Pensions And “The Big Lie”

Dollar Bills SC Pensions and The Big Lie

Across the nation, we are starting to hear from various politicians regarding their concern for the rising and unsustainable pensions and healthcare in the public sector unions. In fact, we are being treated to more of the same game with no real solutions or change. The reason for this lack of improvement is very simple. And in my opinion, the answer is equally simple.

Under current law, there is no way for our cities, counties, and states to declare bankruptcy. The unions have known this ever since we allowed the first public sector workers their “collective rights.” In reality, these rights have done nothing but increase exponentially year after year – along with their pay rates and inefficient work rules. As I said, the problem is simple: we the voters do not understand math, and in particular the rules of exponents. You know, those little numbers placed above and to the right of a given number? They look harmless enough at first glance. And so in our dumbed down electorate today, when faced with an exponent of as little as the number “2″ we fail utterly to understand what it means. I will save the conspiracy theory of how the educators have been planning this ever since the early ’70′s when “new math” was rolled out, since it is of no matter unless we change soon. Suffice to say, it is never too late to learn math, and I recommend it for anyone who feels lost in the numbers today.

As an example of how devastating that little exponent can be, consider this: Our current federal government uses a baseline budget which assumes approximately 8% increase per year across the board. Many local governments get away with even bigger assumptions! Beware! This little assumption results in the total budget to double in less than 10 years. In another 10 years, it will double again! Four times bigger in 20 years. How much has your pay gone up the last 20 years? I bet you wish you were in the government union now. They  have actually done even better than that.

Consider that since the FED came into existence, our dollar has lost 94% of its value. That is the flip side of “exponential inflation” vs. “exponential budget increase” vs. “non stop government union give aways”. The only way to win in this game is lock in your pay ahead of time and guarantee that money with laws which protect it. Of course, no private company has the ability to do this. In the old days, a company pension fund really existed and was actually invested in (you guessed it) government-issued bonds and other government-insured instruments. We have never had such liquidity in the public sector. No need. Taxes could always be raised, and anyway, people didn’t really live long enough to enjoy retirement. That game is over. We do live longer now.

Here is the reason we can’t win the debate: We implicitly agree with the underlying assumptions that we can’t possibly go back on our word, even if “our” word was given by inept and corrupt politicians. And this reasoning is reinforced by the various banking/credit rating agencies along with a healthy dose of shame and peer pressure thrown in for good measure. How is it that a populace, which in general is poorer and has a bad credit rating compared to their union counterparts who can’t be fired, has bought into this scam? It is because the general population does not understand exponents and compound interest. If we did, we would not be voting for so many government issued-bonds, which are purchased by the rich, the banks, and “union owned organizations” and to be paid back by taxpayers at high interest, compounding exponentially. The numbers are so unreal, and the descriptions are so misleading that when voting for bond measures,  we routinely approve the selling of all sorts of bonds. Do any of you know the  formula used to figure your mortgage payments? Even if you did, since it would invariably involve exponents, you would probably not understand it anyway. The bank does! And that is why we are doomed. Exponent ignorance.

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California Dreamin,’ Jerry Brown-Style

Jerry Brown SC California Dreamin, Jerry Brown Style

For those of us that have been watching the evolution of California’s “Bullet Train” Project, mercifully, the end is near for this taxpayer boondoggle. If you have not kept up here, the Bullet Train was passed off to the voters a few years ago as a $10 billion solution to California’s unemployment & transportation problems. A miracle which would not only pay for itself with massively overstated ridership, but would create thousands of jobs and lift the entire state out of the recession by connecting Los Angeles to San Fransisco. President Obama even agreed to help pay for almost $4 billion of the work! Who could possibly be against such a wonderful event? Heck, this train would even solve the pesky problem of Climate Change – a top priority of the environmentalist-owned Democratic super-majority in the state legislature.

This train would literally get everyone out of their cars. Or so Governor Jerry Brown would have you believe. In fact, it turns out to be yet another complete fabrication of truth on all levels. The newest cost was recently revised upwards to 98 BILLION DOLLARS. Almost TEN times the original estimate. How could this happen? It turns out this type of number crunching is now the “new normal” for the Left. Doubt me? Just notice how Obamacare has now gone from saving us money to ballooning to almost 2 Trillion dollars. And if they can trot out numbers that are double, triple…heck, even TEN TIMES the original estimate, who are we to complain? It is the classic case of letting the camel get his nose under the tent. Once that happens, it is too late. It turns out that’s all the Left wants. Enough time for the ink to dry on the government loans before declaring bankruptcy a la Solydra. Get the unions working. Then the project is “too Big To Fail.”

Now Governor Brown has just come out with a newly revised downward estimate in an effort to get the legislature to quickly authorize funds to break ground before the people know what happened. He is now telling us the project will now cost $28 BILLION LESS with his brilliant new design. Only Alice in Wonderland could believe his new numbers, which are still SIX TIMES more than the voters approved.

But that is exactly my point here. California politics has come to this: the voters are faced with some of the highest taxes overall in the entire nation – yet this coming November, they will willingly vote to approve even more! And they will willingly vote all their Democratic legislators another term while booting out a few more of the almost extinct Republicans. They are pretty much tied with the highest sales tax, yet they will vote for more. The Governor will tell them that they are voting for a tax on Millionaires, yet they are actually voting to tax those making $100,000 on up. The voters, being finished products of the prevailing school system, no longer think before they vote. The peer pressure to vote Democratic is severe. Environmentalism is the official state religion. Yet, even in California, the voters actually approved Proposition 8, which would have outlawed same sex marriage- only to be undone by a gay activist judge who struck the law down as unconstitutional. The voters are confused and agitated while too lazy to do their own thinking.

How does this bode for the future of our country? Will the smart people left in California flee the state and reintegrate with the rest of us? Or will the few remaining non-union people give up and go to work for the government unions or their private sector counterpart with government contracts? There are a few other states, like Wisconsin,  in a similar precarious situation. Right To Work states vs. Unions…Business friendly vs. high tax states. And 12% of educators now earn enough to take a spot in the top 1%! Our decisions are coming closer together now; the Left basically came out of the closet back in 1972 when Gov. Jerry Brown’s father signed into law the unionization of public sector workers and teachers in California. It’s been downhill ever since, and the chickens are coming home to roost. Massive unfunded pensions (and complete denial by the people of the enormity of that problem) along with liberal welfare benefits will bring about complete insolvency.

California will come begging the federal government for a bailout soon. California will make the Greece bailout look trivial. The General Motors Bailout times one thousand? We are numb to the numbers. GM had “record” profits; the workers received on average over $7000 EACH – and yet GM still owes America a debt of over $26 BILLION. This is the new math. I remember back in grade school when they gave us our new books and literally told us we were learning “new math”…all with a straight face. Didn’t see it coming.

The Left seems to better able to focus their battles and spread disinformation more quickly than the truth can get out. Witness the recent Trayvon/Zimmerman debacle in Florida. Now that the black voting block is sufficiently angry, and the racial polarization is raging, it is too late even when the truth comes out. The Left seems to thrive on discord and chaos. Do they make the Arab Spring sound harmonious?

That is also the tactic of Governor Brown. Just get the funding for the train, say whatever is necessary. There are not enough thinking voters to matter any more, and he knows it. That is scary. President Obama is actually doing the same thing with many of his issues involving healthcare, recess appointments, the EPA power grabs to destroy the coal industry, and so many more. The old maxim which says “If you are gong to tell a lie, tell a BIG lie” seems to be working for the Governor in California.

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