Drudge Retort: The Other Side of the News
Friday, January 12, 2018

California Governor Jerry Brown said legal rulings may clear the way for making cuts to public pension benefits, which would go against long-standing assumptions and potentially provide financial relief to the state and its local governments. Brown said he has a "hunch" the courts would "modify" the so-called California rule, which holds that benefits promised to public employees can't be rolled back. The state's Supreme Court is set to hear a case in which lower courts ruled that reductions to pensions are permissible if the payments remain "reasonable" for workers. "There is more flexibility than there is currently assumed by those who discuss the California rule," Brown said during a briefing on the budget in Sacramento. He said that in the next recession, the governor "will have the option of considering pension cutbacks for the first time."

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That would be a major shift in California, where municipal officials have long believed they couldn't adjust the benefits even as they struggle to cover the cost. They have raised taxes and dipped into reserves to meet rising contributions. The California Public Employees' Retirement System, the nation's largest public pension, has about 68 percent of assets needed to cover its liabilities. For the fiscal year beginning in July, the state's contribution to Calpers is double what it was in fiscal 2009.

Across the country, states and local governments have about $1.7 trillion less than what they need to cover retirement benefits -- the result of investment losses, the failure by governments to make adequate contributions and perks granted in boom times.

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Oh Noes, how can Moonbeam betray us like this?

-AFL-CIO-M-O-U-S-E

#1 | Posted by Rightocenter at 2018-01-11 12:08 AM | Reply

Pardon me for being realistic, but some California pensions are extremely lavish.

#2 | Posted by snoofy at 2018-01-11 12:40 AM | Reply | Newsworthy 1

Pardon me for being realistic, but some California pensions are extremely lavish.

#2 | POSTED BY SNOOFY AT 2018-01-11 12:40 AM

Congratulations Snoofy, you have won the Coveted Moment of Clarity Award (tm) for today!

keep up the good work and thanks for playing!

#3 | Posted by Rightocenter at 2018-01-11 12:22 PM | Reply

Pardon me for being realistic, but some California pensions are extremely lavish.

#2 | Posted by snoofy

You can say that about most government pensions.

#4 | Posted by Sniper at 2018-01-11 12:22 PM | Reply

I couldn't say. I've actually never seen government pensions as lavish as the egregious ones I hear about in California.

#5 | Posted by snoofy at 2018-01-11 12:45 PM | Reply

California pensions are a mess, State, Local and Teachers have lavishly awarded themselves HUGE pensions over the years and have fought savagely to keep them.

It is a testiment to how bad it is when Jerry Brown starts saying they have to be cut.

#6 | Posted by Rightocenter at 2018-01-11 01:41 PM | Reply

California teacher pensions are about the same level as US military pensions. Time to cut military pensions to balance the federal budget.

#7 | Posted by bored at 2018-01-11 05:40 PM | Reply

Time to cut military pensions to balance the federal budget.

Posted by bored at 2018-01-11 05:40 PM | Reply

Boaz is about to have a conniption fit. GIGGLES.

#8 | Posted by LauraMohr at 2018-01-11 05:43 PM | Reply

what does "lavish" mean?

Is there some sort of link that establishes the lavishness of their pension relative to other public pensions?

and where is the outrage from folks like Corky, Danforth, Bayviking,donner, etc..

this thread is 18 hours old and not a peep from any of them.

could it be their interest ends where they can blame a republican for something?

Funny, it's been a norm for years and years that addressing public pensions and cutting them have been at the hand of dems and GOPers.

but you can't convince some folks of things that fly in the face of ideology.

#9 | Posted by eberly at 2018-01-11 06:02 PM | Reply | Newsworthy 1

"what does "lavish" mean?'

Too big, too costly, and going to someone whose six-figure salary provided them with more than enough to fund their own retirement.

#10 | Posted by snoofy at 2018-01-11 06:08 PM | Reply

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"and where is the outrage"

I think it sucks. And it suggests, once again, retirement plans should be contemporaneously funded, and the monies turned over to a blue ribbon panel of Trustees who ONLY represent the recipients. As they've proven time and again, government can't be trusted with it.

#11 | Posted by Danforth at 2018-01-11 06:45 PM | Reply | Newsworthy 1

"this thread is 18 hours old and not a peep from any of them."

Shave its -----, that might get them excited. ;)

#12 | Posted by snoofy at 2018-01-11 07:07 PM | Reply | Newsworthy 1

California, largest state in the land and this barely gets anything

Imagine if big ole Kansas was the state in this article

Great big bad Kansas with 1/20th the population......this would be 200 post thread.

LOL.

#13 | Posted by eberly at 2018-01-11 07:41 PM | Reply | Newsworthy 2

Great big bad Kansas with 1/20th the population......this would be 200 post thread.

LOL.

Posted by eberly at 2018-01-11 07:41 PM | Reply

Want some cheese for your whine???

#14 | Posted by LauraMohr at 2018-01-11 07:44 PM | Reply

Yes.

#15 | Posted by eberly at 2018-01-11 07:45 PM | Reply

where is the outrage from folks like Corky, Danforth, Bayviking,donner, etc..
this thread is 18 hours old and not a peep from any of them.
could it be their interest ends where they can blame a republican for something?

I have to give Dan credit, he doesn't shy away from threads like these.

The rest of them, not worth a bucket of warm spit if it damages their narrative.

#16 | Posted by Rightocenter at 2018-01-11 09:19 PM | Reply

#16

Pensions would have been cut long ago if your ilk were still in charge, lawyerboy. Those that still existed at all, anyway.

#17 | Posted by Corky at 2018-01-11 09:50 PM | Reply

#17

And it looks like Governor Brown now agrees with my "ilk". It's funny how reality intrudes on your fantasy world, Dorky.

#18 | Posted by Rightocenter at 2018-01-11 09:59 PM | Reply

- Governor Brown now agrees

He has little choice... rwingers, however, are gleeful when pensions are cut. Or corps get yuge tax cuts, or Republican donors get yuge tax cuts taken from kid's school lunch programs.

It's just the way they roll.

#19 | Posted by Corky at 2018-01-11 10:02 PM | Reply

"He has little choice... "

HAHA!!

#20 | Posted by eberly at 2018-01-11 10:08 PM | Reply

- HAHA!!

He must have walked past that darn mirror again.

#21 | Posted by Corky at 2018-01-11 11:02 PM | Reply

"I have to give Dan credit, he doesn't shy away from threads like these."

Fnuck that, do you agree with me or not?

Should workers' pensions be funded contemporaneously, and the money handed over to non-governmental entities, or should we keep the status quo?

#22 | Posted by Danforth at 2018-01-11 11:55 PM | Reply

Workers pensions for governments should be treated exactly like non-government employers.

Except that non-government employers raid and cut the pensions regularly.

Look at the screwing over Bethlehem Steel, Sears, United Airlines, Delphi workers got. Management routinely asks bankruptcy trustees to destroy their pension obligations and then give themselves huge bonuses and golden parachutes.

#23 | Posted by 726 at 2018-01-12 11:45 AM | Reply

My company matches 100% up to 6% contributions and then they put another 10% in at end of year based in profitability but they've always done it. We used to have a pension and they replaced it with the current system. If I put in 6 the company puts in 16. Very good plan.

And I control it like any 401-K with the investment options, rebalancing, all my discretion.

THAT is how companies should do it.

#24 | Posted by eberly at 2018-01-12 11:52 AM | Reply

For those who want to see what American healthcare will be under a single-payer system, replace "pension" with "healthcare" in this article and you will see how loose the government plays with your "right" to healthcare.

#25 | Posted by humtake at 2018-01-12 11:53 AM | Reply

California pensions are a mess, State, Local and Teachers have lavishly awarded themselves HUGE pensions over the years and have fought savagely to keep them.
It is a testiment to how bad it is when Jerry Brown starts saying they have to be cut.

#6 | POSTED BY RIGHTOCENTER AT 2018-01-11 01:41 PM | REPLY |

How do teachers award themselves pensions? Doesn't the state have to sign a contract at some point?

Why are these contracts ok to ignore?

Why can't I do the same thing to the contract I signed with Verizon? Just say I can't afford the agreed to amount so I'm going to give you substantially less but you have to give me the service

The pension was part of their pay. reducing the pension is theft.

#26 | Posted by hatter5183 at 2018-01-12 11:56 AM | Reply | Newsworthy 2

#9 | POSTED BY EBERLY

How's 90% of your peak pay and retiring at 50 sound?

"California Highway Patrol officers could retire at 50 and receive as much as 90% of their peak pay for as long as they lived."

www.mercurynews.com

But lavish? Maybe. When compared to SS, absolutely. When compared to the average American retiree...a bit. Compared to a savvy lifetime investor who begins building his portfolio starting at 21? Na, not lavish at all. :)

Davis, who was elected in 1998 with more than $5 million in campaign contributions from public employee unions, says that if he had it to do over, he would not support the pension improvements.
"If you're asking me, with everything I've learned in the last 17 years, would I have signed SB 400 ... . no, I would not have signed it," Davis, now 73, said in a recent interview at his Century City law office.

#27 | Posted by gavaster at 2018-01-12 12:00 PM | Reply

"How do teachers award themselves pensions?"

Award? I think they "negotiate" them.

#28 | Posted by eberly at 2018-01-12 12:00 PM | Reply

And I control it like any 401-K with the investment options, rebalancing, all my discretion.

THAT is how companies should do it.

#24 | Posted by eberly

Some of us are not into gambling with our life savings.

401k's were a trick to get people to switch from REAL pensions to FAKE pensions that could disappear in a flash if/when the economy tanks again.

#29 | Posted by donnerboy at 2018-01-12 12:54 PM | Reply

#26 | POSTED BY HATTER5183 AT 2018-01-12 11:56 AM | FLAG: | NEWSWORTHY 1: Agree, so the state should just increase it's taxes to make up for any pension shortfalls ;)

#30 | Posted by MSgt at 2018-01-12 01:25 PM | Reply

"If I put in 6 the company puts in 16. Very good plan."

Very excellent plan. One of the best I've ever heard.

#31 | Posted by Danforth at 2018-01-12 01:27 PM | Reply

To make money on the stock market you have to buy low and sell high. Unfortunately for active investors there aren't a lot of people selling low or buying high to fill the other half of the transaction.

401(k)s were designed for 2 purposes:

1) To Allow companies to pretend that allowing you to invest your own money is a benefit. You always could. The match that employers pay out is much lower than the pension funding. They transferred the burden to the employee. Instead of pay plus pension you get pay minus 401(k) contribution and they still have people convinced its a better deal.

2) 401(k)s provide a constant stream of buyers regardless of stock market conditions. They are buying stock every two weeks regardless of how high the market is. The current wave will break just like it always does. The active investors are cashing out. It also provides a source of sellers when the market is low. In down economy people who couldnt touch their pensions can now sell their 401(k)s

#32 | Posted by hatter5183 at 2018-01-12 01:38 PM | Reply | Newsworthy 2

In down economy people who couldnt touch their pensions can now sell their 401(k)s

#32 | Posted by hatter5183

If you can get to it before it vanishes in a puff of smoke. If you are invested in the stock market you can lose your entire principle.

Many 401k plans do not allow for you to get at your cash instantly. Or you get only so many transfers per month. You could lose tens of thousands of dollars before you can move it into a safe account where you can get to it.

#33 | Posted by donnerboy at 2018-01-12 02:31 PM | Reply

#33 | POSTED BY DONNERBOY AT 2018-01-12 02:31 PM | FLAG: That loss would only be on paper unless one actually chose to sell at a loss. My wife's 401k went down big time on 08, she stayed the course and continued to fund weekly and unlike those who panicked and got out at a loss, the market has come back big time and her account has risen accordingly. Also, when one retires, few actually 'cash out' all at once due to taxes, but rather pull out monies over years.

Additionally, a 401k of investments would not 'disappear in a flash' unless it was invested in only one stock and that company went bankrupt.

#34 | Posted by MSgt at 2018-01-12 05:24 PM | Reply

Re# 34

My statement was on relation to hatter describing what happens in a down economy (like the 2009 crash).

It is not about people "panicking" it is about people trying to save their homes and pay bills and support their kids while their jobs are ripped out from under them and the world crashes down around them.

Don''t get me wrong. 401K's are good investments to have in ADDITION to a pension. But, you are still gambling. That is what my 401k is. It's a gamble. That will be my fun money when I retire. Not my retirement fund.

#35 | Posted by donnerboy at 2018-01-12 05:52 PM | Reply

Additionally, a 401k of investments would not 'disappear in a flash' unless it was invested in only one stock and that company went bankrupt.

#34 | Posted by MSgt

Many 401k's are invested in funds that track the S&P or the Dow. If the Dow crashes or the S&P drops 10 pts you lose. You can invest in safe government bonds but they only pay about 4-6%.

Investing in the S&P is great right now. And it will be until one day when something happens (maybe Trump plays with his big button) and then it is not.

#36 | Posted by donnerboy at 2018-01-12 05:57 PM | Reply

#36 | POSTED BY DONNERBOY

Of course, historically the S&P500 chart looks roughly like this, as long as you zoom out: ༼

#37 | Posted by IndianaJones at 2018-01-12 06:44 PM | Reply

#36 | POSTED BY DONNERBOY AT 2018-01-12 05:57 PM | FLAG: You are the ballpark with that.

Price and Interest
Condition Type of Security Explanation
Discount (price below par) 10-year Note Issue Date: 8/15/2005 Below par price required to equate to 4.35% yield
Premium (price above par) 10-year Note reopening* Issue Date: 9/15/2005 Above par price required to equate to 3.99% yield
Individual - Treasury Notes: Rates & Terms - TreasuryDirect
www.treasurydirect.gov

Personally. I'm invested in dividend paying stocks and MLPs which pay distributions which the majority pay well above that. With good solid investments I receive the yield regardless of the current stock price [whether up or down}.

Another thing I like about a 401k is that over the years and decades you are dollar cost averaging so in a down [Bear] market [like 08] you accumulate a greater number of shares for the same investment dollars which greatly increase in value in a following up [Bull] market. I have my wife's split between four mutual funds and one high yield [junk] bond fund.

#38 | Posted by MSgt at 2018-01-13 12:14 AM | Reply

Dear Eberywrong:
Many "libs" aren't hear because they (like me) don't know the actual state or scope of California public pensions. Until then, resume your rtolling.

#39 | Posted by e1g1 at 2018-01-14 09:08 AM | Reply

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