Pension reformer Chuck Reed will fight on

Pension reformer Chuck Reed will fight on

chuck.reedSan Jose is in the center of the world’s economic pulse, Silicon Valley. By all rights, its city treasury ought to be overflowing with digital wealth.

Instead it has flirted with bankruptcy because of its burgeoning pension problem — a problem that already was the major cause of the bankruptcies of Vallejo, San Bernardino and Stockton. The pension problem, as everywhere, was caused by the irresponsible pension spiking of 1999-01.

Enter Mayor Chuck Reed. A Democrat, he valiantly struggled with the problem, passing the Measure B in 2012 with 69 percent of the vote. It is being challenged in court by grasping unions.

Term limits are forcing Reed to leave. But Sam Liccardo, who backs Reed’s reforms, just was elected to succeed him — in the teeth of vicious union opposition.

Reed failed to place a pension reform initiative on the statewide ballot this November after Attorney General Kamala Harris forced on the initiative an incredibly biased title and summary. He says he’s going to keep pushing reform, including a possible 2016 initiative.

It wouldn’t surprise me if he ran for governor in 2018. After all, the problem only is going to get worse. And Harris’ anti-reform stance could come back to haunt her in her own bid for the higher office.


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  1. maximilian
    maximilian 1 January, 2015, 10:46

    Reid stays focused on doing the right thing regarding out-of-control pensions and healthcare needs for state retirees…reform the entire system {no more double-dipping, spiking, increase the retirement age, etc} and institute a defined contribution formula for current employees. Unfortunately, AG Kamala Harris, elected with more union money than any candidate, always plays politics and prevented Reid’s state proposition from ever seeing the light of day. She kicked the can down the freeway and gave herself some breathing room until she tosses her beanie into the ring to replace Boxer for U.S. Senate. Sure, she’ll run and avoid the stench of California pension politics. If Reid runs, he has my support and will get a major donation.

    Reply this comment
  2. fletch92131
    fletch92131 1 January, 2015, 11:02

    Mayor Reed is my second favorite city individual, following San Diego Councilmember Carl DeMaio, who single-handedly brought our city out of financial ruination.I totally agree with everything Maximilian said!

    Reply this comment
  3. Ulysses Uhaul
    Ulysses Uhaul 1 January, 2015, 11:30

    Pension doomers revel in seeing older workers dumpster diving and working beanie and apron jobs in fast food gastro nightmares.

    Sickening. How do you sleep nights?

    Reply this comment
    • Tough Love
      Tough Love 2 January, 2015, 18:24

      Yeah, Can’t you see THESE guys “dumpster diving” ?

      In what, the pool on their 50 foot boats?

      Reply this comment
      • S Moderation Douglas
        S Moderation Douglas 3 January, 2015, 12:13

        It’s a classic example of tabloid journalism. Why am I not surprised that you fell for it?

        Transparent California is interesting, but their data is not reliable for serious comparison.

        Reply this comment
        • Tough Love
          Tough Love 3 January, 2015, 14:47

          Oh no its not ………. it’s a perfect example of the Taxpayer-“ripoff” now typical everywhere.

          Taxpayer must find a way to RENEGE on all of these truly OUTRAGEOUS pension promises.

          Reply this comment
          • SeeSaw
            SeeSaw 3 January, 2015, 16:44

            There is no way to renege TL, unless you want a hard cot for a bed. Otherwise, if you truly don’t want public services, move to a piece of sand and a thatched roof in Borneo or somewhere. Watch out for the snakes and spiders.

          • S Moderation Douglas
            S Moderation Douglas 4 January, 2015, 11:38

            “Average full-time municipal employee compensation statewide was $120,569.”

            I am sure TL is suitably impressed by the big shiny numbers. Which was the point of the author (also TL, by the way, another one)

            Transparent California believes, very strongly, apparently, that total compensation is the proper value to use for comparison. Which would be copacetic, *if* they clearly explained that these are not “wages”, and should not be compared to private sector “wages”.

            I don’t recall any media, right, left, or moderate, listing private sector total compensation. Most CWD readers are aware of the difference. Most others are not, thus the jaw dropping or “stunning” response to $120,569 compensation.

            In California, the average wage is about $53,000. The average wage for public sector workers is about $70,000. It has been a truism for years that public sector compensation is about 40% higher than private. Apples and oranges. At the same time as these discrepancies in overall *average* salaries, rigid economic studies have consistently shown public workers earn lower cash wages than equivalent private sector workers. The only disagreement has been in the value of benefits.

            This is one reason why, in my opinion, “Stunning data on average compensation for municipal employees in California”, both the title and the article, are a classic example of tabloid journalism.

            A second reason is, to quote SkippingDog, the TC data is “…..mixing and matching salary, overtime, and total compensation to make your case,”

            We don’t know what compensation is included in the $120,569 “average.” I doubt that Mr. Lifson knows. I don’t think even Transparent California always knows. We do know that if pension costs are included, they are the actual ARC for this year, not the normal cost. If overtime is included in the average, there is no chance of reasonable comparison to private sector compensation.

            More sensationalism is in publishing total compensation of some of the highest paid workers. These often contain unexplained one time payments resulting in highly inflated compensation which is portrayed as a normal annual salary.

            And overtime. A wild card. It is not a part of the “average wage” or “average compensation”. We just went through this example lately where a fireman was basically accused of being overpaid because his city made a conscious decision to reduce the number of firemen and rely on overtime to meet staffing levels.

            If overtime is included in the listed ” average compensation ” of $120,569, it should not be. State and local governments have reduced their staff in the last five years, if a city has nine employees where there once were ten, and some of them work OT to compensate, that does not make that worker “overpaid”.

            It’s fine and useful to publish the OT used by each individual and department, but to include it in average pay is misleading.

            Kudos (I think, I’ll take a closer look later) to the State Controllers Office. They seem to be able to publish much of this same information by position number, without publishing the name of the worker. But I believe the SCO has a disclaimer similar to TC. They are not responsible for inaccurate information.

  4. killer kane
    killer kane 1 January, 2015, 12:02

    I notice you didn’t print that most of Measure B has been shot down via the courts as illegal…and while he was a city council member he voted for more money and benes for city workers…He only took up the cause when a sugar daddy popped up named John Arnold who destroyed Enron and took everyone to the cleaners….

    Reply this comment
    • Tough Love
      Tough Love 2 January, 2015, 18:30

      So John Arnold …”John Arnold “destroyed Enron” and “took everyone to the cleaners”. Did you know that he made 99+% of his money AFTER he left Enron ?

      If he wasn’t so rich and had little interest in “bloviating ignoramuses” (using a term George Will used to describe Donald Trump) such as yourself, he might teach you a lesson or two about slander.

      Reply this comment
  5. killer kane
    killer kane 1 January, 2015, 12:19

    I noticed the reporter forgot to put in this report that most of the important topics of Measure B have been overturned by the Courts as illegal..Big win for unions in San Jose….wa wa wa wahhhhhhhhhhhhh……….

    Reply this comment
  6. bob
    bob 1 January, 2015, 12:33

    John, what are you doing working on New Year’s day?

    Why don’t you be like a trough feeder and take the day off?

    Or better yet be like a retired trough feeder and take every day off. For them every day is like Christmas thanks to the taxpayers.

    Reply this comment
  7. bob
    bob 1 January, 2015, 12:38

    And this just in. A DemoNcrat is proposing taxing the shiite out of gasoline. It’s for your own good, of course.

    Steinberg proposed that the state increase the price at the pump by 15 cents a gallon starting in 2015. That number would increase to 43 cents a gallon in 2030.

    “Higher prices discourage demand. if carbon pricing doesn’t sting, at least a little bit, we won’t change our habits,” Steinberg said.

    Old Stiney wants to sting ya!

    If that doesn’t prove Stinkbug and the DemoNcrats are the enemy of every working person I don’t know what does

    Reply this comment
  8. Desmond
    Desmond 1 January, 2015, 13:44

    The beauty of a driver free electric car with no registration or insurance. Coming soon to a road near you.

    Reply this comment
    • SeeSaw
      SeeSaw 2 January, 2015, 08:16

      I am not up on the particulars for the driver-free cars–but it is reasonable to believe that such cars will be registered and insured. I don’t like the idea, because it is just another step in the direction of the use of non-human robots for everything–they don’t need to eat like humans do.

      Reply this comment
  9. Queeg
    Queeg 1 January, 2015, 13:45

    Follow the money you never get-

    Somehow, globalists and high tech imperialists and minders of the masses divy the goodies.

    And the cycle repeats again and again.

    Reply this comment
  10. Teddy T Steele Teddy ex-call the ball!
    Teddy T Steele Teddy ex-call the ball! 1 January, 2015, 20:48

    Chuck’s problems have always been that he just can’t write a lawful measure– just can’t do it– no matter what.

    He has some good ideas but over time he is being forced to learn that that aint enuf—-but——he will roll on………..Zzzzzzzzzzzzzzzzzzzzzzzzz

    Reply this comment
  11. SeeSaw
    SeeSaw 2 January, 2015, 08:10

    Pension spiking might have been a problem in San Jose, whose workers except for officials like Reed, are not on CalPERS. CalPERS put a stop to pension spiking in 1993. It is simply false to say that pension problems are what caused the three cities to become bankrupt–of course the pension plans became a problem–after the most horrific global, financial collapse in our lifetimes, since the Great Depression, occurred in 2008. If Chuck Reed has designs on the Governor’s office he will have to get past Newsom first–I doubt he can do it–he has made himself a pariah as far as most Democrats are concerned.

    Reply this comment
  12. Ted Steele, Editor
    Ted Steele, Editor 2 January, 2015, 08:44

    That’s correct SeeSaw– pension spiking ended in 93-94 but please don’t tell the cwd doomera!

    Reply this comment
  13. SkippingDog
    SkippingDog 2 January, 2015, 11:05

    Reed must have received more money from Enron executive John Arnold to screw over some more pensioners. Arnold and his cronies screwed over millions of pensioners for billions of dollars at Enron and elsewhere, but I’m sure that’s perfectly fine with the doomers who inhabit these spaces.

    Reply this comment
  14. John Moore
    John Moore 2 January, 2015, 11:26

    From 1998-2002, CalPERS gave its cities, counties, et al a waiver of annual pension contributions. In 2001, there was a 7% market decline that caused substantial deficits from three sources: 1. no annual contribution of 8% of PVB, no earning of 8% of PVB and a 7% loss of assets(MVA), for a daunting loss of about 23% of PVB(present value of liability to pay benefits). The loss created large pension deficits. In 2004, CaLPERS created “pools” and placed each cities deficit in a “side fund’ and charged annual interest at the income rate of 7.75% which together with reinstaement of annual contributions caused contribution rates to increase and caused extreme reductions in services. Many govt. entities issued pension bonds to foist the 23% pension liability for work already reformed onto future taxpayers.

    In 2008-9, the financial markets crashed. CaLPERS entities suffered about a 28% loss of assets(including pension bond proceeds) and failed to earn 7.75% of PVB.

    Current pension reform is about reform going forward, but for most entities, they cannot provide govt. services without relief from current pension deficits and pension bond debt. The Ca state legislature created the pension mess. It has continued to empower CaLPERS and the pension structure that it created.

    In view of the above, the state legislature should take responsibility for its actions. It should assume full liability for pension debt and pension bonds. As taxpayers we are liable for city, county, state and districts debt, so it makes sense to consolidate that debt in one place, the legislature. If it contends that the amount is too great, that is a confession to the magnitude of the problem that it created. By making the legislature responsible, it will quickly enact pension reform going forward. In my view it is the only path to reform that will restore local govt.

    Reply this comment
  15. desmond
    desmond 2 January, 2015, 18:15

    Go Arnold. Anything to screw a govt leech is a go by me.

    Reply this comment
  16. SeeSaw
    SeeSaw 2 January, 2015, 18:52

    I don’t think Arnold has been a pension-reform player in CA, thus far. The $200,000 he donated to Reed was for a Chamber of Commerce event–not his pension initiative. Lack of money was the real reason that Reed did not go ahead with the signature gathering for his initiative.

    Reply this comment
  17. Ulysses Uhaul
    Ulysses Uhaul 2 January, 2015, 23:24

    Dessi….so harsh and crude…..lightin up Bro.

    So far you kill off old people, government workers…..who is next immigrants, the sick, disabled?

    Reply this comment
  18. Ted
    Ted "Patriot" Steele 3 January, 2015, 17:00

    I wonder if Cluck Reed has a paid off house? Or like most doomers– hocked to the hilt and whining about life? !!!

    Reply this comment
  19. Ted
    Ted "Patriot" Steele 3 January, 2015, 17:01

    U hauler– Desi aint playing with a very bright bulb. Go easy on her.

    Reply this comment
  20. Ted
    Ted "Patriot" Steele 3 January, 2015, 17:02

    Cluck Reed ins the John Arnold Enron poster boy!

    Reply this comment

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