Los Angeles, CA In a bombshell expose of California’s massive unfunded public employee benefits Full Disclosure Network® is featuring a two-part series with public employee officials and finance expert B. Scott Minerd, CEO Guggenheim Partners, Asset Management to debut on L.A. Cable Channel 36 Sunday, January 7th from 8-9 p.m. and on Monday, January 8th from 4-5 p.m. A six minute Internet preview is available 24/7 for viewing here as a public service. The program is distributed to 43 cable systems. DVDs of the complete series are available upon request.
Scott Minerd was a moderator at the Milken Institute’s “State of the State Conference” last fall, for a panel discussion entitled “The Ticking Time Bomb. Expert panelists featured are:
- Hon. Keith Richman, MD, California State Assembly
- Carl De Maio, CEO Performance Institute
- Jack Ehnes, CEO California State Teachers Retirement System (CALSTERS)
- Dave Low, California School Employees Association
- Barbara Lloyd, Sr. Vice President Lehman Brothers
Highlights from the six segments in Full Disclosure® series:
Segment #1: Scott Minerd describes his role as a Managing Director of Credit Suisse he exposed the risky concentration in derivative securities which directly led to the liquidation of the Orange County investment portfolio and the county's subsequent bankruptcy." He defines the new GASB (General Accounting Standard Board) rules and estimates new disclosures will reveal $300 to $400 billion in unrecorded benefits owed to California public employees.
Segment #2: Will Municipal bankruptcies spread across California? Minerd suggests that pension benefit debt is unanticipated by the public and bond rating companies. The $300-$400 billion debt is “present value” but Minerd adds” the actual sum is more likely a trillion dollars.”
Segment #3: How widespread are the unfunded liabilities? Assemblyman Keith Richman cites the counties of San Diego, Contra Costa and Orange County (again) that have billions in unfunded public employee pension benefits. Minerd suggests the alternatives: (1) Attempt to fund now (2) Ignore and pay as you go, hoping for the best (3) Break the promises made to public employees by redefining benefits, employees working longer, caps on amount of benefits.
Segment #4: What role have politicians and public employee unions played in this crisis? Carl DeMaio CEO Performance Institute cites retroactive benefits approved by elected officials, and pension benefit debt is $130 billion before unfunded health care benefits that is three times all outstanding debt now in California. Keith Richman cites State Legislative Analyst reports that School Districts are likely to go bankrupt, citing LAUSD’s own report of $10 billion debt that will cost $2,100 per student per year for the next 30 years to pay off.
Segment #5: Barbara Lloyd of Lehman Bros. Cites that only ten percent of Counties have funded or partially funded public employee benefit plans. And, that these plans include coverage for spouses, survivors even after medicare age. Scott Minerd suggests that the stock market performance on benefit plan investments have no impact on government pension plans where no money has been set aside.
Segment #6: Infrastructure Bonds of $40 billion will cost another $40 billion in interest. Scott Minerd and other experts on the Milken Institute panel maintained that infrastructure projects should be paid for out of the general fund because it is an investment in the future. “The electorate is as guilty as the politicians….by saying what is good for me today, let someone else pay for tomorrow” Minerd suggested that when voters approved the bonds “all it did was allow the state to spend more on other things and not to address the true fiscal issues.”
Billed as “the news behind the news” the Full Disclosure Network® is an independent, educational, public affairs cable and Internet television program available from the website www.fulldisclosure.net Hosted by Leslie Dutton, who in 2002 was presented with a local public affairs Emmy Award from the Academy of Television Arts and Sciences for their series entitled “L.A.’s War Against Terrorism”.
Comments to date: 6. This is page 1 of 1.
Cher' CA
Posted: 03:41 pm [PST] on October 02 2007
Please get your facts straight. CAL-PERS is funded by our employee contributions. The majority of income from CAL-PERS comes from what they invested, which has been far more successfully managed when compared to other investment and certainly far exceed the investment earning on an IRA. To balance California's state budget by borrowing or raiding our retirement is theft. We have worked for wages far below what the private sector would have paid for the benefits offered in the public sector and do not have enough income to otherwise afford medical treatment for ourselves and our children. As a school employee for more than 30 years who has raised 4 children on poverty wages, I object to this segment being aired as a public service.
Gary Michael Adler Northridge, CA
Posted: 11:16 am [PST] on January 15 2007
Bankruptcy won't occur on *my watch* so what do I care?
It's those same liberals that think that Bush blew up the WTC to get us into a war, made our governor into a Rino, and blame EVERYTHING on those cruel Republicans . The only problem is that they work for us and teach our children to hate what America really stands for.
Can they teach our children to spell EXODUS?
Leslie Dutton Los Angeles
Posted: 09:09 pm [PST] on January 07 2007
Jay Graham,
Thank you so much for your comments and perspective. At last we have begun a public discussion, without which the problems cannot be resolved. Now there will be public disclosure of the promises made to our public servants, hopefully there will be more responsiblilty and the likelihood that whatever promises are made, will be realistic and be kept. Thanks again for your comments. Hope you will continue to share them with us.
Jay Graham Apple Valley, California
Posted: 08:29 pm [PST] on January 07 2007
I worked in law enforcement for 25 years. I served the public in work that no civilian would undertake for any amount of money. Many others, like myself, worked and work in occupations like this so our society can remain as safe as possible.
Others provide services needed by the public to live their daily lives in transportation, flood control, government services and much, much more.
We all paid into this retirement program and other opportunities to plan for our retirement. Now, we hear about the liability on the tax payers and the need to change or reduce the pensions that we earned.
Fortunately, L.A. County, my retirement program, is 85.8% funded currently. Due to excellent asset management, forward thinking and knowledgeable staffing, LACERA has continued to meet its obligations to the retirees of L.A. County with little cost to the tax payer in L.A. County.
However, due to the mismanagement of other programs, the L.A. County program is in jeopardy of modification under the assumption that if one or several plans are in financial difficulty, then all of them are in trouble.
The public needs to understand that there are various levels of government pensions, city, county, school districts, state employees and more.
If you desire to point out public liability, then take a look at the federal politicians. They retire after only one term with full benefits for life, all on the tax payers backs. Now that's a scandal and no one talks about it.
Those of us who receive a public pension are also penalized in another area, Social Security. Anyone receiving said pension falls under the Windfall Elimination Provision and Government Pension Offset, where we lose our Social Security benefits even though we planned our retirements with this as another stream of income. This money is stolen from us after serving the public that needed us.
Now, you raise issues to scare the public even further. The issues discussed are of concern to all, even those of us on public pensions, because we are tax payers, too.
Maybe if we weren't taxed at every turn in our lives things wouldn't be this difficult for the pension programs.
A cry for change is valid but not for those already receiving their pensions. The change should be in pension management, not pension types.
Improperly managed retirement programs should fall on the backs of those who manage them and not the retiree or tax payer.
Can reform be acconplished? I believe it can. How? I'm not sophisticated, educated or learned enough to see all of the options available but to talk doom and gloom to the public won't make the things needing change happen.
Given sufficient information and using common sense, which most politicians and nay sayers lack, a path of reform could be found.
Until the right people are involved in all aspects of pension reform, we are all in harms way.
Everyone discussing this matter seems to see the negatives and does little to find a solution. They'd rather use scare tactics to make this a political issue for their own use or fame or power play while not caring about the retiree.
This also provides another avenue for desension and division in our state and country. "A house divided cannot stand." Keep it up and further destruction of our society, country and way of life will occur. But, maybe that is what is sought by those undertaking this campaign.
Thanks for allowing me to express my views and thoughts on this matter.
SALLY FLEER THOUSAND OAKS
Posted: 11:35 am [PST] on January 07 2007
A time will come when we start enjoying the gifts God has given us so freely, and not depend on the "GREED of THINGS " we have learned to desire.
Unfortunatly our Grandchildren will need to fix this problem, we don't seem willing to WAKE UP
Sally Parkinson San Francisco
Posted: 09:20 pm [PST] on January 06 2007
This is astounding. How could we get billions in debt without even knowing it? It looks to me that our elected officials are looking out for themselves and the labor union leaders are doing the same. There is no excuse for this selfishness.