Posted on 05/23/2017 10:12:55 AM PDT by george76
Guv Brown is going to “loan” $6 billion from a previously unknown slush fund to keep CalPERS doors open. That is after he GIVES then $500 million, so they can keep sending out checks. This is an economic disaster for the people of California—and another reason to leave for a Free State beofre your family finances are destroyed.
...
employees don’t share in the cost of Unfunded Liabilities. 100% of that cost falls on citizens, whose services get crowded out and taxes get raised to pay off the liabilities.
Jerry Brown proposes to borrow from a citizen-funded restricted fund to boost pension contributions. The loan would be of a variable rate nature that, based on current yield curves, is expected to cost 3–4% but is not capped. The proposed source of repayment for the loan is a taxpayer-funded account established by Proposition 2 to accelerate payments on certain state debts but that’s just a fig leaf since state debts eligible for acceleration dwarf the size of the Proposition 2 fund. No investment return is guaranteed and citizens have all the risk. Employees take no risk and will collect their pensions regardless of the outcome.
If enacted, Brown’s proposal would set a terrible precedent. With $70 billion in restricted funds and more coming in from a recently boosted gas tax, what’s to stop more such loans? Every public-employee-controlled pension fund would learn the same trick and be rewarded for transferring wealth from citizens to employees by setting Normal Costs unfairly low. Also, who would enforce payback of the loan? In which state official’s political interest would it be to press for repayment? There is good reason to believe repayment would be deferred or ignored.
Brown should withdraw his proposal.
(Excerpt) Read more at capoliticalreview.com ...
Our centrally-controlled, elitist monetary system, controlled by the Federal Reserve, combined with our completely printed currency means that there is always more debt and printed money for progressives to run their social-engineering schemes.
California “government” is such a pathetic joke. Leave before you are ruined.
We just went to Studio City to attend my daughter’s wedding. We saw a lot of nicely maintained little bungalo type houses all around us and my wife decided to check them out on Zillo.
She entered the city and 2 bedroom minimum, and a maximum price. She got no hits until she hit $650k.
The same houses where we live would be more like $45k, and much lower taxes, no traffic, etc. California is like health insurance: Nice but not worth the money.
We’re reaching the point where kicking the can will simply not work. It’s like reaching the speed of light. It becomes impossible to accelerate.
We’re almost there. They will appear more and more desperate and seem to go deeper and deeper into lunacy. Come to think of it, they already are...
Brown should withdraw his proposal.
bkmk
It’s Bush’s...er, I mean Trump’s fault.
Here is the problem: When your dad comes into your room and bashes your piggy bank to get your allowance so they don’t shut off the electricity, don’t judge the breaking of the piggy bank. Rather, ask yourself how bad it has to get for your dad to do that.
That is the REAL message in this story.
This is why we had a gasoline tax increase. Brown and the others that if was for the road and highway infrastructure. We know it will be something like 10% for the highways and 90% for other things such as propping up the pension system.
Then they wonder why their roads and bridges are collapsing, they raid these funds to pay for welfare and other government programs. Government is too big and it’s exploding.
But if you leave, you don’t have to pay....
The baby boomer retirements are just beginning.
Every year the pension crisis will get worse and worse—until states like California will have to declare bankruptcy—whether they want to or not.
This is why I’ve said since the housing bust that the solution to our problem will be dramatic and crippling austerity.
And it will be non-voluntary.
And it is not just the US.
Moonbeam should have his bullet train rammed up his Liberal rear along with his illegal voters. All the slithering Swamp Scum downtown at the Capitol in Sacramento are complicit in destroying CA.
“until states like California will have to declare bankruptcy—whether they want to or not.”
As a Californian, this can’t happen soon enough. I just hope that when it does, the PE union people get hurt worse than anyone, and that they string up the RATs at the same time.
Our Assemblywoman ( a rare Republican ) has communicated to her constituents on the gas tax that the “safeguards” against raiding these funds are so weak that they are essentially non-existent.
Important Bump For Later.
Is this a pyramid scheme? How long can Brown push back the economic collapse? I guess he only plans to postpone the crash until after he retires.
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