The California State Teachers’ Retirement System estimates that the cost to fully fund the teachers’ pension debt will be almost $4.5 billion in the coming year, $4.6 billion the year after that, and more in each subsequent year.
CalSTRS calculates that 30 years from now – and many veteran teachers who retire now will live another 30 years – the annual cost of fully funding the system will be $13.9 billion.
The Bee’s editorial board last wrote about this issue in December 2012. The total unfunded liability stood at $65 billion then. Now, the amount is $71 billion.
14 comments:
If California adopted their own currency this wouldn't be such an issue...
Golden Bear Chits.
Seriously, CA is poised to pass Italy and Russia thus knocking on the door of the G7.
Rob Dawg said... Golden Bear Chits...
in da woods?
What would the unfunded liability be with a realistic projected rate of return?
nearly double. 7.5% now assumed. That isn't too bad but it assumes the past delayed contributions have been accreting at that rate all along.
Not sure about this whole situation. We need to clear out the bad debt accumulated in the system to return to sustainable growth, but clearing out this debt would be disastrous to the big pension funds like CalSTRS. The reality is that the people expecting lush pensions are going to have to alter their expectations.
5 moves to survive the 2014 bond meltdown
1) Understand when the bond bubble will burst
2) Determine exposure to the riskiest bonds
3) Reduce duration in your bond holdings
4) Hedge your bets
5) Diversify with dividend stocks
#1 is a toughie...
War on Poverty -- it's not a lost cause
Newsflash! If after 50 years of a war on poverty you're saying it's not a lost cause or it's not too late to save it, it's a a lost cause and it's too late to save it...
A slightly off-center perspective on monetary problems: The US should have crappy infrastructure
At a time when more and more left-wing people are inclined to deride welfare state capitalism as “pity-charity liberalism,” Kenworthy also argues against the further-left’s notion that what we actually need is a revival of trade unionism, a rollback of globalization, or much more extensive labor market regulation. In a few brief but forceful sections, Kenworthy also makes the case that progressives need to start caring more about the cost-effectiveness and quality of public services and not simply see things like schools and transit systems as means for creating highly paid public sector employment.
I'm sure this more rational view will be drowned out by his progressive compatriots...
Transit is only good for delaying renewal in order to extract maximum invested recovery. A rear guard action while looting the infrastructure.
The poors will always be with us (to do the laundry).
Climateers Caught in the Vortex
The cold snap may well be consistent with the general theory of global warming climate change, as the spinners are frantically arguing this week. (Andy Revkin points out–see the nearby chart–that while it’s colder than normal here, it is warmer than normal in Siberia. But let that sink in a moment. Siberia. The chart doesn’t tell us that it’s still really really cold there—this chart is a measure of relative temperatures, not actual temperatures. Because it’s flippin’ Siberia.) The trouble is that climate change has become what philosophers call a “non-falsifiable hypothesis.” Everything—Hurricane Sandy, warm winters, cold winters—is said to be proof of climate change.
Death to the 5th Republic?
Did François Hollande single-handedly kill the state Charles de Gaulle made?
Since LBJ began the war on responsible fathers, we now have three or four generations of unmentionables (12 to 15 yrs is a generation now) who call Washington their Daddy.
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