Retirement Roulette

Don't Gamble With My Pension

Gov. Backs Down on Pension Overhaul, But Fight for California's Working Families Continues

Don't Sign Anti-Worker Initiatives

Thurs., Apr. 7, Gov. Schwarzenegger has temporarily backed off his plan to eliminate secure retirements for California's public employees. He has dropped attempts to qualify the measure for a Nov. special election. While this is good news, it's no cause for celebration. It's only a temporary reprieve while he addresses death and disability benefits for police and firefighters.

The governor is insisting on converting our defined benefit (DB) plans into defined contribution (DC) plans — a 401(k)-style system that leaves employees at the mercy of the stock market. Blaming pensions for the state's budget woes, he's determined to shift costs as well as risks back on to employees. But privatizing pensions will not fix any budget problems and will cost taxpayers billions in steep start up costs.

Schwarzenegger is still raising funds from Wall Street investment firms, the very firms that stand to gain the most from forcing public employees into individual high-risk retirement accounts, and big corporations. If he's unable to work out a compromise with the legislature, Schwarzenegger has publicly committed himself to putting a more carefully worded pension measure on the June 2006 ballot.

Keep Up The Fight

Schwarzenegger's retreat will allow him to focus more time, energy and money on the other anti-worker initiatives corporate interests are trying to qualify for a Nov. special election, which will cost an estimated $70 million. In his typical bravado, Schwarzenegger vowed, "to accomplish the goal with our budget reform, the goal of redistricting and the goal of education reform." Here's what that means:

  • Budget "reform": This measure would make Prop. 98 funding for schools subject to automatic cuts, effectively writing voter-approved education funding guarantees out of existence whenever the state faces a budget deficit.
  • Redistricting: The business interests pushing the measure hope that divesting power from the Democrat-run legislature will make it easier to elect more Republicans to state Assembly, Senate, Board of Equalization seats and the US House of Representatives.
  • Education "reform": Schwarzenegger's so-called merit pay system has never been instituted on a statewide basis; usually restricted to particular schools or districts, merit pay has proven unwieldy, worsening problems rather than fixing them.
  • Paycheck "protection": In an effort to silence workers' voices in the halls of government, big corporations want to make it harder for unions to represent their members in the political arena by adding unnecessary hurdles to dues collection.

Bottom Line: Don't sign the governor's initiatives! Tell your friends and family, too.

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