Friday, August 20, 2010
Brother, Can You Spare $2 Billion?
Politics Chris Thompson — Fri, Aug 20, 2010 at 8:35 AM
When Governor Arnold Schwarzenegger isn't forcing state employees to go on three days of unpaid leave every month, he's asking them for a $2 billion loan. That's the news coming about the Sacramento Bee today, as word leaked that the Grand Teuton has privately floated a proposal to borrow the money from CalPERS, the state employees' pension investment fund, to close the $19 billion budget deficit. State leaders have worked this scheme before; Pete Wilson borrowed a roughly similar amount in 1991 to close that year's budget gap. But union leaders generally get irritated when governors come begging for cash, and they'll want something in return. We can't say we're all that sympathetic to state employees; the spikes in public pension benefit outlays since 1999 have been truly unreasonable, and are a main factor behind not just the state's budget problems, but those of almost every other city and county. Since they're so much of the problem, they could be part of the solution this time around.
Comments (2)
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PERS is a government funded pension plan and the money is not set aside like a 401k. It is taxpayer money and should be used to fund the budget. PERS payouts must be cut now and phased out in the long term and replaced with a totally employee funded system. The taxpayers can no longer afford the lavish money paid to public employees.
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Actually, the PERS pension system is entirely self supporting, and has NOTHING to do with any government, other than the fact that participation in the program is limited to those who are public employees. Like a credit union, the rule exists only to place limits on those who can give money to the program. Once the money has been placed in the account, it is like any other bank, 401K 403b, etc.
The money does not belong to the government, and the government should raid all private sector banks at the same time it decides to raid this private retirement fund.
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