By Daniel Pellissier
In a transparent attempt to divert attention from billion-dollar losses and unfunded liabilities that will last two generations, CalPERS released its own study of the fund’s economic impact trying to take credit for $26 billion in economic activity generated by its generous retirement benefits. Of course, the economic impact would be the same if General Motors, Boeing or IBM had made those same retirement payments out of a $230 billion fund, so there is no credit to be earned for merely sending out checks.
The CalPERS-sponsored study does not detail how most of the money they hand out comes from taxpayers. Across California, public employee contributions to pension costs range from nothing, up to 35%, making most of the money in the fund returns on taxpayer contributions. In addition, CalPERS is charging its member agencies higher costs to make up for severe market losses in 2008 that will take two generations of higher taxes to repay.
So while CalPERS tries to convince Californians that they are helping the economy, their increasing demands for tax dollars is draining the economy — taking money needed to fund our schools and build our roads — and giving it to 55-year-old retirees. That’s nothing to be proud about.
Daniel Pellissier is president of California Pension Reform.