Are this week's victories for pension reform forces in California – already contested by lawsuits from public employees – signs that the financially challenged state is ready to follow the lead of Democratic Gov. Jerry Brown?
On Tuesday, voters in both San Jose and San Diego sided with proposals calling for huge changes to public employee retirement benefit plans, with San Jose requiring its employers to pay double-digit contribution increases to their own plans, and San Diego adopting a fixed 401(k)-style plan for new employees.
According to a Reuters story, Brown is using the momentum from this week's vote as a sign of support for his own plans to help narrow a massive pension shortfall, estimated to approach half a trillion dollars, as California's economy continues to struggle.
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Brown's own proposals call for new state employees to adopt retirement benefits with higher market risk, raising the state retirement age to 67 (some employees can currently retire at 55) and also bolster state retirement boards with financial experts.
"The pension vote in San Jose, which is a more liberal city than the state as a whole, is a very powerful signal that pension reform is imperative," Brown told the San Francisco Chronicle. "Right now, I want to lock this budget down. But people should have the confidence that pensions and their reform are on the agenda, right at the top."
Those supporting public employees say the measures all work to conspire to deny workers the rights they've earned over the years, and see a larger fight looming in the future.
"My instincts tell me that it would not be a major boost," Dave Low, chair of Californians for Retirement Security, told Reuters. He says public interest in the pension issue still remains low and that raising the retirement age poses major, unexplored issues for the state.
Read the whole story here.
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