Modesto Bee: TIETJEN: False claims overshadow progress in bargaining pension reform

Modesto Bee: TIETJEN: False claims overshadow progress in bargaining pension reform

By Tim Tietjen

Regarding The Bee's Dec. 30 editorial "Lockyer, Chiang must nail down pension data": Public pensions must be affordable, but the sky is not falling.

In fact, the non-partisan Legislative Analyst's Office says pensions are among the smallest and slowest growing costs in state government, making up less than 3 percent of the budget. Far bigger and more pressing are corporate tax loopholes that cost the treasury tens of billions.

Moreover, where changes are needed to ensure public pensions systems are stable and affordable, the bargaining table has proved to be the best place to work out wage and benefit issues, including pensions. There, state workers have already agreed to pay more for pensions while trimming benefits and lowering costs, bringing $600 million in savings over the past two years. Similar savings are coming from local level negotiations in more than 200 California cities, counties and local districts.
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Here in Modesto, firefighters and other public worker unions have been active partners in solving the city's financial crisis, making concessions over the last four years — including agreements for higher retirement ages for new employees — that will save the city millions.

Meanwhile, the pension advisory votes taken here last November, if implemented, would actually increase costs to the city because of the failure to factor in the liability of what has already been earned by current employees. We are willing to talk about more changes to our pension that would even affect current employee contributions but that must happen through collective bargaining, with give and take on both sides, and not through spurious claims in the media.

But, even with such changes, will public pensions remain affordable over in the long haul? CalPERS, the state's largest public fund, reports that over the past 20 years, it has earned an average annual investment return of 8.4 percent. Those earnings are .6 percent above what its actuaries say the fund needs to ensure it has the money to pay long term benefits.

And CalPERS has largely recovered from its losses during the crash of 2008 and is now funded at 75 percent, a level considered healthy by rating agencies. These numbers are documented and readily available for public review.

Two recent reports on public pensions released by the Stanford Institute for Economic Policy Research fly in the face of these facts, instead trumping up assumptions that CalPERS' earnings are much lower.

The more recent of the two reports claims those earnings must really be just 6.2 percent per year based on "the long-term historical average for investors allocating capital in the same manner as pension funds." In other words, rather than use real-world data, the Stanford study dummied up CalPERS' supposedly "real" earnings from the average results of investors kind of like CalPERS.

This isn't the first time the Stanford institute has distorted the numbers. Last winter grad students from the institute tried to claim that despite the real record, CalPERS' actual earnings should be assumed to be 4.14 percent, the absurdly low so-called risk free earnings rate. That discredited number served as the basis for a spurious Little Hoover Commission report that stirred up a public furor over a supposedly looming pension crisis that would break the state budget.

Unfortunately, these false claims overshadow the real progress public sector unions and state and local government have made at the bargaining table. And that is truly a shame, because overall, though California's public workers can still look forward to decent retirements, a continuing decline in private sector retirement plans leaves California third from the bottom overall among the states in retirement security.

So, rather than fighting to drag everyone down to the bottom rung of the retirement ladder, the real goal of pension reform should be to ensure secure retirements for all Californians, public sector and private.

Tietjen is president of the Modesto Firefighters' union.

Dave Low in Fox & Hounds: Costa's Pension Initiative: Devil is in the Details

By Dave Low
Chairman of Californians for Health Care and Retirement Security
Mon, August 8th, 2011

Initiative gadfly Ted Costa is trying to get a Pension Solvency Act initiative on the ballot he claims would deal with pension spiking and create a secure, state-run pension plan for private sector workers. But onerous as pension spiking is, it is a problem that Costa himself admits affects only a tiny minority of public retiree pensions and one that is already well on its way to elimination at the state and local level via collective bargaining. And the Legislature has already killed as perhaps desirable but impossibly unworkable a proposal to create a CalPERS-managed private pension scheme almost identical to the one Costa wants.

Read more: Dave Low in Fox & Hounds: Costa's Pension Initiative: Devil is in the Details

CRS Member Maricruz Manzanarez in La Opinión: Las pensiones son justas

By Maricruz Manzanarez | July 23, 2011

La Opinión

Alguien puede sorprenderse de que en mayor proporción que cualquier otro grupo de californianos, los latinos creen en mantener pensiones justas y seguras para los empleados públicos? ¿No debería ser al revés? Después de todo, la proporción de trabajadores públicos entre los latinos es pequeña. Es en el sector privado en el que el destacado crecimiento de las empresas latinas—en Los Ángeles, por ejemplo, ese crecimiento triplica el de la población latina—ha creado oportunidades laborales.

Pero la realidad es esta. A pesar del crecimiento en el sector privado, los latinos tienen menos probabilidad de estar cubiertos por un plan de pensión y menos probabilidad de tener ahorros importantes en el momento de la jubilación que cualquier otro grupo en EEUU.

Read more: CRS Member Maricruz Manzanarez in La Opinión: Las pensiones son justas

Pension 'reformers' distort facts on benefits

Sacramento Bee Viewpoints: Pension 'reformers' distort facts on benefits
Published Tuesday, May. 31, 2011

By Martha Penry

Martha Penry is a special education teacher's assistant in the Twin Rivers school district.

Those who want to gut retirement security for public employees in California are issuing an ominous-sounding ultimatum: Slash pensions now or slash school budgets. Trouble is, as clear a choice as it may seem, it simply doesn't compute.

Public employee pensions amount to just 3 percent of California's budget. The growing number of politically motivated proposals to overhaul California's public pension system will not make a dent in the state's current budget shortfall. Not by any calculation. Not now and not anytime soon.

Read more: Pension 'reformers' distort facts on benefits

Pension scare tactics ignore the changes already made

PORAC’s Ron Cottingham, in this op-ed for the Sacramento Bee, makes the case that public employees deserve a fair shake. Millions of dollars in concessions have already been made. Read the article here.

Opinion: It's time to tell the truth about public pensions

In this op-ed appearing in Capitol Weekly, CHCRS Chairman Dave Low makes the case for improving the pension system at the bargaining table. Read the article here.

Why Pension Plans Are Good For Workers

By Paul Weber
Los Angeles Police Detective League

Traditional pension plans have been a proven retirement vehicle for many decades. While ambitious politicians can blithely proclaim that the era of defined benefit plans is over, as we mentioned in our previous post, millions of Americans will soon find that 401(k) plans will have failed miserably to provide them with a secure and dignified retirement. It's becoming increasingly clear that reliable and secure retirement incomes cannot be provided by 401(k) plans. Read the full story here.

Assemblyman Sandre Swanston in Oakland Tribune: Middle Class Under Attack

March 22, 2011
By: Sandre Swanston

I'VE WATCHED with concern the events unfolding in Wisconsin as collective bargaining rights of public sector employees have come under brutal attack and the lies begin to infect our state. Read the article here.

Californians Need Debate on Retirement Security Based on Facts, Not Scare Tactics

March 22, 2011
By SEIU Local 721 Truth Tracker

A poll from last week shows that anti-worker politicians and their media pundit allies are continuing to misinform the public about the retirement plans of nurses, parole officers, road maintenance workers and other public employees. In the wake of this poll, here are some facts about retirement security that deserve attention. Read the article here.

Pension Reform Reality Check

March 18, 2011

Dave Low Op-Ed in PUBLICCEO.com:

It is absolutely worthwhile to consider how to ensure that California's public pension systems remain on a sound footing and able to provide a secure retirement for public workers. Read the article here.