Pension Politics

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

Republican legislators want pension reform because they believe it is a step toward overall fiscal reform. The governor wants pension reform to show government can fairly manage tax dollars so that voters will support his tax increase initiative. Voters want pension reform, 83% in a recent poll, because they are concerned pensions are eating away at other services they expect to receive and they don’t want to fund extravagant retirement benefits that they, themselves, don’t receive.

Do Democratic legislators want pension reform?

We’ll call that the $500 billion dollar question.

Democrats in the legislature are under pressure from public employee unions not to make major changes to the pension systems. The unions are prime supporters of Democratic lawmakers. Yet, now pension reform has taken on a bipartisan hue.

With both the Senate and Assembly Republican caucuses coming out firmly in support of Governor Jerry Brown’s 12-point pension reform plan, Democratic legislators will be asked time and again if they can sign on to the bipartisan reform package.

One response to the question came from the Democrats yesterday when Senator Kevin de Leon introduced legislation requiring a pension fund for private workers. Democrats hope to change the discussion and escape what Assemblyman Warren Furutani called “pension envy” that private employees supposedly have for public employee pensions.

Changing the discussion doesn’t make the $500-billion dollar problem of unfunded retirement costs in the public sector go away.

Just what the state doesn’t need: a new program. Just what small business people don’t need: more mandates, regulations and paperwork to frustrate their business.

Another response to the demand for reform may be blithely resisting the pull to jump on the reform bandwagon. After all, Democratic legislators might reason, pensions are a complicated issue, the general electorate doesn’t use pensions as a yardstick when they decide for whom to vote, and the people most passionate about pensions don’t want big changes.

However, pension reform is an important piece in healing California’s dysfunctional government. Call it the first domino. If it falls other reforms would likely follow.

If the legislators come together with the governor to complete a basic reform, the feeling toward the legislature, consistently recorded in negative numbers, could be reversed.

Republicans supporting the governor’s pension reform package is being regarded in some quarters as a simple move on the political chessboard — an attempt to pin the Democratic legislators in a corner by siding with the Democratic governor.

In truth, if the Republicans were in charge, the reforms they offer would go further than the governor’s plan. This move by Republican legislators to support the governor’s plan is an effort to find compromise on an important issue.

Perhaps, more importantly, this is an opportunity for the government in California to prove it can work.

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