Fixing economic mess
| Thursday, Jul 02 2009 05:11 PM
Last Updated Thursday, Jul 02 2009 05:11 PM
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Our local and nationwide economic disaster was caused by banks' and loaning institutions' aggressive and successful loan activities, which exceeded the borrowers' capability to repay.
Too many cars, homes, real estate tracts, etc., were used as collateral for loans far exceeding the value of the asset and the ability of the borrower to service.
Our tax revenues are reduced by at least 30 percent from last year and this is a longterm, five-year problem. The boisterous economy of the last six years has encouraged our lawmakers, from city council persons to federal legislators, to be aggressively generous with the abundant tax receipts.
Here's a possible solution: Reduce all government wages and benefits by 30 percent, including Social Security, fire and police, educators and lawmakers. Make no layoffs -- the solution should be shared by all and each of us. The supply side of the tax burden which includes carpenters, plumbers, salespeople, mechanics, etc., have already lost 30 percent or more of their wages.
Government pension benefits have far exceeded the tax base's ability to serve that debt.
There are many governmental retired personnel receiving two or three times their employed monthly income by receiving pensions from two or more government entities. A retiree should be eligible for one benefit only. Take the best of the selection available but not more than one.
After years of increasing wages and benefits, the unions should recognize the loss of tax revenue and offer the lower wages in exchange for full employment.
THOMAS R. POOR
Bakersfield
