Dan Walters: Reckoning day coming for pensions

Sacramento Bee ^ | 10/9/6 | Dan Walters

[SmithL]

We'd like to think that those we elect to public office are motivated solely by the long-term betterment of their constituents' lives, but if we've learned anything about politics, it is that it is, at best, a short-term business.

Just as corporate executives live or die by how investors view their annual profit-and-loss statements, politicians are driven by how action plays with interest groups and voters in anticipation of the next election.

We have seen any number of corporate scandals -- Enron, for example -- that involved efforts to mislead the investing public about a company's true fiscal condition. Generally, however, political figures have been given a pass when they play Enron-like games with public money by hiding liabilities and inflating assets.

San Diego city officials might have skated when they played games with the city pension fund, deliberately underfunding it after granting big benefit increases. However, they not only misled the public, but hid the fund's condition in paperwork to market city bonds, and that's illegal.

San Diego's mayor was driven to resignation by the scandal, and eight former officials face criminal charges for the cover-up of what turns out to be a $1.43 billion long-term deficit in the pension fund. To restore public confidence, city leaders are proposing a ballot measure that would require all future pension increases for city workers to be ratified by voters -- a provision that San Francisco has had for many years.

Court decisions have declared, in effect, that once granted, pension benefits to public employees cannot be abrogated. Fiscally, therefore, they have the same long-term effects as any other debt. We require voter approval of general obligation debt, so it's not outlandish that obligations for pensions face the same hurdle.

San Diego may be the poster child for irresponsibility...

[Carry_Okie]

In this election season, this comeuppance of public employee unions needs to be laid squarely where it belongs: at the feet of Jerry Brown.

[Paloma_55]

Jefferson, Adams, Washington and Franklin would be rolling over in their graves to imagine a system whereby the government employs millions of employees, who are organized into a union that donates money to elected officials who then grant raises and benefits to those employees.

The system is SOOOOOOO broken.

We should ban corporate and union campaign contributions. Let individuals contribute only.

[Jack Black]

Court decisions have declared, in effect, that once granted, pension benefits to public employees cannot be abrogated.Except for bankruptcy, which is where many municipal governments are going to end up. San Diego probably isn't one. Given the buildng boom they have lots of ways to raise cash to pay the debts.

[tickmeister]

All pensions are iffy. They all depend on someone deciding to make the payment, and for any number of reasons they may decide not to. No money is high on the likely list.

Lesson is take care of yourself, don't depend on anybody else to do it.

[goldstategop]

As I've said, this is the sleeper issue of American politics. Its greatest threat is to the Democrats for it puts at loggerheads its two chief pillars: the public employees unions who work for government and its social services recipients who get public benefits from government. With a finite amount of money around, this has the real potential to destroy the Democratic coalition. The political fallout could be just as fierce as the financial ramifications of dealing with escalating public pension fund liabilities.

"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." -Manuel II Paleologus

[goldstategop]

Think GM, not just the government. And Social Security, thanks to the reckless demagoguery of liberals, is going to face a shortfall within a generation. Traditional retirement funds have reached a dead end. With people living longer and when they stop working, there are fewer and fewer people working to support them. Do the math. There is a day of reckoning coming and its already here. The problem is few politicians want to address it because it puts their short-term political future at risk.

"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." -Manuel II Paleologus

[SmithL]

As I've said, this is the sleeper issue of American politics.

Agreed.

I've posted a couple of articles about the West Contra Costa Unified School District. Within just a few years, their pension obligations will equal 100% of their school budget. What will they do then, close the schools?

WCCUSD certainly isn't alone, but they'll probably be the first agency within California to max out their entire budget on retirement benefits.

[longtermmemmory]

The left (and MSM) treat Pensions like a ponzi pyramid scheme. Those are unsustainable.

Pensions have to be like individual retirement accounts. Pension fund managers are too political to be trusted.

[longtermmemmory]

Hopefully by then, the left will have moved from right to die into full duty to die. (/s)