Calif. city seeks to escape soaring pension costs

March 7, 2012
Ben Tracy

Steven Greenhut, now vice president of the Franklin Center for Government and Public Integrity, penned this powerful piece in the Washington Examiner Friday, March 9

Manhattan Moment: Fiscal mess coming soon to a city near you

Stockton, Calif., a hard-pressed industrial city of nearly 300,000 people in the agriculturally lush Central Valley 80 miles east of San Francisco, is grabbing national headlines because it might become the largest U.S. city yet to enter Chapter 9 bankruptcy.

First, it must go through a 90-day mediation process mandated by a new California law designed to put the brakes on an expected wave of municipal bankruptcies. But the city is out of cash, and other cities aren’t far behind.

Stockton’s situation epitomizes the reality of local government in California today: City governments don’t exist to provide services to the public, but function mainly to dispense high salaries and pensions to the people who work for the government.

Ninety-four of Stockton’s retirees, for instance, receive six-figure pensions, placing them among a rapidly growing list of 15,000 California public retirees in the $100,000 pension club. Click here to read more.