Missing the Point on Pension Reform

Pundits and electeds take entirely wrong message from Tuesday’s election results

by Brian Leubitz

On Tuesday, voters in a few communities across the state approved pension reform measures.  That one of these communities was San Francisco, you know with its San Francisco values, makes a whole lot of uninformed people think that they know something about the electorate.

Except that they have no idea. Take San Jose Mayor Chuck Reed, ostensibly a Democrat, but backed mainly by the so-called “business” interests (ie developers).  He’s not a knee-jerk anti-union guy, but hardly in the pocket of labor either.  His thoughts on the San Francisco vote was so wildly off-base as to be laughable.

The results cheered local officials such as San Jose Mayor Chuck Reed, who’s seeking a March special election on his own controversial pension reform proposal, as well as advocates for a statewide measure aimed at slashing the costs of public retirement packages.

“It certainly demonstrates solid public support for pension reform,” Reed said Wednesday. “Even in a labor-friendly town like San Francisco, 68 percent said yes.” (BayAreaNewsGroup)

His quote makes absolutely no sense.  Why? Well, that would be because the pension reform measure that was passed by San Francisco voters was supported and funded by labor. So rather than being in-spite of SF being a labor friendly town, that was the reason that SF gave 68% of the vote to Prop C.  On the other hand, Prop D, opposed by labor, went down hard with about 66% voting no.

Take that combined with the results in Ohio, what you should get is not that Californians want to shove something down labor’s throat.  Rather, perhaps Mayor Reed should consider how Mayor Ed Lee and the Board of Supervisors worked with labor and other stakeholders to get a deal that everybody can live with. I assure you, not all union members are happy with Prop C, I spoke to many that said they were voting No.  However, a deal could not get done without labor or by simply forcing Ohio/Wisconsin type ideas into California.

Pension reform is possible, that is what San Francisco showed.  But it should be pension reform that is negotiated. A compromise can be reached without bullshit ballot measures with right-wing funding. You know some organizations can calmly sit down and discuss issues, even ones that rise to the existential level. Perhaps now is the time for some discussion.

8 thoughts on “Missing the Point on Pension Reform”

  1. Who is, as you correctly point out, a DINO. And I’m sure has been taking tactical lessons from Rush. Or at least Beck.

  2. The public reacts negatively to taking away the right to collective bargaining, but is very in support of cutting the benefits for the union crony bureaucrat class.

    The reason you the leftist fear a ballot initiative is you know it will be successful.

  3. Each community has their own values when it comes to public employees, but lets look at Ohio, San Francisco and Palo Alto as three examples of public expressions on labor unions.

    Ohio said rather strongly that they support collective bargining for public employees.  I’m not really sure why the elected John Kasich because he was pretty clear about what he would do and now it is pretty clear Ohio doesn’t like it…whatever.

    You don’t have to be particularly pro-union to support collective bargining.  It is an efficient and common sense way to understand what’s important to employees, to develop a consistent and fair compensation system and for long range budgeting purposes.  

    San Francisco adopted the Mayor’s pension reform package but it was developed with Jeff Adachi lurking in the background.  Either the unions agree to something that saves the city some money or Adachi could pass something really draconian.  So the package was negociated, but with a huge threat in the background.

    Palo Alto changed their city charter to eliminate binding arbitration for public safety workers by a 2-1 margin. I don’t understand Palo Alto politics well, but it seems that unions have overplayed their hand and has lost several elections there.  

    I guess that Ohio is an example of the anti-union people going too far and getting their wings clipped.  Palo Alto is an example of the union going too far and getting their wings clipped.  San Francisco seems to be an example of getting it about right.  

  4. The point is:

    We have to be RESPONSIBLE about public pensions

    They Should be self supporting

    And, in SF they haven’t been

    It’s NOT anti-union to expect pensions to be self supporting

    What I’d like to see is a look at Executive Pensions in California State and Local government including the Judiciary

    Let’s make sure the Big Shots don’t steal all the pension benefits

    I think Government (and Private) executives are Wildly overpaid

    We can do something about it in the public arena

    We see Porfessors doing one day strikes and students try to occupy UC Berkeley

    But, like clock work, we see UC and CSC executive getting Outrageous salaries and pay raises

    The only person who talked about this was State Senator Leland Yee

    Let’s look at UC and judicial and school superintendent salaries and pensions

  5. No doubt administrators are getting pay and pensions in excess of their worth. That has two unfortunate effects: it raises costs to the public, and it tars the whole system with the same brush.

    Most public employees get lower pay than comparable private-sector workers. They also get between 2 and 10% better benefits. In general, the disparity is greater at lower levels. The janitor at the capitol building in Sacramento gets vastly better benefits than a non-union worker at the same level–who probably gets none–for example. However, the science researcher at a state-supported university could probably do better in private industry. If you look at the federal level, you’d be hard-pressed to find a corporate CEO who would run an organization the size of the EPA for what Lisa Jackson makes. Not to mention the fact that cabinet secretaries have fairly short tenures.

    The figures at a city level are more varied and therefore harder to categorize. But one thing few talk about in any of these pension debates is the market forces and their effects on the pension funds. If you have any retirement savings in the stock market, you’ve probably seen pretty big drops in the value of your funds. Public pension funds are invested in the market too. But you can multiply your personal losses by a factor of hundreds for local pension plans, and probably millions for a state fund. You can quickly see why the projections for how much employees needed to contribute were far off the mark because they were made in rosier economic times.

    In short, though there are some pension abuses like spiking that have to be eliminated, and there are some public employees who simply make too much money in both cash and benefits, it’s simply not true for the vast majority of teachers, nurses, and home health aides. Plus, the same market factors that have brought the economy to its knees have done the same to pension funds–rather than underfunding by workers.

    I’d like to think a lot of people understand this, or at least some of it. And that it explains the overturn of Ohio’s anti-union law. That and the overreach.

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