CalPERS, the state pension system, is one of the big players whose fiscal irresponsiblity contributed to Stockton’s meltdown.
The State Worker blog specifies the culpability.
“…13 years ago the fund promoted legislation that hiked the very benefits that the new law will roll back for future employees,” today’s post says.
“In 1999, the fund’s asset portfolio was flush, its confidence in its investing acumen high. So when a bill to boost retirement benefits surfaced, CalPERS published a brochure with a promise: “NO INCREASE OVER CURRENT EMPLOYER CONTRIBUTIONS IS NEEDED FOR THESE BENEFIT IMPROVEMENTS.”
Despite this rosy hogwash, CalPERS has taken the position that its pensions are sacrosanct. Stockton cannot cut them, no matter the consequences to police or fire or anyting else. Public retirees deserve special treatment, even in bankruptcy.