[quote=Allan from Fallbrook]
My point is that municipalities and states will always spend to their level of income and that these various Treasurers, Controllers and Comptrollers have NO business being in the business of investments that they don’t understand. The reason I gave the investment “opportunity” a miss, was that I didn’t understand a friggin’ word this guy was telling me (and I suspect he didn’t know fuck-all about the investments, either) and it seemed too good to be true. When you have CalPERS predicating pension payouts on an annualized 8% rate of return EVERY year, well, at some point the chickens come home to roost. And here we are.[/quote]
One thing future polititians should look at is how to incentivize savings within government. I surmise that there is not much incentive for a given department to not spend up to their level of income because then they have a surplus and they know that surplus will be cut or transferred away in the next budget cycle. The “saving for a rainy day” concept doesn’t seem to even enter the picture. There will always be other areas that need funding, so if education has a surplus one year and CalTrans doesn’t, then the education funds will be wiped out to pay for road fixes. I don’t have any answers but I think this is one idea that needs careful consideration.
