It is rather pathetic to come to the understanding that if the MBTA solves its 2012 deficit problem in the $160 million range with a fare increase and service decrease, the MBTA will be facing a more than $40 million deficit next year requiring another purge of service and fair increase unless a miracle occurs.
Then there are the following 5 years which will also leave the MBTA a deficit every year
The situation is dire but no one in government wants to talk about exactly why or solve the problem.
First, officials say, it is the debt for expensive service systems that were installed in recent years.
But the dirty secret are the outrageous wages, health insurance and pension plans that are burying the MBTA.
It isn’t just the debt and the juice for the debt, it is the salaries and benefit packages that are also aiding in burying the agency.
Still, we go along being told we should all pay more all the time, have less service and be happy.
The MBTA problem is all about the unreality of government in the modern age.
Why can’t the MBTA skirt bankruptcy and renegotiate all its debt?
If its debt was negotiated down to .30 cents on the dollar, the deficit would become an almost moot question.
The sovereign nation of Greece just renegotiated all its debt by literally erasing the money owed in bonds to private investors.
Instead owing the total unsustainable debt it was holding, investors chose to accept .30 cents on the dollar rather than to have a default.
Why couldn’t that work here?
After all, if something like that is not done, fares will rise to a level that cannot be afforded by commuters, income to the MBTA will drop and the interest will not be paid let alone paying back the bonded debt when it comes due.
The solutions being offered now are laughable.
With the MBTA in state of technical insolvency, something drastic must be done.
Raising fares and cutting services won’t do it.