The Problem--In a Nutshell

You'd have to be nuts to think that we, that is--us, that is--the United States of America, can continue along this path: public employee retirees that collect north of $100,000 per year in pension benefits. In perpetuity.

Indulge me for just a moment: In the small little county in which I live we have an exclusive club. It is a rather small club at the moment--535 members. Though it is growing rapidly, adding over 100 new members in the last year alone. That's almost 25% growth. In a sluggish, no growth economy. This particular club doesn't actually DO anything. Rather, it is a club where the members are rewarded just because.

Because they are part of the cabal that makes all the rules.

The club of which I speak is a subset of the Contra Costa County Employees Retirement Association (CCCERA) and includes those public employees who have retired with pension benefits in excess of $100,000.00 per year. $100K! Guaranteed. No matter what.

I don't know a business that provides a defined benefit plan any longer. That is not to say they don't exist. But, it is to say they are rare. Because defined benefit plans are expensive and businesses (you know, the entities that must match revenues with expenses, that can only spend what they take in, based on the value they provide to their clients rather than government which holds the arbitrary ability to increase revenues via tax increases totally disconnected from any value added and not in the least voluntarily paid by those who provide the revenue ) must manage their affairs responsibly. They will not be around for long if they continually spend more than they take in. That's just the way it is.

So here are the ugly facts of the CCCERA Club from an article written by Bill Gram-Reefer on Halfway to Concord:

• The club represents 7.3% of all county retirees but they receive 23.8% of the benefits.
• The Club costs the public $5,766,927 each and every month. Guaranteed. No matter what.
• The number one position in the club is held by a retiree who receives an annual retirement benefit of $291,000. And, it should be noted, despite the budget shortfalls in our county and our state and our country, his benefits rose last year.

It should not be lost on any of us that while the rest of the population suffers (i.e., the private sector) the public sector is thriving. Since the private sector funds the public sector through the production of goods and services--that people actually want--there is something terribly wrong with this equation. The public sector cannot continue to grow while the private sector shrinks.

And that's the problem. In a nutshell.