Yet another reason to leave California while you can

On the heels of learning that three California cities either have, or are considering filing for bankruptcy, yesterday’s USA Today had an interesting blurb on Calpers, California’s pension trust fund.  I will quote it in its entirety.

The nation’s largest public pension fund reported a dismal 1% return on its investments, a figure far short of projections that will likely add pressure on California’s state and local governments to contribute more, officials said Monday.  The California Public Employees’ Retirement System reported its returns for the fiscal year that ended June 30.  The return is well below its projected annual return of 7.5%. [emphasis supplied]

Let’s break this down.

First, how can any responsible entity project annual returns of 7.5% in this economy?  I suppose anyone can project anything, but the key word in that question was “responsible”.

Second, because of this, I’m sure, “unexpected” shortfall, there will be “added pressure on California’s state and local government to contribute more”.  Of course they will have to contribute more.  How else do you make up for the millions of dollars of “shortfall” caused by the ridiculous assumptions used by the state?

And finally, where will those “more contributions” come from?  The state doesn’t print money.  It can’t borrow the money, as very few, if any, sane people would lend California the money for this purpose.  And, from a state that just approved a high speed rail (that it can’t afford) from nowhere to nowhere, it’s not likely California will cut its spending to make up the shortfall.

Oh, wait, I forgot, the taxpayers will do it.

California isn’t alone.

Call your governor’s office and ask three simple questions.  How much did you project your public employees’ pension fund would earn its last fiscal year?  How much did it earn?  And, how do you propose to make up the shortfall?

That should be an interesting conversation.

 

18 replies
  1. Dimsdale
    Dimsdale says:

    What is the old business/investing adage?? “Past performance is not guarantee of future results”?
    ?
    Unfortunately for California (soon to be the New Greece), continued political stupidity is a guarantee of future failure.

  2. Dimsdale
    Dimsdale says:

    As an interesting aside,? the Massachusetts legislature recently passed legislation that allows people on the Optional Retirement System (ORPS) (alternate retirement system with employee contributions with state match) to “buy into” the state’s guaranteed benefit system, which is in pitiful shape as is CT’s.
    ?
    Needless to say, I am staying in ORPS.

  3. JollyRoger
    JollyRoger says:

    I’d been hearing all my life that California was gonna to fall into the ocean…? I didn’t realize this was an allegory for bad fiscal policy.?? I guess global warming kicks in when we start burning our dollars just to keep warm?

  4. ricbee
    ricbee says:

    Never a thought to cutting benefits is there? Just build & spend more,a railway or a busway it’s amazing how they all think alike. I belong to a private national organization that thinks just like them-being based in NYC may have something to do with it.

  5. Murphy
    Murphy says:

    Ayup JollyRoger, California’s been underwater for years, they’re just too stoned to notice.

  6. JBS
    JBS says:

    Was it Will or Buckley who said, “California is the sick man of the Republic?” California certainly embodies most, if not all, of the accomplishments of the Progressives. Its state flag might well feature a very sad donkey.

  7. sammy22
    sammy22 says:

    I wonder why the population of California is growing twice as fast as that of Connecticut.

  8. sammy22
    sammy22 says:

    But why are they not coming to CT, if CA is so bad?? Maybe to work on the high speed rail?

  9. Benjamin Less
    Benjamin Less says:

    Two words.? “Medical Marijuana.”?? Once the State of California lights up in public unity, growing, packaging and selling this medicinal herb to its very needy and in pain population there will be billions trillions zillions over flowing the government coffers.? Each bud grown in the heights of attics and deep within citizens basements, sold, groomed, rolled and toked will elevate the State to a level of complete utopia/euphoria.? The State taxing weed will save all mankind.?
    ?
    It’s alright.
    Everything will be alright.
    It will be okay.

  10. JollyRoger
    JollyRoger says:

    Population only appears to be growing in CA because they’re letting so many criminals out of prison right now- as mandated by the supreme court in order to improve conditions inside the prisons…? Or are they being released because there’s an election coming up?

  11. sammy22
    sammy22 says:

    Hey, Benjamin Less. Check this out: medicalmarijuana.procon.org/view.resource.php?resourceID=000881

  12. PatRiot
    PatRiot says:

    hmmm.?? Is there a legal precedent that states a person is?obligated NOT to give money to a person or group(i.e.: either party)?that has a proven track record of finacial mismanagement?

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