employees, according to a legal analysis by County Attorney R.A. Cuevas Jr.It’s unclear exactly how big a tab that might be, but it would be a huge chunk of the $86 million of salaries and benefits that the public hospital system spends each month. At present, Jackson is expected to run out of cash in May or June unless drastic cuts are made.
This revelation on the county’s responsibility comes just before a special meeting scheduled for Wednesday by the Miami-Dade County Commission “to really understand the issues . . . being faced by the community’s safety net hospital,” according to the memo from Chairman Dennis C. Moss, who ordered the meeting.
Cuevas’ memo explores many issues in the relationship between Jackson and the county and raises the possibility that Gov. Charlie Crist might set up an oversight panel to administer the financially troubled institution, much the same way that Gov. Lawton Chiles created a financial emergencies board in 1996 to get the city of Miami back on track.
Jackson Chief Executive Eneida Roldan is trying to find ways to get faster and lower costs, but last week she announced she was putting a 45-day moratorium on job cuts, meaning it would likely be May before any major cost-cutting takes place.
The county meanwhile is battling its own budget woes, needing to find another $48 million in cuts this fiscal year, making it extremely difficult to find more money for Jackson.
Cascading Bankruptcies
Read the last sentence in the above article above again. It highlights the problems of unions dumping on cities dumping on counties. The only solution is to get rid of unions, taxpayer supported defined benefit pension plans, and taxpayers supported salaries well above what the private sector makes.
As I said years ago, I fully expect several counties in Florida to go bankrupt. Moreover, I expect many cities in many states to do the same. The only way out is for unions to voluntarily agree to dramatic cuts in wages and benefits. However, as noted in Moorestown New Jersey Unions Highlight Union Arrogance, the odds of that happening in mass are slim.
Ironically, this depression is bound to unwind the devastatingly parasitic measures FDR used to combat the last depression.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
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The Spanish property market has posted its first rise in house sales for three years, it has been announced.
Figures revealed by the Ministry of Housing show that sales in the country were up by 4.1 per cent year-on-year during the fourth quarter of 2009 and could represent a return in interest to the economically-troubled destination.
Speaking to Overseas Property Professional, many developers and agents reported that they had experienced a rise in the number of sales and enquiries they had dealt with surrounding the popular European destination.
Alfredo Milla, director of international investments at Mediterranean, told the property website that there was a feeling that the economic climate was improving.
"We believe that the confidence is returning to the international buyers as they can see the great offers that are now available in Spain.
"With a lot of European countries predicted to leave the recession this year there is not so much financial fear."
Meanwhile, the National Association of Estate Agents International has recommended that buyers invest early in the country to take advantage of bargain properties.
France could benefit from a massive influx of foreign property investment after its government decided to implement the country’s first ever trust law.
A report on Overseas Property Professional has explained that the new guidelines mean that foreign pension trustees will now be allowed to invest in leaseback property within the country.
Furthermore, wealthy investors can now avoid heavy taxation when using offshore funds for property transactions.
Investors from tax havens such as Jersey, Guernsey, the Isle of Man, the British Virgin Islands and the Cayman Islands will now be exempt from the three per cent penalty that has been applied in past years.
David Anderson, of law and tax firm Sykes Anderson, told OPP that this could represent one of the largest developments in overseas property of the last ten years.
"We’re seeing quite a run of high net worth individuals with offshore funds focusing on trophy properties and asset classes that can’t be bought in the UK, such as vineyards and ski lodges, as well as prime agricultural land."
A survey conducted by HomeAway and Savills recently claimed that France was set to become an investment hotspot during 2010.
After a turbulent few months for the Cypriot housing market, news that property sales are beginning to pick up is likely to be welcomed by investors.
The latest statistics, compiled by the island’s Lands and Surveys Department, demonstrate an increase in volumes of around 30 per cent in February compared with the same month last year.
Solomon Kourouklides, president of the Cyprus Real Estate Agents’ Association, explained that the growth was probably a result of more opportunities opening up for buyers in the marketplace.
Many new purchasers are buying up property from individuals who are struggling with loan payments.
Meanwhile, Mr Kourouklides made his predictions for the coming year: "If the economic parameters remain the same, we believe that the market will remain at the save level as in 2009."
This is the second month in a row that property sales posted an increase, as in January the Land and Surveys Department reported that there had been a 24 per cent increase in house sales compared with the same period in 2009.
Listen to experts breakdown the development of an international framework for geoengineering and the implications of these technologies for U.S. foreign policy.
Listen to experts breakdown the development of an international framework for geoengineering and the implications of these technologies for U.S. foreign policy.
Report
In a scene that I expect to play out in every city across the country, Unions won’t reopen talks in Moorestown New Jersey.
Township officials expressed frustration that several unions representing Moorestown government workers have not agreed to reopen contract negotiations.Last month, township council asked the unions to consider making wage and health benefit concessions this year even though they have contracts that continue through 2012 and guarantee annual pay raises of 3.75 percent.
At Monday night’s council meeting, Township Manager Christopher Schultz disclosed to the public the specifics of council proposals to the unions — a wage freeze and a payroll contribution to health care benefits to help cut costs to the township.
As of Monday night’s deadline to respond, township officials said none of the unions had agreed to reopen negotiations.
“It’s more than frustrating,” said Councilman Greg Gallo. “It’s irresponsible and it shows tremendous shortsightedness and, frankly, I think it shows a disrespect to the taxpayers and to council to not even enter into a conversation. We respect the fact that they have existing contracts, but the world has changed and we are living in extraordinary times.”
“The membership has decided not to open up the contract at this time, but we understand the township is facing economic pressure,” said CWA local President Adam Leibtag.
For the current contract reached in August 2008, he said the union made concessions that included an increase from $10 to $15 in doctor’s visit co-pays.
Blatant Union Arrogance
It is the height of arrogance and stupidity to brag about concessions like a $5 increase in copays made in 2008. Councilman Greg Gallo hits the nail on the head with “It’s irresponsible and it shows tremendous shortsightedness and, frankly, I think it shows a disrespect to the taxpayers and to council to not even enter into a conversation.”
I am thankful for that shortsightedness actually. Cities will be forced to realize what leaches unions are.
The correct solution, and the only solution is to get rid of union pestilence. That is easy to accomplish by privatizing every job, including the fire and police departments, the latter to the sheriffs association.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
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