A real look at reform

For information about CalPERS average retirement benefits, visit www.calpers.ca.gov and search for “facts at a glance.”

Californians are understandably concerned about paying for the pensions of retiring state workers. Given the economy, a dysfunctional budget process, and stubborn resistance to additional taxes and fees, it’s tempting to renege on the state’s pension liabilities.

Some form of pension reform is inevitable, and—given The Sacramento Bee’s recent analysis of the roughly 9,000 state pensioners who are receiving more than $100,000 in annual benefits—there are certainly some state employees who need to have their pensions adjusted.

And the rapid growth of pensioners receiving these big pay-outs is concerning.

But buried deep in the daily’s reporting is the good news: High-pension retirees account for less than 2 percent of all CalPERS pensioners. The average annual CalPERS benefit is slightly more than $26,000—a much more reasonable sum and one that, when combined with Social Security and some sensible investments, would allow retirees to live a comfortable, if thrifty, retirement.

Here’s how it works: Workers pay into their pension funds. Their contributions are supposed to be complemented by an employer (that’s the state) contribution. In lean years, the state bargained with employees to cut worker’s contributions rather than give workers raises—ones that those workers might have invested for retirement on their own.

So, yes, let’s ask what a fair and decent pension ought to be for public workers. And certainly, let’s ask questions about top salaries, particularly among management; public workers should be paid fairly, but they certainly shouldn’t be overpaid.

But let’s not get overly zealous here.

After all, state workers have the pensions they have because the state’s representatives—elected by its citizens—negotiated those pensions to adequately compensate workers for slightly lower wages and to reward years of service.

Why should any of us have to fear retirement? Why shouldn’t each American who puts in a lifetime of work have a secure retirement that doesn’t leave him or her dependent on the largesse of younger generations?

In the frenzy to cut, let’s remember what will happen if state workers’ pensions are used to pay other obligations.

Their needs won’t change, and instead of retirees who can take care of themselves—with pensions they’ve earned—we’ll have instead a wave of impoverished elders in need of public services.

We will pay for this, one way or another.