Friday, August 13, 2010

What did Jerry know and when did he know it?

Radio bonus (late addition): About 15 minutes into this podcast from the John Batchelor Show, we discuss Friday's revelations...

The pensioner...

Earlier today, the Orange County Register (a newspaper I actually "threw" back in the early '70s as a substitute paperboy) broke a story that could have significant impact on California's gubernatorial race between current state Attorney General/former two-term Gov. Jerry Brown (D) and former eBay CEO Meg Whitman (R).

California, which is drowning in debt (some say as much as $600 billion-plus when all unfunded liabilities are counted) is coming apart at the seams. One of the largest aspects of those liabilities is the ever-growing mountain of obligations to state employee pensions.

The public's awareness of (the magnitude of) these liabilities has increased in part due to politicians like Whitman drawing back the curtain on the greed and graft in Sacramento, and the perks connected to public employee unions. And media outlets like the Los Angeles Times, the Bee newspapers and Wall Street Journal have done their duty in reporting scandals like the city of Bell's pension scandal (and now property tax mess) and the city of Vernon's culture of corruption.

As public resentment has grown and become more vociferous, the opportunity to capitalize on citizens' collective anger has not been lost on politicians. Notably, Brown - never one to pass up a good photo opp or media dog-and-pony show - has come out in recent weeks as standing foursquare against the problem. As the public's awareness of the Bell scandal and the burdensome pension schemes has increased, so has Brown's campaigning (on it) - despite the fact that he as former governor helped enable the system now destroying the Golden State.

Until today...

Thanks to the OC Register's Sacramento correspondent, Brian Joseph, California voters now know that Brown not only feels their pain when it comes to these pensions but he also has enjoyed cashing pension checks. Brown as a lifelong public employee, has collected a pension. This isn't hard to imagine since he's been Secretary of State as well as Governor (and now Attorney General).

According to Joseph, writing in the paper's
Watchdog blog, "Campaign spokesman Sterling Clifford did tell the Watchdog that Brown started receiving an annual pension of about $20,000 when he turned 60 in 1998 and pocketed it every year until he assumed the attorney general’s office, when it was suspended. That means Brown’s received a pension on top of his $115,000 salary as Oakland mayor [prior to serving as AG]."

One of the questions surrounding all this has to do with time. Brown's pension (and, by the way, it appears he was double-dipping) appears to be significant: about $110,580 annually, which is what someone who has been a member of the select Legislators’ Retirement System (LRS) receives if they've been part of the system for a period between 25-29 years. The problem is that Brown, after he has completed his latest term as AG, will have only served a total of 16 years (which is only $73,720 annually). Quite a difference and until we all started hearing about this today, Brown didn't seem to be doing much - and certainly not doing much - about the crucial 9-year discrepancy (a discrepancy that could be worth hundreds and hundreds of extra dollars).

The other question connected to this problem for Brown is that the LRS is somewhat of a secret. Only a few select state employees are eligible and the system, which voters typically think they dismantled with Proposition 140 back in 1990, still pays out...handsomely. (Read the story for more information.)

Currently, Whitman's campaign hasn't said or done much to capitalize on the problem for Brown. (Team Whitman, however, has taken Brown to task for the pensions his subordinates have raked in...)

Brown vs. Whitman...

Brown's team, however, doesn't seem to get how bad these latest revelations could be for "Governor Moonbeam," who has made a career out of appearing frugal.

In an email to Joseph, Brown spokesman Clifford wrote, "He concluded his brief email with this reminder: “And of course if you are worried about paying out Jerry’s pension, the best thing to do is elect him Governor so he doesn’t collect it.”

In these tough economic times, much due to the incompetence, willful negligence and criminality of public officials, that's probably not a message that will resonate with a large number of voters.

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