Giving employees more pension flexibility and increasing efficiency in government could prevent an urban doom loop.
America’s big cities are at risk. The work-from-home revolution has slashed city revenues by pushing residents to the suburbs and decreasing commercial-property taxes. That these workers are typically among the more well-paid only makes the impact greater. Meanwhile, the cost of pensions for retired police officers, firefighters, teachers, and other city employees continues to rise. The resulting budgetary strain will mean either higher taxes or decreased public services, unless our cities embrace a necessary alternative: pension reform.
Recent population data show that 2 million Americans have left core urban counties in the past two years. In red and blue cities alike, an “urban doom loop” looms whereby America’s cities are forced to cut public services or raise taxes, which in turn spurs even more out-migration. The market declines of 2022 and an impending economic downturn force cities to spend more on pensions while residents receive less in actual services.
Continue reading the entire piece here at National Review (Paywall)
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This article is based off a recent report.
Daniel DiSalvo is a senior fellow at the Manhattan Institute and professor of political science at the City College of New York-CUNY.
Jordan McGillis is a Paulson Policy Analyst at the Manhattan Institute
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