A new report from the California Public Policy Center concluded that "The total outstanding government debt confronting California's taxpayers is bigger than is generally known." The total outstanding debts soar above $800 billion when all forms of debt are accounted for. The study also shows that if the state's retirement systems used a realistic rate of return on their investments (4.5 percent), then the unfunded pension liability soars to $1.1 trillion. California's Democratic leaders -- and only Democrats are leaders here these days -- insist that the pension problem is behind them. They are looking for new ways to raise taxes so that they can keep the spending train going. Even the state's Democratic "moderates" have no appetite for pension reform. Things are going to get worse here before they get better.

The enactment in 2011 of a 2 percent cap on local property tax levy increases was a signature achievement of Andrew Cuomo's first year as governor of New York. But to get it passed, he allowed his fellow Democrats in the state Assembly to insert a clause making it easier for local governments and school districts to pass along a portion of their rising pension costs in years when such increases are especially big.

At the California Democratic Party convention last weekend, the party adopted a resolution calling for undermining 1978's property-tax-limiting Proposition 13, which signifies a milestone. As the San Francisco Chronicle's Joe Garofoli noted here, it's now safe to touch the third rail of California politics. Prop. 13 has held sway among Republican and Democratic voters who don't want to see their property tax bills soar. Democrats, who have a supermajority in the Assembly and are likely to gain one in the Senate after a forthcoming Senate special election, are feeling emboldened. They are pushing for removal of Prop. 13 protections for commercial properties and for lower vote thresholds for parcel taxes. Many tax-raising measures are moving through the Capitol despite pledges that there would be no tax-raising frenzy. The unions are pushing these measures, which are better for them than reforming pensions. But the taxing-and-spending spree can't go on forever. Unfortunately, Democrats are about to see how long they can go on given that Republicans can now offer only token opposition.

A mental health agency in Kentucky that participates in the state's public employee pension plan is filing for bankruptcy after the state legislature passed pension reforms that would dramatically increase contributions into Kentucky's severely underfunded pension system. Seven Counties Services, a nonprofit, is shutting down its state pension system for all employees and moving them into a defined-contribution 403(b) plan after Kentucky passed legislation that would have forced the nonprofit to spend 20 percent of its annual budget on pension costs. Although the situation is unusual because few non-government employers participate in public worker pension funds, Seven Counties predicament illustrates what happens when sharp increases in contribution levels to fix struggling pension systems hit an employer that simply can't turn to taxpayers to meet its increased costs.

The Sacramento Bee's columnist Dan Walters argues that the Stockton bankruptcy decision is not a clear win for unions or the California Public Employees Retirement System (CalPERS). As he wrote, "But the details of Klein's ruling imply that the city and CalPERS may not prevail on the pension issue when he weighs the city's plan to deal with its debts - a plan that now excludes CalPERS as a creditor." Let's hope that Walters is right and that the first-blush conclusions that this is a big win for the unions is moderated by these other words. I can't imagine that the bankruptcy court will decide to take on CalPERS. As I read it. Judge Klein only wants an explanation from the city about why it is leaving CalPERS alone -- and it already has offered an explanation (that the city won't be able to recruit talent). I certainly hope the optimists are right.