In the past year, we’ve gone from crisis to crisis to crisis. Never really producing a clear picture for the general public of the direction of the state. Truth be told, most of the people who are running the show in Sacramento are being tossed by these swells as well. It’s not really their fault, it’s just a tough situation into which they’ve been elected. Term limits give some really bad incentives to kick the can down the road, and the can is looking pretty beat up these days.<\/p>\n
Of course, if you are attempting to shock doctrine<\/a> a nominally progressive state out of its progressive views, well, hell, this seems like a great pattern. And time after time, it has succeeded. Arnold plays the hesitant soldier, just doing what he has to do. Sure, he says, it’s terrible that we have to destroy the master plan, the social safety net, or whatever it is at the time, but we have to “live within our means<\/a>.” And he says that platitude, over and over, until the Democrats in the legislature relent, and Arnold and his corporatist friends take one more spoil<\/a> of what was once a proud state.<\/p>\n And so it is with the pension issue. Until this point, debate has been pretty exclusively along party lines. Arnold says the state employees are costing us too much money for their retirement plans, that the level of spending is unsustainnable. Recent news out of CalPERS seems to confirm that:<\/p>\n CalPERS says that when it purchased $1.3 billion worth of special securities sold only to large investors like pension funds, all that it knew about the complex financial instruments is that they had top ratings from Moody’s, Standard & Poor’s and Fitch.<\/p>\n Now CalPERS, which may have lost $1 billion on the deal, has belatedly learned that there were subprime mortgages and other risky assets in the “structured investment vehicles” (SIVs) purchased in 2006 from three hedge funds, two of them based in London.(CalPensions 11\/25\/09<\/a>)<\/p><\/blockquote>\n Unfortunately, that is hardly the only story of troubles at CalPERS in the news. You have stories of how they make deals<\/a>, and of ugly-looking court settlements<\/a>. And then you have the possibility of rising contribution requirements:<\/p>\n The 1.6 million-member public pension fund, the largest in the country, is expected to require additional money to help it recover from recession-fueled investment losses. But just how much and when have yet to be determined.<\/p>\n The 13-member CalPERS board will make the decision in May for the 2010-11 fiscal year that begins July 1. CalPERS has signaled that the employer contribution likely will not rise for that year. But increases in 2011 are expected. State staffers familiar with the issue believe it could be in the range of $200 million to $300 million by the middle of 2011. CalPERS did not comment on the estimate. (CapWeekly<\/a>)<\/p><\/blockquote>\n Of course the solution is either to privatize (!) or simply slash the defined benefit into a defined contribution or something to that effect. Or so say the right-wing corporatists looking at a big pile of money to plunder.<\/p>\n Look, state employees take up a relatively small portion of the budget, and they do so frequently at a short-term cost. There are no huge salaries (save for a few UC doctors, executives, and some corrections doctors), no big bonuses, but they are promised a consistent pension at retirement. While during the current economy filling jobs isn’t all that hard, that won’t always be true. Shooting for the lowest common denominator nets what you would expect.<\/p>\n If we are going to keep messing with state employee compensation, let’s take a holistic approach, instead of reeling from one mess to another. We can’t keep changing the rules of the road, one paving stone at a time. It’s not a viable budget solution, nor is it fair to our public sevants.<\/p>\n","protected":false},"excerpt":{"rendered":" In the past year, we’ve gone from crisis to crisis to crisis. Never really producing a clear picture for the general public of the direction of the state. Truth be told, most of the people who are running the show in Sacramento are being tossed by these swells as well. It’s not really their fault, it’s just a tough situation into which they’ve been elected. Term limits give some really bad incentives to kick the can down the road, and the can is looking pretty beat up these days.<\/p>\n Of course, if you are attempting to shock doctrine<\/a> a nominally progressive state out of its progressive views, well, hell, this seems like a great pattern. And time after time, it has succeeded. Arnold plays the hesitant soldier, just doing what he has to do. Sure, he says, it’s terrible that we have to destroy the master plan, the social safety net, or whatever it is at the time, but we have to “live within our means<\/a>.” And he says that platitude, over and over, until the Democrats in the legislature relent, and Arnold and his corporatist friends take one more spoil<\/a> of what was once a proud state.<\/p>\n And so it is with the pension issue. Until this point, debate has been pretty exclusively along party lines. Arnold says the state employees are costing us too much money for their retirement plans, that the level of spending is unsustainnable. Recent news out of CalPERS seems to confirm that:<\/p>\n CalPERS says that when it purchased $1.3 billion worth of special securities sold only to large investors like pension funds, all that it knew about the complex financial instruments is that they had top ratings from Moody’s, Standard & Poor’s and Fitch.<\/p>\n Now CalPERS, which may have lost $1 billion on the deal, has belatedly learned that there were subprime mortgages and other risky assets in the “structured investment vehicles” (SIVs) purchased in 2006 from three hedge funds, two of them based in London.(CalPensions 11\/25\/09<\/a>)<\/p><\/blockquote>\n Unfortunately, that is hardly the only story of troubles at CalPERS in the news. You have stories of how they make deals<\/a>, and of ugly-looking court settlements<\/a>. And then you have the possibility of rising contribution requirements:<\/p>\n The 1.6 million-member public pension fund, the largest in the country, is expected to require additional money to help it recover from recession-fueled investment losses. But just how much and when have yet to be determined.<\/p>\n The 13-member CalPERS board will make the decision in May for the 2010-11 fiscal year that begins July 1. CalPERS has signaled that the employer contribution likely will not rise for that year. But increases in 2011 are expected. State staffers familiar with the issue believe it could be in the range of $200 million to $300 million by the middle of 2011. CalPERS did not comment on the estimate. (CapWeekly<\/a>)<\/p><\/blockquote>\n Of course the solution is either to privatize (!) or simply slash the defined benefit into a defined contribution or something to that effect. Or so say the right-wing corporatists looking at a big pile of money to plunder.<\/p>\n Look, state employees take up a relatively small portion of the budget, and they do so frequently at a short-term cost. There are no huge salaries (save for a few UC doctors, executives, and some corrections doctors), no big bonuses, but they are promised a consistent pension at retirement. While during the current economy filling jobs isn’t all that hard, that won’t always be true. Shooting for the lowest common denominator nets what you would expect.<\/p>\n If we are going to keep messing with state employee compensation, let’s take a holistic approach, instead of reeling from one mess to another. We can’t keep changing the rules of the road, one paving stone at a time. It’s not a viable budget solution, nor is it fair to our public sevants.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[],"tags":[62,783],"class_list":["post-10585","post","type-post","status-publish","format-standard","hentry","tag-62","tag-783"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack-related-posts":[],"jetpack_shortlink":"https:\/\/wp.me\/p6Pvhz-2KJ","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/posts\/10585","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/comments?post=10585"}],"version-history":[{"count":0,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/posts\/10585\/revisions"}],"wp:attachment":[{"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/media?parent=10585"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/categories?post=10585"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/tags?post=10585"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}