When are contracts ironbound, and when are they optional? Via the Center for Economic & Policy Research, Dean Baker writes:
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The debate over public pensions clearly shows the contempt that the elites have for ordinary workers. While elites routinely preach the sanctity of contract when it works to benefit the rich and powerful, they are happy to treat the contracts that provide workers with pensions as worthless scraps of paper.
We see this attitude on display currently in the Detroit bankruptcy proceedings. It is even more clearly on display in efforts by Chicago Mayor Rahm Emanuel to default on the city’s pension obligations.
The basic story in both cases is that the contracts that workers had labored under are being laughed at by the elites because they find it inconvenient to carry through with the terms.
In Detroit, paying for pensions or anything else without outside assistance poses a real problem.