The CalPERS [The mismanaged, incompetently-run State of California pension fund] financial bomb has gone off. The blast wave hasn’t arrived to knock us all down is all.
A deficit of $7.4 billion is projected for CalPERS by the end of the year. Look, I like unions and believe people deserve good pensions. But the simple financial fact is that everyone and their uncle jumped on this gravy train, insuring they’d have a well-paid retirement with great health benefits. But the pensions are so bloated, the corruption and mismanagement so grave, and the financial shortfalls so tremendous, that the pensions can no longer be funded. That’s the cold hard ugly truth.
People went to work for the state because while the pay may be less, the retirement was great. That’s probably all going to be renegotiated or voided. Municipalities here have already filed bankruptcy and broken pension agreements with police and fire departments. Imagine the firestorms that will ensue when that happens on a statewide basis.
The state of California is also in deep trouble.
Revenues are falling further, unemployment is out of control. The UE fund is projecting a $23.7b deficit.
That means even more peasants with pitchforks.