NJ Fiscal Folly

Thursday, June 08, 2006

America's Next Civil War?

I've just run across an interesting article, "America's Second Civil War: The Public Employment Complex vs Taxpayers", from the Yankee Institute in Connecticut.

At the state and local level, the "public employment complex" (PEC) includes all persons or groups that earn a living, either directly or indirectly, from government programs. PEC includes government employees, public unions, community organizations, advocacy groups, lobbyists, lawyers, consultants, etc. As we've already seen in NJ, the steady escalation in government spending and PEC costs has created numerous financial crises across the country. The resulting tax burdens can no longer be sustained or ignored. Thus, many politicians now face an unavoidable choice: either cut back government spending, or watch their taxpayers migrate to lower-cost communities.

The article forecasts a dramatic increase in labor militancy, bitter political conflicts, and harsh attacks on those persons or groups that want to reduce PEC costs. The author believes that taxpayers will eventually win, due to a numerical majority and the fact that constantly growing PEC costs can't be sustained or justified. However, the other consequences of this imminent "civil war" may be harmful to everyone.

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