George Gibbs Center for Economic Prosperity

Sunsh⁠i⁠ne S⁠t⁠a⁠t⁠e News: Ac⁠t⁠ L⁠i⁠ke Leaders Bu⁠t⁠ Then Ge⁠t⁠ Slammed

By: The James Madison Institute / 2013

Sunshine State News: Act Like Leaders But Then Get SlammedPundits are fond of urging politicians to act like “statesmen” and “think of the next generation instead of the next election.” Indeed, that theme has become a cliché in the opinion-writing business.Yet when our elected officials actually do this in ways the pundits don’t expect, they’re often subjected to criticism and partisan attacks. Recent Florida history offers three illustrative examples.When Gov. Rick Scott spurned federal funding for a Tampa-Orlando high-speed rail line, critics accused him of sending our tax dollars to other states and ignoring the jobs the project might have created during its construction phase.Yet if critics had been thinking of the next generation of Floridians, Scott would have been praised for refusing a bait-and-switch deal for a project whose costs were as egregiously underestimated as its potential ridership was largely overestimated.As California and other states that took the rail deal are ruefully discovering, had the Florida project been approved, it would have had huge cost overruns, after which the state would have been stuck forever with operating costs amounting to a fiscal black hole.Yet nobody’s perfect. Scott, facing a tough re-election fight, took the shorter-term view on Medicaid expansion, pirouetting 180 degrees from his steadfast opposition to Obamacare and winding up in support of expanding this costly and flawed program.This time the amount of borrowed federal money dangled in front of state officials was much larger. Intended as an enticement, it worked, at least here in Florida. Several other governors also took the bait, overlooking studies showing that it would cost states dearly in the long run. Yet Scott’s flip-flop was all the more remarkable because he’d been such an outspoken critic of the federal intrusion into health care.Fortunately, Florida’s House of Representatives under the leadership of Speaker Will Weatherford has taken the long view, sparing the next generation of Floridians from being forced to carry a heavy burden.Ironically, perhaps, the Florida House also figures in a third recent example of long-term thinking. The issue: pension reform. The House wants all new hires entering the Florida Retirement System (FRS) to be placed in a 401(k)-style defined contribution (DC) plan rather than the traditional defined benefit (DB) plan.The reason the House’s position is a bit ironic is that in the constitutional scheme of things, the lower chamber’s members in Florida – as in Washington, D.C. – face re-election every two years, so they’re expected to be thinking of the next election.Commendably, however, most of Florida’s House members are looking at the fiscal future as projected in various actuarial studies of pension costs. These studies persuasively show that even though the FRS is better funded than most other states’ pension plans – and even though the DB-to-DC switch would cost a bit more during a brief transitional period – the change would be best for the next generation of Floridians.This bit of mathematical reality has also dawned on many of the nation’s prominent Democratic Party leaders including Chicago Mayor Rahm Emanuel, formerly President Obama’s chief of staff, and Gov. Andrew Cuomo of New York. Both have acknowledged the importance of moving new hires from a DB to DC plan, so pension reform is obviously not a partisan issue.Moreover, I have yet to see many “progressive” pundits praising these three commendable examples of long-range thinking as “statesmanlike.” What I seem to recall instead is that whenever they’re trotting out the old cliché, it’s usually to urge lawmakers to support some form of unpopular tax hike or some other iteration of a growing government.Yet it’s precisely that kind of philosophy — atop looming pension burdens and the cost of operating high-speed rail lines – that has landed states such as California and Illinois in fiscal ruin.All of this is a timely reminder of why Florida’s elected officials would be well-advised to continue taking the long-term view, thinking of the next generation instead of the next election.Dr. J. Robert McClure is president/CEO of The James Madison Institute, a nonpartisan free-market think tank based in Tallahassee.