Utopian Union Fantasy: What If Every California Worker Made What City of Irvine Workers Make?

This is a guest post written by Ed Ring, editor of UnionWatch, a project of the California Public Policy Center. Ed Ring asks What If Every Worker Made What City of Irvine Workers Make?

Everything that follows is from Ed Ring.

“Jennifer Muir, a spokeswoman for the Orange County Employees’ Association, which represents more than 18,000 public employees in Orange County, said the California Public Policy Center’s study was a politically motivated attack on public employees and unions. Aside from promoting the center’s anti-public employee union agenda, Muir said, the reports are misleading and shift focus away from the discussions that matter most. Union leaders have long urged for people to consider the possibility that private-industry employees are being undercompensated and should receive retirement benefits and health coverage.”
 
Orange County Register, April 19, 2013

The study Muir refers to, entitled “Irvine, California – City Employee Compensation Analysis,” was published on April 8th, 2013, by our parent organization, the California Public Policy Center. To call this study “a politically motivated attack on public employees and unions,” as Muir alleges, is itself a distraction. It’s easy, and necessary, to impugn the motives behind information when the information itself is so embarrassing.

As noted, Muir went on to accuse the study of “shifting focus away from the discussions that matter most… that private-industry employees are being undercompensated.”

Let’s recap some of the facts regarding Irvine’s city employee compensation, drawing both from the CPPC study (which itself used payroll data provided by the City of Irvine), as well as from the Orange County Employee Retirement Systems 2011 Annual Report:

• The average City of Irvine employee receives direct pay of $ 95,751 per year, and when the cost of employer paid benefits is included, this average goes up to $ 143,691 per year (Source: CPPC Study, Table 1.



 


• The average participant in the Orange County Employee Retirement system who worked 25-30 years and retired last year collects a pension of $ 70,920 per year. If they worked 30 years or more, like virtually every private sector worker, that average goes up to $ 81,192 per year (Source: OCERS Annual Report, page 109.

Now let’s suppose that private industry employees are indeed being undercompensated. What are the economic implications of paying them a proper living wage à la Irvine – and every other unionized public sector job in California? Here are some facts:

• In 2010 there were 8.3 million residents in California over the age of 55, which is the age by which a public employee may reasonably be assumed to have logged 30 years – assuming they completed their education by age 25 and entered the workforce for a full career in public service (source: U.S. Census Bureau.



 


• Also In 2010, the GDP of California – its entire economic output – was $ 1.9 trillion (source: LA Times).This means that if everyone over the age of 55 in California got a pension of $ 70,000 per year, it would cost $ 581 billion per year, 31% of California’s entire economic output. Ms. Muir is invited to explain exactly how we’re going to accomplish this.



 


• Using the same census data, in 2010 there were 15.8 million people between the ages of 25 and 55. Assume that two-thirds of these people work full-time, and the other one-third are unemployed spouses, stay-at-home parents, or are otherwise supported by a working partner. If every one of these 10.5 million people collected total compensation of $ 140,000 per year, this would cost $ 1.47 trillion per year, or 77% of California’s entire economic output.

So according to this utopian vision, if everyone could just receive the same compensation packages as the average full-time worker for the City of Irvine, it would consume 108% of California’s entire economic output.

There’s a bit more to this, however. In the real world, wages and salaries fluctuate between around 44% and 54% of GDP (source: TelltaleChart.org).

We may argue over what share of GDP legitimately belongs to workers vs. corporations – bearing in mind that corporate profits are an absolute necessity for a public sector pension plan to have any hope of remaining solvent, and these profits are also necessary to invest in equipment and conduct R&D if we are to have any hope of remaining an economically viable nation – but let’s use an unprecedentedly generous proportion.

Let’s assume that 60% of California’s GDP is comprised of wages, benefits, and pension payments.
To complete this thought, we’re now going to have to indulge in some basic algebra (T=trillion), one of those nasty tools of analysis that never plays well in a 30 second TV commercial, but nonetheless is an ideal tool to express cold quantitative reality, rather than utopian union fantasies:

[ .58T (pensions) + 1.47T (wages) ] / .6 (40% for corp. profits) = GDP of 3.48T

Isn’t that terrific? All we have to do is wave a wand and instantly, we’ll nearly double California’s GDP from $ 1.9 trillion per year to 3.5 trillion per year. Nobody will be “undercompensated” any more! Then we can afford to implement this compelling vision of social justice – total compensation of $ 140,000 per year for every full-time worker, then after 30 years, a pension of $ 70,000 per year. It should be easy. Perhaps new legislation is called for.

End Guest Post

Ed and I frequently trade guest posts on subjects related to unions wages, pensions, and the precarious state of California’s economy.

If you are interested in such matters, you may wish to Subscribe to UnionWatch.

Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com

Mike “Mish” Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Mish’s Global Economic Trend Analysis

Utopian Union Fantasy: What If Every California Worker Made What City of Irvine Workers Make?

Utopian Union Fantasy: What If Every California Worker Made What City of Irvine Workers Make?

This is a guest post written by Ed Ring, editor of UnionWatch, a project of the California Public Policy Center. Ed Ring asks What If Every Worker Made What City of Irvine Workers Make?

Everything that follows is from Ed Ring.

“Jennifer Muir, a spokeswoman for the Orange County Employees’ Association, which represents more than 18,000 public employees in Orange County, said the California Public Policy Center’s study was a politically motivated attack on public employees and unions. Aside from promoting the center’s anti-public employee union agenda, Muir said, the reports are misleading and shift focus away from the discussions that matter most. Union leaders have long urged for people to consider the possibility that private-industry employees are being undercompensated and should receive retirement benefits and health coverage.”
 
Orange County Register, April 19, 2013

The study Muir refers to, entitled “Irvine, California – City Employee Compensation Analysis,” was published on April 8th, 2013, by our parent organization, the California Public Policy Center. To call this study “a politically motivated attack on public employees and unions,” as Muir alleges, is itself a distraction. It’s easy, and necessary, to impugn the motives behind information when the information itself is so embarrassing.

As noted, Muir went on to accuse the study of “shifting focus away from the discussions that matter most… that private-industry employees are being undercompensated.”

Let’s recap some of the facts regarding Irvine’s city employee compensation, drawing both from the CPPC study (which itself used payroll data provided by the City of Irvine), as well as from the Orange County Employee Retirement Systems 2011 Annual Report:

• The average City of Irvine employee receives direct pay of $ 95,751 per year, and when the cost of employer paid benefits is included, this average goes up to $ 143,691 per year (Source: CPPC Study, Table 1.



 


• The average participant in the Orange County Employee Retirement system who worked 25-30 years and retired last year collects a pension of $ 70,920 per year. If they worked 30 years or more, like virtually every private sector worker, that average goes up to $ 81,192 per year (Source: OCERS Annual Report, page 109.

Now let’s suppose that private industry employees are indeed being undercompensated. What are the economic implications of paying them a proper living wage à la Irvine – and every other unionized public sector job in California? Here are some facts:

• In 2010 there were 8.3 million residents in California over the age of 55, which is the age by which a public employee may reasonably be assumed to have logged 30 years – assuming they completed their education by age 25 and entered the workforce for a full career in public service (source: U.S. Census Bureau.



 


• Also In 2010, the GDP of California – its entire economic output – was $ 1.9 trillion (source: LA Times).This means that if everyone over the age of 55 in California got a pension of $ 70,000 per year, it would cost $ 581 billion per year, 31% of California’s entire economic output. Ms. Muir is invited to explain exactly how we’re going to accomplish this.



 


• Using the same census data, in 2010 there were 15.8 million people between the ages of 25 and 55. Assume that two-thirds of these people work full-time, and the other one-third are unemployed spouses, stay-at-home parents, or are otherwise supported by a working partner. If every one of these 10.5 million people collected total compensation of $ 140,000 per year, this would cost $ 1.47 trillion per year, or 77% of California’s entire economic output.

So according to this utopian vision, if everyone could just receive the same compensation packages as the average full-time worker for the City of Irvine, it would consume 108% of California’s entire economic output.

There’s a bit more to this, however. In the real world, wages and salaries fluctuate between around 44% and 54% of GDP (source: TelltaleChart.org).

We may argue over what share of GDP legitimately belongs to workers vs. corporations – bearing in mind that corporate profits are an absolute necessity for a public sector pension plan to have any hope of remaining solvent, and these profits are also necessary to invest in equipment and conduct R&D if we are to have any hope of remaining an economically viable nation – but let’s use an unprecedentedly generous proportion.

Let’s assume that 60% of California’s GDP is comprised of wages, benefits, and pension payments.
To complete this thought, we’re now going to have to indulge in some basic algebra (T=trillion), one of those nasty tools of analysis that never plays well in a 30 second TV commercial, but nonetheless is an ideal tool to express cold quantitative reality, rather than utopian union fantasies:

[ .58T (pensions) + 1.47T (wages) ] / .6 (40% for corp. profits) = GDP of 3.48T

Isn’t that terrific? All we have to do is wave a wand and instantly, we’ll nearly double California’s GDP from $ 1.9 trillion per year to 3.5 trillion per year. Nobody will be “undercompensated” any more! Then we can afford to implement this compelling vision of social justice – total compensation of $ 140,000 per year for every full-time worker, then after 30 years, a pension of $ 70,000 per year. It should be easy. Perhaps new legislation is called for.

End Guest Post

Ed and I frequently trade guest posts on subjects related to unions wages, pensions, and the precarious state of California’s economy.

If you are interested in such matters, you may wish to Subscribe to UnionWatch.

Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com

Mike “Mish” Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Mish’s Global Economic Trend Analysis

Utopian Union Fantasy: What If Every California Worker Made What City of Irvine Workers Make?

Mystery missile over California

Mystery missile over California

California Court: Checking Maps On Your Phone While Driving is Illegal

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For years, we’ve discussed the problematic nature of “distracted driving” laws that seek to outlaw things like talking on your phone or texting while driving.

 by Mike Masnick
Tech Dirt
April 8, 2013

It is not that we don’t think these behaviors are dangerous. It seems clear that those activities can take one’s attention away from driving and potentially increase the likelihood of an accident by a significant amount. However, the laws are often broad and inconsistent — and, worse, they can have serious unintended consequences. As we’ve noted there are lots and lots of things that can distract a driver which are still considered perfectly legal, such as changing the radio station, talking to passengers, eating, etc. Trying to ban each and every distraction one by one is a ridiculous and impossible task. In fact, studies have suggested that bad distracted drivers will often just find a different distraction to occupy their time. And, thanks to these laws, those drivers are often still texting while driving, but are simply holding their phones even lower, taking their eyes further off the road, so as to avoid detection… actually making the roads more dangerous. The real answer is to focus on stopping bad driving, not trying to call out specific activities.

Anyway, all of that is preamble to a new court ruling in California, found by Orin Kerr, saying that using a mobile phone to check a mapping/GPS program violates the state’s law against distracted driving. The driver had argued that the laws are about talking on a phone and/or texting/surfing the internet, but that clearly using a mapping program should be allowed. The court disagreed, even as it acknowledged some of the oddities of what that meant, and said it’s really the job of the state lawmakers to figure out what they want to do.

The ruling doesn’t totally rule out using a phone’s mapping program, but does suggest it needs to be set up in a manner where it is done handsfree, where the driver does not need to hold or touch the phone. Basically, the ruling suggests that it’s mostly illegal to touch your mobile phone while driving. The driver noted that this interpretation didn’t make much sense, since the legislature had felt the need to add a specific clause to outlaw texting/messaging on phones, but if the overall bill banned any non-hands-free operations, then that would have already been covered. The court disagrees, claiming (oddly) that the added provision also served the purpose of banning non-telephone mobile devices. That may be true, but doesn’t explain why that provision also called out messaging services for telephones.

All that said, I generally agree that if you are using mapping software it is probably a hell of a lot safer to somehow have it mounted on your dash, rather than in your hand — but still this ruling seems to once again highlight the oddities of these particular laws, and how confusing and ineffective they can be.

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California Court: Checking Maps On Your Phone While Driving is Illegal

Mystery missile over California

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Mystery missile over California

California Photojournalist Detained for Photographing Naval School From Public Street

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A photojournalist was illegally detained after he photographed the entrance to a naval school from a public street in California this week.

by Carlos Miller
PINAC
April 6, 2013

Nic Coury, who shoots for the Monterey County Weekly, said he was on assignment to photograph the Naval Postgraduate School when he was ordered inside the guardhouse and told it was a “national security issue” to photograph the school.

He wrote about the incident on Sports Shooter, which consists of mostly professional photojournalists who work for the mainstream media.

I was detained today while taking photos of a military school in town for a story we’re putting together on the school.

I was on public property the entire time—the city sidewalk—and the places I was photographing could be seen by any passer-by, etc. I was shooting photos of the main gate where cars and military personnel enter and exit the campus after they check in with a gate guard, who I think it an MP.

I was asked by the gate guard to follow him and was told to sit in the guard house while the guard called his supervisor and I asked why I was being held, to which his answer was, It’s “very illegal” to shoot photos of the school. It’s a national security issue.”

I explained my position of shooting from a very public place and asked if everyone who shot a photo of the school was detained and he said yes.

I was eventually let go after they determined I wasn’t a threat and my editor called they school’s PR folks whom we have been working with for a few weeks on the story and they confirmed who I said I was and what my press ID and driver’s license said I was.

All in all, it was like 30 minutes of my time.

I’m curious on the legality of their claims that it’s “very illegal” to photo a military base/school, even from a totally public place.

Some of the responding commenters gave him some good advice but one commenter advised him to call the school’s public affairs department days in advance next time he plans to shoot to avoid any such hassle.

It sounds like you need to work closer with the Public Affairs Office and let them know several days in advance, what day and time you will be there and where you will be. Then they can let the appropriate people know so when they ask you about what you’re doing they will know about it. Even better would be to meet with someone from the Public Affairs Office and have them as a guide even for areas you think are public property.

While that might seem like the polite thing to do, one should not have to go through such measures to take pictures from a public street.

And this is exactly the problem I see with so many mainstream journalists; this insistence on avoiding confrontation even when confronted.

In fact, one of the commenters advised against notifying me of the incident because I tend to be confrontational.

Personally I would leave Carlos Miller out of this. Mickey would be a good call, but Carlos, despite never really being wrong, tends to be more confrontational and sensational for the sake of being confrontational and sensational sometimes, and I don’t think thats needed.

I’m not bothered by that comment because he acknowledged that I do get it right, but how confrontational can I get over this story when I’m all the way in Miami?

The unfortunate fact is that the Monterey County Weekly will never report on this incident in order to not be confrontational.

And that’s exactly why these authority figures believe they can keep getting away with this unlawful behavior.

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California Photojournalist Detained for Photographing Naval School From Public Street

...And If You Call Now, You Can Get $2 Billion In California Bonds At A Low, Low Price

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Presented with little comment aside to note the ‘special’ pre-sale ends April 10th – Your State Needs You! Of course, if California wants to really sell these bonds, they should take a page out of Japan’s book – Sex sells Bonds.

 

 

which while well written has nothing on Japan…

Zero Hedge

...And If You Call Now, You Can Get $2 Billion In California Bonds At A Low, Low Price

California thirsty for blood

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California thirsty for blood

About That Surprise California Budget "Surplus": There is No Surprise and No Surplus Either

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Last month writers were all aglow on the state of finances in California. For example …

• The Christian Science Monitor reported Surprise! California has a budget surplus
• Reuters reported California Governor’s budget has surprise: a surplus

Accounting Anomaly

Today we learn the surprise $ 5-billion bump in revenue in January is likely an accounting anomaly as a result of tax changes.

The surge of revenue that showed up unexpectedly in state coffers last month may well be offset by a revenue dip in coming months, according to Gov. Jerry Brown’s administration. The surprise money has been the source of much speculation in the Capitol. Unanticipated tax receipts filled state coffers with more than $ 5 billion beyond initial projections for January — more tax dollars than are allocated to the entire state university system in a year.

The revenue bump was historic. But the question for budget experts was whether lawmakers could begin allocating the windfall toward government programs and tax breaks — or whether the money amounted to an accounting anomaly.

Brown’s budget office now advises in an official cash report that it is probably the latter. The report says the extra money was “likely the result of major tax law changes at the federal and state level having a significant impact in the timing of revenue receipts.”

That is: Taxpayers were paying a share of their bill early, getting income off their books in the hope of limiting exposure to the tax hikes that recently kicked in.

Surprise! Surprise! Surprise!

There is no surprise. Are you surprised by the non-surprise? I am not.

Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com

Mike “Mish” Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Mish’s Global Economic Trend Analysis

About That Surprise California Budget "Surplus": There is No Surprise and No Surplus Either

Why the Gun Lobby Is Terrified of California

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California would ban the sale of all semiautomatic rifles that accept removable magazines, slap a hefty tax on ammo, and require every gun owner to take a yearly safety course under a new package of firearms laws that would give the Golden State the nation’s strongest gun controls.

These and many other proposed firearms laws were announced late last week by leading state Democrats and the mayors of San Francisco and Los Angeles. Many of the laws are expected to pass, in part because the Democratic Party in California now controls the governor’s mansion and a supermajority in the Legislature.

“As it is with many issues, California is out front on firearms regulations,” said Mark Hedlund, a spokesman for California Senate President Pro Tem Darrell Steinberg. “We don’t represent the NRA. We don’t think that the NRA represents the majority of Californians, by a long shot.”

California’s newly proposed gun laws would:

• Ban the possession of ammunition magazines that hold more than 10 rounds
• Prevent the future sale, purchase, manufacture, importation, or transfer of any firearms that can accept detachable magazines
• Close the “bullet button” loophole by banning tools that allow the quick changing of gun magazines
• Regulate ammunition sales like the state regulates gun sales. Ammunition dealers would need to be licensed and anyone buying from them would need to obtain a permit and complete a background check.
• Create a 5 cent tax on each bullet purchased, for the purpose of funding crime prevention
• Prevent felons and other adults barred from gun ownership from living in a house that contains any guns
• Prohibit the loaning or sale of a firearm between people who know each other personally
• Take steps to phase out legal possession of assault weapons that were purchased before California outlawed their sale
• Require all firearms owners to take an hours-long gun safety course every year, similar to what the state now requires for obtaining a concealed-weapon permit
• Require gun owners to purchase insurance to cover damage they may inflict
• Require CalPERS and CalSTRS, two of the nation’s largest pension funds, to divest from companies that make, sell, or market firearms or ammunition

California has already enacted some of the nation’s strictest gun control laws, partly due to its experience with a Sandy Hook-style massacre: In 1989, a mentally unstable ex-con opened fire with an AK-47-style assault rifle on an elementary school playground in Stockton, killing five schoolchildren and wounding 28 others. The shooting contributed to the passage that year of California’s assault weapons ban.

Somewhat uniquely, California’s state constitution doesn’t guarantee the right to bear arms. The Golden State gives its cities the option of refusing to issue concealed-carry permits and doesn’t recognize permits issued by other states. It requires the reporting of all handgun sales, and it cross-checks the data against the names of convicted criminals and violent mental patients. And unlike most states, it requires background checks for firearms purchases between private parties, closing a loophole that accounts for 80 percent of gun acquisitions made with intent to carry out a crime.

Since the passage of California’s strict gun rules, the incidence of mass shootings has plummeted. “California used to be the mass-shooting capital of the country, but instead of throwing up their hands, they addressed the problem head-on and are reaping the benefits,” says Julie Piotrowski, a spokeswoman for the Violence Policy Center, a pro-gun-control group. “Their success will most certainly inspire action in other states and at the federal level.”

If enacted, the new laws might do for guns what California’s pollution and fuel economy rules did for the nation’s automobiles. In 2011 alone, Californians bought 600,000 firearms; only Texas sports more registered weapons. “The gun industry has a love/hate relationship with California,” Hedlund says. “They hate our gun regulations because they are among the toughest in the country, but they love our marketplace.”

Not to mention how the state essentially does their marketing. No matter what, the weapons industry can rest assured that there will be no shortage of guns in Clint Eastwood flicks.

Politics | Mother Jones

Why the Gun Lobby Is Terrified of California

California Scientists Say Marijuana Compound Cures Cancer

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SHADE the Motion Picture – An Ambellas & Bermas Film — Watch NEW Trailer 3

By Sarah Dee
theintelhub.com
February 12, 2013

The Huffington Post reports that two researchers in San Francisco, California have made the astonishing discovery that the compound called cannabidiol, or CBD, extracted from the marijuana plant, could help stop the spread of cancer.

Cancer is spread by genes called ID-1’s and when Pierre Desprez and Sean McAllister combined their research knowledge they also combined cannabidiol with these killer ID-1 cells in a petri dish and this is what they found:

“What we found was that his Cannabidiol could essentially ‘turn off’ the ID-1,” Desprez told HuffPost.

The cells stopped spreading and returned to normal (1).”

If these findings are as promising as they seem it would mean people all over the world who are afflicted with cancer could have hope for a cure.

Studies in laboratories and on animals have shown similar results and now Desprez and McAllister are eager for human clinical trials to begin. These trials are still waiting on approval.

The pair of scientists first posted a paper on the subject back in 2007 and here are a few telling excerpts from the abstract (1):

“Here, we report that cannabidiol (CBD), a cannabinoid with a low-toxicity profile, could down-regulate Id-1 expression in aggressive human breast cancer cells (2).”

“In conclusion, CBD represents the first nontoxic exogenous agent that can significantly decrease Id-1 expression in metastatic breast cancer cells leading to the down-regulation of tumor aggressiveness (2).”

When considering the progress that could have been made into CBD cancer-cure research in the six years since this paper was published it is rather disheartening.

Many people have been diagnosed since then, but the outlook thanks to this discovery is hopeful and the research that has been done points to a cure for this devastating illness.

“We started by researching breast cancer,” said Desprez.

“But now we’ve found that Cannabidiol works with many kinds of aggressive cancers–brain, prostate–any kind in which these high levels of ID-1 are present.”

Desprez hopes that clinical trials will begin immediately (1).”

Certainly cancer patients would agree, in light of this promising research. If marijuana were legal in all fifty states it would cut through the red tape that has been impeding research into this field for years.

Colorado and Washington will have to take the lead on the front of cannabis-based cancer-cure research for now, or until the human clinical trials are approved in California.

Sources:

(1) Wilkey, R. (2012, September 19). Marijuana and cancer: Scientists find cannabis compound stops metastasis in agressive cancers. The Huffington Post.

(2) McAllister, S. D., Christian, R. T., Horowitz, M. P., Garcia, A., & Desprez, P. Y. (2007). Cannabidiol as a novel inhibitor of id-1 gene expression in aggressive breast cancer cells. Molecular Cancer Therapeutics, 6(11), 2921-7

Read more articles by this author HERE

Sarah Dee is a University of Texas graduate and animal lover who enjoys writing, reading, and living in the Lone Star State.

She is also a guest co-host on Truth Exposed Radio Show and an investigative journalist for theintelhub.com a popular alternative news website.

Follow Sarah Dee on Twitter @Sarah_Bee86

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California Scientists Say Marijuana Compound Cures Cancer