Article

2011-03-07 Economy

Pensions pushing California to the brink

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Posted by GolfBravoUSMC 2011-03-07 14:28|| || Front Page|| [1 views ] Top

#1 From the article: "pension costs will crush government." This certainly should get the attention of progressive Democrats who claim to care about public services, although the reality is that these Democrats believe that Californians are woefully under-taxed and that massive tax increases on business and "the wealthy" will fix things.
The US & its states have many problems pending which can crush those governments & worsen life for their citizens. The author proposes CA simply forces a change in (IIRC) contractually-obligated pension payout plans. IANAL, but I guess the only way to do that is for the state to go through bankruptcy.

Posted by Anguper Hupomosing9418 2011-03-07 15:24|| 2011-03-07 15:24|| Front Page Top

#2 If anyone wonders, the US has the highest corporate tax rate of any of the major industrialized nations and California has the highest corporate tax rates of any of the 50 states. So they wonder where the jobs went and where the businesses went? If they were less communist and more pro business, there would more jobs and more people paying taxes.

Its the elastic side of the productivity curve. To a point you can lower cost (taxes) which increases sales (jobs and tax payers) and remain revenue positive compared to the other side of the curve where decreases in taxes decreases revenue.

Too bad none of the clowns in congress know how to spell economics much less understand them.

Posted by Bill Clinton 2011-03-07 17:41|| 2011-03-07 17:41|| Front Page Top

#3 IANAL, but I guess the only way to do that is for the state to go through bankruptcy.

This isn't my area of expertise but there's no legal provision allowing states to declare bankruptcy. Even if there were the massive Democrat / union axis would force states to lobby hard to screw bondholders while preserving everything promised to public employees which, in turn, would guarantee we'd be right back at the present tipping point in a very few years.

One solution I've seen proposed, which seems rather brilliant to me, is to simply tax public employee salaries, pension payments & benefits at the state level at rates high enough to completely cover the present cost of all public employee pensions & benefits to both present & past employees. That's perfectly allowable, would easily pass Constitutional muster, & would accomplish what is necessary to solve the problem. Namely: pitting unionized workers against unionized retirees & letting them engage in a contest to see how fast one group can screw the other in their own self-interest. Would solve the state & local budget problems overnight and snap public employees and their unions back into line rather quickly.

Posted by Ulutch Dingle8554 2011-03-07 22:42|| 2011-03-07 22:42|| Front Page Top

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