All The Ingredients

Krugman’s column is part of a much broader trend: the intellectual and economic underpinnings of the blue social model are in a process of accelerating and serial collapse.  I posted last week that the truly deadly threats to the public sector unions, the threats that doom them to long term decline, aren’t coming from people like Wisconsin governor Scott Walker; they are coming from blue state governors in places like New York and Vermont who recognize that their states simply cannot afford to give public unions anything like what they want.  The New York Times editorial board, one of the bluest groups in the United States, published an editorial the day before Krugman’s piece appeared that argued for deep changes in the way state workers are rewarded and managed.  Sez the Times:

"At a time when public school students are being forced into ever more crowded classrooms, and poor families will lose state medical benefits, New York State is paying 10 times more for state employees’ pensions than it did just a decade ago."

And why is this?  Well, continues the Gray Lady, there are several reasons, including this:

"[M]ost state employees pay only 3 percent of their salaries to their pensions, half the level of most state employees elsewhere. Their health insurance payments are about half those in the private sector."

And where does this leave us?

"In all, the salaries and benefits of state employees add up to $18.5 billion, or a fifth of New York’s operating budget. Unless those costs are reined in, New York will find itself unable to provide even essential services."  http://blogs.the-american-interest.com/wrm/2011/03/07/paul-krugman-gets-it-half-right/

Sounds like the makings of a death spiral to me ... for either the capacity of the state to provide any meaningful service, or for the ability of public sector unions to continue to extract compensation packages that are clearly unsustainable, and place the short term interestes of the public sector unionists above the long term interests of anyone, including those same public sector employees.

Krugman and the Times editorial board are both examples of something important in American life today: left-liberal intellectuals are increasingly able to understand that individual supports of the blue social model are crumbling.  But they are still so captivated by the blue model, so profoundly convinced that the Progressive movement’s solutions to America’s social ills in 1910 are still valid today, that they cannot yet look beyond the blue model to imagine a different and brighter future for the United States.