Monday, November 21, 2016

Thanks to pension funds, Los Angeles is close to becoming a microcosm of Greece

Thanks to pension funds, Los Angeles is close to becoming a microcosm of Greece « Hot Air:
"Back in the summer of 2012 the City of Los Angeles realized that they had a serious budget problem on their hands and the culprit, as in so many other cities, was the city’s extremely generous pension plan for municipal workers.
Image result for pension disasterMayor Antonio Villaraigosa, backed by the city council, jumped into the fray and passed what was then described as sweeping pension reform and patted themselves on the back for a job well done.
...Good thing they got that sorted out, eh?
Really dodged a bullet there.
So, four years down the line, how well have those reforms worked out? 
Well… let’s just say that things could have gone better. (LA Times, this week, emphasis added)
Today, Los Angeles taxpayers are underwriting retirement benefits that are among the nation’s most generous — at a cost that has never been higher.
The city’s general fund payments for pensions and retiree healthcare reached $1.04 billion last year, eating up more than 20% of operating revenue — compared with less than 5% in 2002.
L.A.’s vaunted pension reforms have not cut the city’s pension costs; at best, they have modestly slowed their rate of growth.
...How many cities and states have seen seen this pattern repeated in? 

  • Pensions basically bankrupted Detroit. 
  • Chris Christie has spent a huge amount of his term fighting the bloated pension system in New Jersey. 
  • Cities from Cincinnati to Billings, Montana, Charleston, Portland and Chicago (which is at the top of the list) comprise the dozens of municipalities with the most massive unfunded pension debts hanging over their heads. 

Have we learned nothing?
...Unfortunately, in virtually every major city in the country, the government was run by the Democrats. 
...Now the chickens are coming home to roost in too many of these cities and the unions have crafted their deals so carefully that there is little the government can do to dig themselves out of massive budget holes..."

No comments: