Public pensions spared attack by ballot measure
By JENNIFER MUIR BEUTHIN, Contributing Columnist
Former San Diego Councilman Carl DeMaio and former San Jose Mayor Chuck Reed announced this week that they have, once again, failed in their effort to launch ballot initiatives aimed at destroying public employee retirement systems. This follows on the heels of their failed attempt last summer to qualify a similar ballot measure.
The Reed-DeMaio effort’s demise, even if it only turns out to be temporary, is great news for all California taxpayers. The fact is that, wherever you land on the political spectrum, the proposed initiatives were hopelessly flawed and would have needlessly cost taxpayers hundreds of millions, or, more likely, billions of dollars in the future.
The first initiative was misleadingly titled the “Voter Empowerment Initiative.” It would have required any pension benefit for new government workers and some benefit enhancements for existing workers to be placed on the ballot for approval by voters.
This initiative raised scores of legal questions certain to require years if not decades to resolve, threatened the health of existing pension systems and virtually ensured the eventual elimination of pensions for public workers. It would have crippled the ability for municipal governments to recruit and retain the workers they need to keep our communities safe and healthy. And it would have done so by creating a funding mandate that was certain to drive up retirement contributions dramatically until every current public worker retired.
The second initiative, called the Government Pension Act, would have affected not only public retirement plans, but would have imposed restrictions on Social Security, Medicare, retiree health care, defined contribution plans and other deferred compensation plans, which would have resulted in huge pay cuts for all new workers such as teachers, firefighters and public health nurses.
In reality, these two initiatives were blatant attempts to circumvent collective bargaining laws and destroy retirement security for a large percentage of Californians. So it’s no surprise that Reed and DeMaio backers include the Reason Foundation, which is bankrolled by the Koch brothers. The objective of the so-called reformers – beyond destroying unions – is to increase the profits and power of Wall Street by turning the retirement security of millions of people directly over to banks and investment firms.
We only need to look at how independent pension programs initiated by Reed and DeMaio in their hometowns turned out to see the risk we averted.
Key provisions of San Jose Mayor Chuck Reed’s Measure B were not only blocked by a judge, but its passage resulted in hundreds of police officers, firefighters, librarians and clerical staff leaving the city for jobs elsewhere. As of last October, 500 of the city’s 5,900 positions remained unfilled including 167 police officers, according to the San Jose Mercury News.
One-term San Diego Councilman DeMaio took a different approach in 2012. His Proposition B required all new employees to move into a 401(k) plan but allowed existing workers to remain in their pension programs. An administrative agency ruled last December that San Diego’s pension cutbacks violated collective bargaining laws and ordered the city to provide retroactive pensions for approximately 2,000 recently hired workers.
That decision is now being appealed by the city, but meanwhile recruitment remains a serious problem in San Diego where almost 800 positions remain vacant.
In both cities, Reed and DeMaio tore apart the fabric of their communities, wasted taxpayer dollars on needless court battles and left their communities without adequate staff to perform core municipal services.
Reed and DeMaio say they will return to shop their initiatives again in 2018. For the sake of California taxpayers and their retirement security, the public’s appetite for the Reed and DeMaio show hopefully will remain as anemic as it is today.
Jennifer Muir Beuthin is general manager of the Orange County Employees Association.
Publication Date: January 22, 2016