Point of View: Pension Reform
LOS ANGELES, CA (FOX 11) - According to The Stanford Institute for Economic Policy, all California pension and employment benefit plans are drowning in red ink. Estimates are over one trillion dollars' worth. The State of California retirement plans, for example, are short billions of dollars in assets needed to pay for them. As a result, the California taxpayer supported "general fund" has to make up the difference. That income deficit is roughly calculated at $10-billion dollars a year…and rising.
If government benefit and pension debt continue to rise at the present rate, in ten years the state could have to make some very hard choices. Like raise taxes in the amount of the shortfall of about $18-billion, or make deep cuts in basic state functions from the prison system to road repair and higher education, to name just a few.
In twenty years, the choices will be even starker because the shortage will rise to a possible $29 billion dollars. Of course, Governor Brown, you will have been out of office by the time all of this happens. Still, I am sure you do not want to be remembered as the governor who saw a financial disaster coming -- but did nothing about it. Dealing with government worker pension and benefit debt is far more important than your current obsession with high speed rail and the twin tunnels water project.
Change your priorities. Make pension and retiree benefit reform your number one goal. Make sure by legislative change or the ballot initiative process that these programs are in line with what the state can actually afford, in order to prevent huge financial problems later.
Now is the time to take action. Thanks for listening.
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