Schwarzenegger, Unions Clash Over Pension

[corksean]

SACRAMENTO, Calif. (AP) - Gov. Arnold Schwarzenegger's proposal to overhaul the pension funds that 2.1 million California state employees have long depended on - by converting the funds into plans resembling 401(k)s - has teachers, firefighters and other workers suddenly worried about their retirement.

Under the proposal, Schwarzenegger wants to replace the nation's two largest public pension systems with private retirement plans similar to the 401(k)s popular with businesses.

The proposal is designed in part to make up for the shortfall the pension funds have suffered in a struggling stock market. Because of subpar returns on their investments, as well as enhanced retirement benefits approved during good times, the state will be required to pay $2.6 billion this year into its largest pension fund, the California Public Employees Retirement System, and another $1 billion in the teacher retirement system.

http://www.guardian.co.uk/worldlatest/story/0,1280,-4819311,00.html

[GetTheRightVote]

1. So now the Big A wants to destory the union retirement funds, watch out

pension holders, you are about to go on the worst ride of your lives.

:kick:

[oneighty]

2. "Short fall the pension funds have suffered

in the struggling market"

I hope he ran that past Bush* first.

180

[skylarmae]

3. they wanted him, now they got him - maybe they need to RECALL

his "b grade actor" ass....

[Egalitariat]

4. California screwed the pooch in a major way

when they updated all of their spending programs and retirement benefits to reflect the monetary flows of the dot-com bubble, which benefitted California more than any state in the country. Not only that, but they set it up to guarantee the outflows would increase every year after that, regardless of whether the money kept coming in at the unheard-of windfall pace. They could have set a lot of that extra windfall money aside, but they found a way to spend every penny in the bank.

And then they screwed the pooch in an even bigger way by electing a steroid fuel idiot to fix the problems.

[AP]

6. They weren't asking employees for contributions when the market was going

up. That was the mistake. They should have been taking contributions those years to cover the lean years. I believe that was a decision made by the Wilson gov't, but I'm not sure.

[whistle]

5. See, the repukes are attacking social security and federal and

...state employee pensions. It is total social warfare, the looting of working persons security for retirement. In the meanwhile, the federal government is taking over airline company pensions and bailing out other corporations who have defaulted on their pension programs and making taxpayers pay for those. This is complete piracy!

[Megahurtz]

7. We need a Robin Hood.

[AP]

8. What this is REALLY about is public pension fund management (which is

elected by union members) not being in bed with the management of companies whose stocks they buy.

CALPERs holds corporate boards' feet to the fire and Wall St doesn't like that.

Wall St wants individuals who don't have the time to or information or collective strength to be voting and "controlling" shares. They're trying to diffuse the little power shareholders have among millions of 401k holders rather than concentrating in the hands of a very powerful pension fund manager.

The other thing this is about is Wall St broker profits. It costs something like 18 cents per 100 dollars of CALPERs investment to pay for management costs. But 401k management fees are something like $2.85 per 100 dollars invested. Why? Because a CALPERs manager doesn't have 1000 times as much work if she's investing 10M vs 10K. But every 401k holder has to pay for a buy or sell order each time they move shares, no matter how little it is. To Wall St, Calpers represents a huge opportunity cost (in addition to being an unwanted oversight on their management which is generally designed to make insiders rich, rather than the average schmo who owns 100 shares of Class C non-voting shares).

Even if you don't have money in CALPERs, you better hope they don't disappear -- they're the only powerful organization out there making sure the equities market isn't a rip-off.

[CountAllVotes]

9. I'm sure Vanguard & Fidelity can hardly wait!

Ahnuld is pissing off people off I'm sure!

I wonder how many of greedy/desperate for a buck State employees that voted for this idiot so they'd get their car tags lowered are regretting it now?

The unions are fighting ... for what it is worth!

Pension Attack News
Here's the latest news and information about Governor Schwarzenegger's attack on public employee pensions and what we're doing to fight back.
CalPERS Office of Governmental Affairs recommends that the pension fund oppose legislation to create a defined contribution plan. Read the memo. (2/15/05)

ABC News: Schwarzenegger Axes Pension Plan Opponents (2/10/05)

Myths, lies and broken promises. A San Francisco Chronicle "Open Forum" article by CSEA President J.J. Jelincic. (2/6/05)

CalPERS Says State Should Look Before It Leaps Into Privatizing Public Pensions. (1/6/05)

Pension Reform Likely to Heat up Quickly (LCC, 1/21/05)

Fight looms over Schwarzenegger's call for pension reform (San Jose Business Journal, 1/6/05)

Schwarzenegger's pension reform plan called attack on corporate cleanup (San Jose Mercury News, 2/3/05)

http://www.calcsea.org/president/pension-index.asp

and ...

Schwarzenegger's Pension Plan Will Take Investments OUT of California. Currently, nearly $20 billion in pension funds managed by CalPERS is invested in California. For example, CalPERS is one of the state's largest real estate developers. Under the Governor's plan, this money would be taken out of California and given to out-of-state companies like Fidelity and Vanguard. Check out this Fact Sheet (pdf).

http://www.calcsea.org/index.asp



:kick:

[cosmicdot]

10. there seem to be several aspects and sub-plots ...

the ousting of Sean Harrigan as president of Calpers, naming a former real-estate executive, Ron Alvarado, seen as more business friendly to replace the outspoken union official as a board member of the largest U.S. pension fund
http://sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2004/12/02/BUGLPA4Q721.DTL&type=business

CalPers witholding votes from Warren Buffet from Coca-Cola Board, and support from Citigroup's Chairman Sanford Weill and Chief Executive Charles Prince as directors ... Warren Buffet advised the Gropinator ... imagine he still does ... good ol'boys don't take defeat easily ... they typically retaliate and seek retribution.
http://www.bizjournals.com/seattle/stories/2004/04/12/daily8.html
(the little check and balance action citizens of America have against corporate america)

Enron
http://www.calpers-governance.org/news/2002/0221.asp

from the Guardian UK article
````````````````````````````

"There will be the unions and the special interests fighting us,'' he told a Republican party gathering Feb. 11. ``Now we are going to the source, right there where all the evil is and we are going to fix this problem once and for all." - the evil Gropinator* to the biggest evil special interest group of them all, the evil Republican Party


"At CalSTRS, four of the governor's own appointees voted against his plan, which led Schwarzenegger to retaliate by firing them, a move his critics dubbed the 'Thursday afternoon massacre'."

* a tool with school yard rhetoric and Hitlerian techniques

heaven help us get him out of office