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Now California: Hoover Commission Proposes Rolling Back Pensions

February 24, 2011

One more assault on public workers. The monies in the pension funds that are now anemic were tied to Wall Street investments which were blasted by the 2008 financial collapse, just as Wisconisin’s were, and Ohio, and the rest of the states. THIS IS A PERFECT EXAMPLE OF WHY WE DO NOT WANT SOCIAL SECURITY TO BE TIED TO THE STOCK MARKET.

Sacramento Bee reports today:

The bipartisan Little Hoover Commission recommended today that California state and local governments roll back pensions for existing employees, dump guaranteed retirement payouts and put more of the pension burden on workers.

Although any attempt to reduce pensions for current workers would prompt a legal battle, the commission says that public pension funds are in such dire financial straits that they’ll never right themselves by reducing benefits for new hires. The recommendation would not affect current retirees.

The most controversial Hoover proposal would allow state and local governments to freeze existing employee pension benefits and then lower them for future years worked.

Courts have ruled that pensions are legally protected property and that government has a contractual obligation to follow through with them.

The Hoover idea echoes a similar plan that the California Foundation for Fiscal Responsibility has said it hopes to put to a public statewide vote next year.

Such a measure, if approved by voters, would undoubtedly trigger lawsuits that would test government’s ability to alter pension promises prospectively. The foundation believes that its ballot measure would hold up in court.

Read more: http://blogs.sacbee.com/the_state_worker/2011/02/commissions-plan-rolls-back-pe.html#ixzz1EvFjBPuJ

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