Charitas Dictator: My Solutions to CA Financial Crisis

Even San Francisco rejected them. By a landslide the voters of California told its government, "We do not want more taxes. We do not want you raiding one account to pay others. We do not want to extend your ability to spend our money with impunity." So now what? What will our dysfunctional state government do to change its culture of spending on salaries and expanding government?

Were I placed in the role of Charitas Dictator of California I would enact the following decrees as solutions to California's budget difficulties today and fix them for future years. Someone has to stick their neck out, goodness knows our Legislature will not as evidence by their continuous use of Propositions to do their jobs.

Make it harder to get Propositions on the ballot. Too often our state Legislature shirks their responsibility in making difficult decisions by putting propositions on the ballot and letting the voters decide. The Propositions that were on the ballot on Tuesday never should have been sent to the voters. Not only did voters say "No" to tax increases and more spending, they also said "No" to the Legislature when asked to do their job. Restrict the Legislature from placing any propositions on the ballot, increase the number of signatures required for the people to place an initiative on the ballot from 5% of the turnout from previous gubernatorial election to 10%.

Eliminate term limits. Combined with the changes in the redistricting process that become effective in 2012, we should eliminate term limits for members of the Assembly and Senate. The revolving doors in Sacramento create revolving doors in elected offices throughout the state creating instability and politicians spending more time collecting donations and working for election to the next level than paying attention to their current jobs and constituents. Elections are term limits, do not limit how many an individual may win.

Spending cap mandates on the State budget. Regardless of revenue the growth of the state budget should be capped at a formula of population growth and inflation. If revenues exceed spending funds should be divided between paying down debt, funding reserve accounts, returning funds to counties and cities and returning taxes to tax payers in the form of rebates. Increased revenues over a prolonged period should not enrich those who work for the state, but rather should be returned to those who provided the excess revenue.

Budgets are made on revenues received not forecast. In conjunction with the previous item, lawmakers will not longer use budget projections to create budgets. Too often the projections are wrong, or are misleading, to allow higher spending and balancing the budget for signature only to see revisions later in the fiscal year. All budgets going forward would be based upon prior fiscal year revenues--you can't spend what you did not collect. The current budget crisis is worsening because of the spending built into the budget and a complete failure to accurately predict revenues for the current fiscal year. I realize this proposal has a one year lag time; we are already spending fiscal year 2008-09 revenue leaving none for FY 2009-10. Therefore a special bond would be floated to provide revenue for the first fiscal year of the new budgeting process. Every budget for the next fifteen years would first carve out funds to pay down the bond from revenue collect the prior year before any other spending items are placed in the budget.

Negotiate with public employees: a lot of job losses or fewer job losses. California has 235,000 employees, does anyone really feel everyone of those jobs is necessary? As charitas dictator I approach each of the public employee unions and offer them option A or option B, their choice: Option A is the elimination of 15% of the jobs represented by that collective bargaining unit. Option B is the elimination of 10% of the jobs and those who remain will have new contracts reducing benefits and limiting salary increases to be the same formula used to allow for increases in the budget. Benefits would change such that all employees would contribute on par with those contributions in the private sector to retirement accounts: the state will match 50% of your personal contributions up to a maximum amount that equals the limits imposed on private sector employees. Medical benefits would be paid based on the MediCal rates of coverage; our state is already insuring and paying for the medical benefits of millions of Californians, if this insurance is good enough for them it should be good enough for the 200,000 plus public employees. If an employee wants private insurance they will be credited the amount of the insurance premium payments equivalent to the MediCal premiums. These reforms are enacted for all state employees, not just those who are union members, but anyone who receives a check from the State of California.

No more state resources used to collect political donations. The state will not longer allow payroll deductions to collect donations made to the political units of the employee unions. The state will not pay for the accounting, collection and distribution of funds used to elect individuals to public office. Public employee unions must collect their political donations directly from the individual union members not from the state through their paychecks.

Reform MediCal so it is equal through the state. There is so much institutional dysfunction in the MediCal system that wastes so many millions of dollars that it is hard to know where to begin; so let's over simplify the program. First, all hospitals will receive the same reimbursement for the same treatments, no more tiered payouts depending on where the hospital is located or whether the hospital is contracted with MediCal--the same for payments to doctors and other health care providers. If it is mandatory that anyone walking into any hospital be treated then it should be required for the state to reimburse all health providers equally. This alone will eliminate the need for a huge amount of staff that is currently utilised to review and deny claims, process appeals, approve claims, cut the reimbursement, all on a patient by patient basis. If a hospital or health care provider is found to have engaged in fraud then immediately begin fraud prosecutions, and put in place a leadership team to ensure the hospital stays open. This single pay provision will also save hospitals and health care providers up and down the state hundreds of millions of dollars in personnel costs used for accounting the current complex MediCal system of payments. It will benefit patients in that they will not have to be transferred from non-contracted to contracted hospitals and no matter what hospital they go to in the state they can expect the same level of care.

Reform the education system. Eliminate the mandates for programs that create a one fits all mentality. Cut the State Department of Education in half and push the savings down to the local school districts. Allow the school districts to have more control over their budgets and how they wish to spend their revenues. Using standardized tests, if districts fall behind take over the district and slowly re-integrate local control; such as occurred with Compton Unified School District in recent years. Put more control closer to the parents through their local school boards and Superintendents. With increasing power in Sacramento we have decreasing opportunities and programs for our children, we need to reverse that trend.


Encourage department managers to succeed and reward success. Too much money is added to our budgets to maintain prior years' funding, whether the funds are needed or not. Reward department managers who are able to show year after year after year savings with financial incentives. Allow managers to present five year plans for projects and place into their budgets funds to save for future expenditures for capital improvements. Allow managers of our public funds to operate as their counterparts are allowed to operate in the private sector, plan for success and reward success. Our current system does not bring accountability into the management of public funds nor does it allow for long term planning; managers are operating on a year to year basis without encouragement to be innovative or creative in product delivery. Changing the culture will encourage more entrepreneurial management and will attract individuals who thrive in such an environment.

Cut taxes. Roll back the sales tax by 2.5% across the board. Roll back auto registration fees by 10%. Cut the income tax rates by 1.5% for every level and raise the income levels for each tier so they more closely match those at the Federal level. You cannot tax your way out of a recession. Study, after study, after study shows that raising taxes cuts revenue, lowering taxes raises revenue. Look at the states that have done well during our recession and you will see states that are attracting businesses and jobs because of their low tax rates. Even during the economic growth from 2002 through 2007 California's business community grew slower than most states. Taxes are killing job development and growth in this state. We need to attract wealth and investment, we do that by allowing success to accrue to those who succeed.

Drill for oil. Open the coastal oil fields for development and extraction. Follow the leadership of Governor Sarah Palin in Alaska and the deals negotiated with the oil companies to extract oil and natural gas from her state. For the Palin haters ignore who and concentrate on the results, a tremendous spike in revenue for the State of Alaska. California is sitting on hundreds of millions of dollars of revenue that could benefit our state, unfortunately a small minority has been allowed to deny those funds to the people of California. I find it appalling that the Legislature and Governor find it okay to throw a huge tax burden on the families of this state but refuse to extract the millions of dollars of revenue sitting right off our shores.

Sue the Federal government. Require providers of service receiving state funds to document whether the recipients are legal residents of the United States. If they are not then send a bill to Washington D.C. Prisons, hospitals, schools, law enforcement are all expending resources to pay for services provided to illegal aliens allowed into this country by lax federal enforcement of our borders. Take the Feds to court and recoup the billions spent by California tax payers every year as a result of the problems created by Washington's inability, or refusal, to address this problem.

Require and accounting and spending of money from Propositions. We have billions of dollars that have gone unspent because of voter passed initiatives; from stem cell research, to Rob Reiner's cigarette tax, to fixing the Delta to avoid a Katrina type collapse, to countless other propositions passed and funded but not accounted for to see if the projects have been completed or even worked upon. Every proposition that requires bond funds would also have an audit component for review every two years. If within five years at least half the funds have not been spent to accomplish the purpose of the proposition then the funds are returned to the State, the bond is paid off and the project(s) shut down. There is no accountability for any of the funding for the multitude of propositions passed by the voters, seemingly on a whim. Most of the spending propositions benefit a very narrow segment of the population, make them accountable for the funds or they lose all of them.

Keep the two-thirds majority requirement. I would not change the requirement that all budgets and tax increases require a two-third majority vote in the Assembly and Senate. One can imagine the budget problems we would be having if it were not for this rule and if the Democratic majorities in both houses had the ability to pass budgets with a simple majority. Only the hold out of Republicans have lowered the tax increases from initial Democratic proposals and lessened the spending in the proposals. Unfortunately every year the necessary two or three Republicans have eventually jumped over the line and allowed the horrendous budgets of the past decade to pass. Removing the two-thirds obstacle will remove any filter on the budgeting process.

Given the ideological bent of this state and the control the public employees have I am certain that these proposals would probably fail in any general election, which is why I would have to enact them as the Charitas Dictator, or Benevolent Dictator. For our budget problems in this state to be solved in the short and long term we will need someone, or more likely several someones, to have the courage to stand up and loudly proclaim specific solutions to our problems.

We Are Californians Not Colonists

In 1765 the British Parliament passed the Stamp Act, a tax which was imposed only on the American Colonies. The purpose of the tax was to fund the presence of the British military in the American Colonies, where they remained after the conclusion of the French and Indian War. While later repealed, the Stamp Act was a major factor in coalescing the American Colonies into a single political unit for the purpose of fighting the Stamp Act and other taxes later imposed on the American Colonies by the British Parliament. The British saw the Colonies as a source of revenue and also a source of geopolitical advantage in spreading their control across the American Continent using the British Army and Navy now garrisoned in America.

Of course the most important phrase to come out of the Stamp Act was the rallying cry that began in Boston and spread through the Colonies, "No Taxation Without Representation." And Representation began with every colony sending representatives to Philadelphia which later became the Continental Congress; which as we know later became the Constitutional Congress and still later the Congress of the United States of America.

Now we find ourselves in the 21st Century on the far side of the North American Continent from the original American Colonies in the State of California. Like the 18th Century American Colonists citizens of California are finding themselves subject to increasing amounts of taxation to support what they see more and more as a foreign government, when in fact it is the government of their own making. And like 18th Century American Colonists more and more Californians are feeling their taxation is coming without representation, when in fact they cast the actual votes that have elected those passing the taxes. Juxtaposing a more modern phrase with that of the American Revolution, if perception is reality than in many Californian households there is taxation without representation.

There are numerous factors that have led our State Legislature, abetted by the signature of whomever held the Governor's office, to the current state of financial collapse in state finances. The most basic and over-riding cause has been the explosion of spending in Sacramento over the past ten years or more that has doubled the size of the California government expenses. This has been enabled by the combination of term limits and gerrymandered legislative districts which ensured not only a Democratic majority for both the State Assembly and Senate, but ensured further that each District is so gerrymandered that only the most Democrat of Democrats or Republican of Republicans stand any chance of getting elected in the jigsaw shaped district they represent.

Further compounding the issue has been the question of representation. Who exactly have the Legislators in Sacramento been representing? The middle income families who are paying the highest income tax rate in the nation? The lower income families who are paying the highest sales taxes in the nation? The children in the State's public schools who while having the highest paid teachers in the nation score near the bottom in standardized tests? The business owners who have been taking their businesses out of the state, and during the sustained period of economic growth from 2002 through 2007 did not open new businesses in our state? Are any of these groups represented by the budgets passed in each of the past ten fiscal years by our Legislature? The answer is no, and because of that we ask, do we have taxation without representation in the State of California?


We get what we elect and the majority of Californians have blindly followed the path of campaign ads, political flyers and what the letter is inside the parentheses on the ballot--for the Legislature if there is a (D) then it gets elected in almost 60% of the State. And who funds that (D)? Prison guards who created the most expensive prison system in the United States. Teachers' unions who have the largest amount of spending on education in the United States and the highest teacher salaries. Unions representing almost all of the 235,000 state workers from Chula Vista to Redding, the most of any state in the United States. Year after year, election after election these groups have poured millions of dollars into state political campaigns, almost exclusively funding the candidates of one party, and year after year we have seen budget after budget paying these groups back with increased numbers of employees, higher salaries and higher benefits. And now the people of California are waking up to the reality of what has happened to them.

The Governor and other officials up and down the State have been on a tour trying to scare the people into voting for Propositions 1A through 1E on Tuesday. The message is the same, if we do not pass these measures we will face an even greater budget deficit. We will have to lay off some government workers (at latest count about 2%), we will have less money for schools, for prisons, for the fixing of infrastructure.

What they do not say in these Scare Rallies is the even if the voters do pass Props 1A-E, and increase the highest taxes in the nation for even longer, if we will still have deficits in the coming years because of the massive give-aways in the previous ten budgets. None of these Propositions unravel any of the previous spending or contracts, all they do is perpetuate them.

Just as the Colonists formed the Stamp Act Congress which eventually led to the Declaration of Independence, the People of California need to band together and overthrow the ideas of those who govern us. We need to defeat everyone of the Propositions on the ballot and force our Legislature and Governor to address the real problems we face: too much government, too much government spending and too much of our hard earned money that is taken from us in taxes going to pay too many people salaries and benefits that are too high.

It is time for the people of California to quit enabling Sacramento while disabling our schools and communities and future.

Vote NO on Propositions 1A through 1E. Tell every elected official in the State "No more taxes, no more spending."

Rebuttal To Teacher Union President On Props 1A-E

On Wednesday the Press-Telegram ran a letter to the editor from Michael Day, President of the Teachers Association of Long Beach (TALB) which I re-print below and link here. Mr. Day uses his letter to try to convince voters why they need to vote "yes" on Propositions 1A through E on Tuesday May 19th; or should I say scare voters into supporting the measures?

I have been publicly critical of Day in the past, most notably several posts I wrote for the Long Beach Post (you can click this link then put TALB in archives section, or for sample see this post); the main source of my criticism was not so much Day as the Executive Director of TALB until his dismissal last year, Scott McVarish. Since McVarish arrived in Long Beach TALB became increasingly militant and power hungry in his attempt to control the Long Beach Unified School District. After a take over of the union by the California Teachers Association and an audit which showed significant malfeasance by more than one staff member at TALB McVarish "resigned." During this period Day was the President of the local and acted very much in concert with McVarish and his plans for controlling the district. Since McVarish has left TALB has been working for their teachers more and against the district less.

With that as background here is Michael Day's letter to the editor on Wednesday May 13, 2009 to the Press-Telegram, my letter will follow:

Propositions support schools

For the last few years the employees and students of Long Beach Unified have dealt with dwindling support from Sacramento while maintaining high academic standards. Because of decreased funding we have seen support for students cut through reductions of specialists, aides, nurses and tutoring programs as the district works to maintain fundamental services for our kids. Even services we used to consider part of our core program, such as libraries, music and counseling, are being pared back to near non-existence.

The public needs to realize how important propositions 1A through 1E are to our schools. We need to support propositions 1A and 1B to restore the $9.3 billion Sacramento has taken from our schools while creating a plan to repay those vital funds. We need to support propositions 1C through 1E to ensure our schools do not suffer billions in cuts next year. We have been getting by the last couple of years, while making great academic gains, but a defeat at the ballot box will only cause suffering for the students we serve and the people who serve them.

For years teachers have been told we must do more with less. But if propositions 1A through 1E do not pass we will do less with less. The public and the politicians demand a great deal of accountability and performance from our schools. And in Long Beach our teachers, administrators and classified staffs meet those challenges. But until the public and politicians
are willing to equate adequate funding with performance we will not have the system our students deserve. Not for a lack of effort on our part but for a lack resolve on theirs. Please vote "yes" on Propositions 1A through 1E.

Michael Day
President
Teachers Association of Long Beach

Today, Thurdsay May 14th, the Press-Telegram printed my rebuttal to Mr. Day (link here, 2nd letter):

Support for schools

Re "Propositions support schools" (Letters, May 13):
Michael Day, president of the Teachers Association of Long Beach, is right: Our teachers, administrators and staff in the Long Beach Unified School District do a tremendous job educating my children and tens of thousands of others. He is correct that every year this job is being done with less and less support from Sacramento.

However, Day and others in Sacramento and in the public employee unions are perpetuating a fallacy in saying we must support Propositions 1A through 1E so our schools and other services will not face more cuts. Even if the propositions pass we will see cuts in services while state government continues to grow.

In the past 10 years the size of the state budget has doubled. Since California must have a balanced budget, this means that revenue to the state has also doubled in the past 10 years. In the past few years our schools have cut computer classes, science camps, counselors, music, reading and arts programs. Our state government has doubled in size and our school programs have been cut with more to follow.

I ask Mr. Day and other supporters of the propositions: In the past 10 years has the quality of education doubled? Has the funding for local schools doubled? While we have seen our taxes increase have we seen a corresponding increase in the level and quality of services delivered? I answer "no" to each of these questions, just as I will also vote on Props 1A-E.

What makes Mr. Day or other supporters of Props 1A-E think that giving Sacramento more money will not lead to even more cuts in funding for local education and programs? Voting "yes" on Props. 1A-E will just enable Sacramento to continue to spend our tax dollars to the benefit of public payrolls with no tangible benefit to our students or our citizens. If you need proof just look at the last 10 years.

Dennis C. Smith
Long Beach

Quit enabling Sacramento while disabling our schools and communities, vote no on Props1A-E!

How Cities Should Manage the Next Foreclosure Wave

In February Governor Arnold Schwarzenegger signed into law a 90 day moratorium on foreclosures in the State of California. There were some loopholes, naturally, but the effect of the law was to keep tens of thousands of foreclosures from happening from the end of February through the end of this month, May 2009.

Since February we have seen an increase in the number of "short-sale" transactions (seller owes more in mortgages against the property than the sales price necessitating mortgagor(s) to discount principal owed to facilitate closing) as many homeowners have sold their properties ahead of filings of notices of default and foreclosure. As well California has seen a flattening of the median sales price through the first quarter of 2009, indicating a firming up of the housing markets through much of the state--particularly coastal counties and communities--from the bottom up. In some areas there has been an increase in median prices, particularly condominiums in some zip codes.

In part the flattening of the median prices and increase in the number of short sales versus bank owned foreclosures on the market in California are the result of the Governor's moratorium on foreclosures. With only a few weeks left before the moratorium expires what preparations have various California cities and counties and lenders undertaken for what will occur when that happens? My guess is nothing.

While the moratorium has allowed many lenders to off load poor performing mortgages through short sale transactions initiated by their borrowers, what the moratorium has not done is reduce the flow of borrowers into default on their mortgages. As a result lenders in California have a very significant number of mortgages on which they are about to initiate foreclosure proceedings. Three months of unpaid mortgages are going to start being processed by the banks and if not handled properly California housing markets will be hit with a flood of foreclosure sales due to the moratorium. The primary argument against the moratorium was what it would do to housing markets when the moratorium expires--we are about to find out.

Supply and demand function in any market, and left without interference will seek a market price for any good or service. Everyone with a basic concept of economics knows that scarcity of supply raises prices, scarcity of demand lowers prices, abundance of supply lowers prices and abundance of demand raises prices. For the past several months we have seen a growing abundance of demand in the lower price ranges and a flattening of supply, leading to stabilizing of home prices for the first time buyer markets. What happens to those markets when flooded with pent up supply due to banks being able to foreclosure again on delinquent borrowers? Abundant supply creates lower prices.

There is a possible solution to the flooding of the market with lender REO's (an industry acronym for Real Estate Owned, bank owned foreclosures) and the subsequent fallout in housing prices. Banks and local governments can work together to allow the banks to receive revenue from their REO properties while slowly placing their inventory on the market over period of a year or more and cities and counties can increase the supply of rental housing or moderate income housing for first time buyers.

Using Bank of America and the City of Long Beach as an example. Long Beach can approach Bank of America and determine how many properties they have in Long Beach that are REOs, in delinquency and about to be foreclosed upon. Understanding that BofA will need to remove the "toxic assets" off their books, BofA will continue with its normal foreclosure processes on delinquent borrowers. Understanding that the City of Long Beach is concerned with property values in its communities and the loss of tax revenues BofA will agree to work with the City to slowly sell its REO inventory over a period of twelve, eighteen or twenty-four months; slowly bleeding inventory on the market instead of dumping it all at once. For the properties that are not yet placed on the open market the City of Long Beach housing department can work with the BofA REO department to fill the properties with tenants paying fair market rent, perhaps subsidized (I cannot believe I wrote that word!) with funds from the housing department, to allow BofA to maintain funds for property taxes, insurance and general operating revenue (such as paying personnel in the REO department). Some of the properties can become eligible for funds from the housing department set aside for first time buyer programs that are currently not used due to inefficiency and requirements imposed on everyone involved.

Housing and government do not get along very well. Government imposition of requirements for low to moderate income families purchasing or renting housing creates hundreds of pages of restrictions and regulations and bottlenecks any funding to the point that no funding occurs. In the City of Long Beach there are millions of dollars in housing funds left unspent due to the requirements imposed on those funds being too stringent for the market to comply. If someone with sense in government, at the local, state and federal levels, were to look at the looming foreclosure flood about the hit the market in California he/she can see the problems that will occur. Yet under the guidelines imposed on housing funds there is nothing a city can do to manage the flood of inventory about to the open market in their communities. By re-negotiating the restrictions placed on housing funds from the state and federal governments cities can free up millions of dollars to use in working with banks so the inventory of REOs can be managed in a manner that helps both the banks and the communities where the properties are located.

From the bank's perspective the ability to forge a partnership with local governments to manage the removal of REOs from their balance sheets over time will add stability to their balance sheets, revenue to their income statements and groundwork for future partnerships that benefit both parties. Instead of having hundreds or thousands of properties on the market with declining values, they can have a few hundred properties at a time selling in a more stable market environment.

I do not expect this proposal to work as there is little chance the bureaucracy of the government housing departments can move nearly fast enough to free up the necessary funds from their current regulations that prevent their use. Cities across the country are flush with funds to promote home ownership and community development through rehabilitation of distressed properties--unfortunately the policies, procedures and regulations governing the funds make them useless. It is time for local governments to push back on Sacramento and Washington and renegotiate the terms under which those millions of dollars are being restricted.

Self-Filling Paychecks Crashing Local Budgets

The vast majority of California cities are doomed to financial failure in the near future because of the mandatory raises in salary given to the bulk of their employees and subsequent increase in pension payments. Imagine if you were guaranteed a raise in your salary every year and corresponding raise in your retirement pension with no regard to how well you do your job, all because your employer is worried you will go to work for your competition.

That is what happens with most of the municipal employees across the State of California. Here in Long Beach we hear the same refrains when contracts with various sectors of city employees are being negotiated: 1) We have to pay them more or they will go work for City "X" and 2) We have dedicated employees in the City who deserve our support.

Which is it? Are they dedicated to their jobs or are they mercenaries ready to bolt to Vernon or Bellflower or Santa Ana because the same position there is paying 3% more in base salary? They cannot be both, either they are loyal or they are in it for the bucks. Because almost none of our members of City Council over the years have any business experience, especially management and/or ownership experience, they believe the arguments. As a result our city employees have guaranteed raises in their contracts and when it comes time to renegotiate they are given raises framed in such a way at to appease only the most intellectually vapid among us: our employees are within 5%, 3%, 1% of the median for the sector in the region/state. Of course the employees in the municipalities against whom our employees' contracts are based are represented by the same union and of course have the same language in their contracts. As a result the unions, across several different city governments, have contracts guaranteeing perpetual raises for their members since the median income will always be going up.

Essentially every raise that occurs in any municipality in the state trickles through the system to enact raises for every other city due to a rising median salary and benefit package. If Alameda pays their General Maintenance Worker II's more money then when Richmond's contract renews their workers will get a raise to "stay competitive" and so it trickles down the state, Fresno, San Louis Obispo, Glendale, Bell, Long Beach. And by then when Long Beach gets their raises it will trickle back up to Alameda in time for them to get their new raises.

Keeping in mind how difficult, damn near impossible, it is to fire any employee with union representation, these employees are guaranteed the salaries regardless of productivity, efficiency or any standard of job performance. Further, it includes payments into their pension plan--which is the real budget killer.

As residents we are subject to attempts at blackmail by management telling us, if we do not give these raises and "stay competitive" we will lose our best and brightest to a neighboring city who is paying their employees more. Really? In this economic environment Carson, El Monte or Aracadia are going to bring in new employees to replace existing employees who are what retiring? Being fired? Because they have money in their budgets to hire more General Maintenance Worker II's or Division Budget Analyst Managers?

If anyone decides to leave the guaranteed employment, guaranteed salary--which is quite generous given the lack of performance requirements that can lead to dismissal--and guaranteed pension for a few bucks more, I say let them. Let them go. Here in the private sector we often do, sure go to the suppossed greener pasture, leave stability and venture into the unknown. Employees know this is the case and because of that do not play chicken for pay raises. There is a bottom line to company profit and sustainability, if giving you a raise just to keep you jeopardizes that then good luck at your next place of work if you choose to go. Further, if you cannot justify your raise with corresponding increases in profit, decrease in other expenses, productivity or other measurable output then you will not get one. Try that with a city job.

So if employees in negotiations say, "We can go to ______ (fill in city of choice here) for more pay, I say let them try it. For one we can use the job loss on the city income statement. But more importantly it is a bluff. If we do not give our cops a big pay increase, or our firefighters or our City Hall employees, we will not be seeing any job exodus. When city management uses this argument it is tatamount to me telling my children to go to bed or the Bogeyman will get them.

Currently the City of Long Beach has ninety-four former employees drawing over $100,000 per year in pensions from CalPers for a total of over $11.25 million per year. Guess where that money came from? Not the employees but from the tax payers. Instead of building a new library City Councils past handed out pay raises. Instead of fixing streets or sewers City Councils handed out retirement benefits based on last salary. Instead of protecting the city infrastructure our elected officials and city managers padded salaries, particularly for those groups most active in campaign donations for local and state elections. With each new series of raises comes a series of pension contributions that are that much higher, that drain that much more from city coffers, that creates that many more retirees in the $100k club. Meanwhile the rest of us pay into our own 401(k) with limited company contributions--mainly due to federal tax limitations--and keep pushing back how long we will have to work before retiring.

The City of Long Beach, and other city governments across the state, must stop the spiralling salary increases that feed off each other. Call the employees' bluffs that they will leave their current jobs in search of more pay elsewhere, I say good luck matching what you have now. There is a reason employees in the private sector stay with the same companies for decades: loyalty, steady employment and fairness by both sides.

Finally regarding the pensions Long Beach and other cities need to renegotiate with every group and individual. Retirement benefits should not be set on an employee's last year, or six months, of employment but rather be based on the median income of the last five or seven years. Each employee must pay into his or her retirement account as we do in the private sector. Finally, if an employee leaves before five years they only carry a portion of the city contributions with them.

It is time for our elected officials and senior city management to quit playing us for fools, and time for the electorate to quit being played. Take control of the spending which is 80% of the budget: salaries and benefits. Quit worrying about losing employees and start worrying about saving money for today and into the future. Start acting like employers who care about the long term survival of our city and not like politicians worried about your next campaign donations.