continued Both Shipione and Gleason compare San Diego's situation with the pension mess in the private sector. Bankrupt airlines are dumping their pension obligations on the quasi-governmental Pension Benefit Guaranty Corp. Other airlines and large one-time blue-chip companies may well follow suit. There is a huge incentive for blue-chip corporations to go bankrupt. Some may be the same blue chips that used phony accounting in the 1990s -- taking their pension-fund excesses into profits.
The corporate frauds are instructive. "The financial condition of San Diego is built on every one of the irregularities which plagued the private sector in the late 1990s -- Enron and similar companies," says Shipione. She wonders if managers in San Diego government "believed that government entities were easier and more forgiving targets for manipulation and abuse."
"Private enterprise is laying off pension problems on future generations of stockholders," says Gleason. "San Diego is laying them off on future generations of taxpayers."