Friday, April 04, 2014

California State Teachers Retirement System

What?  Here in sunny California, the Golden State, where everything is hunky-dorey and Obamacare is praised in story and song--here in California, the teachers retirement system is going broke?  Who would ever have thought such a thing?
CalSTRS said Thursday that its long-term funding shortfall has risen to $73.7 billion, a stark reminder of the financial issues facing the teachers’ pension fund.

The newest tally reflects CalSTRS’ financial condition as of last June 30. The pension fund said the shortfall grew by $2.7 billion in the 12 months since the previous valuation of June 30, 2012.
What fraction of the state budget is that $74 billion? Page 3/54 here shows it to be about half the current annual state budget.

Read more here:


maxutils said...

Let's be fair. CA teaches and state employees don't pay in to FICA ... which is also going bankrupt. These employees pay the same percent of tax, but they are completely separate. Thing is? For a very, very long run, both organizations were virtual investment wizards, outperforming most mutual funds. Now, with the stock market crash and gradual recovery? They are in trouble. But at least their pay offs are based on something real-ish. Social Security just comes from the government ... no questions asked.

pseudotsuga said...

This is why I don't bother looking for teaching jobs in Cali...