Academic

Sunday I met a woman who works for an organization that provides social services for the city of Philadelphia and has not gotten paid since June.  Moreover, she said that the last time she was paid the check bounced, and the government had to take steps to cover the fees resulting from the bounced check.  She concluded her story by telling me that her oldest son was starting college, noting that the bills were still coming even though she was not getting paid. 

Her story prompted me to look again at the budget woes impacting Philadelphia.  Indeed, Pennsylvania has been without a budget since its new fiscal year began July 1, and the stalemate at the state level has repercussion for cities and government workers.  Indeed, it has meant that many workers and contractors stopped receiving a full paycheck at the end of June, and while a bridge budget was passed in early August that covered many workers, others were left out.  And it is not clear when a budget will be passed.  In fact, apparently Pennsylvania may soon become the only state in the nation doing business without a budget.  What does this mean for Philadelphia?  According to the city's mayor, the state's inaction could force Philadelphia to institute a plan that not only would shrink the municipal workforce by 13%, but also would require the closing of all of its recreation centers and all branch and regional libraries while reducing trash pickup to a bi-monthly schedule.  One group called the plan "the largest lay off of Philadelphia public servants in history."  To be sure, it is not clear if the plan will be implemented.  Indeed, on a somewhat brighter note, yesterday the mayor of Philadelphia announced that the city would be getting a $275 million loan from JP Morgan Chase.  The loan obviously provides much needed cash for the city, enabling it to finally pay the salaries of thousands of contractors.  Not sure if this would include the woman I met, but I certainly hope so.  Needless to say, even if a state budget is finally passed and Philadelphia is able to avoid such large layoffs, its budget woes have had a tremendous impact on its citizens, reminding us that the financial crisis has very real and personal repercussions. And that the bills keep coming.