05-06-10, “Greek crisis now, Spain crisis next, Glendale crisis tomorrow”

Article by Dan Roberts in The Guardian (UK): "Like many countries, the Greek government relies on borrowed money to balance its books. The recession has made this harder to achieve, because tax revenues are falling just as welfare payments start to rise. It doesn't help that, in Greece, tax evasion is commonplace and pension rights are unusually generous – but, to be fair, using public spending to even out the bumps of the global downturn is what most large developed economies are trying to do right now."

Replace the word "countries" or "economies" for "cities", then replace "welfare payments" for "pension obligations", replace "tax evasion" with "disability retirements", and you get the financial future of cities in California, including the one you are living in right now.

The Mediterranean free-ride mentality arrived in Glendale in 2001 in the shape of city councilman Quintero with ample readiness for increases in pension benefits. City employees had sought two objectives: Less work, and more pay. Years ago Firemen and Policemen retired at age 60. Then they pushed to work only until 55 and now they can retire at 50. Years ago they accepted 60% of their last year's pay. Then they demanded 75%. Now they demand 90%.

Glendale is now relying on borrowed money. Money is taken from GWP to support the payroll and pensions of the General Fund. When the city needs to maintain the equipment and assets of GWP, it borrows the money. Skip the intermediate step and we are borrowing money to support pay increases and higher pension obligations. It's the Greek or Spanish style of governance.

Quintero didn't do it alone. He had plenty of help from councilman Weaver. Together they have squandered the city's finances and put the city hundreds of millions into debt. Brace yourselves for fewer city services, less infrastructure maintenance, more borrowing, and higher city fees. 

Herbert Molano