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California pension system playing politics with your money

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The California Public Employees’ Retirement System (CalPERS) is in the news once again. I wish I could report that with a record high bull market that CalPERS was well on its way to becoming solvent. Unfortunately, CalPERS, the largest public pension fund of approximately $345 billion has roughly $138 billion in unfunded state actuarial liabilities. Due to unrealistic actuarial assumptions and poor investments in Environmental, Social, and Governance (ESG) funds; CalPERS is moving closer to collapse than solvency.

In simpler terms, what is going on is that CalPERS is playing politics with retiree and taxpayers’ money. Meaning future, and current retirees will inevitably see a dramatic cut in their pension benefits; which they have been paying into their entire careers. Cuts in local and state government services to redirect funds into CalPERS as well as the inevitable tax increase.

Laundering Money

One of the ways they played politics with our money was the passage of SB 400 in 1999, which gave government employees a retirement security reserved for the wealthy. This meant that many retirees could retire at 55 and in most cases collect more than half their highest salary for life. California Highway Patrol officers could retire at 50 and receive as much as 90% of their peak pay. So basically, they dramatically increased pension benefits without any way of paying for it.

Why do this? Taking taxpayer dollars and using it for your political campaign is illegal. But union contributions are perfectly legal. Government employees are not to blame; it’s their unions. Government employees have no choice, they must be part of the union and pay union dues. Most unions are like most crony capitalistic corporations. They want to limit competition through government actions and want to make money for their shareholders.

So unions work hard at eliminating any outsourcing of services and jobs to private companies. If it must be done, it must be a government union member. Meaning more employees will be needed and hired and thus more union dues paid. Unions also work hard to increase pension and salaries because yet again more money means more money for the union. The union bosses or in the corporate world known as CEOs, take those taxpayer-funded union dues and then turn around and give millions to political campaigns. Thus you have essentially laundered millions of dollars of taxpayer money and made it legal to donate to politicians that promise you billions in taxpayer-funded benefits. This is no different then crony capitalism. Different shareholders, same corruption.

Crony Capitalism & Ideological Investments

Secondly, they play politics by investing in companies that have no promise of a reasonable rate of return. They invested in failing renewable energy companies because it’s more important to invest utilizing ideological metrics than sound fiscal policy. They divested in successful businesses who engage in legal commerce because their products or projects don’t align with their ideological views. They pressured companies to diversify their board of directors to meet their ideological views of diversity, or they will not invest in their companies. This, in essence, is blackmailing businesses to do what CalPERS wants, or they will pull millions if not billions of dollars from these companies.

The consequences of these actions are that many of the most successful and profitable companies with safer and higher rates of return don’t need CalPERS money. They do fine without them. CalPERS, on the other hand, needs to invest their money and thus are limited to less financially stable and untested companies. Companies in desperate need of liquidity will do as CalPERS wants. But in the end, picking companies based on ideology instead of sound fiscal decisions isn’t a sound investment strategy. Thus, lower rates of return and higher risk for loses will continue to create greater insolvency due to these ideological and politically motivated investments. Overall, they could care less because even though they don’t invest their own money in ESGs. Their ideological investing will drive their base to the polls and keep their political coffers full.

But before you think its all about ideology it is not. Crony capitalism plays a part as well. These companies in desperate need of capital don’t do what CalPERS wants, and that’s all. These same companies turn around and donate back to these same political coalitions which gave them all that money. Why just force the hands of these companies when you can force their hand and expect campaign contributions at the same time? Its a win-win for politicians.

My Solution

For those unaware. I’m a candidate for California State Controller in 2018. When I’m elected, I will be an ex officio member of CalPERS. As Controller, I can independently audit government agencies that spend state funds. With this authority, I will work to eliminate CalPERS. Due to the corrupt nature of politics in Sacramento, this will most likely happen through a voter-approved ballot measure. As Controller, my examination and audits will be used to expose the mismanagement and most likely propose the following changes.

First, the State will no longer invest on behalf of current or retired government employees. Responsibility will be handed over to their unions. Unions told us the pension benefit found in SB 400 were not excessive and could be paid for and managed. If that is the case, they should handle the investment portfolio on behalf of their members. I understand that union members are taxpayers, but the entire population of California taxpayers shouldn’t be on the hook for their union’s decision to push for pension benefits like those found in SB 400. The state and local municipalities that participate in CalPERS will contribute a fixed percentage of current employees salaries and the union, not the taxpayer, will be responsible for the consequences of making ideological investments.

Secondly, all future state employees can either decide to have their unions invest in a pension on their behalf or they can decide to invest on their own through an IRA or 401k. Current government employees can also decide to pull out a portion of their funds and invest on their own. With CalPERS heading for a fiscal cliff, we should allow government employees to determine what is best for them.

By doing this, we can fix the problems we are currently experiencing with this pension crisis. Taxpayers are protected, and government agencies will have a set percentage based on wages on what they must contribute to their employees’ retirement. If we take sound fiscally responsible actions, we can not only increase the rate of return on CalPERS investments, but we can protect taxpayers, reduce corruption, and give great stability and certainty to government workers.


Sources – CalPERS Pension Reports & Pension Crisis

CalPERS’ green investments underperform, business group says | The Sacramento Bee

http://www.sacbee.com/news/politics-government/the-state-worker/article188047259.html#emlnl=Breaking_NewsletterThe nation’s largest public pension fund is leaving money on the table by favoring environmental and social causes in its portfolio, a business-backed nonprofit argues in a study it’s releasing Tuesday on the California Public Employees Retirement System.

The report by the American Council for Capital Formation criticizes CalPERS’ sustainable investing strategies, which include engaging with companies to encourage them to address climate change, pressuring companies to diversify their boards of directors and investing in certain funds that nurture companies with those priorities.

How a pension deal went wrong and cost California taxpayers billions – Los Angeles Times

http://www.latimes.com/projects/la-me-pension-crisis-davis-deal/More than 200,000 civil servants became eligible to retire at 55 — and in many cases collect more than half their highest salary for life. California Highway Patrol officers could retire at 50 and receive as much as 90% of their peak pay for as long as they lived.

CalPERS had projected in 1999 that the improved benefits would cause no increase in the state’s annual pension contributions over the next 11 years. In fact, the state had to raise its payments by a total of $18 billion over that period to fill the gap, according to an analysis of CalPERS data.

The pension fund has not been able to catch up, even though financial markets eventually rebounded. That’s because during the lean years, older employees kept retiring and younger ones continued to build up credit toward their own pensions. Pay raises and extended lifespans have magnified the impact of the sweetened benefits.

By far the largest group of state workers — office workers at the Department of Motor Vehicles, the Department of Social Services and dozens of other agencies — contributed between 5% and 11% of their salary in 2015, and the state kicked in an additional 24%. To fund their more costly benefits, Highway Patrol officers contributed 11.5% of pay and the state added 42%.

CalPERS Report – ACCF Corp Gov

The nation’s largest public pension fund, the California Public Employees’ Retirement System (CalPERS), is severely underfunded.  With more than $300 billion in assets, CalPERS future liability exceeds those assets by more than $100 billion. How did things get so bad? A number of factors have contributed to CalPERS’s relatively recent and precipitous decline.

Mr. Roditis a candidate for California State Controller. He is an entrepreneur and owns several companies. He graduated from UCSD with a B.A. in Political Science/International Relations. He's a former City Commissioner with the City of Anaheim, CA. He's a Conservative Constitutional Federalist. Follow him on Twitter @KonRoditis

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4 Comments

4 Comments

  1. T B

    December 8, 2017 at 11:51 am

    I will definitely vote for you!

    Here’s my solution to the public pension crisis:

    https://drive.google.com/file/d/0B90sU3A85q46OE9BZHJFSWEzbGM/view?usp=drivesdk

    Thoughts?

    • Konstantinos Roditis

      December 8, 2017 at 12:42 pm

      Thank you for your support and sending me this article. My initial concern with this proposal is that this would take pensions run by the states and local municipalities and merge it with social security and thus move more power to the federal government. I’m a federalist, and I believe that social security is unconstitutional and the power for the federal government to have social security is not found in the constitution, specifically Article I, Section 8 of its enumerated powers. On the federal side, I would prefer to see a plan that would begin to shrink and eventually eliminate social security and devolve and transition those powers to the states as our constitution prescribes.

      The federal government has never shown signs of fiscal responsibility, and thus I doubt any safeguards put in place will actually work because the federal government will rather spend recklessly and just print more money and raise the national debt. I believe we must eliminate power for the federal government and the state government and move to greater local control. That is one reason why I created Trickle-up-Taxation ( http://noqreport.com/2017/11/07/trickle-taxation-plan-bring-local-control-california/ ). I believe moving forward a plan similar but maybe not identical to Prop B that was passed in San Diego is needed for all future government employees ( https://www.sandiego.gov/sites/default/files/legacy/city-clerk/elections/city/pdf/retirementcharteramendment.pdf ).

      Cuts in defined benefits will happen as the courts have ruled that defined benefits can be adjusted, but it must be a reasonable benefit. The issue with this is it is not defined what is reasonable. All pensions are different and have different contribution rates and defined benefits, as well as, various jurisdictions with different laws governing them. So with your plan, some pensions might be defined as reasonable to take maximum social security payout and other it might not be. It is entirely subjective, and it will depend on the judge ultimately, as almost every pension will fight this in court. They want to keep their defined pension benefits.

      Ultimately, I believe that all new employees should move to a 401k system. I think this is the best solution. Move pension investment from the politicians’ hands to the unions, and they can invest it themselves or better yet hire the right people to do this. Most of the people on CalPERS have not investment or financial experience. Make changes to defined pension benefits with a maximum payout per year. As State Controller I will study this and look for the best solution, not the best political solution and move to fix the problem and thus best protect the taxpayers and the government employees which have done nothing wrong.

      If you would like to help support my campaign, please consider contributing today. https://secure.anedot.com/roditis/donate

      • T B

        December 8, 2017 at 12:53 pm

        Thank you for your quick and thoughtful response, a lot of what you say makes sense. I understand my approach would only be considered after an apocalyptic correction in the stock market, thereby rendering all public pensions around the world insolvent. Not sure how accurate it is, but I have read many expert’s opinion that once a fund dips below 50%, it will never recover to full funding status.

        • Konstantinos Roditis

          December 8, 2017 at 1:02 pm

          Many factors including payouts, number of retirees to current employees, number of future employees (increasing or decreasing), the age of retirement, the rate of return, etc. play into when the point of no return happens if changes are not made. But I wouldn’t be surprised if 50% isn’t a reasonable rough average of future collapse of a pension system.

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Guns and Crime

Liberty Control (aka Gun Control) Dead at 501 [1517 – July 10, 2018]

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Today we celebrate the passing away of one of the Left’s worst legacies: Liberty Control

Liberty Control (aka Gun Control), the absurd idea that depriving the innocent of a means of self-defense will protect them from criminals and the government died on July 10, 2018, after a protracted illness. The past few months saw it suffer multiple degradations, but the final cause of death was a settlement between the Department of Justice and Second Amendment Foundation in SAF’s lawsuit on behalf of Cody Wilson and Defense Distributed over free speech issues related to 3-D files and other information that may be used to manufacture lawful firearms:

Significantly, the government expressly acknowledges that non-automatic firearms up to .50-caliber – including modern semi-auto sporting rifles such as the popular AR-15 and similar firearms – are not inherently military.

“Not only is this a First Amendment victory for free speech, it also is a devastating blow to the gun prohibition lobby,” noted SAF founder and Executive Vice President Alan M. Gottlieb. “For years, anti-gunners have contended that modern semi-automatic sport-utility rifles are so-called ‘weapons of war,’ and with this settlement, the government has acknowledged they are nothing of the sort.

This curse on freedom began with the nonsensical label ‘Gun control’ but like a mutating virus, it morphed into ‘Gun safety’ or ‘Gun reform’ as people began to understand it’s true liberticidal nature. The final proper designation for this statist abomination helped seal its fate: Liberty Control.

In recent years, Liberty control had suffered a number of potentially fatal maladies ranging from the Heller and other Pro-Liberty decisions of the Supreme court to the virtual explosion in gun ownership with untold numbers of new adherents joining the ranks. Despite valiant attempts by the Left to resurrect this absolutely horrid idea from a bygone era, most imbued with common sense came to realize that more guns equaled less violence.

Liberty Control is barely survived by its one year older half-brother in statist tyranny Collectivism, born when the book ‘Utopia’ was published in 1516.  This ancient idea remains in critical condition having been transferred to the Bronx on life support. It is not expected to survive, despite the best efforts of the Socialist-Left. As is usually the case when a free-people can properly assess the liberticidal ideas of the Left.

Libertas [The ancient Roman personification of liberty] Celebrated the death of one of its intractable foes down through the centuries. “There must have been some viral affliction in the water of the early 16th century to have created these two horrible curses upon mankind.”

Services will be held on July 27th, 2018, and after August 1 Cody Wilson plans on re-launching Defcad.com with ‘a treasure trove of 3D-printed gun files for download.’  In Lieu of flowers, those of the Liberty loving public are encouraged to visit https://ghostgunner.net/ after that date and download the files for future use as well as donate to the organizations that defend this critically important freedom.

Please note that while we are using this ‘obituary’ form to prove a point, it should be patently evident that the dreams of the Liberty grabbers of banning and confiscating guns are now dead. Even if by some freakish turn of events whereby the defenders of Liberty forget history, agree to the requirement of governmental permission to exercise a commonsense human right, and then have their guns confiscated. The technology will still exist for everyone to produce their own weapons. It should perfectly clear to everyone including the cadres of Liberty Grabbers out there that the genie is out of the bottle, that there is no way they can ever ban guns, knives or even the odd spanner here and there. It should also be evident that such groups should move on to other causes that actually have a chance of coming to fruition. Also, note that it was very proper that this took place during #Gun Pride Month.

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Entertainment and Sports

LeSean McCoy domestic violence accusation: the “Hold My Beer” of recent NFL player scandals

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Players getting into trouble off the field is nothing new for the NFL, but the accusations levied against LeSean McCoy on Instagram tops the accusations made and found true against the likes of Ray Rice, Michael Vick, Adrian Peterson, and countless others. This follows a recent arrest of former Seattle Seahawk, Brandon Browner, being charged with attempted murder. 

Shady McCoy is publicly accused of illegal drugs, PED, animal abuse, domestic abuse, and child abuse. The seriousness of the accusations alone could endanger his career. Like any person guilty or innocent, McCoy took to denying the accusations, claiming to have had no direct contact with them in months.

But the evidence is being gathered. Police say they are investigating a home invasion of the victim’s residence. So far, McCoy has not been named a person of interest.

Furthermore TMZ reports that the victim has lawyered up and named LeSean McCoy as the orchestrater of the attack. This changes the narrative from the original IG post, but in no way lessens the severity. As of now, McCoy stands accused of sending people to do this attack.

TMZ Report:

Delicia Cordon has hired attorney Tanya Mitchell Graham — who issued a statement saying Delicia was sleeping early Tuesday morning when a man entered her Georgia home and pistol whipped her.

Graham says the assailant demanded specific items of jewelry that had been given to her by McCoy — jewelry that McCoy had previously demanded she return to him. She claims the victim also sustained injuries to her wrist when the assailant tried to rip off her bracelet.

Graham claims before the incident, McCoy “would often suggest to Ms. Cordon that she could be robbed because the jewelry was expensive.”

Graham — who’s joined by associate attorneys Demetrius Price and Kiarra Brown — never straight-up accuses McCoy of criminal activity, but strongly implies it.

For example, Graham claims the assailant entered the house with NO signs of forced entry. She also claims McCoy changed the security system at the house and did not give Cordon access to the new one.

She also claims McCoy has a documented history of having other people do his dirty work for him — and references the time he allegedly ordered other people to evict her from his home in June and remove her furniture from the house.

Graham says despite the fact Cordon and McCoy have had a relationship since 2016, he has NOT called to check in on her since the details of the violent attack went public.

Final Thoughts

LeSean McCoy doesn’t have a reputation for being a model citizen. As Smitty of Barstool Sports notes:

The odds of Shady McCoy being guilty are high. That being said, the NFL doesn’t wait for due process. Otherwise Ezekiel Elliott wouldn’t have undergone a 6 game suspension. They will have to act as this scandal is prime to escalate and disrupt the storyline of the upcoming season.

Originally published on Startup Christ.

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News

PRIDE: Portland renames major street after pederast, cult defender

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In 2016, the U.S. Navy named a ship after the late politician, Harvey Milk. In 2009, President Obama posthumously bequeathed Milk with the Presidential Medal of Freedom.

Now, city officials in Portland, Oregon, have voted to rename a 13-block section of one of the city’s major streets, Southwest Stark Street, after Harvey Milk, the first open homosexual to serve on the San Francisco, CA, Board of Supervisors. Milk was murdered in 1978, by a fellow democratic Board of Supervisors member.

Harvey Milk was also a serial pederast. As his friend and biographer, Randy Shilts, wrote:

“Harvey always had a penchant for young waifs with substance abuse problems.”

Milk was also a defender the now infamous Marxist cult leader Jim Jones. As Daniel J. Flynn wrote at City Journal in 2009, in a piece entitled, “Drinking Harvey Milk’s Kool-Aid”:

Nine days prior to Milk’s death, more than 900 followers of Jim Jones — many of them campaign workers for Milk — perished in the most ghastly set of murder-suicides in modern history. Before the congregants of the Peoples Temple drank Jim Jones’s deadly Kool-Aid, Harvey Milk and much of San Francisco’s ruling class had already figuratively imbibed. Milk occasionally spoke at Jones’s San Francisco-based headquarters, promoted Jones through his newspaper columns, and defended the Peoples Temple from its growing legion of critics. Jones provided conscripted “volunteers” for Milk’s campaigns to distribute leaflets by the tens of thousands. Milk returned the favor by abusing his position of public trust on behalf of Jones’s criminal endeavors.

“Rev. Jones is widely known in the minority communities here and elsewhere as a man of the highest character, who has undertaken constructive remedies for social problems which have been amazing in their scope and effectiveness,” Supervisor Milk wrote President Jimmy Carter seven months before the Jonestown carnage. The purpose of Milk’s letter was to aid and abet his powerful supporter’s abduction of a six-year-old boy. Milk’s missive to the president prophetically continued: “Not only is the life of a child at stake, who currently has loving and protective parents in the Rev. and Mrs. Jones, but our official relations with Guyana could stand to be jeopardized, to the potentially great embarrassment of our State Department.” John Stoen, the boy whose actual parents Milk libeled to the president as purveyors of “bold-faced lies” and blackmail attempts, perished at Jonestown. This, the only remarkable episode in Milk’s brief tenure on the San Francisco board of supervisors, is swept under the rug by his hagiographers.

Along with Stoen, 275 other children also perished that day in Jonestown.

Portland’s Southwest Stark Street is at the center of the largely LGBTQ Burnside Triangle neighborhood.

According to an article at LGBTQNation.com, “this change symbolizes the districts history as well as the legacy of Harvey Milk.”

Portland Mayor, Ted Wheeler, prior to the vote, spoke about the importance of this name change, saying that it “sends a signal that we are an open and a welcoming and an inclusive community.”

Portland now joins several other cities, including San Diego and Salt Lake City, which have honored Harvey Milk.

My Take:

Those on the right side of the aisle are regularly accused of vilifying the LGBTQ community. Oddly enough, it’s the most vociferous activists on the left – specifically, it’s those who select, uplift, and honor “heroes” like the sexual predator Harvey Milk – who do the most damage to the image of the LGBTQ community, along with the ideologues who simply go along with it.

What could the right possibly do to harm the image of the LGBT community which the radical activists haven’t already inflicted themselves? I can’t think of anything. Can you?

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