Skip to comments.California's — And America's — Pension Debacle On Its Way: Watch Your Wallets
Posted on 02/06/2014 6:36:25 AM PST by SeekAndFind
Hold on to your wallets, folks. Without a powerful intervention, California may soon become the first big domino to fall in America's public pension debacle.
To help prevent catastrophe, the California Public Policy Center (CPPC) has just made public a new database detailing the size and scope of the state's outsized expenditures on public employees the largest ever compiled in California. Legislators and voters should take note, because California can't afford another round of fact-free partisan warfare.
As recently reported in the New York Times, the fate of California cities such as Desert Hot Springs where civic bankruptcy looms, in large part due to oversized pension payments is shining a bright light on the detrimental growth of unfunded pension liabilities around the country: For years, municipalities have steadily enhanced promised retirement benefits to public sector workers.
This unsustainable profligacy spans from inland municipalities to the coastal metropolises of Silicon Valley.
All told, California state and local governments face an estimated $655 billion in unfunded pension and health care liabilities.
To address the problem head on, San Jose's Democratic Mayor Chuck Reed filed the Pension Reform Act of 2014. If approved by voters, the act would provide state and local governments the tools they need to fix California's public employee retirement plans.
Otherwise, our elected officials will likely steer us toward the same dreaded fate that hit California cities Vallejo and Stockton which have been forced to impose heavy write-downs on municipal bondholders.
Incredibly, labor unions are pressing municipal officials to defend these unsustainable outlays.
(Excerpt) Read more at news.investors.com ...
Confiscation, along with nationalization
EXHIBIT ONE--California School District Owes $1 Billion On $100 Million Loan
npr ^ | Dec 7, 2012 | Richard Gonzales / FR Posted by Biser
More than 200 school districts across California are taking a second look at the high price of the debt they've taken on using risky financial arrangements. Collectively, the districts have borrowed billions in loans that defer payments for years leaving many districts owing far more than they borrowed. (Excerpt) Read more at npr.org ...
In 2010, officials at the West Contra Costa School District, just east of San Francisco, were in a bind. The district needed $2.5 million to help secure a federally subsidized $25 million loan to build a badly needed elementary school. Charles Ramsey, president of the school board, says he needed that $2.5 million upfront, but the district didn't have it. Why would you leave $25 million on the table? You would never leave $25 million on the table.
- Charles Ramsey, school board president, West Contra Costa School District. We'd be foolish not to take advantage of getting $25 million when the district had to spend just $2.5 million to get it, Ramsey says. The only way we could do it was with a [capital appreciation bond].
Those bonds, known as CABs, are unlike typical bonds, where a school district is required to make immediate and regular payments. Instead, CABs allow districts to defer payments well into the future by which time lots of interest has accrued.In the West Contra Costa Schools case, that $2.5 million bond will cost the district a whopping $34 million to repay.
California is in a race with Illinois to see which state can become the Greece of America. The Golden State has a new über-bureaucrat....jaw-dropping details from a Bloomberg report.....More at townhall.com
EXHIBIT TWO A Labyrinth of Govt Fraud----stories like this mean astonishingly easy, massive govt fraud.
REFERENCE Govt officials find 2nd off-the-books bank account / LAT / February 17, 2011
Montebello, Cali govt officials said they discovered yet a.n.o.t.h.e.r secret off-the-books bank account that once contained nearly $1 million in city govt funds. Officials do not know why the secret account was created, why it was never recorded on the city's general ledger or what happened to the govt money that was transferred out.
One signator on the secret account was former City Manager Richard Torres. City policy generally requires the treasurer to be a signator, not the city manager. The bank holding the secret account refused to disclose to the city who the other two signators are.
Revelations about a secret Union Bank account follow news of an off-the-books account at Banco Popular discovered earlier....That account contained about $240,000 govt monies; officials also discovered records that indicated tens of thousands of govt dollars had been transferred out. They do not know to whom or why.
City govt's official banker is Bank of the West. Officials have asked for bank statements and records and are hoping to reconstruct what happened. They have also queried every member of the govt finance department to ask if they know of any other off-the-books accounts. The Union Bank account came to light when an employee spontaneously alerted the finance director. Officials found out about the Banco Popular account when the bank contacted city govt because the account had been dormant for a while.
The news about the secret accounts comes as Montebello struggles to close a deficit that could force officials to make deep service cuts and lay off employees. Criminal probes have also begun in San Bernardino agencies for possible govt fraud.
EXHIBIT THREE The $822,000-per-Year Bureaucrat and the Death of California
Townhall.com | Daniel J. Mitchell / 12/12 / Posted by Kaslin
The chief bureaucrat of a low-income California city getting almost $800,000 per year. Cops in Oakland getting average compensation of $188,000. Here are some of the jaw-dropping details from a Bloomberg report.(Excerpt) Read more at finance.townhall.com ...in California,a state psychiatrist was paid $822,000, a highway patrol officer collected $484,000 in pay and pension benefits and 17 employees got checks of more than $200,000 for unused vacation and leave. The best-paid staff in other states earned far less for the same work, according to the data.
.... the states highest-paid employees make far more than comparable workers elsewhere in almost all job and wage categories, from public safety to health care, base pay to overtime. California has set a pattern of lax management, inefficient operations and out-of-control costs.
Governor Jerry Brown hasnt curbed overtime expenses that lead the 12 largest states or limited payments for accumulated vacation time that allowed one employee to collect $609,000 at retirement in 2011.
Last year, Brown waived a cap on accrued leave for prison guards while granting them additional paid days off. Californias liability for the unused leave of its state workers has more than doubled in eight years, to $3.9 billion in 2011, from $1.4 billion in 2003, according to the states annual financial reports. The per-worker costs of delivering services in California vastly exceed those even in New York, New Jersey, Illinois and Ohio.
Actually, Brown is making things worse, having seduced voters into approving a ballot measure to dramatically increase the tax burden on the upper-income taxpayers. ....so many bureaucrats now rank as part of the top 1 percent, theyll have to recycle some of their loot back to the political vultures in Sacramento.
The data also reveal the motives that drive individuals and businesses to leave California. One of these, of course, is work.
Taxation also appears to be a factor, especially as it contributes to the business climate and, in turn, jobs. Most of the destination states favored by Californians have lower taxes. States that have gained the most at Californias expense are rated as having better business climates. The data suggest that many cost driverstaxes, regulations, the high price of housing and commercial real estate, costly electricity, union power, and high labor costsare prompting businesses to locate outside California, thus helping to drive the exodus.
Nationalization is right. All to support unsustainable pensions for our ruling class, the government workers.
Thanks for the informative, educational post, Liz. BUMP-TO-THE-TOP!
There are thousands of state workers now getting over $100,000+ in pensions. On the John & Ken radio show (KFI640)in Los Angeles they were siting some of the worst. They have people who retire with over $300,000 a year pensions at 50 years old.
If anyone has anything put away they should just keep it under the mattress since Obama intends to seize personal bank accounts at some point in the future.
Obamacare Healthcare Exchange seizing bank accounts to pay premiums, fines
In Uncategorized on December 17, 2013 at 10:46 AM
Obamacare Healthcare Exchange seizing bank accounts to pay premiums, fines
Recent trending of this story is breaking the airways right now with great magnitude. Vast masses of people are becoming aware and many are showing outrage as once again a runaway government is attacking its people and this time where it hurts the most, their purse or in this case banking accounts.
Reportedly the Obamacare Healthcare Exchange is erroneously debiting bank accounts in Washington State and across the nation, levying fines, suspending drivers licenses and placing liens on homes till their Obamacare debt is paid.
Initial reports are confirming that many are having their monthly premiums debited from their checking accounts not once but multiple times a month and having fines deducted from their accounts placing financial hardships on many Americans.
Take for instance the Bruner family on the news video below from Washington State. They enrolled and were hoping to pay their Obamacare premium in a few weeks when Josh Bruners next payroll check hit the bank but the deduction came 2 weeks early placing their bank account nearly 800 dollars in the negative forcing this family to postpone Christmas and seek alternatives to assist with feeding their family.
MyRA? SD Warned You in 2012: Obama Begins Push to Confiscate IRAs & 401ks
February 1, 2014 By The Doc
With last nights announcement by President Obama of his new MyRA, the No Risk, Guaranteed Return Retirement Savings Bond Program, we thought it apropos to bring back AGXIIKs November 2012 warning that President Obama had begun a push to confiscate Americans IRAs & 401ks, and force retirement assets into treasury bonds.
While many have scoffed, we have long warned at SD that Americans retirement plans are the last remaining bastions of wealth for the criminal banksters to pilfer, and that they will ultimately be confiscated via forced allocation into treasury investment vehicles.
With President Obamas State of the Union speech on 1/28/2014, the process has officially begun.
As AGXIIK warned, Please realize that this is 100% about funding $1.5 TRILLION annual deficits using Americans retirement funds, as there is simply no other remaining pool of wealth able to soak up $1.5 Trillion in T-bills annually.
AGXIIKs Full MUST READ 2012 Warning on Obamas Plans to Confiscate 401ks & IRAs is below: