Thu, Aug

OMG! Ted Costa Got It Right On Pensions!

BLOG SOUP - You want proof positive that the debate over how to fix pensions for California public workers is stale and dumb?

How about this? Ted Costa has the smartest proposal for pension reform out there.

Costa's newly filed initiative is long and complicated and, in a few places, crazy. But Costa, the original proponent of the recall of Gray Davis and frequent filer of initiatives, has - more than anyone else with a pension proposal - gotten the big stuff right.

Costa does not propose, as so many do, to replace the current pensions system with a two-tiered system, with no pensions for new employees. His initiative would keep the pensions and impose all sorts of new caps and rules to limit pensions. But the retirement security of a defined benefit plan is preserved for all.   

Better still, Costa's initiative makes the point that any pension plan that is good enough for public workers should be available to private sector workers. He proposes to create Cal SPERS, the California Separate Private Employees Retirement System, a pensions fund into which private individuals and their employers could pay. It would provide defined benefit plans and be managed by CalPERS. Any U.S. citizen or legal resident would be eligible.

There are host of practical problems with setting up a pension system for all like this. But Costa is right on the big point that public and private workers alike need retirement security - and a pension.

He's also right that pensions should be the same whether you work for the state or not.

Costa rarely has the money to qualify his own initiatives. But this is one measure that should have broad appeal. It is certainly the standard by which any pension proposal must be judged.

And yes, I can't believe I just wrote those words.

(Joe Mathews is Journalist and Irvine senior fellow at the New America Foundation, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It. This column was posted first at foxandhoundsdaily.com) -cw

Tags: Ted Costa, pensions, initiative, retirement, retirement system, US Citizen, pension reform

Vol 9 Issue 62
Pub: Aug 3, 2011