With their addition to spending and subservience to public-sector unions, California lawmakers have ignored the state’s debt crisis. In particular, the Legislature has basically shrugged as unfunded public-employee pensions have not only nibbled away at the general fund, but have consumed municipal budgets. At the local level, pension costs crowd out spending on vital public services.
A new report from the libertarian Reason Foundation should serve as a wakeup call for Gov. Gavin Newsom and any lawmaker who wants to keep the state’s finances on an even keel. As California prepares for a gubernatorial election in 2026, candidates should address this issue. It should be near the top of the list, but instead the unimpressive field of candidates is focused mainly on national issues.
It’s not surprising that California tops other states in overall debt, from pensions to long-term debt to outstanding bonds. California is the most-populous state, so we spend more than small-population ones. But the per-capita numbers are telling. California’s total state date is $12,565 per capita. We rank 10th on that list. We rank 14th per capita on the list of pension debt.
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What do local members of Congress think about bombing alleged drug boats? Paying price for Trump’s pique against Canada Great Park hits latest snag in continuing saga Trump should leave Venezuela alone Milei’s midterm victory a true win for liberty The California Public Employees’ Retirement System (CalPERS) is funded at 79% — and that’s after it rebounded following a stock-market drop that pushed funding levels to 71%. It only has 79 cents on the dollar to pay the promises made to public employees. A volatile stock market threatens not only individual Californians’ savings, but their tax rates. Pensions are a senior state obligation, which means that government retirees get paid no matter what — even if our taxes soar to cover the shortfalls.The state has punted since 2012, when the Legislature passed Gov. Jerry Brown’s modest pension-reform law. Yet local governments worry about the impact of growing debt payments on their budgets. Check out Transparent California and you’ll see the mind-blowing compensation packages that are the cause of the state’s unfunded liabilities.
We’d be be happy if prominent state politicians at least talked about the matter. Maybe the new Reason report will force them to do so.
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