Emergency Press Conference on Newark Budget Gap; Massive Service Cuts; No Toilet Paper for City Offices; Newark is Bankrupt
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Newark Mayor Cory Booker and the city council are fighting over ways to balance a $70 million budget hole. Literally everything is under discussion except the one thing that needs to be done: declare bankruptcy.
Please play this video. It is pretty enlightening.
CNN Money reports Newark mayor: No toilet paper for city offices
In a desperate attempt to fill a $70 million budget hole, Newark's mayor is taking a chainsaw to the town's budget -- even going so far as to cut toilet paper from the 2010 budget.Municipal Utilities Authority Idea is Sheer Madness
"Every single contract that does not go to the core function of our city in providing safe streets, providing fire protection, or other things to keep our city afloat will now be cut," Booker said during an emergency press conference Wednesday.
The reductions include not buying toilet paper for city offices, cutting the work week to four days for non-uniformed city workers, which is equivalent to a 20% pay cut, scrapping city holiday decorations, and closing city pools. These extreme measures, most of which will take effect beginning in August, are expected to save the city between $10 million and $15 million.
The city came to this impasse after the city council deferred a vote to create a Municipal Utilities Authority, a key component of Booker's method of balancing the budget. Because Newark could issue bonds on the Authority, it would have cash inflow to cover the immediate deficit. Without that infusion, the mayor said they can't make ends meet.
I applaud the decision by the council to reject Mayor Booker's Municipal Utilities Authority.
It is time for cities and states to address issues now, not raise taxes and not float more bonds that cannot and will not be paid back unless sugar daddy Congress steps in with taxpayer sponsored guarantees.
The Blame Game
As you might expect, finger-pointing is now running rampant. Please consider Newark council slams Mayor Booker for 'savage' proposed budget cuts.
Donald Payne Jr., Newark’s council president, and four of his colleagues today put up a united front to counter Mayor Cory Booker’s roll out of "savage" budget cuts, accusing him of political gamesmanship for trying to thrust responsibility on the governing body.Both to Blame
"It appears the mayor is Pontius Pilate," said Mildred C. Crump, councilwoman-at-large. "In other words, his hands are clean. The blood of the residents of Newark will be on our hands."
The dramatic push-back came just 24 hours after Booker unveiled a four-day workweek for 1,450 non-uniformed city employees, the closing of city pools, even cutbacks on everything from toilet paper to holiday decorations — and then proceeded to challenge the council to come up with its own budget blueprint.
"This is the mayor’s issue. We advise and consent on the budget. It’s the mayor’s job," Payne countered. "Press conference after press conference, he says the council is not doing its job."
The mayor and the city council are both to blame. Once again the culprit should be easy to spot: union contracts and pension benefits.
Public unions in conjunction with corrupt politicians have bankrupted Newark. There is simply no other way of looking at this. The city's best option is to declare bankruptcy, placing pension benefits and salaries in a court of law rather than on the backs of over-burdened taxpayers.
Stories like these abound. Indeed nearly every city in the country is headed for bankruptcy, yet people email me this is not the big issues.
Well this IS the #1 problem for cities and states. There are other extremely important issues at the federal level such as ridiculous military spending. However, addressing Federal issues will not cure problems with cities and states.
Union benefits are preposterous, wages are too high, and pension plans are $2 trillion in the hole. Let me repeat that: Public pension plans are $2 trillion in the hole, and getting worse every year.
Yet every day I receive emails from people saying there are more important issues. No there certainly are not more important , at least at the city and state level.
Kicking the Can
Unfortunately, Newark Mayor Cory Booker wants to do nothing but kick the can down the road. He is also pandering to police and fire unions by holding those spending levels high. By doing that, Booker may raise enough ire from citizens who have no toilet paper in parks or government buildings.
The mayor is either a fool or is guilty of political pandering, more likely both. The problem is public unions and that problem cannot be fixed with a Municipal Utilities Authority. The problem can only be addressed by taking the police and fire unions head on.
The city council is not showing much leadership either.
Newark is Bankrupt
Newark is bankrupt and public unions did it. The only sensible solution for Newark is to declare bankruptcy, dissolve the unions and their pension plans, and start all over with non-union employees for government services.
Mike "Mish" Shedlock
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