October 11, 2012
There was an interesting article in the CA last Monday, October 8, 2012. The title was “TVA shortfall proves costly to ratepayers”.
Our local electric power comes mainly from TVA and here we have a template for what is happening at the MLGW. Salaries, benefits (healthcare, vacations, sick days, etc.) pensions and OPEB (retiree health care) come mainly from the rate payers plus employee contributions. Contrast this with the City of Memphis and Shelby County which is mainly financed by property taxes and sales taxes. The difference is that TVA and MLGW salaries and benefits are hidden in your utility bills and as long as electricity, gas and water rates stay reasonably level, you don’t complain too much. On the other hand, when property taxes are raised, the tax payers get mad and rightly so.
Now suppose two things happen. One is another 2008 financial debacle and the other is rising energy rates. Both of these could happen if the national government decides to go all green as the administration wants to do. (“Under my cap and trade plan, electric rates would naturally rise astronomically”).
Change is coming as the national level of political promises made by politicians in the form of public pensions and health care promises are unsustainable and we are seeing states, cities and counties struggle to pay the bills for the promises and continue the needed level of fire, police, education and public services needed for a civil society. The sooner we face up to these problems and come to a joint agreeable solution, the better our future will be.