Home / Debt / Stockton, California Emerges from Banpruptcy. Will It Cut Pension Payments?
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Stockton, California Emerges from Banpruptcy. Will It Cut Pension Payments?

Written by Gary North on April 2, 2013

The City of Stockton has officially gone bankrupt. But it is still paying pensions. The other creditors are complaining. What entitles pensioners to get paid, when no one else is getting paid? The judge overruled them.

But if Stockton gets away with this, the California pension system will be in trouble. Cities will stop contributing as much.

The city is a disaster. But it has always been a disaster: a crime-ridden city. Its crime rate has been two times higher than the nation’s for as long as City-Data has kept records.

It is cutting services even more.

The city borrowed to make payments into the California Public Employees Retirement System (CALpers). These lenders just got stiffed. So, who will be the next victims?

Stockton owes CALpers $900 million. It is not alone.

The other creditors will appeal the ruling against them.

CALpers is in big trouble. It is in the hole $87 billion out of $255 billion in assets.

Lots of other cities are unfunded.

This will drag on for years.

When the checks from Washington bounce, state and local pension programs will go under.

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10 thoughts on “Stockton, California Emerges from Banpruptcy. Will It Cut Pension Payments?

  1. The Big Easy says:

    This is just where the whole country is headed with this administration doing the garbage it is doing.———–What a bunch of pukes———————-

  2. There are only two ways for things like this get stopped. The first is in a healthy democracy where laws are enforced. That doesn’t seem to be happening these days with the clowns who are in power in California or with the clowns in Washington D.C., for that matter. The second way usually involves providing water for that thirsty old liberty tree that Jefferson talked about.

  3. Bill McCroskey says:

    Just like GM stiffing everyone BUT the UAW be taking bankruptcy …. lots of votes there for Democrats ….. creditors, stockholders, bondholders be damned …. typical …. crony capitalism.

  4. Public sector Unions have been well taken care of in California. Gotta give the Democrats credit – they will dance with the ones who brought them, to the point of pain if necessary.

    Republicans, it seems, would at times rather be popular than to do the right thing by their friends (even if that right thing hurts everyone else).

    Pity – the original idea for public sector unions was to protect low level government workers from being maced. Some folks can't leave a good thing be it seems. Turning a protection into racketeering.

  5. GM did this because saving the UAW from the consequences of its own short sightedness and greed was either a tacit or implied part of the Bailout. GM management also went along because white collar workers get similar benefits to UAW people.

    The amusing part is that GM took some of the bailout money and upgraded operations in Mexico and China. This will help them funish money for those UAW people AND the legions of white collar employees at GM.

    Jobs? Like most anything involving an attorney, and the Democrats are a party of an for attorneys, you have to "read the fine print". The fine print was "GM Jobs" and not "Manufacturing Jobs".

  6. I agree but I am hard pressed to figure out what to do about it. I know it has been stupidity on steroids under Obama and the democrats, but I also know the republicans are to blame also.
    I say if you are suppose to be a public servant and the only one being served is you. You need to go, possibly to prison. We have a government that makes laws for everyone other than themselves. Everything the government does form social security on to the smallest thing is a disaster.
    We the people are waiting for the people that caused all this misery to fix it. Now what can be more stupid than that. Electing who may run against them will not work. they will be just as bad if not worse.
    We have to change the way business is done so they do not avoid being part of the people rather than the problem. The government does not use the postal system and the postal service is advertising for us to use it. It is corrupt and will not change on it's own. Who is our savior? It isn't anyone we have seen running lately. Who is the superman or woman that will actually do the job? Ross Perot was the closest we have seen, but who will take his place? Who can defeat the power houses we have in place?

  7. With the white house visitors closed down and the air traffic controllers put out of work because supposedly the sequester has kicked in. Have you heard how much the white house spends on vacations and staff and the dog groomer and all the entertainment coming to the white house? How much are we sending in foreign aid?
    I don't really care about the white house tours, that is something a government that is not bankrupt can afford. I am personally for the sequester because that is the only way any cuts will be done. They have the gang of eight and all that crap, but that just serves to show us that our government is so corrupt it can not function. The white house is the main example of this.
    How will history view this? It will view it as the comedy of tragedy that it is and wonder why a free and strong world power could fail as easily as ours. We won't be allowed to say that and I am a little worried about saying it now.

  8. Jack Dean has a site called Pension Tsunami that lists the $100,000 plus pensions paid in California and other states. It
    tells a lot about California's financial problems…especially when you contrast government paid pensions with the pensions in the private sector! http://www.pensiontsunami.com/

  9. The state will fall because the people are stupid and keep voteing in the scum, TAnd please stay away from are stateshey are the ones that are lining there pockets big time and you people are so dumb you keep voteing them in everytime So I dont feel sorry for you let the Unions and the libs distroy your state

  10. And as soon as we become afraid to say the TRUTH the fascistic communists like bamy and all his evil minions have won. ALWAYS say the truth or we really are doomed. It failed so easily because in my politically conscious lifetime (since the 1970's) I have seen nothing BUT Communism being implemented in this country. And to do that they had to destroy our financial, political, moral, and education systems. All of which they've done rather remarkably. We now have a populataion of people so stupid and indoctrinated they have no realistic idea of HOW indoctrinated and dumb they really are.