Friday, March 25, 2011

Inside job?

So why don't state employee pensions and entitlements pose a problem to state budgets?

Let's just say that in many cases there might be conflicts of interest and where state employees responsible for cooking the books... crunching the numbers are assuming totally unrealistic rates of return as explained by Veronique De Rugy in the video below.

And a little bit closer to home here in California:

Actuaries got another rebuff this week when the labor-friendly CalPERS board voted to leave its earnings forecast unchanged, much like a CalSTRS board action in December that did not lower its forecast as far as actuaries recommended.

A lower earnings forecast raises pension costs for state and local governments struggling with budget cuts during a deep recession. But another rate increase also might fuel the drive for pension reforms that increase worker costs and cut their benefits.

"I was afraid we were going to throw gasoline on the fire in the public pension debate," Neal Johnson of the Service Employees International Union told a CalPERS committee after a key vote.

Whew. Dodged a bullet. Nothing like a dose of reality to harsh your mellow, eh, champ?

The fix is in but it doesn't matter because math is winning and this Johnson clown just doesn't want to admit it.

1 comment:

SarahB said...

Super excited my retirement is in the crapper.