Tag: government pensions

Milton Friedman’s Solution for Social Security Would Work for Government Pensions, Too »

Milton Friedman, the 1976 Nobel Laureate in economics, was interviewed on the television program Uncommon Knowledge in 1999, and he offered a solution to Social Security’s financial problems: shut it down. But Friedman didn’t advocate that the federal government walk away from its promises. Social Security participants are owed a stream of payments during...
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Actuary Hands Gift to Pension Reformers »

The actuarial firm Cheiron recently projected the future yearly pension costs for San Jose’s police and firefighter pension plan. Cheiron wrote: In the worst scenarios, the City’s aggregate contribution rate can exceed 110 percent of payroll. In the best scenarios, the City’s Tier 1 rate can drop to 0 percent, leaving a relatively small...
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Time for Bond Investors, Especially in Chicago, To “Know What You Own” »

Four U.S. cities went belly up recently, and all declared bankruptcy largely due to unaffordable government pension costs. The outcomes of these bankruptcies should make everyone think twice about lending money to cities with serious public pension debts. The graphic below shows the outcome of the municipal bankruptcies in Vallejo, Detroit, Stockton, and San...
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Democrats and Republicans to Blame for Public Pension Crisis »

I’ve appeared on more than 70 television and radio talk shows coast-to-coast in the past three months to discuss my new book California Dreaming: Lessons on How to Resolve America’s Public Pension Crisis. One common question has been: “Aren’t Democrats responsible for creating the unfunded public pension debt by over-promising pension benefits?” My answer,...
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Janet Napolitano Makes History as University of California Pension Reformer »

In an effort to control skyrocketing retirement costs in the massive University of California system, U.C. employees hired after July 1, 2016, will be able to choose a 401(k)-style pension plan, the first time this has been offered. Governor Jerry Brown and U.C. president Janet Napolitano negotiated the agreement, which was enshrined in the...
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Two Reasons to Pay Off Public-Employee Pension Debt Quickly »

In a recent op-ed in the Wall Street Journal titled “Pension Reform Doesn’t Mean Higher Taxes,” Andrew Biggs correctly pointed out that new Governmental Accounting Standards Board (GASB) rules require state and local governments across America to be more transparent about the financial health of their public-pension plans. But, as he noted, the rules...
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Soaring Pension Costs Devour School Budgets in California »

The revised budget unveiled in May by California Gov. Jerry Brown seeks to increase the amount of money that public school districts and their teachers would pay into the teacher pension fund going forward. The legislature must approve a budget by June 15 or legislators forfeit their pay until a budget is passed. The...
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The Police State Retaliates Against Mayor for Pension Reform »

Mayor Jim Righeimer of Costa Mesa, California, is taking the city’s police union to court saying he was the target of police intimidation for trying to curb pension costs associated with the city’s police officers and other employees. Costa Mesa has $200 million of unfunded pension liabilities for its government workers. The city has...
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California’s Pension Tsunami Swells as Pension Benefits Surge »

The California Public Employees’ Retirement System (CalPERS) is the nation’s largest public pension fund. It also has massive unfunded liabilities, as much as $290 billion depending on the calculation method. Many are quick to blame the Great Recession and its low investment returns for the unfunded debts. But new data uncovered by the Sacramento...
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What’s Work Got to Do with It? Labor Day the Chicago Teachers Union Way »

Most Americans are celebrating Labor Day with barbecues, picnics, and parades—but not the Chicago Teachers Union. They’re busy planning the city’s first teachers’ strike in 25 years, which incidentally coincides with the September 10 start of most Chicago Public Schools. Observers had hoped a strike could be averted when Chicago Mayor Rahm Emanuel and...
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