Bill opposing federal bailout of pension debt killed
By SHANNON GROVE, Assemblywoman
SACRAMENTO – A proposal authored by Assemblywoman Shannon Grove (R-Bakersfield) to oppose any attempt by California officials to receive a federal bailout of state pension debt was rejected on May 6 in the Assembly Committee on Banking and Finance. Grove introduced Assembly Joint Resolution 10 as a preemptive measure in the face of mounting unfunded pension obligations.
What I’m asking for here is a reality check. Generations of elected officials have approved benefit increase after benefit increase for public-sector workers, without a moment’s concern for the viability of their actions or who will pay for it.
The governor’s feeble attempt at pension reform last year is only expected to save 5 percent of the money the state spends on pensions and health care. California legislators need to develop a serious, comprehensive solution to this growing problem before the full bill comes due.
A recent report by the California Public Policy Center estimated that California’s state and local governments are in debt at least $848 billion and the number could be as high as $1.1 trillion, depending on how retirement obligations are calculated. Future taxpayers, not public employees, will bear the responsibility for pension shortfalls caused by the current structure of state and local pension systems.
In order to force states to face their own problems and enact reform, political leaders need to make it clear that any federal bailout is off the table,
California alone must get its fiscal house in order and address its billions in unfunded pension liabilities. Federal taxpayers shouldn’t be held responsible for the reckless spending habits of the California legislature.
The measure is part of a nationwide campaign initiated by the Illinois Policy Institute, a leading free-market think tank.
The effort began last year after Illinois Gov. Pat Quinn proposed that the federal government guarantee Illinois’ severely underfunded pension systems.Story First Published: 2013-05-15