Why Romney And Ryan Didn't Cut It

Romney never had it in him--

Romney And Ryan Didn't Cut It In A Time For Radicalism - Forbes: " . . . Some thought Romney’s selection of Paul Ryan hinted at radicalism, but the much-ballyhooed “Ryan Plan” wasn’t radical. On the contrary, it was designed to shore up the entitlement state and still would add trillions more to the national debt. Ryan’s plan to gradually reduce deficits over the course of a decade might have sounded reasonable on paper, but does anybody think that the American public has the self-discipline to adhere faithfully to a fiscal diet for 10 straight years? Dream on! For decades, the Republicans have let the Democrats set the agenda, expanding the power and scope of the federal government and spending far beyond federal revenues. The Republicans have been reactive, agreeing to the basic premises of the transfer society while generally trying to slow the rate of growth in spending (although Nixon and Bush II took the line of least political resistance andspent as merrily as any Democrat not named Obama). The result is that Republicans are too stingy for liberals and too profligate for true conservatives and libertarians. . . . "

They're all Hogs at the Trough.

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Social Security changes challenge Democrats

Some people (mainly Democrats in regard to Social Security) just can't handle the truth--

Social Security changes challenge Democrats | www.ajc.com: ". . . The term refers to changing how inflation is calculated, affecting a slew of policies including Social Security benefits and marginal tax rates. The government currently uses the consumer price index, based on a fixed set of goods. A “chained” consumer price index takes into account the fact that people are likely to substitute more expensive goods for cheaper ones as prices shift, and many economists argue it is a more effective measure of inflation. And in a town looking for ways to save money, it’s a bonanza: The Committee for a Responsible Federal Budget, a group pushing the chained CPI as part of a budget deal that follows the Bowles-Simpson fiscal commission’s outline, estimates the switch would save $236 billion over the next decade if implemented in 2014. . . . "

Hogs at the Trough and the Trough will soon be Empty!

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Unsustainable Public Worker Pay and Pensions in California

Unsustainable Public Worker Pay in CA — California Political Review: "Last week, Bloomberg News reported that California has the highest paid state workers in the 12 largest states by population.  But that didn’t tell the entire story. Sure, California has the highest paid public workers. But it also has the highest median income. Adjusting for median income levels, California still has one of the highest levels of public employee pay, as shown in Table A below. But that doesn’t tell the bigger story about the huge submerged public pension iceberg approaching California.  It isn’t only pay levels, but benefit levels that are going to overwhelm California local government budgets. . . ."

California is going down--now it is just a matter of time.

Hogs at the Trough and the Trough Will Soon Be Empty!

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Owner of mental health chain pleads guilty to stealing millions from Medicare

Miami to North Carolina to . . . .

Miami owner of mental health chain pleads guilty to stealing millions from Medicare - Miami-Dade - MiamiHerald.com: "Kept behind bars because of fears he might flee to Cuba, Armando “Manny” Gonzalez has pleaded guilty to stealing tens of millions of dollars from Medicare by fraudulently billing the taxpayer-funded program through a mental health chain in Miami and North Carolina. Gonzalez, 50, a convicted cocaine trafficker who joined the Medicare rackets in the mid-2000 era, had opened a pair of mental health clinics in the Kendall and Cutler Bay areas. By 2008, Gonzalez suspected the feds were on to him, so the one-time Miami-Dade resident exported himself and his business to North Carolina. Before his arrest last May, he was planning to open another psychotherapy clinic in Tennessee. . . . The ALF operators were accused of taking bribes from Gonzalez in exchange for supplying a steady stream of patients, many of whom suffered from dementia and Alzheimer’s disease. They could not have benefitted from the therapy, prosecutors said. . . . ""

"Medicare rackets"-- this guy is just one of many!

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Thousands of public employee retirees draw pension and salary simultaneously

When can one be "retired" and work at the same time? When you retire from/work for the government!--

Report: Thousands of public employee retirees draw pension, salary simultaneously: ". . . From substitute teachers to cabinet secretaries, thousands of public employees in Wisconsin who retired in recent years returned to work, allowing them to earn both a paycheck and a state pension, according to a Legislative Audit Bureau report released Friday. And while many employees and employers like the arrangement, the system can be abused, the report found. The state lawmaker who blew the whistle on the practice last year, Rep. Steve Nass, R-Whitewater, thinks it's time for it to be abolished. "Steve is pretty emphatic — he thinks the report indicates double dipping needs to end," Nass spokesman Mike Mikalsen said. But Employee Trust Funds Secretary Robert Conlin said the audit bureau report supports continuation of the practice but with measures to crack down on those who cheat the Wisconsin Retirement System (WRS) by pre-arranging their return to government service. . . . "

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Right-to-work comes to Michigan

Michigan, surprisingly, is actually trying to iterate--

Right-to-work comes just in time for Michigan - Diana Furchtgott-Roth - MarketWatch: "Democrats tend to be pro-choice on abortion, but they don’t want to give workers any choice about union membership. Witness the howls of rage this week when Michigan’s Republican legislature ruled that workers won’t be required to join a union or to pay fees to unions as a condition of employment. Governor Rick Snyder signed the bill on Tuesday, so Michigan will join neighboring Indiana as a so-called right-to-work state on April 1, 2013. Only police and firefighters will be exempt. Read Wall Street Journal story “Unions Dealt Blow in UAW’s Home State.” By state statute, the new law cannot be overturned by a referendum because it contains an appropriation ($1 million for the law’s implementation and worker education activities). . . . However, this approach didn’t work in Wisconsin, where unions spent millions of members’ dues in a futile attempt to recall Governor Scott Walker, who eliminated collective bargaining for public workers. Michigan is the 24th right-to-work state, following Indiana, which became the 23rd state on Feb. 1, 2012. So far, over 200 companies have announced they will move to Indiana or expand existing operations in the state, and 90 cited the right-to-work law as a factor. . . ."

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Illinois - another new pension reform plan

Still "spinning their wheels" in Illinois--or some would say, "fiddling while Rome burns"--

Illinois rank-and-file lawmakers float new pension reform plan - chicagotribune.com: "Under the proposal, retirees would get an annual cost-of-living increase on only the first $25,000 of their pensions, $20,000 for those who also get Social Security. Retirement ages would not rise for people 46 and older, but a phase-in would increase retirement ages by as much as five years for people 34 and under. Current retirement ages vary, such as 60 for rank-and-file state workers and 55 for prison guards. Employee contributions would rise 1 percentage point the first year and another percentage point the second year. Contributions for rank-and-file state workers now are about 7 percent, according to the union. The proposal also would make it clear that a failure by public employers, such as the state or a school district, would be grounds for a lawsuit if they didn't make proper annual payments — a major reason that many public retirement systems are underfunded. New public school teachers and state university workers would be part of a cash-balance plan, sort of a hybrid between a plan that guarantees employees a certain benefit and also partly relies on investment returns. The plan comes as Illinois faces a pension debt of as much as $96 billion, the worst in the nation. Democratic Gov. Pat Quinn has noted that increased pension payments in the coming years could cut into how much the state has left to spend on education and other government services."

Likelihood of passing? Probably zero.

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Malibu residents move dead whale -- government fails

Doesn't the following story sound typical?

Malibu residents move whale carcass, ignoring red tape - latimes.com: "For days, a whale was left decaying -- and smelling -- on a Malibu beach as government officials debated what to do. On Saturday night, the rotting carcass of a 40-foot fin whale was quietly pulled out to sea by a private tugboat hired by Malibu residents who were tired of its stench. After days of official bickering over whose responsibility it was to deal with the landlocked leviathan, a local homeowners association stepped in, according to Fire Inspector Brian Riley. Members hired a private company to bring a tugboat to remove what was left of the 40,000-pound whale, which had washed ashore last Monday, already dead. The whale had suffered a wound to the back, perhaps the result of a collision with a boat. The tug towed the carcass some 20 miles offshore -- far enough that the remains are not expected to reappear, Riley said. . . . Previously, state and local officials said they were not sure they could accomplish the feat before higher tides arrived this weekend. . . ."

Obviously they (government officials) were right--they couldn't get the job done. I wonder who broke the news to them?

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"Bring Home the Bacon"

Fox 2 News Headlines

Detroit councilwoman to Obama: We voted for you, now bail us out - Fox 2 News Headlines: "City Council member JoAnn Watson said Tuesday the citizens support of Obama in last month's election was enough reason for the president to bailout the struggling the city. (Click the video player to listen) "Our people in an overwhelming way supported the re-election of this president and there ought to be a quid pro quo and you ought to exercise leadership on that," said Watson. "Of course, not just that, but why not?" Nearly 75 percent of Wayne County voters pulled the lever for Obama in November. "After the election of Jimmy Carter, the honorable Coleman Alexander Young, he went to Washington, D.C. He came home with some bacon," said Watson. "That's what you do." Young served as Detroit's mayor for 20 years and served as vice chairman of the Democratic National Committee from 1977 to 1981."

It's all about "bringing home the bacon."


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Municipal and state pension hemorrhage accelerating

KEEGAN: Note to Morningstar: Municipal and state pension hemorrhage accelerating « Watchdog News: "As a leading provider of investment research, Morningstar is taking an interest in government pensions because there is an intense legal debate about who gets paid first, pensioners or bondholders, when a municipality defaults or a state simply runs out of money even though it cannot declare bankruptcy. Numerous recent studies by a wide array of economists calculated that as presently operated, all defined benefit public pension funds will run out of money, some sooner, some later, but all eventually. Reforms 33 years ago intended to put government pensions on an actuarially sound basis failed. The Government Accountability Office warned in a1979 report, Funding of State and Local Government Pension Plans: A National Problem, “To protect the pension benefits earned by public employees and to avert fiscal disaster, State and local governments should fund on an annual basis the normal or current cost of their pension plans and amortize the plans’ unfunded liabilities.” State and local politicians did not, and they are proving now they never will. The defined benefit pension system is fundamentally, systemically flawed and prey to what actuaries call “moral hazard.” Politicians can make promises they know they won’t have to keep and pile up debts they won’t have to pay. To one degree or another, that is what is happening in every state and municipality, and there is nothing under the existing system to stop it. The only solution is to freeze defined benefit plans now, amortize the existing debt and shift to defined contribution or hybrid cash balance plans. . . . "

Answer: abolish all public pensions. Replace with self-funded tax-sheltered retirement accounts for everyone, including government workers.

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Bing Said City Workers Feel Entitled

Bing Said City Workers Feel ‘Entitled,’ Says His Job Second Only To Obama’s « CBS Detroit: "Managing expectations is his day-to-day position against people who believe the mayor can solve all of Detroit’s problems is the hardest thing he deals with every day. That’s according to an interview Detroit Mayor Dave Bing did with CNN where he talked about the community’s deep problems and how he plans to solve them. “We are in an environment, I think, of entitlement, we’ve got a lot of people who are city workers, who for years and years, 20, 30 years, think they are entitled to a job and all that comes with it,” Bing said."

Government workers feel entitled? Hogs at the Trough!

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FHA another Fannie or Freddie?

In an F.H.A. Checkup, a Startling Number - NYTimes.com: "DO we have another Fannie or Freddie on our hands — another mortgage giant headed for a rescue? Like Fannie Mae and Freddie Mac before it, the Federal Housing Administration is suffering in a mortgage hell of its own making. F.H.A. officials say they won’t need taxpayers’ help, but we’ve heard that kind of line before. The F.H.A. backs $1.1 trillion of American mortgages and, by the look of things, it’s in deep trouble. Last year, its mortgage insurance fund was valued at $1.2 billion. Today that fund is valued at negative$13.48 billion. . . . The F.H.A., a unit of the Department of Housing and Urban Development, is not about to stop insuring mortgages. Its officials say that without the F.H.A., people would have a tougher time getting home loans, and the housing market would suffer. (The F.H.A. insures loans of up to $729,750 in certain areas and requires down payments as low as 3.5 percent.) But the sharp decline in the fund’s value is a stark reminder that the mortgage mess is still very much with us, even as the real estate market seems to be recovering. In November 2011, for example, the F.H.A.’s auditor projected that the fund’s value would climb to $9.5 billion this year. The agency acknowledged that its financial position is a hostage to insured loans that still have “significant foreclosure and claim activity yet to occur.” Whether the F.H.A. will have to turn to the Treasury for help, of course, remains to be seen. . . ."

Housing and mortgage mess continues.

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Public pensions in Puerto Rico face possible insolvency

Puerto Rico may become the 51st state--but it looks like it is in the same sad state as California and Illinois--

Public pensions in Puerto Rico face possible insolvency | Retirement Income Journal - The information forum of the decumulation industry.: "After shortchanging its public retirement funds for years, Puerto Rico now has the weakest major public pension system in America, according to a report in yesterday’s New York Times.    The main fund, which serves about 250,000 government workers, current and retired, is only 6% funded and could run out of money as early as 2014. Another fund, for about 80,000 teachers, which is 20% funded, is in almost as bad shape. Police officers and teachers in Puerto Rico rely entirely on their pensions, having opted out of Social Security. The commonwealth itself has had trouble issuing bonds at attractive rates to cover its short-term financing needs. “For now, I’m not totally shaken about the possibility of the fund going broke,” said Jorge Ramón Román, a 78-year-old retired instructor for the island’s Civil Air Patrol. “But I do fear for the future, when I’ll be an even older person, more infirm and with less of a pension.”"

Answer: abolish public pensions, allow self-funded retirement funds, and expand Social Security

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FTC wastes taxpayer money

Guest post today from (republished with permission): Views under the Palm - johnmpoole.com: FTC does not have a case against Google: "Google may dodge FTC's antitrust bullet, report says | Internet & Media - CNET News: "Regulators aren't sure they have enough evidence for an antitrust lawsuit and are examining whether consumer benefits of Google's search approach outweigh harm to competitors, Bloomberg reported, citing three unnamed sources."

No kidding--this was obvious to most non-biased people a LONG time ago--in the meantime the FTC has wasted millions in taxpayer funds chasing a meritless case, hiring expensive outside counsel (I would love to know the particulars of that "sweetheart" personal services contract--"only inside the beltway"), just to harass one of the most respected companies in the world--and a large generator and platform of new businesses which use Google apps and other services at low, or no cost.

Microsoft and some other competitors of Google have been lobbying the FTC and other federal departments and agencies to "harass" Google--

"Those rallying opposition to Google include two industry groups, FairSearch.organd Icomp; Microsoft is a member of both groups, but other companies involved with the groups include comparison shopping sites Foundem and Nextag and travel sites Kayak, Expedia, TripAdvisor, and Hotwire."

And of course I am sure China and radical foreign Islamists (YouTube anyone?) who oppose Google's stance on free speech and a free internet would also want the FTC to do their dirty work.

As one commenter on the above cited article wrote--

"Why not investigate whether sufficient legal authority to hire outside council [sic] ever existed in this case. 'Microsoft told me to.' is not legal justification for wasting taxpayer money and trashing the Constitution.""
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Chicago Still Suffers from Corrupt Image

Chicago Still Suffers from Corrupt Image | NBC Chicago: " . . . One reason Chicago maintains its unscrupulous profile is its tradition of Mike Royko-style investigative journalism and its focus on the darker side of politics, Grossman said. Chicagoans are also deeply interested in that subject, and enjoy speaking about it publicly – arguably more than in most parts of the country. So, corruption cases that might otherwise not attract much sustained attention get thoroughly discussed and dissected.“In some cities maybe where the public culture is less vibrant, corruption doesn’t bubble up as quickly,” Grossman said. But Simpson points out that there several realities still make Chicago a cradle for graft. It is dominated by one party, the Democrats (conversely, the outlying suburbs, with its own tradition of corruption, is overwhelmingly run by Republicans). Despite laws to curb patronage, machine-style politics abound, notably on the hyper-local level. Family dynasties remain, most notably the Jacksons’ (Jackson Jr.’s wife, Sandi, is an alderman). And state campaign finance laws are still relatively lenient, Simpson said. And then there's the continued popularity of politicians facing corruption charges. On the same day that Jackson Jr. won re-election, so did Derrick Smith, who won back his seat in the state House of Representatives despite having been charged with taking a bribe, and expelled from the House. . . In the end, it’s up to the people of the city to make things better. “The problem with corrupt politicians is when people are willing to put up with it,” he said.

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Eisenhower family fights design of memorial

Eisenhower family continues to fight ‘totalitarian state’ design of memorial - Le·gal In·sur·rec·tion: "A proposed Frank Gehry designed memorial for President Eisenhower is being vehemently protested by his only living son as well as granddaughters, who have objected both to the high cost to taxpayers and the design concept. A letter made public November 20 by granddaughter Susan Eisenhower details the latest events in the ongoing struggle between the family and the commission. It also highlights yet another attempt to impose a thinly veiled progressive narrative over historical events (the Rev. Martin Luther King. Jr. memorial comes to mind). Philip Kennicott, the Washington Post’s culture critic, writes: “Gehry has produced a design that inverts several of the sacred hierarchies of the classical memorial, emphasizing ideas of domesticity and interiority rather than masculine power and external display.” The design, which features 80-foot tall ”giant industrial steel” tapestries, is considered by Susan to evoke a ”totalitarian state.” The tapestries are estimated to add considerable cost to the already substantial $120 million cost for their upkeep."

Hope the Eisenhower family is successful. My hat is off to them.

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Miami Beach code officer gets prison time

Power corrupts--

Miami Beach code officer gets prison time - Miami Beach - MiamiHerald.com: "A fired Miami Beach code enforcement supervisor who led the shakedown of a nightclub owner for thousands of dollars was sent to prison Tuesday for more than four years. Jose L. Alberto, 42, was taken into custody immediately after U.S. District Judge Robert Scola sentenced him. Alberto was arrested along with six other Miami Beach employees earlier this year in an FBI sting operation that shook City Hall. Collectively, the ring extorted $25,000 from the Miami Beach nightclub owner, who tipped off authorities. In August, Alberto pleaded guilty to conspiring to commit extortion. He admitted personally accepting 22 separate cash bribes totaling $16,600 from the Club Dolce owner and an FBI undercover agent. Alberto, whom the city hired in 1993, earned $122,000 with overtime pay in 2011 as the second-in-command of the Building Department’s code compliance division. . . . "

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Lawsuit Alleges “Corruption and Negligence” at DOE

Green graft?

Lawsuit Alleges “Corruption and Negligence” at Department of Energy: "A lawsuit filed in federal court on Wednesday alleges mass favoritism in the Department of Energy’s decisions to award federal grants to major car companies to develop electric vehicles, according to a legal complaint obtained by Scribe. The plaintiff, San Francisco-based XP Technology, says in a complaint filed in the U.S. Court of Federal Claims that “corruption and negligence” pervaded DOE’s decision to award loan guarantees to Ford, Nissan, Tesla Motors, and Fisker Automotive for the development of electric vehicle technology. “Investigations have shown that DOE officials intentionally stalled numerous applicants’ reviews in order to force them out of business and protect favored players,” the complaint claims. It adds: XP has received information demonstrating that the unprecedented number of failures in the DOE program relative to what DOE officials have claimed to be “the most expensive and extensive due diligence in history” is explained by manipulated reviews, in the due diligence effort, on behalf of what the United States Government Accountability Office (GAO) investigations found to be “favoritism” in published investigation reports. A senate ethics investigation states, in published reports, that “negligence and mismanagement by DOE officials” was a regular occurrence. XP, which applied for federal backing under the Advanced Technology Vehicle Manufacturing program, “is seeking to have applicants who were “targeted” receive fair re-reviews, in a transparent manner, if they so desire.” In addition to an unfair selection process, XP alleges that DOE retaliated against the company for reporting evidence of negligence and corruption incorporated into the various investigations into the ATVM program."

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Cows Flee California

Cows, Hogs at the Trough--it's all a real barnyard tale--

RealClearMarkets - Cows Flee California Seeking a Better Economic Climate: "A few years ago, the Office of Management and Budget assessed federal dairy price support programs as part of a broad initiative to gauge the effectiveness of over 1,000 government programs. It found that the dairy program had not demonstrated results, has design flaws that limit its effectiveness, and distorts trade in a way that puts the U.S. in violation of World Trade Organization rules. What action was taken as a result of this negative report? None, of course. If you go to ExpectMore.gov to read the program assessment, a note pops up that says, "This is historical material, ‘frozen in time.' The web site is no longer updated and links to external web sites and some internal pages will not work." That's just how special-interest democracy works. So bon voyage, intrepid cows. Yet another trillion-dollar farm bill is being cobbled together in Washington as we speak. And the odds that any deficit producing, wealth-destroying, consumer-shafting dairy programs will be phased out, allowing the dairy industry to restructure itself on rational lines, are about as good as that of the Supreme Court waking up one morning and ruling that the Constitution never granted Congress the power to set milk prices in the first place."


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FHA could need bailout

What is it with Government--doesn't anyone know how to run a solvent operation anymore? The Feds?--the worst Hogs at the Trough--

FHA projected to exhaust reserves, could need bailout - latimes.com: The Federal Housing Administration, which has played a crucial role in stabilizing the housing market, said it ended September with $16.3 billion in projected losses -- a possible prelude to a taxpayer bailout. The precarious financial situation could force the FHA, which has been self-funded through mortgage insurance premiums since it was created during the Great Depression, to tap the U.S. Treasury to stay afloat. The agency said a determination on whether it needs a bailout won't come until next year. . . .  The FHA has permanent and indefinite authority to draw money from the Treasury, although it has never had to use that power."

Never had to use that power--until now.

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Pension Reform: talk vs action?

Chicago Council Approves Rahm's 2013 Budget | NBC Chicago: "His directive for the City Council was to stay the course and to speak up about pension reform. "Here is the hard truth," Emanuel said. "In less than four years, payments to meet our pension obligations will comprise 22 percent of the City’s budget – one out of every five dollars. That’s $1.2 billion of taxpayer money, and growing, each year after that.""

That's right Mayor--the problem is not going to just "go away."  However it's going to require more than just talk--you need ACTION!

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California Prop 30 -- How Greedy Is Your State?

California aims to be the most greedy of all 50 states with Proposition 30--

Would Prop. 30 really drive millionaires out of California? - latimes.com: "A counterpart to the biblical adage that the poor will always be with us is the notion that the rich will always be one tax hike away from leaving us. That's the foundation stone, after all, of the argument against raising taxes on "job creators" and of bestowing preferential treatment on capital gains (largely collected by the rich) over wage income (the sustenance of us other poor slobs). And it's a linchpin of the campaign against Proposition 30, Gov. Jerry Brown's proposal to raise income taxes on income above $250,000, topping out at a 13.3% rate on income over $1 million. Go after the wealthy like that, the argument goes, and the rich will flow out of the state like rainwater cascading down a sewer grate."

Here's the kicker--it passed, but may have solved nothing!--

Proposition 30 win no guarantee of fiscal safety for California - latimes.com: "California's unstable tax base, debt and falling revenue are among the threats that could upend the budget despite the infusion from the passage of Proposition 30."

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Social Security?--government is part of the problem

Social Security?--government is part of the problem--

In addition, the subcommittee found the normal costs of the state’s retirement systems — the amount needed each year to cover benefits earned that year — to be less than those of neighboring states and of private sector employers, chiefly because almost 80 percent of the workers covered by the state plans are not eligible for Social Security, so the state does not pay a federal tax on their salaries. In contrast, private sector employers must pay a 6.2 federal payroll tax to provide Social Security coverage for their workers, and on average contribute 4.4 percent of payroll to 401(k) and other retirement plans, for a total cost of 10.6 percent, compared with state government’s normal cost, which averages about 9 percent of payroll.

In other words--state and local governments "opt-out" of participating in Social Security and pay less! (Wish I could do that!)

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Illinois Pension Crisis

Kick the can all you want--this problem isn't just going to "go away"--

The pension chasm - Illinois Issues - A Publication of the University of Illinois at Springfield - UIS:" . . . Moreover, many private sector employers no longer offer defined benefit plans, in which retirees are promised a certain amount for life, but instead offer defined contribution plans, in which the company agrees to contribute a certain sum each year into an employee’s retirement savings account. “A substantial disparity thus exists between pension benefits generally available in the private sector and the state’s pension plans,” Martin wrote in the minority report. “This disparity should not continue, for two reasons. First, the state cannot afford it. Second, maintaining such a disparity is unfair to taxpayers — who largely work in the private sector — who must pay higher taxes to support the more generous and more costly benefits provided to the state’s employees.”

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Holder Might Not Stay On As Attorney General?

Holder Announces He Might Not Stay On As Attorney General « CBS DC: "Holder has been under fire from congressional Republicans for what he knew about the botched “Fast and Furious” operation where the U.S. allowed guns to be sold illegally in hopes to track Mexican drug cartels. Holder was found in contempt of Congress for refusing to turn over documents regarding the operation. President Obama has invoked executive privilege. Border Patrol Agent Brian Terry was reportedly killed with one of the guns used in the ATF operation. Terry’s December 2010 death lifted the veil on the bungled federal government’s gun-smuggling investigation that was later the subject of congressional probes."

Why leave now?--the party is just starting!

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Hogs at the Trough and Empty Piggy Banks

From the British newspaper--The Telegraph:

A poor lookout - Telegraph: "In the long term, the only solution to this crisis is to increase greatly the amounts being saved. This is the logic behind the Government’s new auto-enrolment system, which pushes workers into a pension scheme unless they actively choose to withdraw. Of course, it may turn out that the new rules are too conservative, and that a return to prosperity sees Britons’ eventual pension values far exceed the new projections. But it is surely better to be pleasantly surprised than to realise, upon retirement, that the piggy bank is empty."

Here in the U.S., prudence has been thrown out the window.  Thanks to all the Hogs at the Trough, almost everyone's piggy bank will be empty in just a few years!

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Fat Cat Generals and Hogs At the Trough

Accusations against generals cast dark shadow over Army--The Washington Post: "The investigation into Gen. William E. Ward, the former chief of Africa Command, is being closely watched at the Pentagon, where rank-and-file officers wonder aloud whether senior leaders will be reticent to punish one of their own. A June 26 report, compiled after investigators pored through a trove of e-mails and expense reports, portrays a general using taxpayer funds to support a high-rolling lifestyle. The inspector general concluded that Ward used government funds to pay for personal travel expenses; assigned staff to run errands for him and his wife; and accepted meals and Broadway tickets from a defense contractor, in violation of Pentagon rules. The inspector general’s report says he wasted and misused tens of thousands of taxpayer dollars. For example, he billed the government $129,000 for an 11-day trip to Atlanta with a team of 13 people, even though he only conducted business during three of the days, the inspector general found. On Feb. 14 he sent the following e-mail to an aide: “Might you be able to stop by a florist and pick up a small bouquet of spring flowers for me? Not extravagant at all — just a small not very expensive bouquet.” The aide offered to get it and asked where the general would like the flowers delivered. Ward responded: “Can you have in the limo pls — trunk. Tnx”


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Mayor Dave Bing says Detroit won't run out of cash, despite pace of financial progress

Mayor Dave Bing says Detroit won't run out of cash, despite pace of financial progress | City of Detroit | Detroit Free Press | freep.com: "Detroit must meet crucial reform goals before the state releases more than $80 million in bond revenue now in escrow. Board members said Monday that they're concerned the city isn't making enough progress, particularly with savings from reduced employee health care not kicking in until Jan. 1. Bing conceded as much but said his administration believes a cash-flow crisis will be avoided, despite huge challenges. For one, the state's emergency manager law faces a crucial test Nov. 6, when voters decide a referendum on it. Equally difficult, he said, is opposition from the city's unions, a lack of cash to upgrade outdated technologies and low morale in battered city departments that have endured pay cuts, furloughs and work force reductions."

As I've said before, ACTION not words, Mayor Bing!

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KUDOS to Illinois State Rep. Greg Harris for accountability of Wexford Health Sources

“It is said that no one truly knows a nation until one has been inside its jails. A nation should not be judged by how it treats its highest citizens, but its lowest ones.” ― Nelson Mandela

As Nelson Mandela says (and he knows)--any society/nation/state/community should be judged on how it treats prison inmates. Therefore KUDOS to Rep. Greg Harris of Illinois--

Illinois State Rep. Greg Harris is pushing HR 1248 to increase oversight of Wexford Health Sources, a private company that provides health care to Illinois inmates | WBEZ 91.5 Chicago: "Democratic Rep. Greg Harris from Chicago’s Northwest Side is pushing HR 1248, a House resolution calling for an official examination of how the state failed to audit Wexford Health Sources before signing a $1.4 billion contract with the private health care company last year. WBEZ has been reporting on poor health care in the prisons, and a recent report by the prison watchdog John Howard Association found that no one in the state is checking on Wexford to make sure they’re providing the care they’re being paid for. Harris's audit would change that. Harris says there are 250 lawsuits against the state right now alleging poor health care. He says he's been seeking proof that Wexford is actually earning the $115 million Illinois pays them every year, but he’s not satisfied with what he’s found."
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California pension plan is a bad trend?

Editorial: California pension plan is a bad trend: "Now, California lawmakers are hoping to start a new trend: states managing retirement funds on behalf of private-sector workers. In September, Gov. Jerry Brown signed a law creating such a fund. . .On its surface, the California plan might seem enticing. Employers would divert at least 3% of their workers' salaries into a state-administered fund for which private money managers would make investment decisions. At retirement, workers would receive a monthly benefit based on contributions and investment returns, with the state guaranteeing a minimum rate of return. But there are two potentially problematic outcomes. One is that the fund will behave like the great majority of publicly run funds, becoming more and more generous as beneficiaries form an organized political constituency and demand more. That has certainly been the case with Social Security. The tax on workers and employees that funds it has been increased 19 times and more than sixfold (from 1% to 6.2%) since the 1930s. And even that has not kept up with the steady growth in benefits. Retirement plans for state and local employees are causing larger problems. They have grown so generous as to put a number of states, including California, into deep fiscal turmoil. Given that track record, it is not difficult to imagine participants in California's new plan lobbying for an increase in the guaranteed rate of return, or even transforming the program into a traditional defined benefit pension, where annual payouts are not based on returns but on the final salary a worker enjoyed."

Actually California is trying to rectify a situation that should be solved at the federal level-- 1) ABOLISH all pensions; 2) allow self-funded, tax-exempt retirement accounts by everyone, with mandatory default 5% direct deduction from employee pay into account of employee's choice at any federally regulated institution; 3) broadening Social Security to include everyone--President Roosevelt envisioned this at the time Social Security was created.

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Recycling fraud is draining California cash

Oh my--another example of CLUELESS California government--

Recycling fraud is draining California cash - latimes.com: Eleven states have container redemption programs, and experts believe some level of fraud exists in each. "Seinfeld" fans will recognize the scheme: Two characters once conspired to drive a mail truck full of empty bottles from New York, where they could be redeemed for 5 cents each, to Michigan, where they could fetch 10. The problem is particularly challenging — and costly — in California. This is the only state in the region besides Oregon with a deposit program, making it a magnet for recycling fraud. And it is the only state besides Hawaii to directly administer the program through private recycling centers. Other states have beverage distributors or sellers collect the deposits and pay the redemption costs, so they — and not the state — are responsible for the money. But grocery stores and markets opposed that approach in California, which opted to have private recycling centers take in the material. The state reimburses the centers for what they spend on redemption costs, based on their account of what they take in by weight. The centers, which make their money by selling the material for scrap value and sometimes by collecting additional fees from the state, have a financial incentive to maximize the amount of material they take in, not to look for fraud. . . ."

What is it about California?  Is it something in the water or air? It has become the laughingstock of the USA.

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Dying Detroit needs ACTION not words

Detroit--on life support--is a classic case of Democratic Party policies destroying the fabric of a city. Even the current Mayor doesn't get it.  When you have an organization, city, country--anything--in as bad shape as Detroit is, you take DRASTIC action, and here he is again just promising faster change. ACTION, not words Mayor!!

Bing vows faster pace of change for city | The Detroit News | detroitnews.com: "Responding to a Detroit News poll this week showing some 40 percent of residents plan to leave within five years — mostly due to crime — Bing said it's critical to get fiscal reforms in place. City administrators pointed to Midtown development as a sign that Detroit is poised for rebirth. "This is a long-term problem," he said. "We've got to get people thinking it's worth staying here, because it's starting to change. That it's not the time to run, because something good is starting to happen.""

Well as they say--LEAD, FOLLOW, or GET OUT OF THE WAY!

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WHAT IS WRONG WITH THE PEOPLE IN CHICAGO?

If there is one city that needs complete disintermediation in its schools, it's Chicago. But Mayor Rahm Emanuel is being stymied by unions, politicians, teachers, and even some parents from doing the right thing--read the full article at the link below for more--

New chief at Chicago Public Schools - Chicago Tribune: "Emanuel on Wednesday told the Tribune editorial board that the schools have slots for 600,000 children when there are 405,000 attending, although he did not say how many schools would be closed or converted to privately run charter schools, even as he conceded the difficulty of closing schools."

Difficulty closing schools?--CLOSE THEM! 

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Federal Government fires ATF agent for exposing corruption?

Exposing Federal Government corruption apparently leads to job termination--wonder why Obama hasn't been asked about this?

ATF Whistleblower Fired in Denny's Parking Lot For Exposing Corruption - Katie Pavlich: "Special Agent Vince Cefalu has worked for the Bureau of Alcohol Tobacco and Firearms for more than 25 years. On top of successfully placing dozens of hard criminals behind bars throughout his career, Cefalu has received promotions and consistently positive evaluations. When he started raising his voice about ATF corruption and illegal wiretapping in 2005, things changed.  Tuesday evening, Cefalu was asked to meet Special Agent in Charge of the San Francisco Field Division Joseph Riehl at a Denny's Restaurant near Lake Tahoe. When he arrived, he was served termination papers in the parking lot. Classy move"

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Pension Mess - Illinois, Kentucky and Pennsylvania becoming like Greece?

If you live in a state like Illinois, Kentucky, or Pennsylvania, get ready for some very bad news:

Pension Funding Scare Won’t Frighten All States - Bloomberg: By Peter Orszag Oct 23, 2012 ". . .  Any way you do the calculation, clearly there’s a big problem. . . . Myth Busting Alicia Munnell, the director of the Center for Retirement Research at Boston College, takes on each of these myths in her new book, “State and Local Pensions: What Now?” Munnell, with whom I served in President Bill Clinton’s administration, has devoted most of her career to pension issues. First, she computes a funding ratio -- that is, the ratio of assets to liabilities -- for each state plan. She finds substantial variation . . . Illinois, Kentucky and Pennsylvania face enormous gaps, while Delaware, Florida, North Carolina and Tennessee have managed their pension plans relatively well. Why were some plans so badly underfunded and others not? . . . union strength isn’t what matters. These plans, though, did tend to share two characteristics: They were disproportionately teachers’ plans, and they used a funding method (called the projected unit credit cost method) that is less stringent than those used by other plans. The states with huge funding gaps have “behaved badly,” Munnell concludes. “They have either not made the required contributions or used inaccurate assumptions so that their contribution requirements are not meaningful.” She added, “Fiscal discipline simply appeared not to be part of the state’s culture.” . . . as in life, what goes around comes around. In states that have behaved well in the past -- such as Delaware -- the burden of pension plans will increase in future years only modestly if at all. In contrast, a state such as Illinois, which has perhaps the worst record of avoiding necessary funding even while expanding benefits, will have to increase its pension contributions sharply if it is to meet its obligations. To get a sense of what looms, assume that, over the next three decades, the plans will earn an average nominal return of 6 percent on their assets. In that case, Illinois will have to raise contributions from less than 8 percent of total state revenue in 2009 to an average of 14 percent between 2014 and 2044. Delaware, in contrast, would need to raise its contribution by only 2 percent of state revenue. The required adjustments in the states with problems need not, and should not, be made overnight, but they will be a drag on state resources for a long time. The revelation that problems exist mainly in states that have failed to adhere to a credible long-term funding strategy contains a lesson for policy makers in Washington: It is essential to behave responsibly. Simply hoping our long-term fiscal problems will magically disappear is not a credible strategy. As part of the negotiations over how to address the fiscal cliff -- the federal spending cuts and tax increases scheduled to take effect in January -- policy makers should combine more support for the economy in 2013 (in the form of tax cuts and infrastructure spending) with a specific and credible deficit reduction plan that rolls out gradually over the next several decades." (Peter Orszag is vice chairman of corporate and investment banking at Citigroup Inc. and a former director of the Office of Management and Budget in the Obama administration. The opinions expressed are his own.)

The consequences of public officials "behaving badly" also has ramifications far beyond the immediate problem of unfunded pension liabilities. For example, knowing the above, why would any business decide to locate or expand operations in a state like Illinois, Kentucky or Pennsylvania? It would be like choosing to live in a "bad neighborhood" instead of a "good neighborhood."

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Are Public Pensioners Safe?

Of course not! 

Are Public Pensioners Safe? | The Business Desk with Paul Solman | PBS NewsHour | PBS: "My own prognosis for public pensioners is pessimistic. Pension funds are in general underfunded, as we've reported early, again and again. They assume unrealistically high rates of return on their assets. They refuse to, or simply cannot, raise taxes on their citizens and businesses. The only alternative is to cut benefits. And that's happening with increasing frequency all over this land."

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LA’s Pension War Goes Nuclear

LA’s Pension War Goes Nuclear: "LA WATCHDOG - Mayor Richard Riordan’s proposed ballot measure, the “Fair Share Pension Reform Act of 2013,” is LA’s Prop 32 (Paycheck Protection), only on steroids, as the leadership of the City’s public unions will view this money saving initiative for our cash strapped City as a direct assault on their control of the City’s purse strings. . . .Riordan’s Fair Share Pension Reform plan will also force the candidates for Mayor, Controller, City Attorney, and City Council to pick sides as the union leadership will demand absolute loyalty in return for their campaign contributions. Based on press reports, Riordan’s plan would “move newly hired workers into 401 (k) style plans and freeze retirement benefits for existing workers,” saving the City “hundreds of millions of dollars every year by 2017 and upwards of a billion dollars by 2020. . . Underlying this plan for serious pension reform is the very real concern that our City will become insolvent within the next five years. Our City’s finances are so desperate that senior elected officials have secretly discussed the sale of our Department of Water and Power, the Port of Los Angeles, and/or Los Angeles International Airport. To earn a seat at the table, our public sector unions must develop a detailed plan that addresses how the City will “Live Within its Means.” This would include a Five Year Financial Plan, balanced budgets based on recurring revenues and Generally Accepted Accounting Principles, and, over the next ten years, programs to eliminate the $10 billion unfunded pension liability and to repair our lunar cratered streets, our cracked sidewalks, and the rest of our crumbling infrastructure."

"Live within its means"--what a novel concept!


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Public blames politicians, not unions, for pension mess

OK--but who elected the politicians?

Public blames politicians, not unions, for pension mess - chicagotribune.com: "Emanuel has pushed the cost-shift proposal, arguing that Chicago property tax payers already are responsible for the tab for pension benefits to retired Chicago Public Schools teachers. . . . "The districts should cover their pensions and not the state," Burns said. "Chicago does. When you raise your pensions locally, you can do what you want with them." But the plan isn't gaining traction in places where taxpayers fear they stand to take the hit. In the collar counties, 55 percent said they were against the plan while 35 percent supported. In suburban Cook, 49 percent opposed and 34 percent supported it. And Downstate, 50 percent were opposed while just 21 percent backed the idea."

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California and Illinois in a race to the bottom

Oh "woe is me" say California and Illinois, the two basket cases of unfunded public pension liabilities:

Finke: Poll: Don't blame public workers for pension woes - Peoria, IL - pjstar.com: "It should be noted that The Associated Press reported on Oct. 8 that California, not Illinois, leads the nation in unfunded pension debt at $100 billion. But Illinois still has an $85 billion unfunded liability, more than twice as much as New Jersey, which is No. 3." 


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Changes to pensions will create two-tier workforce

O Canada!--pension reform--Canada leads the way:

Changes to pensions will create two-tier workforce in the public service | canada.com: "Canada’s public servants will have to pay more for their pensions and new hires will have to work longer than their older colleagues before they can retire with full pension benefits. The changes will create the first two-tier workforce within Canada’s bureaucracy with all new hires losing the once-sacrosanct early retirement provisions that let public servants retire at 55 and they will be forced to work until age 65 . . ."


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Mayor of Baltimore on the pension problem

Not often you hear this kind of honesty--especially from a public official (Mayor of Baltimore):

Baltimore County government pensions - baltimoresun.com: "As 20 years of fiscal mismanagement by government officials comes to a head, we repeatedly hear public servants warn of their underfunded pension funds ("Baltimore Co. weighs pension bonds," Oct. 14). While the private sector* has had a decline in real wages over the last 20 years and the evisceration of pensions, government compensation has continued its upward climb. A recent article by CNN's Fareed Zakaria points out that the municipal bankruptcies we keep hearing about aren't about taxes being too low or spending on services being too high but about pensions. Mr. Zakaria notes that California's pension-related costs rose 20-fold in the decade since 1999, and that this frightening trend is true almost everywhere in America. For decades now, local governments have doled out patronage by increasing pension benefits that impact the budget years later, when the officials who gave the benefits are safely retired themselves. . . .In the private sector, the old defined benefit pension has long ago been replaced by the defined contribution plan. Yet the government plans are paying two or three times more than pensions in the private sector. This is a ridiculous situation that needs to be solved the old-fashioned way: By restructuring the government plans so they are in line with those of the private sector. . . .--Gary Moyer, Baltimore

*Remember Obama saying "the private sector is doing fine"? 



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Public Pension promises easy to make, hard to keep

Public Pension crisis--promises too easy to make, and so hard to keep.

The woods are lovely, dark and deep. 

But I have promises to keep, 

And miles to go before I sleep, 

And miles to go before I sleep.

 --Robert Frost, “Stopping by Woods on a Snowy Evening”

Warren Buffett on pension fund investment return assumptions. | DavidGCrane: "Whatever pension-cost surprises are in store for shareholders down the road, these jolts will be surpassed many times over by those experienced by taxpayers. Public pension promises are huge and, in many cases, funding is woefully inadequate. Because the fuse on this time bomb is long, politicians flinch from inflicting tax pain, given that problems will only become apparent long after these officials have departed. Promises involving very early retirement – sometimes to those in their low 40s – and generous cost-of-living adjustments are easy for these officials to make. In a world where people are living longer and inflation is certain, those promises will be anything but easy to keep."

Link to full report: http://www.berkshirehathaway.com/2007ar/2007ar.pdf

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Public Pensions and the Assumed Rate of Return

How big are the unfunded public pension liabilites? Bigger than reported and bigger than you think because almost every public pension fund uses unrealistically high "assumed rates of return"--

Reason Foundation - Out of Control Policy Blog > Warren Buffett on Public Pensions: "Most public pension funds assume, for example, that they will earn 7.75% or 8% a year, on average, while Buffett has said that 6% would be more realistic."

Study: Public Pensions Underfunded by $1.2B | Fox Business: "Critics have called for public pensions to reduce their assumed rates of return to as little as 5 percent or less, which would cause unfunded liabilities to soar and likely leave taxpayers having to cover the difference. But without the change, critics say, future generations will be left to deal with a financial bomb. Other studies have tried to measure the overall size of the problem. The Pew Center on the States found that the shortfall is about $766 billion. Moody's Investors Service said in July that the collective gap would be $2.2 trillion if funds used a 5.5 percent discount rate."

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Pension Reform in Illinois

One true statement in an otherwise useless article (read the bold):

Pension Reform in Illinois | Poli Chi: "Many are now saying it was too easy to pass pension benefits with a 50%+1 voting model, and that it is because of those easily passed pension benefits that Illinois is in the financial crisis it's in now. This pension reform is expected to be the savior of Illinois' credit rating."

Increases are not the problem are they? Illinois can't afford the pensions it currently has--until you have true pension reform--i.e. cutting benefits and automatic increases, increasing employee contributions, etc., any talk of reigning in "future increases" is not solving the problem.

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A Federal Bailout for State Pensions?

So is this what Governor Quinn (Illinois), Governor Brown (California), and every other state sinking in unfunded public pension liabilities is hoping for? Don't count on it--hope is NOT a strategy--

Bluegrass Beacon - A Federal Bailout for State Pensions? Say It Ain’t So! | SurfKY.com: FRANKFORT, KY (10/14/12) - "Could it be that one of the reasons Kentucky’s political leaders continue to kick the commonwealth’s can of unfunded pension-liabilities down the road is because they are counting on a bailout from the federal government? . . . It must have made the hearts of Gov. Steve Beshear and his political pals controlling the House in Frankfort leap with relief when they heard fellow Dem and Illinois Gov. Pat Quinn recently run the idea of a federal bailout for his state’s $167 billion pension liability up the political flagpole. For years – particularly when economic times were good – Kentucky’s politicians padded pension and health-care benefits as a way of currying political favor, even bringing private entities into the take. The bloated system now has 1,701 different entities, along with their thousands of employees, connected to our state government’s pension teat. The story of states’ failing pension funds has been repeated nationwide. States now face a combined total of$2.5 trillion in unfunded pension costs, including Kentucky’s $34 billion liability. Giving such funding power to cowardly politicians in the first place was like giving car keys and whiskey to teenage boys. An ensuing crash is inevitable, and a bailout would only acquiesce to their disastrous behavior. . . "

Here's why the "federal bailout" won't happen:

"Why should hardworking taxpayers in Washington state – whose pension system at 95 percent funded is the nation’s healthiest – be forced to subsidize the abuse of Kentucky’s pension system by politicians in the form of overspending and benefit creep during the past several decades, which has left the commonwealth’s workers’ retirement funding level at barely 30 percent? . . ."

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The dollar’s days as reserve currency are numbered

Deficit spending, hogs at the trough, public pensions out of control--where does it all lead? Those "public servants" who have led us down this path have NO idea of the pain yet to come as a result of their greed, gluttony, and irresponsibility:

The dollar’s days as reserve currency are numbered - FT.com: "For the US not to address its looming fiscal challenges would be more alarming still. America may not be at risk of default, because the Fed is there to backstop the market in Treasuries. But if the current situation persists, America’s sovereign obligations will not hold their value indefinitely. And if they fail to hold their value, they will not hold investors’ confidence. If they no longer offer the safety that investors have come to expect, they will not function as the stable collateral required by bank funding markets. They will not be regarded as an attractive form in which to hold international reserves. And they will not be seen as a convenient vehicle for merchandise transactions. A serious shortage of international liquidity would spell the end of globalisation as we know it. International financial and merchandise transactions would become more expensive. Without an attractive means to hold the reserves they need to intervene in international markets, central banks and governments would be reluctant to give those markets free rein. Controls would become widespread."

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Chicago still "kicking the can"

Chicago--better read the fine print--

Read Rahm’s lips: No new taxes in next city budget - Chicago Sun-Times: "By holding the line on new revenue for now, Emanuel is also holding open the possibility that a massive tax increase of some kind will be needed to solve the city’s pension crisis — even if union leaders ultimately agree to pension reforms. Ald. Pat O’Connor (40th), the mayor’s City Council floor leader, is scheduled to hold a day-long hearing on the pension crisis on Monday, featuring testimony from the five city employee pension funds. “You can’t fix this with money alone. That would forestall a financial Armageddon. But, the model is not sustainable. There are structural problems that must be addressed,” O’Connor said."

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Public pension funds stung by losses

The hole gets deeper and deeper--

U.S. public pensions end bumpy second quarter with losses | Reuters: " . . . pension funds for U.S. state and local government workers were stung in April, May and June by sagging global stock markets. The funds recorded losses of $14.2 billion for the second quarter, the U.S. Census Bureau said on Thursday. . . U.S. taxpayers worry that commitments made to public employees for retirement benefits may absorb bigger slices of public funds as local and state governments weather America's slowly growing economy. States and local governments face unfunded pension liabilities of $750 billion or more, depending on estimates. . . In the second quarter, states as well as city, county and other local governments throttled back on pension contributions, which totaled $21.36 billion - down from $24.1 billion in the first quarter, Census Bureau data showed. In 2011's second quarter, government contributions were $22.5 billion. In contrast, employee contributions to pension funds rose from the first quarter's $9.3 billion to $10.3 billion in the second quarter. Employee payments to the pensions were $10.9 billion in 2011's second quarter, according to the Census data. Census Bureau data is based on the 100 largest public-employee retirement systems."

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Public pay and pensions too generous

At some point, the trough will be empty--

Ohio public pay called too generous | www.daytondailynews.com: "State employees in Ohio receive $9.89 per hour more in wages and benefits than their private-sector counterparts, according to a report released Thursday by a conservative watchdog group. This disparity is larger than in 44 other states, according to the report from Washington D.C.-based Citizens Against Government Waste. It gives Ohio the grade of “F” compared to other states. A major driver of this difference, according to report authors, is generous public sector pensions: “Taxpayers in every state are struggling to grasp the sheer magnitude that state and local government unfunded pension liabilities are having on programs and services,” it states. In Ohio, the conditions the report illustrates have long been the focus of attention. On Wednesday Gov. John Kasich signed a major overhaul of Ohio’s five public sector pension systems that will cost workers billions, require them to work longer, reduce cost-of-living adjustments and make the programs solvent . . . Nationally, the report authors say state governments pay on average 6.2 percent more per hour in wages and benefits than the private sector in these fields. Utah has the lowest disparity, with state workers there earning an average $28.70 versus $24.74 in the private sector."

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PENSION CRISIS: Municipalities wait their turn

PENSION CRISIS: Municipalities wait their turn | Central Penn Business Journal: ""Something needs to be done. We all know the legacy costs," said Eric Montarti, senior policy analyst for the Pittsburgh-based Allegheny Institute for Public Policy. "How do we get from identifying the problem and coming up with a solution to churning through the legislative process?" New to the debate is a proposal from the state's auditor general to consolidate municipal pension plans. The debt Excluding Philadelphia, Pennsylvania's roughly 1,400 municipal pension plans have a little more than $2 billion in combined unfunded liabilities, according to the state Public Employment Retirement Commission, which tracks the progress of local and state pension plans."

Ever think of abolishing public pensions altogether?

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Washington Versus America --part 2

Washington, D.C.--where most of the "hogs" live (part 2):

Washington Versus America - NYTimes.com " . . . Our gilded District is a case study in how federal spending often finds its way to the well connected rather than the people it’s supposed to help, how every new program spawns an array of influence peddlers, and how easily corporations and government become corrupt allies rather than opponents. The state of life inside the Beltway also points to the broader story of our spending problem, which has less to do with how much we spend on the poor than how much we lavish on subsidies for highly inefficient economic sectors, from health care to higher education, and on entitlements for people who aren’t supposed to need a safety net — affluent retirees, well-heeled homeowners, agribusiness owners, and so on. There’s a case that this president’s policies have made these problems worse, sluicing more borrowed dollars into programs that need structural reform, and privileging favored industries and constituencies over the common good. But this story is one that Romney and his party seem incapable of telling. Instead, many conservatives prefer to refight the welfare battles of the 1990s, and insist that our spending problem is all about an excess of “dependency” among the non-income-tax-paying 47 percent. In reality, our government isn’t running trillion-dollar deficits because we’re letting the working class get away with not paying its fair share. We’re running those deficits because too many powerful interest groups have a stake in making sure the party doesn’t stop. When you look around the richest precincts of today’s Washington, you don’t see a city running on paternalism or dependency. You see a city running on exploitation."

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Washington Versus America --part 1

Washington--where most of the "hogs" live--

Washington Versus America - NYTimes.com: "Last week, new census data revealed that 7 of the 10 richest American counties in 2011 were in the Washington, D.C., region. Fairfax, Loudoun and Arlington Counties, all in Northern Virginia, have higher median incomes than every other county in the United States. Whence comes this wealth? Mostly from Washington’s one major industry: the federal government. . . . like the ruthless Capital in “The Hunger Games,” the wealth of Washington is ultimately extracted from taxpayers more than it is earned. And over the last five years especially, D.C.’s gains have coincided with the country’s losses. There aren’t tributes from Michigan and New Mexico fighting to the death in Dupont Circle just yet. But it doesn’t seem like a sign of national health that America’s political capital is suddenly richer than our capitals of manufacturing and technology and finance, or that our leaders are more insulated than ever from the trends buffeting the people they’re supposed to serve. For Mitt Romney and the Republican Party, what’s happened in Washington these last 10 years should be a natural part of the case against Obamanomics. . . ."

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LA pension peril

Jim Newton: L.A.'s pension peril - latimes.com: "Recognizing that threat, labor leaders may reason that it's better to let Riordan take heat from union members than for those same leaders to participate in pension cuts or contribution increases that make them complicit. They might nominally object but in fact wage only a half-hearted campaign against Riordan's measure, understanding that it might ultimately save them from themselves. "If labor leaders do not see their positions at risk," noted Alex Rubalcava, a municipal finance expert who works closely with Riordan, "they're not paying attention." Then there's the question of how labor would fare if it targeted the reform measure for defeat. Public anger over perceived largesse in public employee pensions is a serious phenomenon, and recent ballot measures to curtail those pensions won in San Diego, a fairly conservative city, and San Jose, a very liberal one. It's quite possible that even if labor did oppose a similar measure here, it would nevertheless pass. Riordan, as usual, is playing his cards carefully. He was coy about his proposal when I met with him at his Brentwood home (in the library, dominated by a photograph of Riordan and then-Texas Gov.George W. Bush), but he insisted this was the most important civic effort on his plate. And he emphasized that L.A. is careening toward bankruptcy. Today's pension system, he said, is "a pyramid scheme." Riordan, who made a fortune as an investor, also made it clear that he's already covering his bases: "I sold all my government bonds two years ago."

Caveat emptor.

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The consequences of years spent living high on the hog

Consequences? You mean there are consequences? . . .

Not even the great economists of history can get us out of this fix - Telegraph: "To think that central bank money-printing offers a largely pain-free way out of our economic difficulties is sadly deluded. Carried to extremes, it ends in hyper-inflation, and in any case, in an era of low growth and the progressive loss of Western employment to technology and foreign competition, it does nothing for living standards. Wages may lag prices for years to come. Friedman offers some plausible solutions, but even he cannot magic away the consequences of years spent living high on the hog. One way or another, a price has to be paid."

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