CHP7747 wrote: Mr Ransom; You just painted a wide spectrum of honest, dedicated Public Employees with a tab brush. I was a California Highway Patrol Officer (OFFICER--out on the road, taking my chances) for 31 years. Every month, they took 10% for my retirement - Public Pensions are Another Form of Theft
Dear Officer Comrade,
No, actually I didn’t.
What I did do was point out that pretending, for example, that your CALPERS pension fund will get 7.5 percent return on investment when interest rates for a 30-year U.S. Treasury bond is 2.69 percent means that the pension will end up with a shortfall- a shortfall you want the taxpayers to cover, for all of the reasons you mentioned.
I thank you for your service, but there are other people you should be venting at rather than me.
Vent at the public officials who allow pension managers to make false assumptions about rates of returns; vent at union officials who are more worried about bragging about benefits than actually delivering benefits.
As our own Mike Shedlock wrote earlier this week:
The California Public Employees' Retirement System (CalPERS) manages pension and health benefits for more than 1.6 million California public employees, retirees, and their families. Its pension plan assumes 7.5% annual growth.
For fiscal year ending 2012 CalPERS reported a preliminary performance of 1 percent.
The reference source in his article estimates that CALPERS is 55-75 percent under-funded.
If you are not familiar with exponential functions such as 7.5% annualized growth assumed perpetually by CalPERS, please [see this video]. Perhaps you should play it even if you are.
Those in CalPERS counting on 7.5% annual growth are going to instead see clawbacks, reduced rates, or outright default.