San Jose, San Diego pension ‘reform’ lets elected officials pass the buck

Too often, we give politicians a pass when it comes to solving real problems, and that has never been more true than when it comes to government budget deficits and the issue of public employee pension obligations.

Two local ballot measures being put to voters this Tuesday threaten to let elected officials off the hook again.

If so-called “pension reform” initiatives in San Diego and San Jose pass at the polls, it will open a floodgate of city council members and county supervisors throughout the state following suit by falsely blaming public employees for structural budget problems. By passing these ballot measures in two of California’s largest cities, voters will be giving lawmakers everywhere permission to pass the buck.

Pensions are not to blame for our budget problems. The state’s general fund deficit last month went up again — to $16 billion. However, every single dollar of public employee retirement payout amounts to just 2 percent of that general fund. So even if we scrapped the entire system and cut off all payments, there would still be a $14 billion problem. What’s more, the California Public Employees Retirement System (CalPERS) is actually healthy. In the two decades between 1991 and 2011, it has earned an average of 8.4 percent a year. What other investment can say that?

True, there are abuses of the pension system. We read stories about six-figure payouts and employees who use tricks to increase the size of their pension in the last few months they are employed. But those abusers are largely higher-ups who know how to game the system, not the average government employee who retires on little more than $2,000 per month.

In San Diego, where Proposition B is central to right-wing conservative Carl DeMaio’s campaign for mayor, the average public employee’s pension is a modest $24,024. In San Jose, the average for teachers, firefighters, police officers, and social service workers is just $28,901. These are not gold-plated pensions.

The place to find solutions for our pension issues is not at the ballot box through politically motivated, poorly written measures. The place to find solutions is at the bargaining table, where more than 200 local government employee unions throughout the state have already agreed to $600 million in concessions.

It was at the bargaining table where, according to the League of California Cities, 73 percent of California cities have already negotiated increased contributions from law enforcement employees; 57 percent of cities have already increased firefighters’ contributions to their own pensions; and nearly 4 in 10 cities have implemented cost-sharing for all employees.

Just six months ago, San Francisco showed that it’s possible to negotiate fairly at the bargaining table and achieve significant cost savings. Mayor Ed Lee and his staff sat down with the city’s unions and drafted a plan that will save $1.3 billion by requiring employees to contribute 7.5 percent of their salaries to a pension fund — a number that will go up or go down depending upon how well the economy performs.

It’s critical to consider the economy. That’s something the legislators tasked with sculpting an overhaul of the state’s public employee retirement system ought to consider carefully.

The conference committee poised to take action this summer should consider that pensions paid through CalPERS were responsible for generating $26 billion in economic activity in 2010 alone, including $1.2 billion into the San Diego economy and nearly $1 billion in Santa Clara County. Those are dollars that are spent on housing, groceries, and countless California small businesses. Mayors and county supervisors ought to be careful what they wish for when they say, out of one side of their mouths, that they want to create jobs, and then out of the other propose plans to reduce public employee pensions. 

They say “as goes California, so goes the nation.” If “as go San Diego and San Jose, so goes California” becomes a true statement, we may be sealing our fate for another decade of budget deficits. Don’t let our politicians use pensions as a scapegoat for their self-created budget deficits. Let’s force them to solve the real problem by saying no to pension “reform” measures on June 5.

Ed’s Note: Brian Moriguchi is President of the Professional Peace Officers Association and the Los Angeles County Organization of Police and Sheriffs.

Want to see more stories like this? Sign up for The Roundup, the free daily newsletter about California politics from the editors of Capitol Weekly. Stay up to date on the news you need to know.

Sign up below, then look for a confirmation email in your inbox.


Support for Capitol Weekly is Provided by: