CA: Public sector environmentalists vs. jobs

110624-farm-drought-hmed-245a.grid-6x2On Saturday I observed in the WSJ that private and public unions were increasingly in conflict this election season, particularly as left-leaning public union leaders align with members of the Democratic coalition like environmentalists, whose no-growth economic policies cost blue-collar workers jobs. One example I didn’t discuss in that piece is a campaign transpiring in California…

Breaking: pensions are unnecessary to attract good teachers

On a dollar for dollar basis, there’s much more risk involved in compensating a worker via a long term pension promise instead of salary or some other benefit expensed in the present. You know for certain how much money you have to spend now. You …

California: Premium pay for ordinary duties

The LA Times has a follow-up story on the August vote by the Calpers board to approve 99 categories of additional pay that government employees in the Golden State can use to boost the amount of their salary that counts toward their final pension. While the major import of the story is the way Calpers undermined modest pension reforms signed into law in 2012, it’s fascinating to see just what kinds of tasks earn government workers “premium” pay…

Why public pension plans are left unfunded

Public pension plans remain massively underfunded, but the standard explanations of the problem-egregious benefits, loopholes and abuse – are the effects, not the root causes, of failures that run much deeper. Pliable accounting rules and weak or non-existent funding mandates are what truly jeopardize the …

Warren Buffett: Call your city council

Warren Buffett might be considered one of the world’s savviest investors, but his warnings aren’t being heeded in his own hometown. Buffett has called the public pension nightmare a “gigantic financial tapeworm” eating away at city and state finances, and he’s criticized funds for their optimistic investment assumptions. His own Berkshire Hathaway uses a modest 6 percent annual projected return on investments in its own pension funds…

How pension debt drives down borrowing costs

The Wall Street Journal reported this morning that favorable conditions in the muni market have allowed World Trade Center developer Larry Silverstein to issue tax exempt bonds to finance his thinly-leased new building. At $1.6 billion, the deal will set a record for unrated debt. Like …

Election 2014 in Pennsylvania: what are the real adult issues?

Observers of Pennsylvania governor’s race have been treated to a lot of adult-themed content in recent weeks. Pornographic emails sent and received by former officials in the state Attorney General’s office; an actor from  ultraviolent, gross-out films who also appeared in a campaign ad; racy …

New York State Comptroller’s office evades questions about recent Goldman Sachs deal

With much fanfare, the Office of New York State Comptroller Thomas DiNapoli announced last month a “strategic partnership” between the Common Retirement Fund (CRF) and Goldman Sachs Asset Management (GSAM) to invest $2 billion in global equity strategies.
The CRF manages the assets of the New …

Philly: More dubious budget reporting from NYTimes

The NY Times finally decided to jump in with its take on the controversial story of Philadelphia’s school reform commission cancelling the teachers’ contract. Not surprisingly, in a story largely sympathetic to teachers (pointing out, for instance, that they make less in salary than neighboring suburban teacher) the Times ignores most of the relevant fiscal facts…

Health care + pensions equal insolvent NJ

New Jersey has gotten a lot of publicity lately because Chris Christie has balked at meeting the state’s extraordinary pension burden, arguing that further reform of the system is necessary. But as a recent NJ report makes clear, Jersey really has a problem of expensive health care for workers and retirees on top of bulging pension debts, which have raised the cost of employee benefits in NJ well above the norm for states. The reason Jersey isn’t paying all of its benefit costs is because it couldn’t possibly afford to…