The Washington Post’s masthead reads “Democracy Dies in Darkness” but sometimes democracy dies in plain sight in Sacramento, where unverified assertions are often employed to justify billions in spending, cover up accounting frauds, shift blame for undue political influence, and more.
For example, whenever a new contract for state prison employees is under consideration, legislators are falsely told by advocates for greater pay that the average life span of a retired California correction officer is only 59 years. But data we recently received after filing a Public Records Act request show that corrections officers on average live well beyond 59. For example, officers born on or before 1/1/1940 who had retired and died by 1/27/20 on average lived 77 years (and of course that doesn’t count retirees who haven’t yet died).
Another oft-stated falsehood is that pension costs are only rising because the stock market declined in 2008 when the real reason is deceptive accounting by state pension funds that covers up the true costs of pension promises when they are created and sets up an automatic explosion in liabilities down the road, as explained here. Even torrid stock market growth cannot overcome that explosion, as illustrated by the negligible improvement in CalPERS’s funded ratio (liabilities divided by assets) despite a a big run up in stock prices:
Another conventional fiction is that the Citizens United decision impacted California politics when the truth is that California already had CU rules before the CU decision, as explained here.
California is worth a deeper dive. Hundreds of analysts pour over the financial statements of The Walt Disney Company, which reported $70 billion of revenues in 2019, while the State of California that spends nearly five times as much and has authority over 29 legal codes that touch the lives of every Californian is rigorously covered by no analysts other than rating agencies that care only about the state’s ability to service debt, which is senior to taxpayers and all but two programs. At GFC we’ve barely scratched the surface, and one of our fondest wishes is that others with private sector experience devote as much attention to their state as they do to their businesses, investments or hobbies. You can be sure that special interests do. Beneficiaries of programs and taxpayers deserve the same protection. Jump in!