That's outstanding!
Posted on 02/10/2005 6:45:46 PM PST by NormsRevenge
SACRAMENTO (AP) - A week after they voted to against his plan to privatize the state's public pension system, Gov. Arnold Schwarzenegger Thursday ousted four of his appointees to the board of the California State Teachers Retirement System.
The sudden firings of Mark Battey, James Gray, Miguel Pulido and Gloria Hom, who were appointed by Schwarzenegger to the board last year, leave one-third of the 12-member board vacant.
Last month, Schwarznegger proposed turning the state's two huge public pension plans into a system more like a 401(k) savings plan in which workers make defined contributions. CalSTRS and its board manages $126 billion, while the nation's largest public fund, the California Public Employees Retirement System, manages $182 billion.
Schwarzenegger formally removed the four through a letter to the Senate Rules Committee.
"The governor concluded that these particular appointees are not best suited to implement his mission for reform," said Schwarzenegger spokeswoman Ashley Snee.
The Feb. 3 vote at the nation's largest teachers retirement system to oppose Schwarzenegger's plan was advisory only. Those prevailing in the 10-2 vote said privatization would undermine the fund's structure by pulling money out and reducing investment earnings for thousands of retirees.
Schwarzenegger backs a proposed constitutional amendment by Assemblyman Keith Richman, R-Chatsworth, that would put the change before the voters. However, Democrats who control the Legislature haven't announced their support, making it unlikely to get the two-thirds vote needed to get on the ballot.
Backers are attempting to qualify a companion measure as a ballot initiative, possibly for a special election later this year. Schwarzenegger made changing the pension system a key element of his government reorganization package, calling it "another financial train on another track to disaster."
Schwarzenegger appointed the four ousted Thursday to the pension fund's board April 2, 2004.
They hadn't been confirmed by the committee, so Schwarzenegger's letter removed them from consideration. The committee had up to a year to confirm the appointees, who had served 10 months.
Pulido, mayor of Santa Ana, and Battey, of Half Moon Bay and a managing director of Miramar Capital, are Democrats. Gray, an Indian Wells resident and trustee of the Desert Community College board, is a Republican. Hom, of Palo Alto and longtime faculty member at West Valley Mission College, is also a Republican.
Schwarzenegger retained Kathleen Smalley, a real estate finance specialist from Los Angeles who has no party affiliation. She was one of the two board members who voted in favor of his privatization plan. The other was Dave Harper, representing Schwarzenegger's Department of Finance.
Officials at CalSTRS had no immediate comment on the ousters.
Treasurer Phil Angelides, a CalSTRS board member, called the firings "outrageous" because the appointees "stood up for taxpayers, for teachers and school children."
The firings were "particularly troubling because trustees of pension funds sit there as fiduciaries with a legal obligation to do what's right from the financial perspective and they rejected the governor's proposal on its merits," said Angelides, a Democrat who's considered likely to run for governor next year.
State Superintendent of Public Instruction Jack O'Connell said he was "extremely disappointed" by the firings. "The STRS board has a record of acting in the best interest of teachers, rather than blindly following political agendas," he said in statement.
Angelides is leading a national campaign among state treasurers and public pension funds to fight the privatization plan, which he says is a move to crush the funds' work to bring more responsibility to corporate governance.
Schwarzenegger removed his appointees on the same day he staged an event in San Diego to promote the privatization plan. Speaking before two Brinks armored security trucks, where white bags marked "Taxpayers $$" and "$" spilled out from one truck, he said, "Right now our treasury is like the armored cars right behind me - the doors kicked wide open and the money is flying out and bleeding our state dry."
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On the Net:
California State Teachers Retirement System: http://www.calstrs.ca.gov
Gov. Arnold Schwarzenegger: http://www.governor.ca.gov
YOU'RE FIRED!!!!
go get 'em Arnold....as an Investment Broker I've seen some of the costly CalPERS and STRS and 403b options that teachers and state emp have and would be better served by the same system that most companies have at a great cost benefit to boot
Since this concerns teachers' retirement in california (I think) can anyone in ca tell me how a STATE can reduce someone's SS payments?
"I never had a governor say, 'You walk lockstep with me or you're out,'" said Gray, who had been appointed to state service by Republican Govs. Ronald Reagan, George Deukmejian and Pete Wilson and served nine years as a California State University trustee
Treasurer Phil Angelides, a CalSTRS board member, called the firings "outrageous" because the appointees "stood up for taxpayers, for teachers and school children."
The firings were "particularly troubling because trustees of pension funds sit there as fiduciaries with a legal obligation to do what's right from the financial perspective and they rejected the governor's proposal on its merits," said Angelides, a Democrat who's considered likely to run for governor next year.
Arnold is not supposed to be stupid -- someone needs to explain to him what 'fiduciary' means.
And what cost benefits would those be?
Recent reports show this will cost significantly more in the short term and there will be no savings until at least 2024.
Here's some explanation:
http://www.calstrs.com/Legislation/Federal%20Legislation/ssandbenes.aspx
Social Security & CalSTRS Benefits
CalSTRS members do not contribute to Social Security (although members hired on or after April 1, 1986, and many members hired before that date contribute toward Medicare). As a result, the retirement benefits you receive from your school employment are provided entirely by CalSTRS. Nonetheless, there are two important issues concerning Social Security of which CalSTRS members need to be aware. First, discussions in Washington D.C. about efforts to reform the Social Security system to provide long-term fiscal stability to that program have included mandating that all state and local public employees hired in the future, including public school teachers, participate in Social Security. Second, although CalSTRS members do not receive Social Security benefits by virtue of their public school employment, many receive such benefits from other employment, or by being married to others who were employed in jobs covered by Social Security. A a result of federal law, the Social Security benefits that a CalSTRS member receives is often reduced because the member is receiving a retirement benefit from CalSTRS.
Those prevailing in the 10-2 vote said privatization would undermine the fund's structure by pulling money out and reducing investment earnings for thousands of retirees.
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I need to go do some research.. or maybe someone here knows,, how many current members and retirees, how dang much money do they actually payout per retiree on average and how long are retirees living these days?
Thank you, that might be part of the answer. However my aunt originally said she received several hundred a month from SS and then California reduced the amount. That still doesn't make sense to me. I can see SS not sending her much if she didn't pay into it all the years she taught in cali, but she taught a few other places and did pay in, so i would think any amount she got would be determined by SS NOT California.
I tracked down some participant numbers earlier. I'll see if I can find them. According to CALPRS, their average payout is currently $20,000 for retirees (but that would be higher for those yet-to-retire under current benefit calculations). Re: how long people are living, the last time I looked at mortality tables, it usually averaged about age 80.
http://www.calpers.ca.gov/index.jsp?bc=/about/press/news/definedplans/home.xml
"Our investment research shows the defined contribution model will provide a meager retirement for most public workers, which today is on average only $20,000 a year, and it will cost more.
Shucks, thanks ff! :-)
NR, are you talking about CALTSRS or CALPERS (or both)?
All I know fer sure is that them retireeeeees are livin about as much longer as the number of "e's" I put in retires, above!
Thanks!
hmmm 20K a year.. and they cut it back if ya draw decent SS.. and I suspect these folks payout a lot worse then CalPERS and some other unions in this state.
and they have 170 some billion to play with.. Yikes!
I was mainly thinking CalSTRS but CalPERS and other unions info would be helpful.
What may sound like of a lot of money to an individual may not be for some 20K a year or ~$1,667 a month and then getting SS adjusted?
Someone who manages the funds is probably the one making out the best.. sounds like a lot of workers bees benefit a few queen bees immnesely.
The money is at the high end, getting to it is the trick.. administration.
many will live well into their 70s, some their 80s and a few beyond.
It's definitely on the uptick.
Yep. Those people are getting 20K a year and $0 SS.
While I hate Calpers activism, their investment track record isn't that bad over time. And, they invest a ton of money in California. With a 401K type plan, that big pot of money they have will be slowly turned into little investment accounts for each person, probably managed by NY firms, and probably invested in equity and bond funds, directed by the individual. There's a big power shift at work.
Maintaining individual investment accounts (e.g. the 401K-type) costs more money than today to administer. Additionally, the investment opportunities are lessened.
The biggest abuses in the pension area are the benefits for the public safety workers. If they would do something there, I'd be applauding.
That's outstanding!
CalPERS has been able to benefit greatly from the state growing the way it has.
There are reasons to be very concerned about any transference of wealth , especially this massive, from local to otherly control.
public safety workers. yup.
This is one of the first concrete, indicative actions that he's beginning to realize that politics ain't beanbag!!! That he ain't gonna charm and smarm his way through this challenge with nothing but his over-sized personality!!!
More power to him when he actually takes action like this that also has projective powers that lets these dumbass Demonicrats understand that even though he's married to one of theirs... he's done takin their crappola!!! So far they've done NOTHING but try their best to make a fool out of him!
Starting with that damned Sierra-Nevada CONservancy!!!
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