Governor Was Right to Reform State Workers Insurance

Published August 26, 2008

The story should not be that state workers are paying into their health benefits like most of their private-sector counterparts, but rather that special interests fought so hard against such a reasonable plan (August 17, “State workers retiring early because of health-insurance costs”). Gov. Carcieri was right to stand up against unions in order to protect taxpayers from the state’s inevitable fiscal crisis that would be caused by these massive unfunded health care liabilities.

Studies show the price to all state and local governments for these unfunded health care liabilities is hovering around $1.5 trillion. David Walker, comptroller general of the United States, even warned in a report to congressional committees earlier this year of the necessity to reform these liabilities, noting, “continuing on this unsustainable path will gradually erode, and ultimately damage, our economy, our standard of living, and potentially our domestic tranquility and national security.”

The governor wisely heeded such warnings and took action to ease the looming burden on Rhode Island taxpayers. In his term he has tackled the growing problem of government liabilities in many ways, including saving $236 million by reforming the state’s pension system and $22 million for his plan to co-share health insurance premiums with state employees.

The public need not feel sorry for state workers. On average, they already earn an average of $13.41 more per hour in pay and benefits than private-sector employees, according to the Bureau of Labor Statistics.

John Nothdurft ([email protected]) is the budget and tax legislative specialist for The Heartland Institute.