Posted on 06/17/2013 9:36:37 AM PDT by Lorianne
There's dumb and then there's really dumb.
The executive of Sacramento County in California recently attributed the increase in his county’s pension costs to “investment losses during the recession.”The official, Brad Hudson, is right that public pension costs are growing, but not that investment losses are to blame. To the contrary, these expenses are rising despite gains in pension-fund investments.
Oh really?
The article goes on to say that the Dow is up 15% from December 31st 2007 to June 3rd of this year. True. But annualized this is less than a 3% rate of return, while the pension fund claimed it could make 8% -- and costs went up even faster than that!
This has now come home to roost in Detroit, where pensioners are being told they'll take pennies on the dollar -- or get nothing.
Reality is this: A promise based upon an impossibility is not a promise, it's a fraud, and frauds are felonies.
What's going on right now is a furious attempt to cover up those felonies and find ways to spin flax into gold. It won't work because it can't work.
(Excerpt) Read more at market-ticker.org ...
I worked with a public employee union in CA for years. Some them knew it was a ponzi scheme financed by political contributions to elected officials who in turn put the taxpayers on the hook to pay for their pensions. After all, they claim, according to CA law their contracts cannot be changed and the consequences to the taxpayers be da....
Then there were some that could not comprehend that the actuarial assumptions simply so not add up, they believe that legislation trumphs math.
1. exorbitant contracts
2. diversion of funding by politicians to buy votes
Politicians need union votes, then they underfund the pensions over time for their pet projects—to buy more votes. Term limits can solve this—nothing else.
Poppycock. If term limits worked California would have a responsible legislature. Instead we have a revolving door for lobbyists and their toadies.
Professional politicians are the problem.
So you pretend. Amateurs can be worse. Power is the problem. A public ignorant of the consequences is the more obvious cause. To that we can assign culpability to public education, which has a vested interest in ignorance.
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