.

[no_such_reality]

[quote=CA renter]
And no, I’m not at all a fan of DC pension plans. IMHO, DB pension plans can absolutely work, but you have to keep everything in-house (no privatization!!!!), and use extremely conservative assumptions for both expenditures and returns. If that means that employees have to pay more/get less, so be it; but I want that to be decided only after the system is allowed to cleanse and heal itself…which will require a period of rather painful deflation, a shrinking wealth/income gap, and a more efficient/productive (and egalitarian, IMO) reallocation of resources.[/quote]

None of which will really occur. I’m not a fan of DB’s for one simple reason, a promise to pay someone starting in 30 years for the 30+ years after that is inherently fraught with risk and abuse. In a DC, your commitment is fulfilled in that year’s pay. It has a side benefit of eliminating the need for employees to ‘stick it out’ to get their max benefit payout.

It would take more money to do a DC. If I need to pay 1000 people $100K a year, I need a much smaller pile than if I need to plan to pay myself $100K a year.

[CDMA ENG]

[quote=CA renter]CE,

Opinions are fine, but you assert yours as if they are factual. They are not. You have yet to offer up any data, evidence, or logic to back up your claims, no matter how many times I’ve asked for anything factual or logical that would in any way prove your point.

The reason my posts are long is because I present facts, data, and logic (and there are plenty of facts and data to be found if you would only bother to look, which you don’t for some reason). Apparently, you find facts bothersome. Perhaps we should debate using only “opinions,” then?

The reason you consistently refuse to debate is because you can’t. There is nothing to back up what you’ve claimed, so you choose to make personal attacks, instead. You lose.[/quote]

Bullshit. I have NEVER made a personal attack so do not claim as such. Arguing with you is pointless so I choose not to… again if you read some to the “facts” that you proclaim I believe many readers would say that they are counter points to your claims.

Cutting and pasting articles from the web pretty much counts as opinions.

As far as personal attacks go… In the past I said that I believe you are misguided… But at least your heart is in the right place.

CE

[CA renter]

CE,

Believe it or not, my mind is open about this issue. If you (or anyone else) can prove to me that there is a net benefit to society when we privatize government assets, cash flows, and services, I will gladly change my mind. Until then, all anyone has ever offered is the same old rhetoric and propaganda from the privatization movement (who stand to benefit greatly…at the expense of taxpayers, consumers of government services, and workers), without any actual evidence to back up their arguments.

Feel free to use the articles that I’ve linked, most with supporting data citing the major studies regarding the problems with privatization. If you’ve found something there that counters my claim, please feel free to point it out.

And I may be wrong, but weren’t you part of the group who liked to refer to BG and I as the “anvil sisters,” because we have differing points of view — with both of us having worked in the public sector. And if I’m misguided, please clarify things for me so that I can get a better understanding of privatization and how it will save taxpayers money **in the real world** (vague theories and opinions don’t count). I follow these things very closely, and have never seen any evidence to support your claims, but you seem to think that you know more about it than I do…so please show us the evidence that supports your claims.

[livinincali]

[quote=CA renter]
Believe it or not, my mind is open about this issue. If you (or anyone else) can prove to me that there is a net benefit to society when we privatize government assets, cash flows, and services, I will gladly change my mind. Until then, all anyone has ever offered is the same old rhetoric and propaganda from the privatization movement (who stand to benefit greatly…at the expense of taxpayers, consumers of government services, and workers), without any actual evidence to back up their arguments.
[/quote]

I can envision a scenario where privatization of a government service would be more efficient, but most privatizations are not done in that manner. For the most part a privatization is a transfer of a government run monopoly to a private run monopoly. It’s the easiest to implement and the less disruptive to the people receiving the service.

Suppose the following scenario. City of San Diego gets rids of free trash pickup and opens up trash pickup to whoever would like to do it. Citizens would be responsible for picking and paying for a trash pickup service based on their need. You might see some people elect to drop off trash at the city dump themselves or they might elect to have somebody do it for them. You create quite a few low skilled jobs in the process and quite a few entrepreneurs that want to run trash hauling services.

After the initial disruption and turmoil this system would likely function at a lower cost and more efficiently than the current city system of picking up trash once a week on a scheduled day. Of course that disruption would be a painful process. Trash would likely pile up at some homes, illegal dumping would rise and other negative consequences would come out of it initially, but after a few years we’s likely find a nice balance.

Of course we’d never privatize in that manner because of those initial disruptions. Instead we’d likely hand a contract to one of the big existing commercial trash haulers and they would likely cost about the same. In their case the owners would likely get rich and the employees would suffer. But on the other hand if you opened it up to all comers and let the market figure it out you’d likely find cost savings and efficiency.

[spdrun]

A system as you’re describing is pretty common in rural American. I know people who own a farm in rural VT — they have to make a weekly dump run (or burn anything that’s paper/compost organics).

[SK in CV]

[quote=livinincali][quote=CA renter]
Believe it or not, my mind is open about this issue. If you (or anyone else) can prove to me that there is a net benefit to society when we privatize government assets, cash flows, and services, I will gladly change my mind. Until then, all anyone has ever offered is the same old rhetoric and propaganda from the privatization movement (who stand to benefit greatly…at the expense of taxpayers, consumers of government services, and workers), without any actual evidence to back up their arguments.
[/quote]

I can envision a scenario where privatization of a government service would be more efficient, but most privatizations are not done in that manner. For the most part a privatization is a transfer of a government run monopoly to a private run monopoly. It’s the easiest to implement and the less disruptive to the people receiving the service.

Suppose the following scenario. City of San Diego gets rids of free trash pickup and opens up trash pickup to whoever would like to do it. Citizens would be responsible for picking and paying for a trash pickup service based on their need. You might see some people elect to drop off trash at the city dump themselves or they might elect to have somebody do it for them. You create quite a few low skilled jobs in the process and quite a few entrepreneurs that want to run trash hauling services.

After the initial disruption and turmoil this system would likely function at a lower cost and more efficiently than the current city system of picking up trash once a week on a scheduled day. Of course that disruption would be a painful process. Trash would likely pile up at some homes, illegal dumping would rise and other negative consequences would come out of it initially, but after a few years we’s likely find a nice balance.

Of course we’d never privatize in that manner because of those initial disruptions. Instead we’d likely hand a contract to one of the big existing commercial trash haulers and they would likely cost about the same. In their case the owners would likely get rich and the employees would suffer. But on the other hand if you opened it up to all comers and let the market figure it out you’d likely find cost savings and efficiency.[/quote]

The only way this change would result in a net creation of jobs is if the private sector was LESS efficient than the city. All the current city waste employees would lose their jobs. The private sector will only do it if the work is profitable. I would assume that many current city waste workers would pick up work in private industry, probably at lower wages. But I doubt the cost to consumers would be less than the current cost to the city. A single provider will always be more efficient in providing service than multiple providers. (A single truck in each neighborhood v. multiple trucks from competing services in that same neighborhood.) Personally, I’d rather have the higher wages going to the city workers and cut out the profit.

[SD Realtor]

SK I think your assumption is incorrect because you are neglecting to factor in the recurring fees that stick with the taxpayers long after that city employee retires. It may be a wash for the actual cost of running the business but the long term cost to the consumer is substantially less.

So I would rather pay the private company to do the job, even if it a little bit more costly now, rather then fund the garbage man’s pension and health care for life.

[SK in CV]

[quote=SD Realtor]SK I think your assumption is incorrect because you are neglecting to factor in the recurring fees that stick with the taxpayers long after that city employee retires. It may be a wash for the actual cost of running the business but the long term cost to the consumer is substantially less.

So I would rather pay the private company to do the job, even if it a little bit more costly now, rather then fund the garbage man’s pension and health care for life.[/quote]

If done correctly, the pension costs are annual expenses, not perpetual. I acknowledge that it hasn’t efficiently been done that way in the past. Though come to think of it, I have no idea how well funded the city of SD pensions are. If they’re fully funded, there are no perpetual costs.

If it’s a little bit more costly now, it will be much more costly in the future. Guaranteed. As soon as Waste Management has 50% of the market, they’ll jack up prices.

[SD Realtor]

I think there is ample evidence to show they have not been done correctly. Similarly I believe it is impossible to correctly forecast the cost of future liabilities more then a year or two in advance and then accurately predict that a given return will cover those liabilities. To compound that problem and guarantee a given return is foolish. Furthermore there is no incentive for pensions to be run correctly given that they will be bailed out by state and now even federal coffers. Why not take the higher risk for a better return? We don’t make enough to fund the liability with a less risky yield, and if we lose the money it will be covered so what the hell does it matter?

Also you may want to read up on the financial health of the SD pensions especially with respect to unfunded liabilities.

Similarly given the financial health of most large municipalities across the nation with respect to pensions and unfunded liabilities, evidence would indeed corroborate that pension costs are perpetual expenses, and unfunded liabilites have sky-rocketed. The ony strategy the municipalities have is to dump retirees off to Obamacare.

I would rather pay for the service as provided. If I don’t like the cost I will haul the crap to the dump and pay the dump fees.

[The-Shoveler]

The other elephant in the room with regard to adequate funding is Pension spiking.

This got so bad in L.A. It was epidemic!!
The last mayor was trying to reform to end the practice but I am unsure if they actually passed it.

They were going to raise the retirement age to 65 as well

Well at least CalPers did end that.

[SK in CV]

[quote=SD Realtor]I think there is ample evidence to show they have not been done correctly. Similarly I believe it is impossible to correctly forecast the cost of future liabilities more then a year or two in advance and then accurately predict that a given return will cover those liabilities. [/quote]

Bolderdash. Annuity companies have been doing it for generations. You want to argue that pensions are too high? Fine. You may have a point. You want to argue that pension funds and current funding have been mismanaged? Fine. You’re probably right. You want to argue that return assumptions have been too high? Fine. It’s arguable. (The city pension fund has earned 8% per year the last decade.) None of those refute the fact that annuity companies have accurately and successfully predicted future costs, some for over 100 years.

[Leorocky]

You are correct. There are 2 problems with “privitazation” and both lie with the politicians and their cronies who implement it.

1 – it rarely happens in the manner you just described. In your scenario some people might have to pay more for trash p/u. Some less. Some will do it themselves. Point being, it’s up to us.

What usually happens is the city locks in a contract with a private sector entity that you are required to use. We’re told they are picked based on cost but in reality it’s whomever wined and dined the right people.

Sure the contract looks good on paper – youre replacing a bunch of unionized workers with $12/hr workers. But the same government mentality seeps in.

“the contract assumes X% growth in population such that in 15 years garbage p/u will have doubled….sounds good to us”

because we all know that home prices and the market and wages always go up in a straight line, right? And innovation never occurs. Nothing ever changes.

2 – when the privitazation occurs the upfront payment and the savings are just tossed back into the system to pay for shortfalls or new spending instead of immediately being returned to taxpayers. If they want that savings for other things let us vote on it.

Also, instead of canning the old garbage men we insist they get picked up by the private co (increasing their costs) or moved to other city jobs where they keep their pay and bene’s.

[no_such_reality]

Privatization runs into many of the same problems outsourcing does. They fail for a very simple reason. The entity that is privatizing or outsourcing doesn’t allow the provider to improve or change the process.

They take a broken process, move it to a new provider and keep a management layer to oversee the new provider and then wonder why it isn’t cheaper and service is decreased when the new provider needs to follow the exact same procedures that the original provider followed.

[SD Realtor]

Except that annuity companies are not backstopped by taxpayers.

[SK in CV]

[quote=SD Realtor]Except that annuity companies are not backstopped by taxpayers.[/quote]

Whole different issue. That’s immaterial to your claim that it’s “impossible to correctly forecast the cost of future liabilities more then a year or two in advance and then accurately predict that a given return will cover those liabilities.”

It IS possible.

[Author]

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