For the last several years, since the economic downturn in 2008, public employees have taken the brunt of the blame for California’s dire financial straits. While private employers were reducing their contributions to 401k retirement plans and cutting salaries, even conducting massive layoffs, it seemed as though public employees had staved off similar casualties, even if temporarily.
Truth be told, many public employees have dealt with their fair share of problems, from furloughs to across-the-board pay cuts and paying more into their retirement as well as losing their jobs. Those cuts, however, haven’t done much to settle upset taxpayers who feel public employees are faring better than they are. The real sucker punch to Californians is not necessarily what public employees have been getting paid to work, but what they have been getting paid not to work and taxpayers’ obligation to pay for their retirement when the stock market falters. The reality of that burden lies in the state’s current unfunded pension liabilities, which stand currently at $398 billion.
With headlines of pension spiking, where certain public employees make more in retirement than they did working, and the state’s ongoing financial crisis, while legislators continue to hack away at public education in order to balance the budget, it’s no wonder that Gov. Jerry Brown has continually promised pension reform, even since before he took office. Talks of capping pensionable salaries, raising the retirement age and ending abuses have been emanating from the governor’s office since he was elected.
In a moment of either brilliant strategy or repugnant maneuvering, Brown laid out his plan for pension reform, at the 11th hour, before legislators and a now-nervous public labor force. As of Tuesday, legislators and public employees have three days to review and comment on the governor’s Public Employee Pension Reform Act of 2012. Though three days seems like a short amount of time, maybe such decisions shouldn’t be long and drawn out, given the issue has been a topic of conversation for years.
Friday, Aug. 31, when either Brown’s plan will be approved or legislators will somehow delay the final vote, will certainly be a day of reckoning. Taxpayers, in general, are fed up with having to cover for government when it fails at its job. The state’s unfunded pension liabilities continue to be a sore spot for voters and, without a decision on pension reform, the governor’s tax initiative may be rejected by a public already feeling burned by government. If the tax initiative fails, it will result in billions of dollars of cuts to education, according to Brown.
Whether or not one agrees with the way Brown pushed his pension reform bill for approval in such a short period of time, at the very least, it’s done now. While public workers have stated they feel this bill is punitive toward them, it less damaging than the original proposal and the reality of the situation, for them, seems to be ignored. If unfunded pension liabilities lead to insolvency, then public workers may have more to worry about than just losing a cushy retirement package. Brown’s efforts are notable and we stand behind doing something rather than doing nothing, the very practice of legislators for decades that got us into this mess in the first place.
To review Gov. Jerry Brown’s Public Employee Pension Reform Act of 2012, go to http://gov.ca.gov/home.php.