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Old 08-20-2019, 12:28 PM
 
2,541 posts, read 657,086 times
Reputation: 4417

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California’s slow-motion pension disaster. Many states have the same issue.

https://www.mercurynews.com/2019/08/...-nl-opinion_nl <== possibly behind a paywall

https://www.ocregister.com/2019/08/1...sion-disaster/ <== The same article without a paywall
Sacramento city officials, led by Mayor Darrell Steinberg, have been discussing how best to spend proceeds of an additional sales tax that the city’s voters passed last year... In pitching for the tax hike, he said he wanted to ramp up spending for infrastructure, affordable housing, cultural amenities and incentives to attract new business, with an emphasis on improving conditions in the city’s poorest neighborhoods.
But...
The city’s current budget declares that over the next five years, mandatory payments to the California Public Employees Retirement System (CalPERS) will increase by 58 percent or $47.3 million a year – almost exactly what the extra half-cent of sales tax in Measure U would raise.
This tactic has been employed across the country. Communities MUST contribute more money to public sector pension plans. However, they know IF they put a measure on the local ballot saying "this money goes to fund the pensions of public sector employees" it will likely be voted down. So they instead put on a ballot measure for future popular stuff such as infrastructure, affordable housing, cultural amenities, with an emphasis on improving conditions... only to take the newly generated money and actually put it into public sector pensions.
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Old 08-20-2019, 06:45 PM
 
1,515 posts, read 343,838 times
Reputation: 2217
Pensions are anything but guaranteed today. Many of them are simply ponzi schemes at this point. Record low rates have crushed the pension system.
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Old 08-20-2019, 06:48 PM
 
125 posts, read 22,916 times
Reputation: 259
Quote:
Originally Posted by RationalExpectations View Post
they instead put on a ballot measure for future popular stuff such as infrastructure, affordable housing, cultural amenities, with an emphasis on improving conditions... only to take the newly generated money and actually put it into public sector pensions.

It's "Perfectly Legal". Besides, {stealing from George Carlin}, consider how stupid the median voter is, then realize half of all voters are more stupid than she.
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Old 08-21-2019, 03:52 PM
 
2,313 posts, read 1,590,115 times
Reputation: 2778
Default Trouble for Pubic Sector Pensions

Quote:
Originally Posted by Chaminade View Post
It's "Perfectly Legal". Besides, {stealing from George Carlin}, consider how stupid the median voter is, then realize half of all voters are more stupid than she.
CA (and other states) pensions systems are in big trouble and are unsustainable. It will be interesting to see what happens when funding levels fall to the point of no return. They are almost there and mismanagement will certainly assure they arrive there at some point.
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Old 08-21-2019, 04:56 PM
Status: "but it depends on what the definition of "is" is." (set 23 days ago)
 
Location: Clyde Hill, WA
3,804 posts, read 676,873 times
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Same situation in Illinois. It's the result of public sector unionism, reform of which politicos will never discuss. They're too busy debating the latest mini-drama, such as whether Trump is a 'white supremacist' or not.
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Old 08-21-2019, 10:32 PM
 
2,313 posts, read 1,590,115 times
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Quote:
Originally Posted by travis t View Post
Same situation in Illinois. It's the result of public sector unionism, reform of which politicos will never discuss. They're too busy debating the latest mini-drama, such as whether Trump is a 'white supremacist' or not.
Yes, unions pushing unrealistic pensions formulas and Democrats supporting this upcoming fiscal irresponsible fiasco.

Also, many layers of middlemen (or women) skimming along the way. How can the S&P go from 666 to over 3000 and funding levels fall?

This is not a trick question.
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Old 08-21-2019, 11:10 PM
 
26,347 posts, read 28,777,661 times
Reputation: 25211
Quote:
Originally Posted by RationalExpectations View Post
This tactic has been employed across the country. Communities MUST contribute more money to public sector pension plans. However, they know IF they put a measure on the local ballot saying "this money goes to fund the pensions of public sector employees" it will likely be voted down. So they instead put on a ballot measure for future popular stuff such as infrastructure, affordable housing, cultural amenities, with an emphasis on improving conditions... only to take the newly generated money and actually put it into public sector pensions.
Yes, this happened in San Jose as well with recent business tax and sales tax increases, as well as a bond for street repaving. The thing is, they wouldn't have needed the bond for street repairs/repaving if the pension costs hadn't spiked.
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Old 08-22-2019, 07:17 AM
 
Location: western East Roman Empire
6,704 posts, read 10,765,978 times
Reputation: 5932
One possible outcome, probably right after lengthy bankruptcy litigation on a case-by-case basis, is that the federal government take over state and local government pensions and pay rights-holders with toxic money.

They did it with housing, next is probably student loans, then at some point state and local government pensions.

I suppose if toxic money is injected into the body economic relatively slowly, over a period of decades, then it can continue to live and limp along in a stupor as it has done over the past 10-11 years, so why not another 20 and 30 and 40, meanwhile that the rest of the world is in a worse stupor?
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Old 08-22-2019, 03:48 PM
 
2,868 posts, read 3,965,055 times
Reputation: 3289
Quote:
Originally Posted by bale002 View Post
One possible outcome, probably right after lengthy bankruptcy litigation on a case-by-case basis, is that the federal government take over state and local government pensions and pay rights-holders with toxic money.

They did it with housing, next is probably student loans, then at some point state and local government pensions.

I suppose if toxic money is injected into the body economic relatively slowly, over a period of decades, then it can continue to live and limp along in a stupor as it has done over the past 10-11 years, so why not another 20 and 30 and 40, meanwhile that the rest of the world is in a worse stupor?
Unfortunately, that toxic money (nice analogy) will pollute ALL money and our savings and income become worth less. Reminds me of a Rip Van Winkel joke.
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Old 08-22-2019, 04:31 PM
 
Location: Was Midvalley Oregon; Now Eastside Seattle area
4,384 posts, read 2,003,737 times
Reputation: 3370
Oregon is right up there with California. The early T1 retirees are sucking up all of the oxygen, knowing that when the oxygen is all gone, they too will die. The answer for T1 retirees is obvious, breath deeply, breath longer, and argue we are constitutionally guaranteed regardless on the financial realities
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