In one of those complicated Sacramento political tangos, this having to do with public pension reform, a ballot measure suspended their campaign citing a deliberately misleading title forced on it by the Attorney General, Republican lawmakers backed Gov. Brown’s 12 point pension reform plan, and Democrats proposed guaranteed pensions for private workers that could be managed by CalPERS.
Depending how you measure it, California public pensions have an unfunded liability of anywhere from $240 billion to over $500 billion. Ignoring the problem and using accounting tricks will not make this go away. Under the existing framework, California owes far more to public workers than it can ever hope to pay. The system must be reformed.
California Pension Reform has halted their campaign saying the phrasing forced upon it by the Attorney General and the Legislative Analyst’s Office was deliberately biased against it and in favor of proposals by Gov. Brown. Veteran Sacramento Bee reporter Dan Walter agrees with this assessment saying “It’s using political office to fix the game, and it undermines democracy.”
Republicans backed Democratic Governor Jerry Brown’s 12 point pension plan while Democrats opposed it. Given that the state legislature is controlled by Democrats, the bill faces a difficult future. Democrats countered with a proposal that nongovernmental workers be guaranteed some type of pension plan. Any business with five or more employees would be required to enroll and would be given the opportunity for CalPERS to manage their funds. Â Â Since CalPERS has had myriad funding shortfalls and internal problem, I’m guessing many employers will not be embracing this plan.
The governor’s 12 point plan is a good start but takes a gradual approach which probably won’t take effect fast enough.