Government labor problems: Not just Wisconsin’s anymore

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While we’ve been wrapped up in a 60-day legislative session that has included a variety of important policy issues, most notably on education reform, New Mexico policymakers, media and the public have watched in detachment the ongoing government labor standoff now happening in Wisconsin. 

So far, New Mexico has been relatively quiet on the pension issue, but that isn’t because we don’t have a pension problem. We do, and as a percentage of GDP, New Mexico’s pension liabilities are actually greater than any state’s but Ohio and Wisconsin, both of which are attempting to make needed reforms.

Based on the foundation’s studies, the main long-term driver of our pension problems is continued over-employment in the public sector. Reducing the number of state and local workers in New Mexico to the national average, relative to the number of private sector workers, would save taxpayers in the state an astonishing $2.5 billion annually while reducing compensation to the national average for those very same workers would save just under $700 million annually. 

That money would both reduce the number of future pensioners while freeing up a great deal of money to make good on already accumulated pension obligations. 

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