The American Interest
Analysis by Walter Russell Mead & Staff
RI Democrat Touches Pension Reform Third Rail…and Lives!

Pension reform is possible, folks. Even by Democrats. Even in Rhode Island.

Fred Hiatt devoted his WaPo column yesterday to a quick profile of Gina Raimondo, the Rhode Island state treasurer who is proving that even Democratic politicians—from deep-blue states no less—can touch the third rail of politics and live:

How did Raimondo do it?

In her election campaign, she didn’t detail her intentions — she says she didn’t know the extent of the problem, nor the right solution — but she also didn’t disguise her goal. That was enough to lose her the teachers union endorsement, though Raimondo was the only Democrat in the race.

[...]

She stressed her respect for public service workers — and that the problem was not their fault. What they had been promised was unsustainable. Their pensions were at risk and so were other state services.

“That was my mantra the whole time: Progressives care about public services,” Raimondo told me. “A coalition of supporters developed, and it wasn’t just the chamber of commerce. It was younger teachers, police, heads of social service agencies . . . Advocates for the disabled really came out.”

The plan that she eventually shepherded through the Democrat-controlled state legislature raised retirement ages, suspended cost-of-living adjustments, and converted the system into a hybrid in which both state and public employee bear a portion of the investment risk. As a result of these reforms, Rhode Island’s unfunded pension liabilities have been cut in half.

Note, too, that Raimondo did all this despite taking ongoing legal and political heat from teachers and other public-sector unions. In fact, she has emerged from the fight stronger than ever, enjoying solid public support along with backing for a possible run at either the governor’s seat or a trip to the U.S. Senate.

Even for Democrats in an indigo-deep blue state like Rhode Island, taking on public sector unions in the name of fiscal sanity is a winning strategy. State and local government workers aren’t bad people, but public sector unionism is a bad system and has led in state after state to grotesquely unbalanced and unsustainable pension programs. Voters increasingly recognize this reality and are ready to reward politicians who deal with the consequences in a responsible way.

Published on September 10, 2012 9:48 am