Sucking up the wealth

[Joeybagadonuts]

By PAUL WISEMAN

WASHINGTON — This is one anniversary few feel like celebrating.
Two years after economists say the Great Recession ended, the recovery has been the weakest and most lopsided of any since the 1930s.

After previous recessions, people in all income groups tended to benefit. This time, ordinary Americans are struggling with job insecurity, too much debt and pay raises that haven't kept up with prices at the grocery store and gas station. The economy's meager gains are going mostly to the wealthiest.
Workers' wages and benefits make up 57.5 percent of the economy, an all-time low. Until the mid-2000s, that figure had been remarkably stable — about 64 percent through boom and bust alike.
Executive pay is included in this figure, but rank-and-file workers are far more dependent on regular wages and benefits. A big chunk of the economy's gains has gone to investors in the form of higher corporate profits.

"The spoils have really gone to capital, to the shareholders," says David Rosenberg, chief economist at Gluskin Sheff + Associates in Toronto.

Corporate profits up

Corporate profits are up by almost half since the recession ended in June 2009. In the first two years after the recessions of 1991 and 2001, profits rose 11 percent and 28 percent, respectively.
And an Associated Press analysis found that the typical CEO of a major company earned $9 million last year, up a fourth from 2009.

Driven by higher profits, the Dow Jones industrial average has staged a breathtaking 90 percent rally since bottoming at 6,547 on March 9, 2009. Those stock market gains go disproportionately to the wealthiest 10 percent of Americans, who own more than 80 percent of outstanding stock, according to an analysis by Edward Wolff, an economist at Bard College.
But if the Great Recession is long gone from Wall Street and corporate boardrooms, it lingers on Main Street:

— Unemployment has never been so high — 9.1 percent — this long after any recession since World War II. At the same point after the previous three recessions, unemployment averaged just 6.8 percent.

— The average worker's hourly wages, after accounting for inflation, were 1.6 percent lower in May than a year earlier. Rising gasoline and food prices have devoured any pay raises for most Americans.
— The jobs that are being created pay less than the ones that vanished in the recession. Higher-paying jobs in the private sector, the ones that pay roughly $19 to $31 an hour, made up 40 percent of the jobs lost from January 2008 to February 2010 but only 27 percent of the jobs created since then.

 

[Sinny]

Great article. How about a link back so we know the source and so that it doesn't violate fair use of this journalist's work. Just sayin'

 

[trysail]

Just so I know what it is that you're so upset about—

what is it that you want?




Do you want the capital that I scrimped and saved and struggled to accumulate from the day of my 16th birthday when it became legal for me to become a summer ditchdigger? Or the money I earned driving spikes and laying rail as a gandy dancer during my 18th summer? Or the money I saved by not spending it on stuff I didn't need?


Do you want to expropriate the capital that I invested after years and years of saving and studying corporations and reading the thousands of footnotes contained in annual reports?


Is that what you want?

 

[koalabear]

By PAUL WISEMAN

WASHINGTON — This is one anniversary few feel like celebrating.
Two years after economists say the Great Recession ended, the recovery has been the weakest and most lopsided of any since the 1930s.

After previous recessions, people in all income groups tended to benefit. This time, ordinary Americans are struggling with job insecurity, too much debt and pay raises that haven't kept up with prices at the grocery store and gas station. The economy's meager gains are going mostly to the wealthiest.
Workers' wages and benefits make up 57.5 percent of the economy, an all-time low. Until the mid-2000s, that figure had been remarkably stable — about 64 percent through boom and bust alike.
Executive pay is included in this figure, but rank-and-file workers are far more dependent on regular wages and benefits. A big chunk of the economy's gains has gone to investors in the form of higher corporate profits.

"The spoils have really gone to capital, to the shareholders," says David Rosenberg, chief economist at Gluskin Sheff + Associates in Toronto.

Corporate profits up

Corporate profits are up by almost half since the recession ended in June 2009. In the first two years after the recessions of 1991 and 2001, profits rose 11 percent and 28 percent, respectively.
And an Associated Press analysis found that the typical CEO of a major company earned $9 million last year, up a fourth from 2009.

Driven by higher profits, the Dow Jones industrial average has staged a breathtaking 90 percent rally since bottoming at 6,547 on March 9, 2009. Those stock market gains go disproportionately to the wealthiest 10 percent of Americans, who own more than 80 percent of outstanding stock, according to an analysis by Edward Wolff, an economist at Bard College.
But if the Great Recession is long gone from Wall Street and corporate boardrooms, it lingers on Main Street:

— Unemployment has never been so high — 9.1 percent — this long after any recession since World War II. At the same point after the previous three recessions, unemployment averaged just 6.8 percent.

— The average worker's hourly wages, after accounting for inflation, were 1.6 percent lower in May than a year earlier. Rising gasoline and food prices have devoured any pay raises for most Americans.
— The jobs that are being created pay less than the ones that vanished in the recession. Higher-paying jobs in the private sector, the ones that pay roughly $19 to $31 an hour, made up 40 percent of the jobs lost from January 2008 to February 2010 but only 27 percent of the jobs created since then.

So you are against Obama's fundamental change.

 

[Joeybagadonuts]

Great article. How about a link back so we know the source and so that it doesn't violate fair use of this journalist's work. Just sayin'

http://www.msnbc.msn.com/id/43611768/ns/business-stocks_and_economy/

 

[Joeybagadonuts]

Just so I know what it is that you're so upset about—

what is it that you want?




Do you want the capital that I scrimped and saved and struggled to accumulate from the day of my 16th birthday when it became legal for me to become a summer ditchdigger? Or the money I earned driving spikes and laying rail as a gandy dancer during my 18th summer? Or the money I saved by not spending it on stuff I didn't need?


Do you want to expropriate the capital that I invested after years and years of saving and studying corporations and reading the thousands of footnotes contained in annual reports?


Is that what you want?

Some just want the government to honor the contract agreement they signed.
Do you think you’re the only one who started working as a kid?

I started delivering newspapers at 12, maintenance work at 14, pumped many gallons of gas, stock clerk...etc... and worked my way through college doing factory work.

Some of my friends graduated college and went after the big money; some got it and others didn’t. Some were more interested in making enough money. They entered into contracts with government entities that provided a salary and salary to be deferred until retirement. They had no choice in that matter; they had to contribute half and the contract called for the government to contribute half. Some government entities are now reneging on those contracts.

 

[Frisco_Slug_Esq]

The same government that told the GM bondholders to fuck off and shook down BP for a slush fund?




You never got back to me over my remarks in your "Private Jet" thread...

Why is that?

Do you feel the strings when they are pulled?

 

[Frisco_Slug_Esq]

Is this going to be a continuing series in defense of Obamanomics?

That tax increase for the rich is insignificant window-dressing thrown in just to piss off mouth-breathers.

It would fund about 30 minutes of government activity and it would costs jobs exactly as did the yacht tax and trust me, I'm not the ONLY one saying it's good for America, Pelosi, Reid and OBAMA said it was good for America when they introduced the tax breaks you're pissing in our Wheaties over.

Then, when they had the chance to raise taxes on the evil greedy rich (the Bush tax cuts for the wealthy, remember them?) they paled, said it would hurt the economy and then they extended them.

It's the Democrats who want to wreck the economy over symbolic gestures in order to have someone to run against, as opposed to something to run on, in the next election that you should have directed your anger against. They knew they could get your panties in a wad and they did!

How does it feel to be a puppet?

http://forum.literotica.com/showthread.php?t=768464

 

[Ishmael]

And who are those scurrilous shareholders?

They're John and Mary Lunchbucket along with thousands of other individual investors. They're the Pension funds for Teachers, Policemen, Firemen, factory workers, office workers, and such. The shareholders are the citizens of the nation.

The author of the article would have one believe that the shareholders are a cabal of men sitting in some room paneled with dark wood making financial decisions for the nation. And further, that the government is working tirelessly to thwart their plans. (Well, that part may be true.)

What the author is really complaining about is NOT the shareholders per se', rather the managers of the aforementioned investment funds. Those people that actually manage the money of the pension funds. If there is an issue to be discussed in that scribbling, their compensation is should be the subject of the debate.

Are they overly-compensated? There is a great deal of evidence that would indicate that that probably is the case. Even so, what is the proper role of the government is all of this? Should the government enact punitive taxation on those rascals? If we follow the theory that is laid forth in the article that is exactly what the author seems to want to happen based on the theory that those 'managers' quite literally 'stole' from the accounts they had the fiduciary responsibility to protect. Quite frankly that smacks of nothing more than two thieves divvying up the the spoils, one thief extorting a portion of the spoils from the other. In what manner does that solution restore anything to those that were victimized by those funds managers? The short answer, of course, is that it doesn't.

How about the government limiting the compensation that these managers can scrape off the transactions? That doesn't work either for several reasons. The first is that these managers will merely employ K street attorneys to lobby for them. Via various loopholes and other convolutions of the tax code exceptions will be made and sooner, much sooner rather than later, the compensation levels will be as high, if not higher, than before. The next point is that if congress can determine what is 'fair compensation' for the managers what is to stop them there? If they can do that to one class of citizenry they can do it to all. And should they go that route there are entire classes of working citizens that cannot afford to buy themselves a K St. legal firm. They are the lowest common denominator in the working class and they will be totally exposed to the predatory practices of both the managers and the congress. At that point we might as well change our name to the United Socialist States of America.

The answer lies in each and every citizen being aware of where their funds are invested, by whom, and to hold those individuals responsible. Funds are fungible and can be freely moved from one investment firm to another. It really is no different than shopping for the best deal on that wide screen TV. Every year or so the individuals, or their designated agents, have the opportunity to move those funds from manager 'A', who charges 7% management fee, to manager 'B' who may charge 6.25%. And while .75% may seem small, when dealing with the sums of monies that they are that .75% adds up to quite a number. In the end it IS the individuals money and it is up to the individual to manage it for their own benefit.

Ishmael

 

[LJ_Reloaded]

Some just want the government to honor the contract agreement they signed.
Do you think you’re the only one who started working as a kid?

I started delivering newspapers at 12, maintenance work at 14, pumped many gallons of gas, stock clerk...etc... and worked my way through college doing factory work.

Some of my friends graduated college and went after the big money; some got it and others didn’t. Some were more interested in making enough money. They entered into contracts with government entities that provided a salary and salary to be deferred until retirement. They had no choice in that matter; they had to contribute half and the contract called for the government to contribute half. Some government entities are now reneging on those contracts.

Don't even bother. Trysail knows very little about the concept of contract law. You agree to a contract you stick to it. Or declare bankruptcy and get taken down by collectors. You don't just unilaterally change the terms of the agreement. This is basic shit that Trysail does not grasp.

What we need, and what we won't get, is hyperinflation. That will destroy the wealthy elite and drag them right down to everyone else's level, and it will show people like Trysail why a civilized society disregards its most vulnerable and working class at its own peril.

We need a new dark age. Actually, technically speaking, the poor are already there.

 

[Holly Delight]

Some just want the government to honor the contract agreement they signed...

...They entered into contracts with government entities that provided a salary and salary to be deferred until retirement. They had no choice in that matter; they had to contribute half and the contract called for the government to contribute half. Some government entities are now reneging on those contracts.

...The answer lies in each and every citizen being aware of where their funds are invested, by whom, and to hold those individuals responsible. Funds are fungible and can be freely moved from one investment firm to another... In the end it IS the individuals money and it is up to the individual to manage it for their own benefit.

Ishmael

The workers that Joey is talking about are calling on the folks in Ish's post to do their jobs and be accountable for the funds they invested for those same workers. Just because it is public money does not make those fund managers less accountable than those who manage private investments.

 

[richard_daily]

Just so I know what it is that you're so upset about—

what is it that you want?




Do you want the capital that I scrimped and saved and struggled to accumulate from the day of my 16th birthday when it became legal for me to become a summer ditchdigger? Or the money I earned driving spikes and laying rail as a gandy dancer during my 18th summer? Or the money I saved by not spending it on stuff I didn't need?


Do you want to expropriate the capital that I invested after years and years of saving and studying corporations and reading the thousands of footnotes contained in annual reports?


Is that what you want?

I think that most of us just want you to shut up.

You're boring.

 

[Ishmael]

The workers that Joey is talking about are calling on the folks in Ish's post to do their jobs and be accountable for the funds they invested for those same workers. Just because it is public money does not make those fund managers less accountable than those who manage private investments.

First of all it's not the public's money. The money invested is invested in the name of the individual and the individual is still responsible.

Any entity that enters into a bad contract can go back and try to renegotiate that contract. History is rife with examples both public and private. What irks me is that Joey, and many others, selectively rejoice in one re-negotiation while vilifying another. Neither he nor his co-believers here had any problem with the contract re-negotiation that essentially disenfranchised the secured investors in GM. That was perfectly OK by them. But re-negotiating the teachers contract in WI? That was abominable.

The consequences of NOT re-negotiating outrageous contracts can have devastating effects. The GM case is open for debate in that the secured investors were told that unless they relented Gm would go into Chapter 11. As soon as they relented GM went into Chapter 11 anyway. A better case would be Eastern Airlines where the machinists union refused to re-negotiate........Eastern Airlines went away entirely. In WI. the consequences of the unions not re-negotiating would have been the furloughing of a significant part of the work force. The unions were willing to sacrifice their members in order to try to enforce a bad contract.

In the private sector bad contracts lead to insolvency and eventually bankruptcy. In the public sector we know that no government is going to go bankrupt, nor is any government going to just go away like Eastern Airlines. They can, and will, pass laws to protect themselves from that eventuality.

But to re-cap, it is their selective condemnation/exultation of contract law depending on who the perceived victim is that irks me. That and the governments interference in private sector contract law. What the government does within it's own confines is one thing, interfering in private contract law is another and only leads to business re-trenching to avoid exposure to the caprice of government. And the final comment is, "Those that feed at the government trough will sooner or later find themselves starving."

Ishmael

 

[NeverEndingMe]

why are you so against playing the game? its your choice that you are poor

By PAUL WISEMAN

WASHINGTON — This is one anniversary few feel like celebrating.
Two years after economists say the Great Recession ended, the recovery has been the weakest and most lopsided of any since the 1930s.

After previous recessions, people in all income groups tended to benefit. This time, ordinary Americans are struggling with job insecurity, too much debt and pay raises that haven't kept up with prices at the grocery store and gas station. The economy's meager gains are going mostly to the wealthiest.
Workers' wages and benefits make up 57.5 percent of the economy, an all-time low. Until the mid-2000s, that figure had been remarkably stable — about 64 percent through boom and bust alike.
Executive pay is included in this figure, but rank-and-file workers are far more dependent on regular wages and benefits. A big chunk of the economy's gains has gone to investors in the form of higher corporate profits.

"The spoils have really gone to capital, to the shareholders," says David Rosenberg, chief economist at Gluskin Sheff + Associates in Toronto.

Corporate profits up

Corporate profits are up by almost half since the recession ended in June 2009. In the first two years after the recessions of 1991 and 2001, profits rose 11 percent and 28 percent, respectively.
And an Associated Press analysis found that the typical CEO of a major company earned $9 million last year, up a fourth from 2009.

Driven by higher profits, the Dow Jones industrial average has staged a breathtaking 90 percent rally since bottoming at 6,547 on March 9, 2009. Those stock market gains go disproportionately to the wealthiest 10 percent of Americans, who own more than 80 percent of outstanding stock, according to an analysis by Edward Wolff, an economist at Bard College.
But if the Great Recession is long gone from Wall Street and corporate boardrooms, it lingers on Main Street:

— Unemployment has never been so high — 9.1 percent — this long after any recession since World War II. At the same point after the previous three recessions, unemployment averaged just 6.8 percent.

— The average worker's hourly wages, after accounting for inflation, were 1.6 percent lower in May than a year earlier. Rising gasoline and food prices have devoured any pay raises for most Americans.
— The jobs that are being created pay less than the ones that vanished in the recession. Higher-paying jobs in the private sector, the ones that pay roughly $19 to $31 an hour, made up 40 percent of the jobs lost from January 2008 to February 2010 but only 27 percent of the jobs created since then.

 

[richard_daily]

The income gap is widening... The recession is going according to plan.

 

[Joeybagadonuts]

The same government that told the GM bondholders to fuck off and shook down BP for a slush fund?




You never got back to me over my remarks in your "Private Jet" thread...

Why is that?

Do you feel the strings when they are pulled?

I was referring to the government entitiy that stole pension money to give tax breaks to the super wealthy.

I have no idea what you are talking about re: private jet thread. You may have me confused with someone else.

 

[Joeybagadonuts]

I didn't write this

If you take the time to read this letter it will give you an idea of what I'm talking about. I don't think particular case is unique.
*******************************************************************
While I can not comment on the teacher’s retirement system, I can speak about the Police and Fire Retirement Fund (PFRS), and more specifically, how it has been mishandled by some of our elected officials. The truth should come out, and the public has a right to know how we got to where we are today.

Long before I became a police officer, the state of New Jersey enacted a law which required police officers and firemen to contribute a certain percentage of their salary into the state’s “secure” pension fund. Throughout my 22 year career, I have paid 8.5 percent of my salary, as mandated by law, into this fund every pay period.

I was not given the option to place my 8.5 percent in an IRA or other investment fund. Every pay check since I was 25 years old had the 8.5 percent taken out of my pay and placed into the PFRS with the promise that the money would be there when I retired. By law, towns and municipalities were required to match that 8.5 percent.

By the time Gov. Christine Todd Whitman took office, there was over $100 billion in the fund. This meant that at the current rate of retirements, pension costs for police officers and firemen were funded at 104 percent, well into the future. This was a prudent and financially responsible plan that worked, and it provided security for the families of these men and woman who risked their lives every day serving and protecting the citizens of New Jersey.

In no way was it heavily over funded or excessive. It covered the costs of promised retirements with a small cushion left over. It was at this time that Whitman stepped in. Gov. Whitman recognized the billions of dollars in our “secure” and “separate” pension fund, and she proceeded to raid that fund. Unknown and unannounced to the public, monies were indiscriminately withdrawn from the PFRS and used to pay for Whitman’s tax cuts and to balance the state budget.

Billions of dollars were taken, and to make matters worse, the Whitman administration passed a law allowing towns and municipalities to no longer contribute to the fund. Over $3 billion in contributions were skipped over the next eight years, while the individual police officers and firefighters continued to have their 8.5 percent contribution taken from them and placed into the PFRS.

The state gambled for years, relying heavily on the returns from the stock market to cover the missing funds. Politicians misspoke on the campaign trail, touting the virtues of how their financial genius was able to balance their state and local budgets, and the public was lulled into a sense of false financial security.

But the small print in Whitman’s bill was ignored. The funds they failed to contribute would have to be made up at a later date. The pension reprieve was temporary and their contributions would have to be paid back, just like any other loan. It was quietly suggested by the Whitman administration that towns set these contributions aside for when the state called to make good on them. It appears most towns and municipalities failed to heed this advice.

Governors (Donald) DiFrancesco, (James) McGreevy, and (Richard) Codey continued this trend, and all failed to call the towns and municipalities on their “loan” while the PFRS fund continued to dwindle down close to $66 billion. They remained silent. To bring this to light at this point would certainly mean political suicide, knowing that towns and municipalities would have to raise taxes to make up for their error in financial judgment and planning.

It wasn’t until Gov. Jon Corzine took office that this trend was stopped, but unfortunately, the damage was done. Gov. Corzine made the call the governors before him were afraid to make. He advised the towns and municipalities that it was time to pay back the monies the towns had been given a temporary reprieve on. And the media jumped on this, printing bold headlines “Towns going broke over police and fire pensions.”

This attention grabbing and misleading headline made it appear that your police and firemen were bilking the taxpayers dry, when the truth is totally the opposite. The politicians bilked your police officers and firemen dry and in the long run, the tax payers of New Jersey.

Towns and municipalities knew they were going to have to pay this money back and for them to insinuate otherwise is simply not true. Realizing the gravity of the situation, a new bill was introduced and passed into law. This allowed the towns to pay back the loan given to them by their public employees in increments; starting at 20 percent, 40 percent, 60 percent, 80 percent, and finally 100 percent each proceeding year.

Towns and municipalities continue to act as if they have been caught unaware and shocked by this entire process. The public is being told that payments for police and fire pensions are doubling, tripling and quadrupling and that the public employee system is out of control. What the public needs to know is that they are the victims of a mounting debt that was created by the Whitman administration and compounded by those following her tenure.

To blame your public employees for the abuses of the pension system is ludicrous at best, especially when our elected officials are the ones responsible for raiding the fund and then enacting the legislation on how and when to pay it back.

Gov. Jim Florio recognized the financial hardship facing the state of New Jersey and proceeded to raise the state sales tax to 7 percent. This helped spell political suicide for him, and Gov. Whitman was not going to make the same mistake. She repealed the 7 percent, dropping it back down to the 6 percent, knowing full well this money would have to come from somewhere.

Her solution was to raid the Police and Fire Pension System, allowing her to balance the state budget and give the false appearance that all was fiscally sound under her watch.

Our current governor, facing the same financial crisis of those going before him, has chosen a similar route, but one with a more vilifying tone. He has again found the same victim: Your public employees. When asked about the pension situation in the state of New Jersey, Gov. Chris Christie replied “I wasn’t going to put $3 billion into a failing pension system. We need pension reform. I passed some already for new hirees, and this fall we are going after the current employees and pension reform and benefits because we are broke.”

Nowhere does he mention how the public employees had already bailed out this state years before, and now he is focused on “going after” the current employees to fix a mess created and compounded by politicians. To say otherwise for him would be political suicide should he aspire to higher political office, and as most of those before him, he is not about to risk his future. Rather, he would gamble on the future of those men and woman and their families who have served this state with honor and integrity.

The principals of the pension system are not broken Mr. Governor. What is broken is the manner in which the politicians have treated and abused it. Yes, the system is failing now, but not because of your police officers and firemen. As of 2009, the pension fund should have assets of $112 billion to meet its obligations, yet it is currently sitting at $66 billion.

It is the largest unfunded liability in the country. New Jersey is the first state ever to be charged with fraud by the Securities and Exchange Commission, and Gov. Christie, strangely, has no comment on this. Yet he continues his rhetoric on the evils done to us by our police officers and firemen, ignoring the truth and lambasting and vilifying us at every turn.

As the saying goes, “Politics has no shame when it comes to preserving your place in office. Why let the truth get in between a good, attention grabbing headline?”

The system is on the brink of collapse and continued arrogance and mudslinging will not fix it. The truth is what it is Mr. Governor, and there is no getting around that. Politicians put us in this mess for their own political gain, not our public employees, as you would like the public to believe. You know this and need to stop ignoring the facts. How we deal with it from here is the measure of each of our character and integrity. I know the public is smart enough to recognize this and I hope that you are too. Long after you are gone, we will still be here, protecting and serving as we always have. In the end, all we have left is our name. Let’s hope yours is remembered for you’re integrity and not for what you have slung so far in your race for political aspiration. I challenge you to do the right thing, as so many police officers and firemen strive to do every day for their families and the citizens of New Jersey.

 

[NeverEndingMe]

The income gap is widening... The recession is going according to plan.

then get off your lazy ass and work. make a plan to increase your income

 

[NeverEndingMe]

wasn't Christine Todd Whitman a democrat?

the pension system needs to be shut down. too expensive and no longer a viable option in today's world. by wanting the pension system, is like wanting to keep the horse and buggy around

If you take the time to read this letter it will give you an idea of what I'm talking about. I don't think particular case is unique.
*******************************************************************
While I can not comment on the teacher’s retirement system, I can speak about the Police and Fire Retirement Fund (PFRS), and more specifically, how it has been mishandled by some of our elected officials. The truth should come out, and the public has a right to know how we got to where we are today.

Long before I became a police officer, the state of New Jersey enacted a law which required police officers and firemen to contribute a certain percentage of their salary into the state’s “secure” pension fund. Throughout my 22 year career, I have paid 8.5 percent of my salary, as mandated by law, into this fund every pay period.

I was not given the option to place my 8.5 percent in an IRA or other investment fund. Every pay check since I was 25 years old had the 8.5 percent taken out of my pay and placed into the PFRS with the promise that the money would be there when I retired. By law, towns and municipalities were required to match that 8.5 percent.

By the time Gov. Christine Todd Whitman took office, there was over $100 billion in the fund. This meant that at the current rate of retirements, pension costs for police officers and firemen were funded at 104 percent, well into the future. This was a prudent and financially responsible plan that worked, and it provided security for the families of these men and woman who risked their lives every day serving and protecting the citizens of New Jersey.

In no way was it heavily over funded or excessive. It covered the costs of promised retirements with a small cushion left over. It was at this time that Whitman stepped in. Gov. Whitman recognized the billions of dollars in our “secure” and “separate” pension fund, and she proceeded to raid that fund. Unknown and unannounced to the public, monies were indiscriminately withdrawn from the PFRS and used to pay for Whitman’s tax cuts and to balance the state budget.

Billions of dollars were taken, and to make matters worse, the Whitman administration passed a law allowing towns and municipalities to no longer contribute to the fund. Over $3 billion in contributions were skipped over the next eight years, while the individual police officers and firefighters continued to have their 8.5 percent contribution taken from them and placed into the PFRS.

The state gambled for years, relying heavily on the returns from the stock market to cover the missing funds. Politicians misspoke on the campaign trail, touting the virtues of how their financial genius was able to balance their state and local budgets, and the public was lulled into a sense of false financial security.

But the small print in Whitman’s bill was ignored. The funds they failed to contribute would have to be made up at a later date. The pension reprieve was temporary and their contributions would have to be paid back, just like any other loan. It was quietly suggested by the Whitman administration that towns set these contributions aside for when the state called to make good on them. It appears most towns and municipalities failed to heed this advice.

Governors (Donald) DiFrancesco, (James) McGreevy, and (Richard) Codey continued this trend, and all failed to call the towns and municipalities on their “loan” while the PFRS fund continued to dwindle down close to $66 billion. They remained silent. To bring this to light at this point would certainly mean political suicide, knowing that towns and municipalities would have to raise taxes to make up for their error in financial judgment and planning.

It wasn’t until Gov. Jon Corzine took office that this trend was stopped, but unfortunately, the damage was done. Gov. Corzine made the call the governors before him were afraid to make. He advised the towns and municipalities that it was time to pay back the monies the towns had been given a temporary reprieve on. And the media jumped on this, printing bold headlines “Towns going broke over police and fire pensions.”

This attention grabbing and misleading headline made it appear that your police and firemen were bilking the taxpayers dry, when the truth is totally the opposite. The politicians bilked your police officers and firemen dry and in the long run, the tax payers of New Jersey.

Towns and municipalities knew they were going to have to pay this money back and for them to insinuate otherwise is simply not true. Realizing the gravity of the situation, a new bill was introduced and passed into law. This allowed the towns to pay back the loan given to them by their public employees in increments; starting at 20 percent, 40 percent, 60 percent, 80 percent, and finally 100 percent each proceeding year.

Towns and municipalities continue to act as if they have been caught unaware and shocked by this entire process. The public is being told that payments for police and fire pensions are doubling, tripling and quadrupling and that the public employee system is out of control. What the public needs to know is that they are the victims of a mounting debt that was created by the Whitman administration and compounded by those following her tenure.

To blame your public employees for the abuses of the pension system is ludicrous at best, especially when our elected officials are the ones responsible for raiding the fund and then enacting the legislation on how and when to pay it back.

Gov. Jim Florio recognized the financial hardship facing the state of New Jersey and proceeded to raise the state sales tax to 7 percent. This helped spell political suicide for him, and Gov. Whitman was not going to make the same mistake. She repealed the 7 percent, dropping it back down to the 6 percent, knowing full well this money would have to come from somewhere.

Her solution was to raid the Police and Fire Pension System, allowing her to balance the state budget and give the false appearance that all was fiscally sound under her watch.

Our current governor, facing the same financial crisis of those going before him, has chosen a similar route, but one with a more vilifying tone. He has again found the same victim: Your public employees. When asked about the pension situation in the state of New Jersey, Gov. Chris Christie replied “I wasn’t going to put $3 billion into a failing pension system. We need pension reform. I passed some already for new hirees, and this fall we are going after the current employees and pension reform and benefits because we are broke.”

Nowhere does he mention how the public employees had already bailed out this state years before, and now he is focused on “going after” the current employees to fix a mess created and compounded by politicians. To say otherwise for him would be political suicide should he aspire to higher political office, and as most of those before him, he is not about to risk his future. Rather, he would gamble on the future of those men and woman and their families who have served this state with honor and integrity.

The principals of the pension system are not broken Mr. Governor. What is broken is the manner in which the politicians have treated and abused it. Yes, the system is failing now, but not because of your police officers and firemen. As of 2009, the pension fund should have assets of $112 billion to meet its obligations, yet it is currently sitting at $66 billion.

It is the largest unfunded liability in the country. New Jersey is the first state ever to be charged with fraud by the Securities and Exchange Commission, and Gov. Christie, strangely, has no comment on this. Yet he continues his rhetoric on the evils done to us by our police officers and firemen, ignoring the truth and lambasting and vilifying us at every turn.

As the saying goes, “Politics has no shame when it comes to preserving your place in office. Why let the truth get in between a good, attention grabbing headline?”

The system is on the brink of collapse and continued arrogance and mudslinging will not fix it. The truth is what it is Mr. Governor, and there is no getting around that. Politicians put us in this mess for their own political gain, not our public employees, as you would like the public to believe. You know this and need to stop ignoring the facts. How we deal with it from here is the measure of each of our character and integrity. I know the public is smart enough to recognize this and I hope that you are too. Long after you are gone, we will still be here, protecting and serving as we always have. In the end, all we have left is our name. Let’s hope yours is remembered for you’re integrity and not for what you have slung so far in your race for political aspiration. I challenge you to do the right thing, as so many police officers and firemen strive to do every day for their families and the citizens of New Jersey.

 

[trysail]

Politicians have been using public pension plans to reward their friends for half a century. Campaign donors who just happened to be stockbrokers or venture capitalists or pension consultants have always bought access to the cookie jar.


Having witnessed for myself the garbage that was sold to the City of Philadelphia's pension, I can attest that there was a lot of "you scratch my back, I'll scratch your back" stuff. These pension funds could have bought good, old stuffy but solid companies like Proctor & Gamble or ExxonMobil or Wal-Mart or Colgate or Clorox or Hershey— but that would be boring. Instead, they bought Internet stocks and racy, high tech stuff.


Then there were the pension consultants who forecast returns similar to those seen from 1950-2000 ad infinitum. There was no reward for being conservative, no skepticism tolerated and no dissent allowed.


Defined benefit public pension funds were a train wreck that took place over many decades because too many people said "yes" because it was easy. The lack of adult supervision made the crackup inevitable.



Defined benefit pension plans are not legal contracts.


http://forum.literotica.com/showpost.php?p=33369195&postcount=157


Warren Buffett's warning ( from 2006)
http://forum.literotica.com/showpost.php?p=33233106&postcount=152

http://forum.literotica.com/showpost.php?p=33433787&postcount=159

http://forum.literotica.com/showpost.php?p=33664782&postcount=169

http://forum.literotica.com/showpost.php?p=33789369&postcount=172

http://forum.literotica.com/showpost.php?p=35292781&postcount=202

http://forum.literotica.com/showpost.php?p=35483112&postcount=206

http://forum.literotica.com/showpost.php?p=35557469&postcount=208

http://forum.literotica.com/showpost.php?p=35700771&postcount=209

http://forum.literotica.com/showpost.php?p=36252651&postcount=214

 

[islandman]

By PAUL WISEMAN

WASHINGTON — This is one anniversary few feel like celebrating.
Two years after economists say the Great Recession ended, the recovery has been the weakest and most lopsided of any since the 1930s.

After previous recessions, people in all income groups tended to benefit. This time, ordinary Americans are struggling with job insecurity, too much debt and pay raises that haven't kept up with prices at the grocery store and gas station. The economy's meager gains are going mostly to the wealthiest.
Workers' wages and benefits make up 57.5 percent of the economy, an all-time low. Until the mid-2000s, that figure had been remarkably stable — about 64 percent through boom and bust alike.
Executive pay is included in this figure, but rank-and-file workers are far more dependent on regular wages and benefits. A big chunk of the economy's gains has gone to investors in the form of higher corporate profits.

"The spoils have really gone to capital, to the shareholders," says David Rosenberg, chief economist at Gluskin Sheff + Associates in Toronto.

Corporate profits up

Corporate profits are up by almost half since the recession ended in June 2009. In the first two years after the recessions of 1991 and 2001, profits rose 11 percent and 28 percent, respectively.
And an Associated Press analysis found that the typical CEO of a major company earned $9 million last year, up a fourth from 2009.

Driven by higher profits, the Dow Jones industrial average has staged a breathtaking 90 percent rally since bottoming at 6,547 on March 9, 2009. Those stock market gains go disproportionately to the wealthiest 10 percent of Americans, who own more than 80 percent of outstanding stock, according to an analysis by Edward Wolff, an economist at Bard College.
But if the Great Recession is long gone from Wall Street and corporate boardrooms, it lingers on Main Street:

— Unemployment has never been so high — 9.1 percent — this long after any recession since World War II. At the same point after the previous three recessions, unemployment averaged just 6.8 percent.

— The average worker's hourly wages, after accounting for inflation, were 1.6 percent lower in May than a year earlier. Rising gasoline and food prices have devoured any pay raises for most Americans.
— The jobs that are being created pay less than the ones that vanished in the recession. Higher-paying jobs in the private sector, the ones that pay roughly $19 to $31 an hour, made up 40 percent of the jobs lost from January 2008 to February 2010 but only 27 percent of the jobs created since then.

In conclusion, $9M/year CEOs are cutting costs and boosting profits at workers' expense, which contributes to lackluster job growth....

...and we're supposed to believe that these same CEOs are going to parlay their Bush tax cuts into fiscal stimuli for everyone else.


Get real.

 

[KRCummings]

CEO's get a bad rap.

 

[NeverEndingMe]

In conclusion, $9M/year CEOs are cutting costs and boosting profits at workers' expense, which contributes to lackluster job growth....

...and we're supposed to believe that these same CEOs are going to parlay their Bush tax cuts into fiscal stimuli for everyone else.


Get real.

the CEO's will respond to market conditions. With obama there is no hope or winds of change. under obama we have "winds of fear"

we could cut taxes another 20% but that wouldn't change the economy right now. we need change, and that means to 86 obama

 

[trysail]

This is the kind of shit that goes on when you put politicians in charge of money. I spent my whole goddamn life watching this crap and had my career destroyed because I wouldn't enable or condone it.

The frickin' politicians have always used public pension funds as a grab bag for patronage and as a means to reward their backers. They keep putting hacks, salespeople, an army of consultants, numbskulls and people like Goldman, Alex. Brown, Montgomery, Salomon, Merrill, Hambrecht, Robertson in charge. That's part of the reason state and local pension funds are so fucked up. The goddamn politicians just cannot keep their hands out of the cookie jar.

http://noir.bloomberg.com/apps/news?pid=20601110&sid=ah.4pfCQJ0Rg


Losing 84 Cents on Dollar Reveals Runaway Public Pensions
By Elliot Blair Smith

April 15 (Bloomberg) -- The deal came together behind the doors of a Louisiana psychiatric ward. John Skannal, 74, signed a document in October 2003 authorizing the sale of land handed down through eight generations of his family.

The buyer was a statewide pension plan for municipal law officers. The fund assembled golf and real estate holdings that lost 84 cents on each dollar the police spent on them over 10 years. The losses are emblematic of a decade in which the $1.2 billion program went from fully funded to $836.3 million short of meeting future retirement obligations.

The nine trustees of the Municipal Police Employees’ Retirement System made a series of decisions that taxpayers and 10,748 active and retired cops are now paying for. The board embraced bad investments, ignored warnings of weak financial controls that enabled its attorney to steal $1.2 million and set up conflicts of interest among its advisers, according to a review of thousands of pages of documents obtained under the state public records act and more than 50 interviews.

“It was like a gigantic playhouse,” says Nick Congemi, 68, chief of the Greater New Orleans Expressway Police in Metairie, who for years criticized the system’s leadership and investments. “These people have taken the futures away of good, decent law-enforcement officers who thought they could depend on this for the rest of their lives.”

$479.6 Billion Deficit
The irregularities in the Louisiana police plan show how trustees and employees of U.S. public pensions, operating with little or no oversight or transparency, can cost taxpayers and threaten the retirement income of government workers. Assets held by state systems are $479.6 billion less than what is needed to fund estimated obligations, according to official financial reports compiled by Bloomberg.

“The failure to govern public pensions appropriately inevitably hurts those who can least afford it: retirees, workers and taxpayers,” says Eleanor Bloxham, chief executive officer of Value Alliance, a Westerville, Ohio, governance consulting firm. “Such lapses can produce even greater harm than traditional financial crimes prosecuted by law enforcement.”

In California, Democratic Governor Jerry Brown brought civil charges last year when he was attorney general against a former CEO and a former board member of the $233.5 billion California Public Employees Retirement System, the largest in the U.S. State and federal proceedings are continuing. In March, Calpers documented six years of unreported gifts by members of the board and employees, and improper awarding of investment contracts that paid excessive fees.

Cuomo Probe
Before becoming New York’s Democratic governor, Andrew Cuomo probed corruption at the state’s $140.6 billion pension fund when he was attorney general, leading to eight guilty pleas and the payment to the state of more than $170 million.

Alan G. Hevesi, the former Democratic state comptroller who was the program’s sole trustee, was sentenced today to a minimum of one year in state prison after admitting he approved pension- fund investments in exchange for almost $1 million in gifts.

“I publicly disgraced myself,” Hevesi told a Manhattan judge at his sentencing hearing. “I have only myself to blame.”

Randy P. Zinna, 53, the former attorney for the Louisiana police fund, pleaded guilty last year to mail fraud after state and federal investigators accused him of embezzling to pay sports-gambling debts.

Louisiana’s 13 statewide plans had unfunded liabilities for fiscal 2010 of $20 billion, with enough assets to cover 65 percent of estimated obligations, according to their latest financial statements.

Funding-Review Panel
Among 45 U.S. states reporting data for fiscal 2009, Louisiana ranked 41st based on proportion of future pensions covered by assets, according to data compiled by Bloomberg. The Legislature next month will consider recommendations by a funding-review panel to increase mandatory contributions and require governance changes.

The law-enforcement fund, known as MPERS, was the fourth- worst funded among statewide plans. The program’s assets were 2 percent lower last June 30 than a decade earlier. Kelly Gibson, a Lafayette police lieutenant who is the board chairman, declined to discuss previous decisions.

“The only comment I will make is that the current board is working to correct any problems that face MPERS,” Gibson said in an e-mail.

Over the U.S. Independence Day holiday in July 1999, three police-retirement board members spent four days at a golf resort on Monterey Bay in California at the pension fund’s expense. It was a “due diligence” investigation of a potential “real estate investment,” according to their expense reports.

Former Pawn Shop Owner
The trustees were led by Bossier City Police Captain Bill Fields, a Corvette-driving former pawn shop owner who chaired the pension’s golf-course committee, and its vice chairman, Willie Joe Greene, a retired captain from nearby Keithville. Fields, now 58 and retired, and Greene, 73, declined requests to comment for this story.

The third member of the West Coast trip was retired New Orleans police Sergeant Larry Reech, 62, who says the trio visited golf courses on a former military base in which the New Orleans Firefighters’ Pension and Relief Funds had invested.

“We were looking at how they were being run, what kind of draw they had -- what kind of clientele -- where they were coming from, the demographics,” Reech says.

As for the stewardship of the board, “oversight was lacking,” he says. “There were mistakes made.”

Cotton Plantation
The committee was in the hunt for golfing properties near the homes of Fields and Greene in northern Louisiana, pension records show. It was close to the peak of the U.S. golf boom.

At the time, Fields cited the success of golfing investments by the Alabama Retirement System, the records show. He zeroed in on the Olde Oaks Golf Club in Haughton, Louisiana. With fairways lined by oak and cypress trees, the course was built on rolling hills carved out of a former cotton plantation owned since 1846 by the family of John Skannal, the man who later sold the officers’ fund an adjacent piece of land.

The course was designed by the professional golfer Hal Sutton, a Shreveport celebrity known for having defeated golfing legends Jack Nicklaus and Tiger Woods. Even after a consultant’s report said that construction was incomplete and some cart paths were damaged, the police fund paid $6.8 million to buy the property in July 2000, $400,000 more than recommended by GVI Consulting of Santa Ana, California, according to the police system’s records.

Playing Olde Oaks
Fields and Greene frequently played at Olde Oaks, enjoying a 50 percent police discount and riding a reserved cart, according to Ben Chavarria, the course manager. Even as the business generated losses, the pension poured $2 million more into upgrades. In the years since, the retirement system has spent $15.3 million to own and manage a property with an appraised value of $3.2 million, pension records show.

“If we bought a golf course, you would think that it would be a moneymaking venture,” says Congemi of Metairie, whose department patrols the 24-mile (39-kilometer) causeway across Lake Pontchartrain.

The Olde Oaks investment was a departure from the conventional blend of stocks and bonds that defined the pension program’s strategy for most of its 37-year history, based on plan records. The system’s holdings came to include undeveloped real estate, foreign currencies, hedge funds and high-yield fixed-income instruments known as junk bonds.

Surplus in 2001
The system had a $14.1 million surplus in the fiscal year ended June 30, 2001. Until the following year, trustees authorized annual cost-of-living increases to retirees. The average yearly pension in the program is $23,183. Under the plan, officers contribute 7.5 percent of their pay and qualify for benefits about equal to their salary after 30 years.

As pension reserves slipped to a $195.2 million deficit in 2002, the trustees revised their investment guidelines to allow greater risks in pursuit of increased returns, board minutes show. The new policies included exemptions for investments in raw land and below-investment-grade debt.

The retirement system also doubled the payback period for its unfunded liability to 30 years beginning in 2003 and raised the assumed rate of returns in 2006 to shrink the growing deficit. It was akin to refinancing a mortgage by extending the term of the loan and paying only interest without reducing the principal.

‘Poor Investment Choices’
In July 2004, three police chiefs, including William Landry of Gonzalez, sued the fund’s trustees in state court. The complaint sought a restraining order to halt “glaringly poor investment choices” that included golf courses, a $3 million headquarters building in Baton Rouge for the program’s staff of six and business trips by the board and consultants to Monterey, Las Vegas, San Diego and San Francisco.

“It was like see no evil, hear no evil, speak no evil,” says Landry, who has since retired. “It was cops ripping off cops. That, to me, was the biggest slap in the face.”

Less visible to members and state overseers, the board also eroded internal checks and balances by undercutting the independence of two professional advisers, according to the records and interviews.

With no public discussion of potential conflicts of interest, the trustees in August 2006 hired their independent actuary as chief investment officer. This gave him the dual responsibility of selecting the investments he had a duty to independently evaluate.

The actuary, Charles Hall, insisted on working at his Baton Rouge home and set his pay at $40,000, with the board’s consent. No other candidate was considered for the job, according to board minutes.

Hall’s Dual Role
With Hall as CIO until January 2007, the board bought $2.1 million in Lehman Brothers Holdings Inc. uncollateralized debt that has since lost 75 percent, as well as $201,916 in Goldman Sachs Group Inc. home-equity loans that have lost 49 percent, pension records show. Lehman entered bankruptcy proceedings in September 2008.

“To be completely independent, you cannot be the investment officer and serve as the actuary,” says John Sondergaard, retired actuary for the state’s fiscal watchdog, the Louisiana Legislative Auditor. After the agency informed the board it was concerned about Hall’s dual role, the trustees dropped the CIO position in January 2007 and retained him as actuary. Hall wasn’t accused of any wrongdoing.

“I think they were right. It was a conflict,” Hall says, adding that he was only trying to assist the board. He says he doesn’t recall the Lehman and Goldman investments.

‘Just Looks Bad’
In March 2006, trustees voted to buy hedge fund investments through Summit Strategies Group of St. Louis, which would collect commissions on the transactions. The board was also paying Summit $250,000 a year to independently screen money managers and provide advice on hiring them. The $70 million that the trustees agreed to pour into hedge funds would double Summit’s compensation. It took the board 19 months to address the double role it created.

“It’s not illegal; it just looks bad,” Bossier City Police Chief Mike Halphen, the board chairman at the time, told Dan Holmes, a Summit managing director, at a meeting in September 2007, according to a recording. The trustees began unwinding the investments.

Holmes, who consulted for the board and presented the hedge fund investment, said in a voicemail that the relationship didn’t constitute a conflict.

The use of independent consultants as money managers drew criticism in the internal investigation of Calpers, the California retirement program.

‘Could Raise Questions’
“It is difficult to see how an external manager could objectively advise Calpers on appropriate levels of management and other fees for its peers and competitors when that advice could raise questions about the level of its own asset- management fees,” the Steptoe & Johnson LLP law firm in Washington said it its board-commissioned report.

The Skannal family, who owned the Sligo Plantation underlying the Olde Oaks golf course, was land rich and cash poor. John C. Skannal once worked as a state trooper and drove Governor Earl Long home from a mental institution during his final term in office in 1960, according to his son A.C. Skannal.

Just before the elder Skannal’s 75th birthday in October 2003, a business partner named Dennis Bamburg visited him in the psychiatric ward of a Shreveport hospital where Skannal was being treated for dementia and alcoholism, according to a 2005 lawsuit the family brought against Bamburg in state court.

Witnessing a Signature
Bamburg obtained Skannal’s signature authorizing him to sell a piece of land next to the golf course, according to the lawsuit. Bamburg was negotiating with Fields of the police pension and a local representative of the fund, James Harris, 53, according to trial testimony. The police wanted to develop the land as a residential community.

In December 2003, the police board approved the purchase of 208 acres (81 hectares) and 70 lots from Skannal and Bamburg in three transactions that totaled $5.9 million, according to pension fund auditor’s records. That same month, the trustees hired Harris as property manager for its planned Olde Oaks development, a job that paid his firm, Twin Peaks LLC, almost $2 million over six years, not including five lots that he received as additional compensation, pension records show.

At the closing in February 2004, four representatives of the police fund -- Fields, Greene, Harris and Zinna -- witnessed Skannal’s signature and later testified he appeared to be of sound mind, in the family’s lawsuit against Bamburg. Skannal had been hospitalized for 112 of the previous 189 days, and his medical records ran to 8,000 pages, Skannal’s lawyer, John Odom of Shreveport told a state judge.

‘Grossly Impaired’
After the elder Skannal died in November 2005, his heirs carried on a suit he had filed eight months earlier in state court against Bamburg to overturn the deal. In March 2008, Judge Ford E. Stinson Jr. ruled that Skannal had been “grossly impaired” and that Bamburg had committed civil fraud in obtaining the signature. Zinna, Fields and Greene never told the pension board they testified at the trial, according to former chairman Halphen and other board representatives. Fields retired from the board in December 2004.

Bamburg, 63, declined to comment for this story. In the trial, he argued that Skannal had been of sound mind in the transaction. A state appeals panel partly overturned the lower court decision, and Bamburg remains in control of much of the former plantation.

As the residential development got under way, Zinna diverted pension-fund money from lot sales and payments to contractors to pay for his sports-gambling addiction, according to subsequent state and federal investigations.

Accountants’ Warnings
The police board already had evidence of financial irregularities in Olde Oaks-related investments from its independent accountants, New Orleans-based Duplantier, Hrapmann, Hogan & Maher LLP, board documents show. In a 2002 audit, the firm reported that unexplained discrepancies included $105,000 the pension plan transferred to the golf course that didn’t show up on the club’s ledger and $26,125 in “undeposited funds” that no employee could explain.

Duplantier, Hrapmann issued warnings each year even as trustees compounded the money-losing investment by buying another golf course in the Bossier City-Shreveport area -- at a sheriff’s auction -- and an undeveloped golf course community near Fredericksburg, Texas.

The board spent $73.4 million on three properties that are now worth $11.7 million to the plan, according to the system’s auditors. Homeowners and businesses may also have been cheated.

‘Zinna Took the Money’
Chester Pitts, a 61-year-old heavy-equipment contractor who lives at Olde Oaks, wrote two checks to the pension system totaling $158,612 in March and April 2005 for an option to buy 48 undeveloped lots, according to copies of the checks and a one-page contract prepared by Twin Peaks.

While Zinna endorsed the checks, bank copies show, the pension fund never received the money and Pitts never got the lots, according to both parties.

“The problem is that Zinna took the money,” Pitts says. Zinna denies that and says Pitts is owed nothing.

The trustees removed Zinna from managing Olde Oaks in April 2009 and asked another attorney, Randy Roche, to investigate. A title search at the county courthouse revealed that Zinna never deposited $725,563 in proceeds from as many as 22 Olde Oaks lot sales or even reported the transactions to the retirement system, Roche says. In addition, court records show, Harris signed for the police pension as the seller and for himself as the buyer in one $15,000 cash sale.

Checks for hundreds of thousands of dollars that the staff wrote for contractors were never delivered, Roche says. Zinna endorsed the checks and deposited them into his firm’s trust account, doling out slow and partial payments, Roche says.

Widow’s Savings
In September 2009, Zinna took most of the $570,000 entrusted to him by an unidentified 83-year-old widow and applied it toward what he owed the police, according to the federal criminal investigation. A month later, Greg Phares, chief investigator for the state Inspector General, served a subpoena and seized records at Zinna’s red bungalow office.

Zinna resigned from the pension system that month. He had diverted $5.1 million of police funds to himself, most of which he repaid, while also misappropriating $1.5 million from the police board and two other Louisiana public retirement systems, according to his plea agreement unsealed in January.

The Legislature plans next month to take up recommendations from the funding-review panel to increase taxpayer contributions that have almost tripled in less than a decade to pay for pension benefits, losses and expenses, according to the police plan’s most recent actuarial report.

Baton Rouge Budget
In Baton Rouge, the jump in pension costs amounted to $5 million last year, according to the city’s budget report. That is equal to 100 officers’ salaries, according to salary.com, a unit of Wayne, Pennsylvania-based human resources consultant Kenexa Corp. The city has frozen staff positions and is budgeting no raises.

Individual police officers also face the likelihood of paying more for their pensions. The state panel suggested raising their contributions to as much as 10 percent from 7.5 percent. Municipal authorities pay an amount equal to 25 percent of police payrolls into the pension system, up from 11 percent last year. They would pay 28 percent in the fiscal year beginning July 1 under state actuarial guidelines.

The state review panel also proposed restructuring the police pension board to include two mayors, an appointee from the Treasurer’s office and a representative of the state’s chief budget officer, giving taxpayers a direct voice for the first time. While two state legislators have been designated honorary trustees, neither has attended a board meeting in about a decade, board minutes show.

Awaiting Sentencing
As for Zinna, he still goes to work as he awaits sentencing, setting out bowls of food and water for the stray cats that visit him on his law office’s stoop. He faces as many as 20 years in federal prison. The state Supreme Court suspended his law license in July, and in December he allowed his state accounting certificate to lapse.

Stephen Street, the state inspector general who led the investigation with U.S. authorities, says that criminal law fell short of addressing all of the police pension system’s shortcomings.

“Randy Zinna is a symptom of a larger problem over there, which is a lack of oversight, a lack of accountability,” Street says. “You can’t conclude anything other than that.”

 

[Sonny Limatina]

CEO's get a bad rap.

http://www.youtube.com/watch?v=HftjwSJRGG4