Roger Lowenstein’s Op-ed in the NYT explains how GM management sold off its future by promising lavish pensions and benefits to its unionized work force. What amazed me were these two paragraphs:
The sorry decline of General Motors has proved Reuther right: the government is the better provider of social insurance. Let industry worry about selling products.
Unhappily, however, the fate of many public-sector pension plans is even worse than G.M.’s. Responding to the same temptation to offload expenses into the future, public employers have committed to trillions of dollars in future liabilities. In New Jersey, a huge pension liability has created a budgetary nightmare for the state. The city of Vallejo, Calif., burdened by police pensions, recently filed for bankruptcy.
Right after telling us that “the government is the better provider of social insurance”, Lowenstein tells us that government is even worse than G.M. The government cannot be better (assertion) and worse (reality) at the same time, can it?