Sunday, July 10, 2011

California Teachers: Pension Spiking is Okay When We Do It!

On the heels of news that the state's public-school teachers are pushing for a massive tax hike on the state's wealthiest residents, a report in the Sacramento Bee gives us an idea of what they hope that money will pay for. According to the Bee's analysis of Sacramento-area retirees drawing pensions through CalSTRS, nearly half of the hundreds of retirees drawing six-figure pensions got huge pay raises in at least one of their final three years on the job. In other words, at least some of CalSTRS' unfunded liability is due to pension spiking.

These pensions are, of course, entirely unsustainable. As we and others have pointed out, the payments that the state's general fund will soon need to dedicate to pensions will sink its finances. Not even the $10 billion that the teachers' union hopes to extract from rich Californians, even if it did materialize, would be close to enough. But it is looking like our "public servants" are determined to make taxpayers pay the price for bad decisions made with our money.

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