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Today's (May 21) issue of the New York Times describes how government pension programs get in trouble because of phony numbers and actuaries who cave in to pressure. San Diego's official numbers were one reason the Securities and Exchange Commission sanctioned the City, says the author, Mary Williams Walsh. "The city sued the actuarial firm, which settled," says Walsh. She is referring to the one-time actuary, Rick Roeder. While she was a member of the pension board, Diann Shipione spotted actuarial problems. The new book, "While America Aged: How Pension Debts Ruined General Motors, Stopped the NYC Subways, Bankrupted San Diego, and Loom as the Next Financial Crisis," which I review in this week's Reader (It will be coming online today), covers the spineless cave-ins by former actuary Rick Roeder. When the City first wanted to plunder the pension system to finance the 1996 Republican convention, Roeder gave a "grudging OK," says the author, Roger Lowenstein. Then when the politicians later wanted to worsen the underfunding, Roeder "seemed to have tired of doing battle." The outside lawyer bullied him into accepting that smelly deal, called Manager's Proposal 2. Lowenstein calls him the "tortured actuary." The inevitable conclusion: Roeder's firm wound up paying San Diego, as did the outside law firm. But what happened to the city bureaucrats, councilmembers, and pension board members who pressured them into capitulating? Nothing at all. And Shipione got slandered as a reward for blowing the whistle.

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Comments

JF May 21, 2008 @ 10:15 p.m.

Johnny, how about this quote from the website of Joseph Esuchanko.

"When designed properly, a Deferred Retirement Option Plan can be a plus for both the employer and employees. Cost-neutrality, however, is vital to the plan’s overall success."

http://www.ascpc.com/pbdrop.html

Once again I ask the question -- has an actuary proven that San Diego's system is not cost neutral? Not BS from the city attorney, real figures from an actuary. No? Why not?

Aguirre's "in depth" report says that "several actuaries have found it is not cost neutral", but oddly fails to tell us who or to footnote his report.

Oh, and since you want to quote from Aguirre's report, let's look at the first line. "The San Diego City Attorney is releasing this updated version of Interim Report 24 on 29 January 2009." Yes, it says 2009. Now that's awesome -- he's practicing time travel. Doesn't that make you wonder what else he screwed up?

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JohnnyVegas May 21, 2008 @ 11:53 a.m.

Where is JF when you need him to spin the facts >>>>?

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JohnnyVegas May 21, 2008 @ 12:02 p.m.

And Shipione got slandered as a reward for blowing the whistle.

Not to mention they were actually going to try to ARREST Shipione at one of the meetings.....Man, talk about some dirt bag politicians!

Too bad they didn't arrest her-she would have had the biggest false arrest lawsuit the City had ever seen!

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JF May 21, 2008 @ 2:30 p.m.

The facts? Rick Roeder didn't need to give his OK. Lowenstein claims that someone else browbeat him in to it. Or maybe he was just a crappy actuary. Or maybe he's a political scapegoat for the politicians stupidity. Your 'facts' are being spun by an author and further spun by a blog.

It's pretty interesting that the actuary currently hired by the city to evaluate the system says that DROP programs can be beneficial to cities. So why is ours supposedly breaking the system? Answer -- it's not.

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JohnnyVegas May 21, 2008 @ 4:01 p.m.

It's pretty interesting that the actuary currently hired by the city to evaluate the system says that DROP programs can be beneficial to cities.

Please post up where the current actuary said DROP is beneficial.

Drop is not cost neutral. Proven fact. I have a great solution to "keep" valued employees, RAISE the retirement age from the bogus 50 to age 67. Boom, problem solved.

Page 1, footnote 1.

http://www.sandiego.gov/cityattorney/reports/pdf/080130report24.pdf

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Don Bauder May 21, 2008 @ 7:55 p.m.

Response to post #1: JF wouldn't enjoy Lowenstein's book. But then, neither would establishment people, local politicians and lots of others. But it is MUST reading. Best, Don Bauder

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Don Bauder May 22, 2008 @ 7:31 a.m.

Response to post #9: Cost-neutrality is the key. And there is no way one can say that the San Diego DROP program is cost-neutral. Remember, the ballpark was supposed to be cost-neutral, too, and it's a big drain. Best, Don Bauder

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Don Bauder May 21, 2008 @ 7:57 p.m.

Response to post #2: Shipione is clearly the heroine. Her critics should have been tarred and feathered. But they are still establishment bigwigs. It's the Incest Preservation League at work. Best, Don Bauder

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Don Bauder May 21, 2008 @ 8:01 p.m.

Response to post #3: My facts are not being spun by an outta town author. I lived through this period, too, and wrote many columns on the demise. In reading the book, I was comparing what I knew to what he came up with; he did a remarkable job coming in from the outside and sizing up San Diego. If DROP is beneficial in some cities, and I doubt that it is, it sure isn't in San Diego. Best, Don Bauder

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Don Bauder May 21, 2008 @ 8:03 p.m.

Response to post #4: That is a solution: RAISE the retirement age considerably. These retirements at age 52 are ridiculous. Best, Don Bauder

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JohnnyVegas May 22, 2008 @ 7:52 a.m.

Mayor Jerry Sanders has done what he promised to do. He has returned San Diego to the bond market, and he did it without filing bankruptcy (as suggested by City Attorney Michael Aguirre), without raising taxes and without gutting the pension plan so important to current city retirees (as again suggested by Aguirre). And he did it in less than four years.

Bwahahahaha.... This was in the letters section of the UT this morning, and I never laughed so hard in all my life. She is either a Sanders staffer or has brain damage.

If this person is on the level and believes the things she wrote, and there are others like her, then this City will never recover.

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Don Bauder May 22, 2008 @ 7:14 p.m.

Response to post #11: Yes, that was an hilarious letter. I have had a couple of posts spouting similar sentiments. Best, Don Bauder

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Don Bauder May 23, 2008 @ 8:16 a.m.

Response to post #13: The fact that fumber worships Jerry Sanders is all you need to know about Sanders. Next, fumber will be saying what an honest public servant Jerry Brown is. Indeed, fumber, why have you not proposed that Jerry Brown go up on Mt. Rushmore? Best, Don Bauder

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Fred Williams May 23, 2008 @ 8:52 a.m.

Fortunately, most of the people I talk to when I'm knocking on voters' doors in the neighborhoods understand just what is happening. There are very few "fumbers" out there, but a lot of pissed off citizens who realize they've been lied to for ages by the corrupt establishment in San Diego.

What is encouraging is that even with the deliberate Sainz slanders and outright lies told about Aguirre, the people aren't fooled at all. They know what's going on. They know that we're in bad shape and Aguirre is one of the very few honest people left downtown.

It's only the barely literate blustering fools who cannot even form coherent written paragraphs and rant about wheatgrass who believe otherwise.

Best,

Fred Williams

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Don Bauder May 23, 2008 @ 10:36 a.m.

Response to post #15: That is encouraging. If San Diegans fall for the AG and S&P political capers, then citizens deserve more of what they are getting now: smoke and mirrors. Best, Don Bajuder

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