Rolling up big paper profits on stocks and other capital investments during 2017 and most of 2018 was very easy, and the California Public Employees Retirement System, the nation’s largest pension trust fund, took full advantage of the opportunity.
Its strong earnings, particularly in 2017, narrowed a yawning gap between its assets and future liabilities for pension payments to state and local government workers.
But it was short-lived and CalPERS has not only regressed but could actually be underwater because of a new way of calculating its liabilities. Read More
Later this year California Governor Gavin Newsom will negotiate a new contract with state prison workers that must be approved by the legislature. The consequences are big, especially for discretionary programs supplied by the state’s General Fund. Read More
Earlier this week the Los Angeles Unified School District reached agreement with striking teachers. The settlement is at best temporary because structural issues were not addressed. Read More
Those of you interested in state, local and school district pension obligations should add an esoteric phrase to your vocabularies: “Accretion of Discount.” Read More
Opinion // Open Forum
Last month I turned 65 and became eligible for Medicare, the national health insurance program for people my age and older. Medicare is fantastic — and fantastically cheap — health insurance. But, believe it or not, if I were a retired California state employee, both I and my dependents would be entitled to health insurance subsidies. Read More
LOS ANGELES (AP) — Strike or no strike, after a deal is ultimately reached on a contract for Los Angeles teachers, the school district will still be on a collision course with deficit spending because of pensions and other financial obligations.
School systems across California are experiencing burdensome payments to the state pension fund while struggling to improve schools.
The problem is especially acute for districts like Los Angeles Unified that will see a financial hit in part because of steadily declining enrollment. Read More
On the eve of a massively disruptive strike that would hit families at more than 900 schools, Los Angeles Unified teachers say they deserve a better deal on pay and working conditions.
The district has given some ground in recent days but argues that on at least the money issues, budget projections are grim despite a current reserve, and you can’t give away what you don’t have. Read More
In December I turned 65 and became eligible for Medicare, the national health insurance program for people my age and older. Medicare is fantastic — and fantastically cheap — insurance. But, believe it or not, if I was a retired California state employee, I would also be entitled to a state-provided health insurance subsidy that this fiscal year will cost taxpayers $2.6 billion — more than double the cost ten years ago. Read More
If I had one wish for 2019 it would be that journalists and elected officials cite original sources of information about K-12 spending in California, a subject about which far too many too often cite unauthoritative sources. Read More
Prevent a strike at LAUSD
On January 7, Gavin Newsom will be sworn in as governor of California. On January 10, a strike has been scheduled by the LA teachers’ union (UTLA) against LA’s school system (LAUSD). A strike will impact 600,000 students — including many who get health and nutrition services at school — and their families plus the members of other unions that, unlike UTLA, have reached agreement with LAUSD. Read More
If ever you wanted a sense of the Kafkaesque world that often characterizes California politics, imagine yourself in the shoes of Austin Beutner, Superintendent of the Los Angeles Unified School District (LAUSD). Read More
Los Angeles Unified School District collected $7.2 billion in revenues in its 2017–18 fiscal year. That translates into $298,000 per teacher, 42 percent more than four years earlier… Read More
Use the Internet, don’t blame it.
China’s government fears an Internet that exposes people to political truths. Today some in Congress fear an Internet that exposes people to political lies. Read More
Ten years ago, California’s Department of Social Services — whose mission is “to serve, aid, and protect needy and vulnerable children and adults” — received nearly $10 billion, which was 10 percent of the General Fund that year: Read More
Arnold Schwarzenegger was not on the ballot in the midterms, but the former California governor’s influence was apparent in the outcome of reform initiatives in Michigan, Missouri, Colorado and Utah. Those four states were the 2018 battlegrounds in Schwarzenegger’s campaign to have independent commissions, rather than politicians in power, draw congressional boundaries after the 2020 census. Read More
This year California’s governor and state legislature are choosing to spend $15 billion on the Department of Corrections and Rehabilitation (CDCR), which incarcerates 127,000 prisoners. Read More
David Crane’s resume is a varied and illustrious one. He was a partner at Babcock & Brown, a global investment firm, for 24 years, then went on to serve as a special adviser to Gov. Arnold Schwarzenegger from 2004 to 2010. Now Crane lectures in public policy at Stanford University, serves on the board of the Goldman School of Public Policy at UC Berkeley, and is president of Govern for California, an organization of more than 250 politically informed philanthropists supporting state legislators who put citizen interests ahead of party or personal concerns. Some legislators vow publicly to support job creation, students and social justice, but vote against those priorities under pressure from special-interest groups. In backing legislators dedicated to honest budgets and open government, Govern for California aims to improve schools and health care, fix pension problems, fund parks and environmental protection, protect tax revenues from special interests, and in general make government work. Read More
Now that Governor Brown has acted on all 1,217 bills sent him by the legislature, we are turning our attention to the 2019 legislative session. One GFC focus will be improving the quality of services provided Californians. Below is a overview of two of the most important services. Read More
On September 20 the Federal Reserve recognized a truth long covered up by California's public pension funds. Read More
In its latest quarterly Financial Accounts report the Fed revised its measure of unfunded pension liabilities owed by state and local governments to $4.1 trillion, more than double the amount previously reported.
The California Prison Guards Association (CCPOA) is spending $500,000 on TV ads against Marshall Tuck in the race for Superintendent of Public Instruction. Why would the largest recipient of state spending on California’s prison-industrial complex care about the identity of the state’s next SPI? Read More