Fiscal Responsibility Migrates North to Canada

As a political news junkie and a person concerned about the fiscal future of our culture I have watched with more than a little interest the woes that have befallen the USA. Throughout the country there have been stories of municipalities, counties and States that are either currently bankrupt or on the verge of insolvency.

The main culprit has been labor agreements negotiated by long gone politicians with public sector unions that provide many services including those defined as essential such as police and firefighters.

The typical scenario has been that very lucrative contracts were provided to those workers by the then in power politicians. Subsequently, when these politicians had retired with their own cushy pensions, it became time to pay these unionized workers their bargained for benefits - except there no longer was enough money to fulfill those obligations.

The American solution was to honor those agreements, lay off current workers, deplete services beyond bare-bones and legislate away the ability for public unions to collectively bargain in the future.

 Interestingly, the province of Ontario is attempting a similar strategy with its education workers (teachers, support staff etc.). The result has been a stand off between the Union and the Government. In the middle, feeling the brunt of the dispute are students being denied extra-curricular activities due to the educators "work to rule" response.

Today, the Ontario Education Minister announced an imposed agreement upon the teachers' union. Basically, the new contract replaces the previously agreed upon, bargained for "Collective Agreements". The Province has unilaterally negated previously agreed upon, legally binding contracts.

Although I am not a big union supporting person I do find it concerning that contracts can be so cavalierly ignored. Our culture, law, and commercial system is based upon the concept of "binding contractual agreements" mutually negotiated and upheld by the judicial system. It seems to me that changed economic circumstances (unless an express term of the agreement) shouldn't form the basis for one of the parties to unilaterally change the terms of a contract. At what point is every contract between any parties subject to amendment or being declared void just because one of the parties made a bad bargain?

This is a dangerous precedent being set by the Ontario Government. This can cut both ways if it becomes the law of the land. I sympathize with the Provincial Government in its efforts to be fiscally responsible and try to "live within its means"; however, what happens to the sanctity of the contract?