California Pols Create Fake Mandatory “Retirement” Fund to Raid


It was either this or pass another tax. And even with a Democratic supermajority of the welfare state running the state, California politicians apparently decided that it would be easier to create a fake mandatory retirement fund. (via American Digest)

California lawmakers are pushing a controversial, first-in-the-nation plan that would require private-sector employers to remove 3 percent from every worker’s paycheck. The money would go into a new state fund with a guarantee that all withheld funds plus investment gains will be available for distribution at retirement age.

The idea behind the Secure Choice Retirement Savings Program, which got preliminary approval, is for it to be a state-run supplement to Social Security, but only for people who don’t have traditional workplace retirement plans. For an estimated 6 million working Californians, the benefit of a pension or 401(k) is out of reach — so state lawmakers are trying to implement the new mandatory retirement fund for private sector workers.

Let’s call this magical ball of money what it actually is, a slush fund to cover the shortfalls on CALPERS, California’s insane public sector pension crisis.

California’s major retirement systems now have $222.2 billion in unfunded pensions, up from $211.4 billion five months ago. The report says that number was $110 billion in 2007-2008, meaning the state’s unfunded pensions have doubled in six years.

In January, Sacramento Bee columnist Dan Walters used figures from Moody’s to estimate that California “could have unfunded pension debt approaching $300 billion, plus another $100 billion for retiree health care.”

In 2010, Gov. Arnold Schwarzenegger’s administration claimed the pension overhang for California State Teachers’ Retirement System, California Public Employees’ Retirement System and the University of California Retirement System was $500 billion.

So you can see where this brilliant idea comes from. Sure it won’t cover all that lost money. It won’t cover any of it, since like CALPERS, the money will be dumped into socially responsible investing in Green Energy and minority businesses. And to fund any boondoggle the politicians like.

Light rail? Sure, here’s your funding. Just 3 percent of every paycheck.

But critics wonder how the state with a turbulent record of budget keeping and a much-ridiculed public worker pension system can be counted on to protect people’s money.

“I think you’ll find out that what is promised in the (Secure Choice plan) is not possible to deliver,” lobbyist Marc Burgat contends. “If you could deliver guaranteed returns with less than one percent costs, no employer liability, no government liability — that’s a fantasy.”

Any promise to cover the money is a fantasy. This just makes it a bigger fantasy. Once again workers are being raided to cover for unions.

  • marshall goodman

    Sounds like the mid 1930s and FDR all over again. And there are many more similarities than just to the grand larceny known as Social Security. Marxism was running wild along with health care reform (Darwinism/eugenics) and a massive war was being planned to give Marxists control of the Far East and to retake Europe. Today, it’s the massive war being planned on the USA, likely by China under the same guise as WWII: preserving liberty and freedom worldwide.

  • PS

    Various studies show that illegal aliens in CA consume many times more in social benefits than they pay in taxes. If the illegal aliens were kicked out, CA would have no problem balancing its budget. Even suggesting this is “racist”, of course, so it will never happen, and all Californians will continue to suffer from chronic shortfalls in the state budget.

  • T100C1970

    In the book 1984 the gubmint bureaus had names opposite of what they did.. The Ministry of Truth actually did Propaganda.. The Ministry of Plenty was in charge of rationing, etc.. In like manner, the “secure choice” program is neither secure nor does the enrollee have any choice in the matter. Kind of reminds one of the “Patient Protection and Affordable Care Act” which is already making care worse while doubling its cost.

  • CypressSteve

    Perhaps the new CA agency responsible for administering the retirement program will be called “Secure Choice Retirement from Employment Wages Extraction Department,” also know by its more familiar acronym, SCREWED. This couldn’t get more ridiculous if written by a Hollywood scriptwriter. To my fellow CA citizens: You voted these thieves into office, knowing full well that they intended to take your money and give it to labor unions and State workers, who funded the campaigns of the thieves, as payback. As all of us employers leave the state, your share of the cost is going to have to rise… Sorry!

    Enjoy the beautiful weather. You will not have to turn the lights out on your way out the door because the power shortages will start long before you leave.

    As it turns out, President Obama was correct: “Elections have consequences.”