Posted on 06/22/2009 8:50:31 PM PDT by SmithL
A milestone on California's meandering journey toward fiscal insolvency occurred exactly a decade ago when the Legislature enacted a massive increase in state employee pensions on the expedient assumption that it would cost taxpayers nothing.
Although the new pensions would generate almost countless billions of dollars in extra income for retirees in the years ahead, the CalPERS board, dominated by union representatives, told legislators that taxpayers wouldn't have to bear the load because investment income, which was flowing into the pension trust fund from high-tech stocks, would continue indefinitely.
"They (CalPERS) anticipate that the state's contribution to CalPERS will remain below the 1998-99 fiscal year for at least the next decade," said a final Senate analysis of the 1999 legislation that expanded state pensions, allowing Highway Patrol officers, prison guards and other "safety" workers in some cases to get more than 100 percent of their salaries.
Wrong.
Within a few years, the dot-com bubble had burst, CalPERS had suffered major losses and the state's burden for pensions had pushed into the multibillion-dollar range, not counting the heavy impact on local governments that had cavalierly followed the state's lead on boosting pension benefits.
The situation was ripe for a backlash, such as an initiative measure that would rein in public pensions, but union-controlled CalPERS lowered the political heat by offering employers a "smoothing" policy that would protect them against immediate jolts, spreading out the increases over a number of years.
...But now we're mired in the worst recession since the Great Depression, CalPERS' investments have dropped by nearly a third and the state is paying more than $3 billion a year into the pension fund, nearly 10 times what it paid a decade ago when CalPERS made its bogus assertion to lawmakers.
(Excerpt) Read more at sacbee.com ...
Wasn’t there also an accounting law change a couple of years ago, that forced CalPERS to restate their books honestly for once?
CALPERS was in bed with Enron big time. In fact it was a change in the reporting requirements for one of CALPERS joint ventures with Enron that exposed Enron and led to its demise.
So were in the world do they teach this "indefinitely" theory. Did they just make it up.
The unions seem to be the lowest common denominator. They played a big role in the demise of Chrysler and GM.
Ole Dan. Always giving us some useless information - the kind that all knew several yrs ago. How this idiot still has a job is beyond me.
Strategically, the upcoming bankruptcies of state, county, and city finances within California could be a major opportunity to attack the reasons for the current crisis. Time to clean out all democRATS, create a flat rate income tax, drastically reduce exorbinant pension plans, cut headcounts by at least 10%, cut pay levels by at least 10%, eliminate useless programs (there are many), issue vouchers so parents can choose private education, sell valuable assets, send illegal criminals back to their home countries to our south, and make the state legislature a part time function only. There are a lot of other good ideas, but here is a good start.
>>So were in the world do they teach this “indefinitely” theory. Did they just make it up.
Well, the government was backing the dot-com bubble with tax breaks and pension fund inflows. What could possibly go wrong? (/s)
Yea. It's rather remarkable (thanks in part to Bush, the GOP, and their fecklessness) that the people and philosophies most responsible for the trouble we have, were given complete control of everything by the voters. ACORN, unions, Barney Frank, Chris Dodd... All clearly bad actors that have been given massive power to continue killing the golden goose.
By the time enough voters wake up (if ever), these knaves will be completely entrenched. California is completely controlled by people bent on destroying any semblance of a functioning state. There isn't even close to enough voters with intelligence or character to reign them in. People get the government that their collective stupidity, corruption, and greed dictate.
The people who turned out (was that a record 30 percent?) on May 19 were the ones who overturned the trend for more taxes to "fix" an unfixable situation. I will wager that they (we) were not the ones who turned up two, three or more times on November 8, 2008 to vote for BO.
There are people who make a difference at the polling booth, it's just that they are only at their most visible during special elections, when everyone else can't be bothered. I fear that their impact and influence would be diluted in a general election with greater turnout and "sexier" issues on the ballot.
So were (sic) in the world do they teach this “indefinitely”...
Easy. That would be lying 101 at any major liberal university.
After all, it is for the “agenda for change.”
Liberals in the California Assembly destroyed California and now want to pass their treachery onto the taxpayers.
Unions eventually suck the blood out of everything.
I certainly wouldn't exclude government... Look what the employees of the city of Vallejo, CA did to their city recently... BK!!!
bookmark
The easy out is to hand out the pension money in the form of money in hand now, and let the govt employees fend for themselves in the stock market, like the rest of us do now.
Why should govt employees be protected?
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