Well, that’s not what Jerry Brown and legislative Democrats claim their bill would do, but how can we doubt that wouldn’t be the effect. Here is what they are claiming, as reported in the SacBee:
The goal is to create a savings program in which workers who have no access to a pension can count on a guaranteed rate of return for contributing about 3 percent of their salary.
Sounds laudable? But who will control the money? Who will guarantee the rate of return? According to the article, private insurers would, because:
Money would be pooled in a state-administered fund that would be professionally and conservatively managed and invested.
So why should anyway be nervous. All those billions will be tucked away safely in the care of the state. The governor wants to make sure that the money is safely managed by his cronies appointees.
Before committing himself to the concept, Brown sought and received the requirements placed in SB 923 – that lawmakers take a final vote before implementation and that a board overseeing the program be increased from seven to nine members, five of whom would be gubernatorial appointees or officials of his administration.
That reassures me. And the record of CalPers in managing pension benefits for state employees has been so sterling, with 99% of private funds outperforming it, I don’t see why private businesses are having misgivings.
My immediate suspicion when I read this news is that the state intends to commingle these funds with the state pension monies. The Appeal-Democrat reports that Kevin De Léon, the main sponsor of the bill, has previously gone on record for calling for all private sector workers to be folded into CalPers. Might this be step one, and the next step taken under the disguise of “efficiency?” Of course it will. The state Democrats are determined to drive every private business out of the state. I wonder who they think will pay the taxes to pay for their hare-brained schemes.