Assembly speaker: Pension crisis? What crisis?

For years, California’s government watchdog agencies have warned about massive unfunded liabilities for health and pension benefits for retired public employees. Just to properly fund pensions for teachers and state workers, actuaries say the state government should provide at least an additional $6 billion a year.

But as news keeps improving on the state revenue front, these reports are suddenly forgotten. Last week, to the cheers of fellow Democratic lawmakers, Assembly Speaker John Pérez said he would introduce a budget that used most of the projected windfall to increase spending on social programs. Pérez said some of the money could be set aside for a “rainy day” fund, which presumably could cover pension shortfalls. But he showed no specific concern about the $200 billion-plus in unfunded state retirement benefits, the same shortfall that led the Legislature to adopt a pension reform measure last year.

So one year, Pérez and other lawmakers acknowledge that the pension crisis is real and take modest steps to address it. The next year brings a chance to take hugely constructive additional steps, and Pérez and other lawmakers say, “What crisis?”

If the stakes weren’t so high, this would be comic in its irrationality.


