Progressivism Bankrupts New York State---Again

As a Brooklyn College professor, I am an employee of New York State. Nataly Billings just forwarded me a Newsday article noting public pension fund losses due to the Lehman Brothers bankruptcy. The article states that 37% of New York State's pension fund is in domestic equities, which seems conservative. But:

"Well before this week's corporate mega-collapses, the state's counties and big cities were sounding their own alarm bells. Lucille McKnight, president of the New York State Association of Counties, said several months ago that lagging population and economic growth, higher costs, fewer jobs and inevitably higher property taxes, drawn from a shrinking base, were components of a 'perfect storm.'"

The article also notes that Wall Street accounts for a full twenty percent of the State's entire tax revenue. Hence, in a bear market there is an automatic decline in the State's most important industry.

What the article doesn't mention and is actually a bigger problem is the unfunded retiree health insurance plan. Such a plan, funded on a pay-as-you-go basis, is feasible only if new firms can replace bankrupt ones like Lehman. But New York suffers from the disease of a century of Progressivism: high taxes, high labor costs, unfriendly regulations, and an anti-business culture. What business would want to open and stay in New York? The state employee unions have not thought this through, with relentless pressure to expand government services, as in the case of Dennis Rivera's Local 1199. The result of government bloat, high taxes, Progressive policies that squash small firms and hostility to entrepreneurship is going to be disappointment when all those state employees retiree in 10-20 years.