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Last Night’s Other Big Elections

California Voters Choose Fiscal Sanity Over Union Largesse

There were actually three major elections centered around state and local government employee pensions and benefits last night.

And though the media blanketed the Wisconsin gubernatorial recall with coverage, you can be forgiven if you didn’t even know about the referenda in San Diego and San Jose, California. Voters in those two cities, respectively the 8th and 10th largest in the country, were asked whether to reform their city employee retirement plans, converting them from defined benefit pensions to defined contribution, 401(k)-style plans.

The reforms passed in both cities by 2-to-1 margins.

Why? Because residents of those cities learned, through bitter experience, that defined benefit pensions – especially for government employees – are unaffordable, and unfair.

They’re unaffordable because with longer life-expectancy and productivity increases in the economy, defined benefit plans assume fewer workers will be subsidizing more retirees not merely for their golden years, but their golden decades. It’s not a coincidence that defined benefit plans are all but extinct in the private sector – companies who didn’t switch to defined-contribution plans inevitably collapsed under the weight of their pension obligations. Today, the only sector of the economy where defined benefit plans remain common is government.

And that brings us to the unfairness of these plans. It is simply unjust for government employees to require private sector workers, who don’t have gold-plated retirement plans, to subsidize such plans for themselves. That is, it’s not fair for government employees to demand better benefits than their bosses, the actual taxpayers.

Worst of all, as these cities’ pensions costs have skyrocketed in recent years – San Jose’s pension payments have risen 236% since 2001, and San Diego’s have jumped 438% since 1999 – those costs have squeezed out actual government services. As the cities spent a growing slice of their tax revenue (roughly one of every four dollars) on bureaucrats’ pensions, they were forced to close libraries, neglect infrastructure repairs, and cut emergency services.

Neither city’s situation is unusual.

Government employee pensions are swallowing state and local budgets across the country. Illinois, for instance, already spends more money every year on its teachers retirement system than it does on actual schools. Many municipalities have or are considering filing bankruptcy to get out from under their pension debts. Total state and local unfunded pension liabilities are already estimated to be $3 trillion and growing.

The status quo cannot be sustained.

Citizens around the country must ask themselves once and for all if their governments work for them, or if they work for the government. San Diego and San Jose gave a resounding answer to that question last night.

COMMENTS

  • anjinconsulting

    When will you be sponsoring a bill that does this for the congressional retirement plan?

    • tnfriendofcoal101368

      We like Senator DeMint in these parts, he is one of the good guys.

      • MF

        Sen. DeMint is one of the GREAT guys. :-)

        • tnfriendofcoal101368

          Couldn’t agree more…

      • mainstreamconservative

        Agreed that he’s one of the great guys.

        But as a Senator who has chosen to post here, it means it’s fair game to ask him about the congressional retirement plan – something he personally benefits from directly.

        • Right Reason

          I believe the question was fair. However, the snark with which it was asked was most assuredly not.

    • lineholder

      DeMint has done more than most for Conservatives. He’s earned our respect.

      Let’s keep it that way, please?

      • gawken

        We arew going to have a GOP majority in the Senate next year, possibly as many as 55 seats, and the overall GOP Senate caucus will be much more conservative. We will thus have the troops. What we lack is a principaled, conservative leadership. McConnell MUST be challenged.

        • commonsenseobserver

          But perhaps it’d be best if we set firm term limits applying from this year onwards, and retroactively as well, for all party leaders.

          • cwfoster

            First, I wholeheartedly agree on term limits. HOWEVER, if you set term limits unilaterally, you concede leadership positions to those who are NOT ascribing to term limits. Suppose the Southern States all set up a two term limit, and Massachusetts has none, are you going to accept Scot Brown being the commitee chairman of whatever committies he sits on? That’s what will happen, because he will be the ranking member of whatever committies he’s a member of when the GOP takes power. That’s how we got Boner and McDoofus! They were there the longest! We need to take control of the Party from the INSIDE, the Steales, the Priuses, and the Rovers gotta GO!

    • tnguy

      Someone above said DeMint is one of the good guys. No, he’s one of the very few great ones. I’m sure I’m not alone in the sentiment that no senator in recent times has more of my respect than he does.

      • anjinconsulting

        But if we are do be taken seriously, conservatives must put their money where their mouth is; we must lead by example. The congressional retirement and benefits plan is the envy of any working stiff. Hell, they are exempt from Obama Care too. This editorial comes across as hypocritical and smacks of political opportunism.

        • mikeymike143

          and anjinconsulting, it takes a real idiot to challenge jim demint’s credibility on spending issues.

  • willik

    Have no fear, some ACLU miscreant will file a suit and the 9th Circus will strike down the “will of the people” once again!

    When in the world are you Californiacs gonna ever learn?

    Willie the Shake-speare had it right in Henry VI.

    Read Willie’s unique solution for lawyers. It’s good reading and indicative of a good starting point for y’all!

    • dwscho

      willik, That was my immediate reaction. How many times have we seen the voters of California make a decision on matters affecting their lives to see it overturned by the 9th circuit. Newt was definitely right about this court., It should be abolished.

  • michaelbowler

    No surprise there.

    Let’s send him some troops to reinforce the conservative contingent.

    Help us elect Ted Cruz to join Jim in Washington. Douchehurst is a thuggish liar, he simply must be denied the senate seat.

  • ThePoliticalHat

    …it to try and pass pension reform statewide via initiative. This is the one issue that they can get the majority of Californians to possible agree on. Sad, but true.