Ca, is 16 BILLION in the hole, yest the welcome Illegals in by the train load. Free food, free medical, free housing, come on in.
The Teachers, Police, Fire and Prison guard unions are paying their retirees millions.
The latest: Newport Beach, California, where some lifeguards have compensation packages that exceed $200,000 and where these "civil servants" can retire with lucrative government pensions at age 50.
$200,000 Lifeguards to Receive Millions in Retirement - David Spady - Townhall Conservative Columnists
The average California household's share of the debt for underfunded state and local government employee pensions comes to about $30,500.
Stanford University studies released last week and in December for the first time aggregate public pension shortfalls statewide. Using moderate assumptions about future investment returns, the unfunded liability is about $379 billion.
Hard-core pension reformers will maintain that the number is much more. Defenders of the status quo will insist it's significantly less. Before sorting out that dispute, let's understand what the numbers mean.
Each year public employees work, they increase their future pensions. So, as they work, they and their employers jointly should set aside enough money to cover the additional benefits.
To calculate the contributions, actuaries and pension boards make assumptions about future investment returns and pension costs. Unfortunately, they've been wrong.
They have overestimated investment earnings, underestimated pension costs and retroactively added benefits without proper funding. As a result, pension systems across California have huge unfunded liabilities.
Keep in mind that the shortfall is for pension benefits employees already earned. Like salary and health care benefits, it's a cost that should be paid when labor is performed.
Instead, the shortfall has been converted into debt to be paid off over time, up to 30 years. Government agencies make those payments, diverting money that would otherwise go for government services. So we're depriving current and future generations to pay off past labor costs.
How much is the debt? It depends on how much pension systems project they can earn on investments. The greater the assumed rate of return, the less money pension systems need now and, hence, the smaller the shortfall. The converse is also true.
