Tags: sam | zell | Public | Sector | Benefits

Zell: Public Sector Benefits Must Be Cut

By    |   Wednesday, 30 Jun 2010 08:41 AM

Real-estate mogul Sam Zell has joined the chorus of those warning that salaries and health benefits for government workers are too generous.

Those costs combined are probably twice as high for public workers as for the private sector, he told CNBC.

"The old game was very simple,” Zell explained.

“If you worked for the government, you had job security. You got less but you got a longer pension." he said.

But public sector pay has jumped substantially during the last decade, and benefits "are literally bankrupting the states," Zell maintains.

While some experts in the United States have criticized Greece for failing to adopt austerity measures quickly enough, those in glass houses shouldn’t throw stones, he says.

"How are they (the Greeks) any different from the public employees in New Jersey?" he said.

Zell compares our overly generous public sector to ancient Rome.

"How did Rome fall?" he asked.

"More entitlements, more entitlements, more entitlements, until there was no more Rome."

Excessive spending by state governments already has helped push their budget deficits to a combined $112 billion for the year starting July 1, according to the Center on Budget and Policy Priorities.

And that figure could rise to $180 billion before the year ends.

“States are going to have to cut back spending and raise taxes the same way Greece and Spain are,” Dean Baker, co-director of the Center for Economic and Policy Research, told Bloomberg.

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Real-estate mogul Sam Zell has joined the chorus of those warning that salaries and health benefits for government workers are too generous. Those costs combined are probably twice as high for public workers as for the private sector, he told CNBC. The old game was very...
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Wednesday, 30 Jun 2010 08:41 AM
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