Providence and Pensions

By Bill Maher

Providence means the invisible guiding hand of God, so I'm always sad to see things skidding wildly into shit creek in a place called Providence.  But that's exactly what happened this year to Providence, Rhode Island, population 178,000.  You could fit the entire population of Providence inside two LA Coliseums and have 9,000 extra seats.  It's not exactly Tokyo.  So the townsfolk were surprised when their unions told them they owed them $901 million for their pensions.

And no, I'm not just blaming the unions.  They're the nicest bunch of no-necks you'd ever like to meet.  There are other problems with the system.  Retirees living longer, for instance, and the pension funds losing money in the market.

But unemployment in Rhode Island is 11%.  It's a beleaguered little Chow-Chow of a state.

And Providence was going bankrupt. So last month -- in cooperation with the unions -- they reformed the pension system.  You can do this stuff, if both sides agree not to be assholes.  One of the things they did was get rid of the 5 percent and 6 percent annual increases given to about 600 former firefighters and police.  Another was to cap future pensions at 1.5 times the state's median annual household income, or about $82,000.  Which doesn't sound like any robber barons are kicking the stool out from under the workingman, but that's just me.

There are two dozen city retirees collecting more than $100,000 a year in Providence.  Which is nice for them, but hard on a tiny city of people who aren't evil or greedy or anything. Really. I've been there.

The poster child for the problem with the Providence pension system is former fire chief Gilbert McLaughlin. And I know this is anecdotal, but that's really just another word for "fact you don’t like."  McLaughlin retired in 1991, age 55, making $63,510 a year.  His contract entitled him to a 6% cost of living increase every year.  So this year, for not being fire chief, he made $196,813.  If McLaughlin lives to be 100 -- and why not, it's not like he's fighting fires -- he would've earned $700,000 a year under the old system.

Something had to give.  So Providence -- and the whole state, governed by our old pal Linc Chafee, neither greedy nor evil, nor out to destroy the middle class -- are suspending cost of living increases, and capping benefits.

I think we need unions.  But when people hear about the retired fireman whose pay doubles every twelve years, you can see how they might not like it.