Wednesday, June 10, 2009

Does Pete Stark Really Have Syphilis of the Brain?

By Mark Ross, Contributing Writer

Back in 1972 I had the occasion to visit the Security National Bank in Walnut Creek… as part of my environmental journalist responsibilities. I didn’t get to meet with its CEO, Fortney H. “Pete” Stark, but his presence was felt. A giant peace symbol greeted me as I approached the front door.

It wasn’t long before “Pete” received, from the voters, a lifetime appointment to the U.S. House of Representatives. Ol’ Pete is now in his late seventies. A lot of the Democrat hacks-for-life from the Bay Area are getting really, really long in the tooth. Ronald V. Dellums shocked the world by voluntarily retiring from Congress… presumably in order to hand pick his successor, Babs Lee, thus costing Alameda County millions in special election expenses. Then he woke up and knew he had to save Oakland. From what? It now seems from himself.

It is widely assumed that Ol’ Pete is without doubt the most obnoxious member of the House of Representatives. For the Bay Area delegation, that’s a tough competition. You got your George Miller, thuggish labor lawyer. Nancy Pelosi, super-rich East Coast carpet bagger (too bad she couldn’t ditch the accent). Mike Honda of the South Bay is probably the cuddliest of them all. Diane Feensteen is less obnoxious than most… but as a stuporvisor in SF she pushed two failed laws: One was to ban the swastika… as an illegal symbol, the other was to require that all political speeches contain nothing but the truth. My initial reaction was to imagine the panel of “special experts” who were responsible for ferreting out untruths in political speeches. Next thing, because of a buzzed out Irishman (Twinkies, don‘t you know), she was mayor of SF and on her way to stardom… still not the brightest bulb on the Christmas tree.

The direction this diatribe is heading concerns the palpable lack of serious competition in selecting our official power brokers. California and the United States are in the midst of a political crisis of epic proportion. Something as basic as fiscal accountability has been criminally neglected… leaving local, state and federal finances in total chaos. Mutant dwarfs resulting from incestuous political marriages, who write our laws, have just raised sales tax in the middle of a retail recession… because they have committed the most deadly of all civic sins: they have put the government ahead of the people.

Their flawed calculus is that a voting majority does not identify itself as taxpayers.

Today, wherever you go, try mentioning taxes and see what people do around you. They are pissed. And this is only the beginning. The trial balloons floating over D.C. and Sacramento would gag a maggot: Taxing health care benefits as income, limiting the deductibility of home mortgage interest, value added tax (VAT), plus a plethora of increases and additions… once again in a recession!

For years I have mused that the American political dynamic mirrors the “town and gown” tensions typical of places like Madison, Wisconsin or Bloomington, Indiana. There, academic elites have been gathered from all over the world and have been obliged to share space with indigenous locals who labor humbly on farms and in factories. Urban centers, like our Bay Area, are dominated by leftist progressives. Were our local elites to be truly sophisticated we’d be, at least, a little closer to utopia. However, they have been imbued with pseudo knowledge… the products of excessive political influence over education. Their agendas are overwhelmed with frauds and hoaxes… never questioned. The humble bumpkins who clean up after the elites can’t afford the “luxury” of believing in crap… their lives are too marginal to be further diminished with unnecessary errors… that is, unless they become wards of the state.

Meanwhile back to Ol’ Pete. I have no way of knowing if he has syphilis of the brain… but it would be a convenient way of explaining his erratic and obnoxious behavior. He recently was hospitalized with pneumonia and quipped that it would help him further perfect his vision of socialized medicine for the bumpkins. At 78 he’s the oldest Congressthing from the Bay Area. Lynne Woolsey is next at 71. Then Pelosi at 69. Curiously, their official websites don’t show their ages. You can expect some serious turnover during the next decade or so… but they’ll probably get away with nominating their own sons and daughters to maintain control of the family business. Boy, do I love democracy!

Tuesday, June 9, 2009

The Beginning Of The End For Oakland

Today, Chip Johnson became the first journalist to put the reality of Oakland's financial situation in print. Chip says the city might need to file for bankruptcy, and I agree.

Bankruptcy is an unpopular option, and several other bloggers including V Smoothe have pointed out that it wouldn't accomplish much because the city is not locked into long-term contracts with public employees. So, the argument goes, they can simply negotiate contracts which dig the city out of its fiscal morass.

To give you a little more information on the roots of the problem, police and fire services comprise something like 75 percent of the city's budget.

Oakland cops and firefighters receive pay and benefits that put them among the highest paid public employees in the country, if not the world. Kind of a funny state of affairs, when you think about it. I mean, Oakland isn't Bel Air or La Jolla.

Much of East Oakland is a burnt out shell -- a fact which makes it hard to justify high pay and benefits on the basis of cost of living.

Oakland's budget shortfall is not a passing phenomenon. It's a consequence of lower property tax revenues, and that's not going to change anytime soon, as the housing crash is probably only halfway through, and no reasonable observer is even beginning to talk about rising house prices.

Oakland has also studiously avoided adding to its high-value housing stock in recent years, opting instead to build condos -- a terrible choice in a housing bubble, since they historically experience terrible boom and bust cycles. Add to this the city's obsession with so-called "affordable" housing and the property tax picture looks pretty grim.

Sales tax doesn't look much better. Oakland's unemployment rate is through the roof, and the wealthier citizens head to Contra Costa and Emeryville to do any real shopping. As with housing, city government has ensured we have no high-quality retail anywhere in the city.

But the real problem isn't on the revenue side. It's the spending side, and Oakland's police and fire unions are the villains. The city's leaders are all either on the union payrolls or have drunk so much Leftist Kool-Aid that they support anything the unions want without even receiving any kickbacks.

Overtime is out of control. Pensions are preposterous. Police and fire employees make enough money to place them in the top tiers of Oakland household income. All this for a job that requires no college degree.So, why not just follow V Smoothe's advice and take a hard line in upcoming negotiations with the union?

The basic answer is reminiscent of what happened with the city's school district. Our leaders simply can't/won't do that.

Frankly, I doubt that they even understand the financial impacts of the contracts they approve. They certainly don't understand the impacts of the pension agreements. They look at those the same way the federal government thinks about Social Security -- it's someone else's problem.

Put another way, rational contracting requires that both parties understand the details of what they are agreeing to. In this case, you can think of the Oakland city government as similar to AIG, which agreed to absolutely insane contracts in insuring mortgage-backed securities.

Sure, AIG had the ability to negotiate each contract up front, but the organization was so incompetent and fraud-ridden that it was unable to do so without causing crippling harm to its shareholders.

Oakland is exactly the same.

We need a bankruptcy judge to come in not because we can't numerically make ends meet but because our leaders will not accomplish that without some kind of adult supervision. And, we're at the point now where if they sign another police and fire contract without making things reasonable, our city budget really will completely crumble.

Without bankruptcy, I can tell you exactly what will happen. Police and fire will get exactly what they want, including some sort of bogus band-aid deal to fake out the federal government into giving us a grant to plug the gap for a couple years. Never mind that that grant won't cover the pension obligations which the city doesn't even understand.

Then, the city will cut other services -- things like parks and roads -- because the unions supporting those things haven't greased the politicians sufficiently.

Finally, as the police and fire expenditures approach 100 percent of revenue, the city will be forced into bankruptcy under far more onerous terms.

My advice is to bite the bullet now and enter bankruptcy to reorganize the city's finances. Use the bankruptcy judge as a resource to instill rationality into the city's budget situation. Also, use bankruptcy as a hammer to push through police and fire pay and benefits more in line with those seen nationwide.

Doing so will probably require something like a 35 percent across-the-board pay cut and a return to a pension formula based on 2-and-60 instead of 3-and-90. For those keeping score, that would mean they receive 60 percent of their highest salary in retirement instead of 90 percent. Which is completely, totally, reasonable and fair.

Alternately, police and fire could have their pensions moved into private accounts like 401(k)s, just like employees in the private sector. And, they could be required to contribute to their own retirement costs.

All across California, police and fire (and the infamous prison guard union) are going to have to face these kind of cuts. It's just a matter of time, because the deals they've extorted by paying off politicians are completely untenable.

Here, Oakland has an opportunity to be one of the first cities to push for this. The first step is bankruptcy.

Friday, June 5, 2009

The Officer James Williams Memorial Overpass... and its connection to the death penalty

By Mark Ross, Contributing Writer

Driving along the communication trench we call Highway 580... west of High Street and East of Fruitvale... you'll see, on either right-hand embankment, a CalTrans sign naming the bridge that 38th Avenue takes over the freeway.  The story behind this obscure memorial brings to light several issues currently in play in today's Oakland.

Early on the morning of January 10, 1999, Officer Williams was fatally wounded while searching in the landscaping along Highway 580 for a discarded shotgun.  The assailant stood on the 38th Ave. overpass... from where he fired his illegal AK-47 communist bloc full automatic military rifle.  Officer Williams was killed and another policeman was injured after his hand cuff case deflected the round.

Later that day a wannabe 19-year-old gang-banger named Chad Rhodes was arrested without reported incident.  Mr. Rhodes has never and will never see the streets of Oakland again.  He pled guilty to avoid the death penalty.

Early that same morning, at about 12:45 am, I awoke from a sound sleep to hear the gunshots that killed Officer Williams.  At the time I had no idea if anybody had actually been shot... but I did know that the weapon was firing in full automatic mode... unusual, even for Oakland.  During Chinese New Year and July Fourth I like to tweak out of town visitors by telling them:  "Here, in Oakland, we like to say 'I sure hope that's firecrackers.'"

Western civilization is supposed to place a high value on human life.  In this case Mr. Rhodes, obviously without serious consideration, took the life of another and turned himself into a potted plant.  There's stupid and then there's DANGEROUS stupid.  In this modern world, and 1999 wasn't that long ago, how can such stupid people emerge from our collective bosom?  The Black Avenger, Ken Hamblin, called these folks "feral humans."  He emphasized the difference between breeding and giving birth.  We're supposed to grow up... and this with the assistance of parents... not street thugs.

We recently saw a parole violator, when the walls started to close in, kill four cops before others killed him.  That was, at least (and in the words of Boris Karloff in "The Tower of London") in hot blood... panic and frenzy.  Mr. Rhodes was in no danger... no panic.  It is said that he was part of the crew that tossed the shotgun.  It's hard to link a shotgun to a crime after the fact.  But he killed Officer Williams and intended to kill several other police if he could have... just to keep them away from the gun?  Maybe just because, in his defective mind, he thought he could get away with it.

Those who argue that the death penalty is not a real deterrent should take note that in this case and in several other higher profile cases in other states (viz. The Green River Killings and the ABC Killings) prosecutors have extracted guilty pleas in exchange for taking the death penalty off the table.

What is wrong with the death penalty is that it is too often used as a political device in lieu of actual law enforcement.  Rape, even without other injury, used to be a capital crime in some states.  Guess what?  Juries had a really hard time convicting even with absolutely convincing evidence.  When we were having serious urban drug wars (like, we're not now) dimwit politicians were advocating the execution of drug "king pins" should they have the temerity to sell a joint to an underage school child.

The other fault with the death penalty in California is that there's really no such thing.  I'm guessing here... but it's a safe guess... that the average life span of someone sentenced to death is longer than that of the average citizen on the street.  They (the condemned) live in a really protected environment.

Were I to be gubernator I would review the cases of all death row inmates.  I'd throw out some convictions, order new trials for others and commute some sentences to life with or without the possibility of parole.  The remaining, say, third would have their sentences carried out at the rate of four a week.  Two on Tuesday and two on Friday... until no one was left on death row.  Without a backlog and without the possibility of eternal appeal the deterrence would be felt on the street.  After all, Mr. Felon, should you pull that trigger and, likely as not, wind up in court and be convicted... YOU'RE NEXT.  Now, that's deterrence.

Monday, June 1, 2009

$500,000 A Year Civil Servant Pensions - Only In California

Today's Matier and Ross column does an excellent job of exposing what lies at the heart of the budget messes at the city, county and state levels in California.

Key points from the article -- 246 former San Francisco employees receive pensions in excess of $100,000 a year. Fifteen are above $150,000.

I don't have the equivalent numbers for Oakland, Alameda County, Bart and all the other agencies which are sticking it to us. I welcome a reader to contribute the numbers.

But, I feel confident they look the same, and from the sound of it, the numbers will just continue to get worse, courtesy of longer lifespans and the ridiculous union contracts put into place over the last 10 years.

I don't know of there's any way to shed these payouts, short of a bankruptcy. But these civil-servant salaries like at the heart of the budget mess. Closing every park in the state and euthanizing stray kittens more quickly -- both of which have been proposed at the state level -- would do far less than reforming these pensions to improve our budget picture.

There is one element of the problem which Matier and Ross did not discuss. That is the rate of return expectation used in computing the amount of money we need in the retirement system now to pay projected future benefits.

Setting the rate of return number higher has the effect of lowering how much must be contributed to the plan, since more is expected to come in through investment income. Apparently, for the past decade this expectation has been set at something like 8 percent a year.

Sadly, investment returns for the past decade have been more like zero percent. And, there's every indication that they will continue to be anemic in coming years.

So, not only are we faced with a tidal wave on the "demand" side of the equation, with retirees now routinely commanding six-figure salaries in retirement. We also are looking at a "supply" side disaster, with insufficient investment returns to pay for what has been promised.

Personally, I think the state and numerous cities and counties all need to go bankrupt to get out from under these contracts. I see no other way to reduce promised pension benefits, since the unions obviously won't agree to concessions.