That always fixes everything.
For so many years, 6-8% has been used for growth projection assumptions--perhaps even more in some cases. Those numbers have not consistently been available since the mid-1990's.
Take 60% of what you were “promised”,
or get 0% of what you were “promised”.
I don’t think CA has even bothered to make the most obvious and easy of reforms. For example, end the practice of allowing pension “spiking” whereby retiring employees sell back accumulated sick and vacation time, which is then counted as salary for the pension calculation. And AFAIK there is no limit to how much sick and vacation time can be accrued. People take full advantage of this and end up with pensions greater than their final year salary.
Another good post, SeekAndFind.
I’ve been telling my cow-orkers this for a while; the pension system will collapse and anyone relying on it will become part of the new proletariat who rises up to TAKE what they ARE DUE.
I have no idea why people continue to make unrealistic promises. I guess human beings never learn.
Yep, the looting of the public treasury continues, secured by the collateral of your family home, your car, your business, and everything else they can think to seize to make good the promises of people who never had to pay the bill in the first place.
Every city budget should run exactly one year with the only liabilities at the end being bonded debt used for construction of city projects. End all benefits for all government employees - give them a set salary, let them buy whatever they wish with their money - health insurance, pensions, sick days, family leave, whatever.
Actually, the rational thing to do is pension “adjustments”. That is, start the cutting by looking at the pensions that are being paid compared to equivalent pensions in solvent markets.
If they average pension for a given type of job around the US is $40,000, but in a few states it is over $100,000, it would not be unreasonable to cut it to the national average, then make an upward adjustment, a COLA, based on the local economy. So instead of $100,000 a year, they get perhaps $43,000.
Just doing this, many pension funds would quickly become far more solvent.