A fiscal crisis is looming for many US cities

City budget comparisons and “mismanagement” claims

• Thread opens by contrasting San Francisco’s ~$15B budget for ~800k people with Seattle’s ~$8.3B for a similar population, and with many smaller U.S. states.
• Multiple commenters argue the comparison is misleading:
  • SF is both a city and a county, and its budget includes port, airport (SFO), and transit agency (SFMTA).
  • Seattle’s equivalents sit in separate entities (King County, Port of Seattle, Sound Transit), so their spending doesn’t appear in the city budget.
• A back-of-envelope pro‑rata adjustment using King County’s budget narrows, but does not erase, the gap; others say even that is incomplete because of structural differences in what each government is responsible for.
• Some participants insist SF’s remaining margin still points to bloat or incompetence; others push back that you can’t draw that conclusion without careful, service‑by‑service comparison.

GDP, tax base, and productivity

• One line of argument: SF’s very high GDP versus small states supports its ability to sustain a larger budget.
• Counter: GDP is distorted by high prices (e.g., an $8 Big Mac vs $4).
• Rebuttal: nominal vs real GDP matters, but for tax base and productivity, high nominal activity still reflects greater fiscal capacity.

Pensions and intergenerational equity

• Pensions are widely seen as a major structural driver of city deficits.
• Younger commenters resent paying for defined‑benefit pensions they will likely never receive; older arrangements are described as “insane” (e.g., full or near‑full salary after 20–25 years, retirement in early 40s, lifelong medical).
• Others argue pensions are not “free”: workers traded lower pay and career ceilings for deferred benefits, and cities saved money upfront. Underfunding and “pension holidays” (e.g., Chicago) shifted costs onto future taxpayers.
• Debate over fairness:
  • One side calls rich public‑sector pensions unsustainable and a transfer from poorer younger workers.
  • The other stresses worker solidarity: the issue is not that some workers have good pensions, but that others had theirs taken away (401(k) shift, underfunding) while executive pay and shareholder returns soared.

Fixing pension shortfalls: who pays?

• Options discussed: cut existing benefits (treating pensions as debt that can be haircut), raise taxes, or federalize/standardize retirement (universal pensions layered on Social Security).
• Objections:
  • Cutting existing pensions breaches explicit promises; cities relied on that promise to hire cheaply.
  • Raising local taxes risks flight of high earners, especially in mobile metros.
  • Singling out pensioners for higher taxation is seen alternately as fair “clawback” or as double‑penalizing workers who already accepted low pay.

Broader generational and macro context

• Some claim “most of today is stealing from the future” (sovereign debt, climate costs, unfunded infrastructure), with Boomers as major beneficiaries; others cite research suggesting some younger cohorts are still net beneficiaries of public transfers.
• There’s disagreement about whether Millennials are relatively better off (via housing wealth) or worse off (via affordability and debt burdens).

Climate change and future city fiscal stress

• Commenters connect looming city crises to climate change: more extreme weather, flooding, and disasters will strain already‑tight budgets, especially in poorer regions.
• Anticipated mass climate migration is seen as something U.S. cities are unprepared for, fiscally and logistically.

Costs of urban form

• One participant argues dense cities are inherently more expensive and resource‑intensive than dispersed living (large structures, safety codes, complex infrastructure), and suggests modern telework makes traditional central cities partly obsolete.
• This view is presented as a minority take; others do not deeply engage with it but implicitly assume cities remain central to economic activity and thus to fiscal debates.