Yesterday the SC Supreme Court ruled against the Governor's proposal that state employees would have to split the costs of the increase in their insurance premiums. Now taxpayers will pay an extra 51 million dollars so that the 255,000 state workers can enjoy their insurance benefits at the same rate they paid as before. Gov Haley's spokesperson said
“It’s a shame that taxpayers will have to foot the entire bill for increases in state employee health care costs. Anywhere other than government, the costs would be shared, and we hope the Senate will do the right thing in their budget and split these costs evenly this year.”
It is a shame and it didn't have to be this way. Everyone knows that insurance rates have been rising faster than the rate of inflation. The past 5 years the rate of inflation has averaged 2.06% a year. That's about the average for the past 25 years. Last year CNN reported that health insurance premiums have been increasing at about 7% a year the past 5 years. The 59% of American workers who are fortunate enough to have health care provided through a company have been splitting those increases with their employers. So why aren't state employees going to do that?
According to The State here's the reason; After years of budget cuts, state lawmakers decided last year to give state workers a 3 percent raise, the first raise in four years. But lawmakers also increased state workers’ required contributions to their retirement fund. That left lawmakers worrying that if they also increased health-insurance premiums, state workers’ 3 percent raises effectively would be wiped out.
That's the kind of liberal thinking that should get everyone who voted for that budget, voted out of office. Every American pockets less money today due to health insurance costs! The math dictates it. If you have a contract that is tied to rate of inflation you take home less, and if like most people, you make the same or less than the year before, you take home a lot less. That's where the country is right now. Working for the state should not insulate people from fiscal pain. Do state employees get put in a magic bubble like it's a Travolta movie.
As for wiping out their raise, there is more money going into their retirement accounts. It's still their money! If you're making $50,000 a year and they bump you up to $51,150 but tell you that entire $1500 will be in your retirement fund, are you not better off? Are we in some weird time space continuum where giving someone thousands of dollars more for their retirement isn't considered giving them more money? That sounds like some Massachusetts math where that extra money doesn't count because they can't spend it today. So we'll give them more money for their retirement fund and we'll give them more money to spend today and we'll give them more money to cover the increase in health insurance. Because if we only gave them more money for 2 of the 3 it's like we didn't give them squat!
Photo: Getty Images
Governor Haley apparently knew this was bad math for the citizens because she's the one who proposed last August that the rate increase be split by tax payers and state employees. But why didn't she know it was bad math June 29th 2012 when she received the budget? Why didn't she and her team know it was bad math after they took all 5 days allowed by law for them to review it? They came up with 81 vetoes, after reviewing it, but this wasn't one of them.
She waited and tried to backdoor the deal a month later at a Budget & Control Board meeting. As the Supreme court noted in their unanimous decision, “If the (budget) board could decline appropriated funds based on its own policy choices, it would have the unbridled power to disregard the General Assembly’s appropriations and make its own appropriations decisions". Of course the Supreme court is correct. You can't have the Governor signing a budget and then getting a couple of people on a commission to just change it to however they really wanted it to look. If it was legal to change deals after everyone signed it there would be no need for fine print. So a good question for legislator (you can find them all here) would be 'did you vote for the budget last year?'. If they answer yes, a good follow up, 'why is it taxpayers are paying the entire increase in state employees premium increase?'. A potential follow up for that 'you don't like this job very much do you?'.