Why did we honor banker's employment contracts but not public worker's (union) contracts?

In the thread about Michigan’s new “financial emergency” law, gonzomax brings up a good point:

If it was so important that we taxpayers pony up to the bankers who caused the financial meltdown because they had employment contracts specifying bonuses, etc. why isn’t it equally important that we honor the contracts already in place for public workers?

Why can one contract just be brushed aside, but another must be paid?

Is it right to ignore a contract at all? Can the public workers go to court and sue the state for what is contractually theirs? Would they stand any chance of winning that legal battle? ISTR that the argument a couple of years ago is that the bankers could sue and would win; so why wouldn’t the teachers et. al.?

The answer is simple: Bankers have more money than teachers. Thus they are better people.

Bankers own our souls. Is this a surprise? We sold our souls to the devil - and our kids’ souls - and no one seems to even care or be surprised.

I would assume it the idea was to punish bankers after the fact. If you have a contract to be paid $1,000/day then even if you screw up, as long as you are still working, you still get paid $1,000/day. The next time your contract comes up for negotiation that can be changed.

I assume it is the same for the teachers. They will continue to get paid whatever their contract specifies for the term of the contract. When the contract is over then the compensation can be renegotiated.

Of course if both sides agree they can renegotiate at any time. So, when the teachers said they would agree to concessions then those could take effect immediately (presuming both sides agreed to it).

We didn’t all sell our souls. Republicans just think that they have the right to act as proxies in transactions for our souls because some of us voted for them.

Well no, if you screw up in just about any other industry, you get fired. Even teachers. Contracts notwithstanding, vast and gross incompetence as evidenced by the financial industry in recent years would’ve resulted in mass layoffs anywhere else. Bankers get bonuses, because they made profits, on the backs of taxpayers and people losing their homes and their retirements.

Their bosses (whoever they were) saw fit to not fire them. Pisses me off too but they didn’t (of course I would bet they had golden parachute clauses so even firing them they would have walked with a fortune).

As such both operated under the terms of the existing contract.

Till you are terminated your employer pays your contracted rate.

America is an oligarchy and the oligarchs protect their own interests.

Except bankers generally don’t worry about having to renegotiate their contracts every time a new boss takes over. Or that their ability to even negotiate contracts will be stripped away.

Contracts aren’t worth the paper they are written on in the states. Their value is only decided by which side has the better lawyers - better often decided by quantity not quality.

Then the teachers need better lawyers.

Look, I am not on the side of the bankers here. They deserve a comeuppance and should have been fired at the least. Personally I think they deserved to be hauled into court and face possible jail time.

There is no doubt they have rigged the system in their favor. There was no accountability here. None at all. They all continued on their merry way and continued to collect record breaking bonuses year after year…even when the shit was hitting the fan.

Not fired? Of course not. Boards of Directors on Wall Street are incestuous. Banker A sits on Banker B’s board and Banker B sits on Banker C’s board and Banker C sits on Banker A’s board. It is a circle jerk. No one on the board busts their CEO because that way that CEO will return the favor. Ditto when it comes to negotiating compensation.

It is a fucked up and seriously broken system.

I would LOVE to rake back the profits the bankers took. I’d like to see them on Skid Row if I could manage it.

In the end though we are a country of laws and it needs to be followed even when it is unpalatable.

Argue for new laws to stop that shit…I am right there with you and will advocate for change too.

Unfortunately those guys have most of the power. It is not going to be an easy fight.

Wouldn’t Ex Post Facto restrictions apply?

I would assume the state cannot undo a legal contract after the fact by passing a law changing it. I thought the current contract runs its course then the new law takes effect and future contracts are governed by it.

I did not mean to imply that you did support the bankers.

My point was only regarding contracts. And teachers definitely need better lawyers - as well as better lawmakers.

So far as I am aware, we are not refusing to honor any contract.

Can the OP provide a specific example?

The Wisconsin effort simply means that new contracts won’t be negotiated the same way,not that existing contracts are somehow void or voidable, at least from everything I’ve heard. But if the OP believes a contract is being abrogated, I’d like to hear about it - thanks.

Wasn’t there some news about contracts being invalidated during the GM bankruptcy such that stock holders got shortchanged compared to union interests? The only links I’m finding now are from some sources that aren’t neutral in the least, but does any one else know where I can find more information about that?

Wisconsin may not be abrogating contracts, but the proposed Michigan legislation, mentioned in the OP of this thread, does give emergency financial managers that power. The CBS news article, linked to in the OP, has this to say:

You might reasonably question that conclusion, in which case I believe (but I’m not absolutely sure) that the legislation in question is Michigan SB 153. This bill says in part,

And, I should add, Michigan already has an emergency financial manager law, but the powers of the EFM are weaker tha nin the proposed legislation. Specifically,

“We” didn’t decide to honor those contracts. “We” pumped a bunch of money into the system pretty much no strings attached, and then “they” decided to honor the contracts rather then litigate in court.

Perhaps you’d like to quote where the OP mentions Wisconsin?

Michigan is the epicenter of this debate. The Gov, wants to declare contracts “null and void”.

Sorry — must have had Wisconsin on the brain.

Right. Irritating, but I’d call it preferable to abrogation. If public contracts could be easily negated by the government, confidence in the federal/state legal structure would be deservedly nil.

Which is to me perhaps the biggest red flag in the Michigan bill. (That and the whole empowerment of the EFM to fire local elected officials.)

Note that a few banks did go through bankruptcy (Lehman, WaMu, Indymac). There may have been job losses and abrogated contracts in the course of those proceedings (although many of the employees and officers may have been picked up by successor organizations).