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Schwarzenegger: Public Pensions and Our Fiscal Future

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Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#81

Earlier quoted context omitted.

This same thing is also an extreme Liberal strategy. Sorry, I can't remember the name to look it up. The theory is that you can so overload the government that it simply can't stand up anymore (like the USSR I suppose). It crumbles, and that gives you the opportunity to erect a new one in its place, doing away with all those things that stand in your way, like Constitutional restrictions on the government. UPDATE: th…

Except there's no mainstream, tea-party-a-like leftists loudly advocating that strategy in the US.

... Which doesn't change a thing about it.

I finally found a reference, it's called the Cloward-Piven strategy.

http://en.wikipedia.org/wiki/Cloward%E2%80%93Piven_strategy#...

>>Cloward and Piven’s article is focused on forcing the Democratic Party, which in 1966 controlled the presidency and both houses of the United States Congress, to take federal action to help the poor. They argued that full enrollment of those eligible for welfare "would produce bureaucratic disruption in welfare agencies and fiscal disruption in local and state governments" that would "deepen existing divisions among elements in the big-city Democratic coalition: the remaining white middle class, the white working-class ethnic groups and the growing minority poor. To avoid a further weakening of that historic coalition, a national Democratic administration would be constrained to advance a federal solution to poverty that would override local welfare failures, local class and racial conflicts and local revenue dilemmas."

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#82
post #24

Earlier quoted context omitted.

Your down votes signal you read those facts and it upsets your beliefs. I didn't write this for people who agree with my point of view. I wrote this for you. Thank you.

My downvote signals that if you want people to take interest in claims like that, you need to substantiate them. It also expresses disapproval at the insertion of a tangentially-related, flamebait ad hominem into a thread discussing a particular set of economic statistics. EDIT: I retract my statement that it's an ad hominem . I think the parent has a reasonable point.

This is disorienting. What is your recount of what happened in the California Energy Crisis involving Enron? Can you tell me which of those points are questionable, please?

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#84
post #34

Earlier quoted context omitted.

You're probably getting downvoted because you seem to be implying, without real evidence, that California is bankrupt because Arnold was complicit in cheating California out of billions because of shady dealings with Enron. These are the sorts of allegations that one would typically see in a political forum populated by partisans and hacks. Downvoting is just HN's way of saying this sort of discussion belongs elsewhe…

Actually if you followed the whole looting of California by Enron & friends, the final conclusion was Schwarzenegger taking office and refusing to pursue a serious lawsuit agains the perps and letting them off with token payments to the state. And yes the proof was and is very clear that the "crisis" was in fact looting. The energy traders who implemented it were taped per regulation and the leaked tapes were ugly. I…

proof:

http://www.cbsnews.com/stories/2005/02/03/eveningnews/main67...

Enron also pulled power out of states like California, causing emergency conditions to worsen.

"Sorry California," an Enron trader says. "I'm bringing all our power out of state today. I moved out six — over six hundred megawatts."

The "shut downs" and "pull outs" triggered sky high power prices.

"We're just making money hand over fist!" one voice is heard saying on the tape.

And when states complained, the guys at Enron seemed to have a response.

"Get a f clue," one says. "Yeah," another chimes in. "Leave us alone. Let us make a little bit of money."

"Exactly," says another trader.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#86

He got that exactly right, unfortunately he didn't go far enough -- debt financed projects are also a huge problem. Look at the big dig & the mbta. People need to learn that you pay as you go, that's why 401ks are great the total cost of an employee is understood completely. Taking debt in someone else's name, which is what essentially all government debt is, is fundamentally immoral and shouldn't be allowed. It caus…

> that's why 401ks are great the total cost of an employee is understood completely

This isn't true. There is no definitive way to determine the total amount of the future burden of a matching 401(k) plan because:

1) You don't know how long the employee will continue working there. 2) You don't know the interest rate at which to discount this future liability. 3) You don't know what future voters are going to change in the current matching system.

In fairness, determining the funded status of the future liability of a retirement pension is a lot more difficult than determining the expected cash flows for 401(k) plans.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#88

After this one gets to +250 can we have a politics moratorium for a while?

What, you don't thing that a State (especially California, the startup capital of the world) in a serious budget crisis has anything to do with entrepreneurs that may be attempting to start their own businesses in such a climate?

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#89

He got that exactly right, unfortunately he didn't go far enough -- debt financed projects are also a huge problem. Look at the big dig & the mbta. People need to learn that you pay as you go, that's why 401ks are great the total cost of an employee is understood completely. Taking debt in someone else's name, which is what essentially all government debt is, is fundamentally immoral and shouldn't be allowed. It caus…

> that's why 401ks are great the total cost of an employee is understood completely This isn't true. There is no definitive way to determine the total amount of the future burden of a matching 401(k) plan because: 1) You don't know how long the employee will continue working there. 2) You don't know the interest rate at which to discount this future liability. 3) You don't know what future voters are going to change…

I don't understand your position at all. The company puts money into a 401k, either as a grant or via some sort of matching scheme. The employee sets up their deductions, normally happens once a year. From that point you know exactly how much that employee will be paid in all compensation that year.

There is no future liability. The money has been paid to the employee in it is in their hands now, and their retirement becomes their responsibility.

I think you might be thinking of some other type of retirement plan.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#90

Earlier quoted context omitted.

I was thinking exactly the same thing. In addition when you know an employee is going to cost you a lot of money in pension, the incentive to reduce the work force as much as possible is high. You end up in a situation where your budget is used to pay for the retired employees and you have nothing left for active employees. One of the reasons you are there is that it's pretty tempting for someone in command to offer…

Just don't allow future expenses.

I could see some definite pros to that. I'm trying to think of problematic things that might also get banned as a result, and not thinking of a lot. One thing that'd get banned along with large pension promises, if that rule were applied consistently, would be golden parachutes.
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