Saturday, July 28, 2012

Oakland Moves Ever Closer To Bankruptcy

Interesting article today in the SF Chronicle about Oakland's PFRS pension obligation.

My opinion is that Oakland should essentially go bankrupt as soon as possible. At this point, only a couple cities in California have taken this step. That mean's there is still an opportunity to get a fairly good deal out of a bankruptcy.

Later, that's going to change. You can be sure that unions will do their level best to prevent cities from right-sizing their expenses for things like benefits and pensions.

One thing I really enjoyed about the article was that it quoted someone -- Nita Balousek -- who is 55 and whose husband retired as a cop something like 17 years ago, after working 27 years.

That's preposterous! That means this lady was 38 years old when her husband retired. And I guess she was 11 when he started working as a cop?

So let's say she lives to age 88. We have to pay her for 50 years of retirement for a guy who worked here for 27 years? How is that sustainable.

Time to declare bankruptcy and move on.

1 comment:

  1. Let the dominos fall. The same article said that to avoid a ca. $38 million payment for the pension, the geniuses who run Oakland used a bond instead that cost (with interest) ca. $115 million. The whole freakin' state is circling the drain... while the rest of the US is recovering... step by step.