CSUN University News Clippings

Editorial: Even CalPERS sees a pension problem

(August 18, 2009)

A top official with the California Public Employment Retirement System finally conceded last week what observers of state and local government finances have been saying for years: California’s public employee pension costs are “unsustainable.”

“I don’t want to sugar-coat anything,” Ron Seeling told a seminar sponsored by the Public Retirement Journal. “We are facing decades without significant turnarounds in assets, decades of – what I myself, my personal words, nobody else’s – unsustainable pension costs.”

Seeling’s comments, first reported by veteran Capitol reporter Ed Mendel in his Web log, calpensions.com, should help jump-start a long-overdue conversation.

Seeling is the pension system’s chief actuary, the man responsible for calculating pension costs for 1.6 million state and and local government employees. He has long defended the analysis that went into granting more generous pensions earlier this decade. So this is a huge admission. But he is not alone.

Dwight Stenbakken, deputy executive director of the League of California Cities, agrees that government pensions are “unsustainable” financially – and politically as well.

“I just don’t think the benefit levels that are in the public sector can be defended in a public debate,” Stenbakken told The Bee.

Gov. Arnold Schwarzenegger recently called upon legislators to tackle the pension crisis, but they refused. Now, with pension bills coming due, something must be done.

It’s not just that public services are being cut to pay for the pensions. Younger public employees are being furloughed or losing their jobs as limited tax dollars go to support another entire class of retired employees.

If union leaders don’t work to negotiate a solution to the problem, they could soon face a revolt from the public – and their own members, who increasingly find themselves on the wrong end of this inter-generational tug-of-war. The time to start talking is now.

Publication: Sacramento Bee