Lawrence J. McQuillan
is Senior Fellow and Director of the Center on Entrepreneurial
Innovation at the Independent Institute. Lawrence McQuillan is a
frequent media guest who has appeared on radio and television
outlets nationwide, including NPR, Fox Business, CNBC, CNN, and
C-SPAN. His writings have been featured in such publications as the
Wall Street Journal, New York Times, San Francisco Chronicle,
Chicago Tribune, Los Angeles Times, USA Today, New York Post,
Investor’s Business Daily, and Forbes. Lawrence McQuillan earned his
Ph.D. in economics from George Mason University, and previously
served in positions at the Hoover Institution, Illinois Policy
Institute, and Pacific Research Institute. He has also served as a
respected advisor for governments nationwide.
www.INDEPENDENT.org .
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California
Dreaming
Lessons on How to Resolve
America’s Public Pension Crisis
By Lawrence J. McQuillan
Washington, DC—A politically created crisis of epic proportions is
brewing across the United States. For decades, public pension
officials and politicians of both parties have promised their
employees increasingly generous retirement benefits—while
low-balling the contributions from government agencies and employees
that are required to cover these promises. As a result, state and
local governments from California to New York now face an impending
public pension tsunami—presenting our greatest financial challenge
since the Great Depression.
In CALIFORNIA DREAMING: Lessons on How to Resolve America’s Public
Pension Crisis (Independent Institute, June 2015) economist and
Independent Institute Senior Fellow Lawrence McQuillan exposes how
skyrocketing costs of public employee retirement benefits have
created a massive unfunded liability crisis. He describes the true
extent of the problem, explains the critical factors that are
driving public pension debt sky-high, and reveals the perverse
incentives of lawmakers and pension officials that reward them for
not fixing the problem and letting it escalate. Finally, he offers
the six crucial reforms needed to restore the financial health of
California—where the crisis is worst—and other threatened
jurisdictions in states and cities across the United States.
The total unfunded pension liability of state and local governments
across America has ballooned to a staggering $4.7 trillion. In
California, state, county, and city governments collectively can
meet only 51 percent of their total pension obligations. The
predicted $576 billion shortfall threatens to seriously disrupt
public services such as schools, roads, parks, libraries, police,
and fire departments; slash pension payouts to millions of public
retirees; hurt the investment portfolios of bondholders; trash the
credit ratings and borrowing capabilities of state and local
governments; and impose huge tax burdens on current taxpayers and
future generations.
This financial and moral crisis is not limited to California.
Massive public pension debt and pension costs are devouring
government services across the United States as similar problems
confront Connecticut, Florida, Illinois, New Jersey, New York, Ohio,
Pennsylvania, Texas, West Virginia, and other states, as well as
major cities such as Chicago, Los Angeles, New York, and
Philadelphia. Taxpayers are on the hook to make up the difference
between pension promises and pension assets. Immediate reform is
needed.
Lawrence McQuillan’s CALIFORNIA DREAMING provides an essential
roadmap for America on how to measure the true extent of the pension
crisis, identifies the political drivers of the crisis, and makes
compelling fiscal and moral arguments for the reforms needed to
permanently fix the problem. Lawrence McQuillan offers six reforms
that would solve California’s pension problem in an equitable,
responsible, and moral way by preserving pension benefits already
earned; allowing governments, if they choose, to provide competitive
defined-contribution pensions going forward to all employees; and
granting governments the flexibility needed, so that future
generations are not paying for deals they did not make. These same
reforms could be applied effectively anywhere in America.
And the specific recommendations—most of them already in place in
the private sector—would require financial transparency and full
annual funding of each pension plan without issuing “pension
obligation bonds.” Also, the reforms would give state and local
governments the flexibility to switch to sustainable 401(k)-style
defined-contribution pension plans going forward for all government
employees. Voters would also be required to pre-approve any pension
plan change that increases financial obligations. These reforms are
the crucial elements of a comprehensive solution. They would stop
the problem from getting worse, fully fund the pension plans without
severe hardships on future generations, and guarantee that the
crisis is never repeated.
To arrange an interview with California Dreaming author Lawrence
McQuillan, please contact Stephen Manfredi at:
Leighton Steward
is a geologist, environmentalist,
author, and retired energy industry
executive. He has written about the
reasons for the loss of much of the
Mississippi River delta (Louisiana's
National Treasure) and has given advice
on how the nation can achieve "no net
loss" of wetlands in the future; advice
that has been accepted by the EPA and U.
S. Corps of Engineers. Leighton was lead
author on a book about nutrition and
health (Sugar Busters) that gave advice
on how to lose weight and prevent and or
treat diabetes. The book became a #1 New
York Times Best seller for sixteen weeks
and made a significant contribution to
the changes that have occurred regarding
the availability of no-sugar-added,
higher fiber, and low-glycemic products
in the super markets. More recently, he
has written a book (Fire, Ice and
Paradise) that is an endeavor to educate
the non-scientist about the many causes
of global climate change so that the
reader will be better prepared to
understand what they hear, see, and read
about in the media and from the
politicians. In recognition of his many
environmental efforts, Leighton has
received numerous environmental awards,
including the regional EPA
Administrator's Award for environmental
excellence.
There
are competing points of viewregarding
the causes of climate change in our current
environment. One group has concluded that human
activities in the burning of fossil fuels have
increased the amount of CO2 in the atmosphere which
has caused a recent acceleration of a 300 year trend
of global warming. This point of view is usually
called "Anthropogenic (man-made) Global Warming" (AGW.)
The most prevalent alternative point of view is that
natural variations account for most, if not all, of
changes in climate. The professional conflict
between the advocates of these two hypotheses
generally comes down to a debate between AGW
advocates attempting to predict future climate
change
through unproven computer models, and the AGW
skeptics point of view based on observed data and
effects of CO2 on temperature changes in Earth’s
present and past climates. In addition, there is
often disagreement about how the existing climate
data is interpreted, and the conclusions drawn from
these interpretations.
continued
Leighton Steward's
significant work with a team of former NASA scientists known as “The
Right Climate Stuff” who have looked carefully at the science of
climate change. Their report concluded that there is no convincing
physical evidence of catastrophic human caused global warming. And
they’ve recently taken this message to the International Conference
on Climate Change.
Leighton Steward is a leading scientist, environmentalist, and New
York Times best-selling author. He contends that this global warming
alarmism is dishonest and should not be used as a scare tactic to
propose radical environmental policies. He argues that true
environmentalists should recognize that modestly rising carbon
dioxide (CO2) levels in the atmosphere have fueled a “greening” of
the earth that is good for plant life and human life.
President Obama has vowed to “respond to the threat of climate
change.” But a team of former NASA scientists with expertise in
physics, chemistry, geology, climatology, engineering, biology, and
other fields has carefully analyzed the evidence for global warming,
and has concluded that there is no evidence of catastrophic global
warming. They determined that current models are un-validated and
clearly deficient for climate forecasting, Earth's sensitivity to
CO2 is much less than commonly claimed, empirical evidence does not
support a catastrophic warming scenario, calling CO2 a "pollutant"
is scientifically embarrassing and we should not be spending huge
sums to reduce CO2 in light of the above. In fact, the team leader
projects a maximum of one degree Celsius of warming by the end of
this century based on a look back at empirical evidence.
Leighton Steward: “There is no convincing physical evidence of
catastrophic man-made global warming…This is not settled science and
this group supports more government-sponsored climate change
research to remove critical areas of prediction uncertainty.”
Leighton Steward: “Instead of attempting to make costly public
policy decisions of dubious effectiveness based on un-validated
computer simulations predicting earth’s future surface
temperature—we strongly recommend taking our time to improve our
knowledge of the critical factors driving temperature prediction
uncertainty…There is no impending climate disaster that requires
immediate action. We need to get the science right first, and then
determine the proper public policies. Forcing our nation to
prematurely use the most expensive energies in the world will kill
jobs and is a recipe for economic suicide.”