One way or another, California will get public pension reform.
When the governor and every expert who has looked at the books use the word “unsustainable” to describe California’s public pension systems, they’re not kidding. If the Legislature doesn’t fix pensions, the voters will have their chance. And if that doesn’t work, the bankruptcy courts may have to do the job.
Public employee unions can spend a small fortune to defeat the plan Gov. Jerry Brown has offered, or they can spend a much larger fortune to ask a frustrated and angry electorate to reject a proposed November ballot initiative that would cap public-agency retirement spending and result in harsher changes for their workers.
If the governor were proposing to slash benefits, it might make sense for the unions to pull out all the stops to defend their members and retirees against his plan. But that’s not the case. The governor is asking workers to pay half the cost of their retirement benefits — just like those in the private sector who are lucky enough to work for a company that matches their retirement contributions.
Public employees who don’t trust Wall Street can keep much of their retirement savings in the same defined-benefits plan they have now. Those who invest in a 401(k) can direct their money into “green” investments or away from the companies they don’t like.
If public employees accept the broad outline of the governor’s hybrid alternative, there’s not much left to argue about. Government workers will have to work longer before they can retire, but so does everyone else. As to the host of abuses the plan and other proposed legislation targets, I wouldn’t want the job of explaining to voters why public employees should be allowed to retire on Friday and report to work on Monday collecting both a paycheck and a pension check. Or why retirees are entitled to retroactive benefit increases. Or why it’s OK to routinely spike pensions by raising workers’ salaries shortly before they retire. Or why felons convicted of stealing from taxpayers should collect state pensions.
Read full article here: http://www.latimes.com/news/opinion/commentary/la-oe-fritz-pension-20111102,0,7172321.story