Staff members of the California Public Employees’ Retirement System are recommending a revision. Instead of a 7.75% return on the pension fund’s investments, they now expect their return will be 7.5%.
Although that sounds like a small adjustment, but it could be costly. While state employees may be required to pay more into the fund, guess who else is on the hook? California taxpayers. If you guessed that, you hit the nail on the head.
As of February, the public employees’ pension fund was facing a shortfall of about $75 billion. Another fund -- the California State Teachers’ Retirement System -- is running a $40 billion shortfall. You add it up, and it’s a total mess.
Now, according to Costa Mesa Republican Assemblyman Allan Mansoor, the shortfall should help people understand reality that taxpayers cannot continue to make up the guaranteed benefits, because they're unsustainable. He has introduced a measure to ban collective bargaining among state employees when it comes to pension benefits. But California is not Wisconsin, Ohio, or Indiana, so good luck with that!
More and more, taxpayers are become aware of the outrageously generous benefits expected and demanded by government workers -- and they resent the entitlement mentality that was on parade in Wisconsin. Despite a three-week temper tantrum by union bullies, fiscal sanity won the day. But it’s only a matter of time before voters elsewhere (maybe even in California) demand the same.
Because the genie is out of the bottle!