Archive for category Colorado Politics
Bennet to Head DSCC
Posted by Joshua Sharf in Colorado Politics, National Politics, PPC on December 4th, 2012
Word is that Sen. Michael Bennet will accept the position as the head of the Democratic Senatorial Campaign Committee (DSCC), reuniting there with his old chief of staff, Guy Cecil, who’s now the DSCC’s Executive Director. It’s tempting to conclude that the appointment is largely on the strength of the unexpectedly strong Democrat showing in this year’s Senate elections.
Cecil was credited with having created “the largest gender gap in the country,” here in Colorado, in 2010’s Senate elections. That gap helped ease Bennet over the finish line against Ken Buck, and was predicated on painting Buck as extreme on women’s reproductive issues, and then waiting for him to do something to justify the claim. Cecil never made any secret of the fact that his plan was to reproduce that strategy nationally in 2012, pointing to it in interviews back in early 2012 and at the DNC in September. Bennet himself claimed it would be the Democrats’ path to victory at a speech to the Colorado delegation at the DNC. It certainly appears to have been key to Democrats’ Senate victories on Election Day.
That said, this could end up being a trap for Cecil.
First, while Obama won Colorado this year, he did so without any noticeable gender gap. If anything, it appears that he won men here by 3 points, while tying Romney among women – a reverse gender gap. This was achieved in part by aggressive push-back from conservative women’s groups like My Purse Politics and the Colorado Women’s Alliance. It suggests that perhaps this is a difficult strategy to repeat. There are states that will have 2014 Senate elections that didn’t in 2012, but since this strategy was also adopted by the President’s re-election campaign, voters in those states will already have been exposed to it. The lack of first-time shock value, combined with a determined opposition message, could limit its success in 2014.
Perhaps as important, the 6th year of a 2-term presidency is historically terrible for the party controlling the White House. In 1958, the Democrats picked up an astonishing 16 seats, going from a 49-47 majority to a 65-35 lead, with the addition of Alaska and Hawaii to the union. In 1986, the Republicans lost the Senate, which they had held since the 1980 election of Ronald Reagan. In 2006, the Democrats picked up a net 6 seats (including two independents that caucused with them) to gain control. While the 1986 results could be seen as a regression to the middle for Republicans, with many marginal 1980 pickups reverting to form, the 2006 elections don’t confirm that as a pattern; the Democrats picked up 4 seats in 2000.
Both 1974 and 1998’s numbers were distorted as a result of impeachments; in 1974, the Democrats went from 56 to 60 seats, and in 1998 it was a wash, with no net gain for the Republicans. These results should serve as a reminder that impeachment is a political process much more than a legal one.
Demagoguing PERA
Posted by Joshua Sharf in Colorado Politics, PERA, PPC on December 3rd, 2012
Just in case anyone thought that the incoming Democrat majority in the Colorado legislature was planning to take a responsible approach to Colorado’s continuing PERA debacle – it has not yet reached the crisis stage – Speaker-to-be Mark Ferrandino has laid those fears to rest. Morningstar has published a report reiterating what anyone with any sense already knew, that PERA is not “fiscally sound,” with a funded ratio of 58%. PERA complains that that only accounts for the state division, and that including other divisions raises the fundedness to 60%. This is the equivalent of a terrible student trying to argue his grade up from an F- to an F.
Ferrandino, instead of understanding that promises are being made that simply cannot be kept, demagogues the issue, claiming that, “There are some who would like to use the economic downturn to take away people’s pensions.” I suppose it’s progress of a sort that he acknowledges that we’re still in an economic downturn, but where on God’s green earth does he think the money comes from to pay those pensions, if not from the retirement savings of the rest of the people in the state? Where is the fairness in using the force of law to place the pension of a 30-year-old government worker ahead of the average Coloradoan’s ability to provide for himself and his family?
Don’t expect much help from the Senate, either, where incoming Senate President John Morse has hired SEIU flack Kjersten Forseth to be his chief of staff.
As California collapses, Colorado has a golden opportunity to pick up businesses looking for more healthy homes. In 2010-11, the Denver metro area had the 7th-highest rate of in-migration from other parts of the country. Unfortunately, the state’s Democrats seem bound and determined to import not California’s prosperity, but its pauperizing policies instead.
Your New Finance Committee Chairman
Posted by Joshua Sharf in Colorado Politics, Finance, PPC on November 28th, 2012
With the Democrats retaking the State House of Representatives, the time has come for them to name new committees, and new committee chairmen and vice chairmen. Most of the designees make sense, at least from an expertise point of view. While I may disagree vehemently with Max Tyler on energy issues, his district includes NREL, and he’s made a point of being vocal on things like wind and solar subsidies.
However, I draw the line at the appointment of Lois Court, my own State Representative, to be the Chairman of the House Finance Committee. Court has spent most of her time agitating for the elimination of the Electoral College, opposing Voter ID, and trying to limit citizens’ petition rights. So State, Veterans, and Military Affairs, where she’s served for four years as a member, would seem to be a natural fit for her interests. (Full disclosure: I ran against Mrs. Court in 2008 and 2010 for the House seat.)
Instead, incoming Speaker Mark Ferrandino appointed a state rep whose main contribution to finance discussions has been to sue her own constituents, to seek the repeal of the Taxpayers’ Bill of Rights. She has historically found its spending and taxation limits to be antithetical to the idea of representative government. (Most of us see her opposition as a threat to the state’s solvency.) With the governor’s TBD Initiative coming up this year, it may signal an intention on the part of the Dems to wage war on TABOR more openly.
And then, there’s Representative Court’s fluency with arithmetic:
and
Hint: Carry the two. Three hundred twenty-five.
Ladies and Gentlemen, your new Finance Committee Chairman. The state’s in the very best of hands.
COPs, Cash Flows, and Taxes
Posted by Joshua Sharf in Colorado Politics, Finance, PPC, Taxes on November 28th, 2012
We’ve pointed out some of the abuses of Certificates of Participation by the Denver and Jefferson County School Districts. However, there are times when COPs are good. One good use of COPs is as a cash management tool. Municipal bonds are usually non-taxable, which means their yields are lower than Treasuries of an equal term, especially in longer-terms, say, 10 years and over. Since a municipality doesn’t pay income tax, it can lend at the higher Treasury rate, while borrowing at the lower municipal rate, assuming that its credit rating is good. (I don’t care if Illinois has 30 years of gold stashed away, I’m not lending them a dollar for a hamburger to tide them over until next Tuesday.) The municipality can make a little reliable money on the arbitrage.
In essence, this is a tax-shift. The Treasury isn’t collecting income taxes that bond holders would normally pay, so that tax money is, in effect, shifted to the municipality. It’s the reason that Treasury yields are higher in the first place.
Over the last couple of years, though, this hasn’t really been possible. Municipal rates have stayed pretty steady, while long-term Treasuries have dropped precipitously as a result of all the various Quantitative Easings by the Fed. This has deprived municipalities of a source of cash. So while the stimulus was essentially a massive shift of debt from the states and municipalities to the Federal government, the feds are taking it back, inch by inch, by taking away this tax shift that had been available to the lower levels of government.
I don’t think it’s coincidence that one of the tax loopholes being mentioned for closure is the municipal bond interest. The feds would like to make this tax shift permanent by pushing up municipal yields above Treasuries. Most of the focus has been on the fact that this would make borrowing more difficult and expensive for municipalities. But it would also close off this tax shift as well. Both these facts will have the effect of making states and municipalities more dependent on federal funds.
Certificates of Prevarication – Part II
Posted by Joshua Sharf in Budget, Colorado Politics, Denver, PERA, PPC on November 27th, 2012
Yesterday, I wrote about the Jefferson County School District’s use of Certificates of Participation to get around the State Constitution’s requirement for a public vote before issuing general obligation debt. I had forgotten that once upon a time, Denver Public Schools did almost exactly the same thing.
The scheme – used widely around the state, and even by the state, is for the district to set up a corporation and then lease its own property back from the corporation, with the lease payments matching bond payment due on debt floated by the corporation in the public debt markets. The debt isn’t exactly unsecured – the school buildings themselves serve as collateral. But there’s no separate revenue stream dedicated to the lease payments, which come instead out of general fund revenue, the very definition of general obligation indebtedness that the constitution seeks to limit.
In 2008, Denver Schools issued$750 million worth of both fixed- and floating-rate COPs, in order to recapitalize its own pension program, which had a $400 million funding gap. This was necessary for PERA to agree to absorb the DPS retirement system. While the ins and outs of the deal are beyond the scope of this post, suffice it to say that by 2010 the deal had become a key element in the Democratic US Senate primary between Andrew Romanoff and Michael Bennet, who had been Denver Schools Superintendent at the time of the COPs.
Our concern here isn’t whether or the the deal was well-structured on its own terms. It may well have been, and has, at any rate, since been refinanced on terms more favorable to the District. The point here is that Denver Public Schools, in order to facilitate turning over the unfunded portion of its own pension plan to the rest of the state, issued what is general obligation debt in all but name in order to cover a shortfall. That debt, issued without public approval, now accounts for 37.6%, or 3/8, of the school district’s entire long-term debt.
In the meantime, the burden of DPS’s unfunded pension liability has been neatly shifted onto the rest of the state. DPS may be required to step in with additional payments if an actuarial analysis shows that, in 30 years, the plan will be less sound than the rest of PERA. As of the 2011 CAFR, the plan’s fundedness had fallen from 88% to 81%, still the least-unhealthy PERA division by far. And the process of renegotiating what is likely to be, as with most public pensions, an unsustainable burden on the taxpayers, got much more complex with the addition of the state and PERA as explicit parties to the contract.
Certificates of Prevarication
Posted by Joshua Sharf in Colorado Politics, PERA on November 26th, 2012
I’ve already written about the Jefferson County School Board’s decision to default on its Supplemental Pension Plan. It turns out it’s also using something called Certificates of Participation as a loophole to circumvent the State Constitution’s ban on governments issuing general obligation debt without a vote of the people. They’re not alone in this, and it can lead to a significant understatement of a government’s – thus the citizens’ – total indebtedness.
In 2006, the JeffCo School Board voted to offer teachers the option of taking a lump-sum payment for the value of their pension benefit, or to stay in the 10-year payout program. In order to help capitalize the buyout, the Board issued $38.7 million worth of Certificates of Participation (COPs), with maturity dates from 2007 to 2026.
Note that even if the Board succeeds in closing down the Supplemental Retirement Program and discharging itself of about $7.4 million of unfunded obligations, approximately $33.1 million worth of principle on those COPs will remain on the books.
Since the State Constitution prohibits governmental entities from issuing unsecured debt without a vote of the citizens, how is such a this possible?
Keep your eye on the shell with the pea.
Technically, the COPs weren’t issued by the School District, but by a corporation, the Jefferson County School Finance Corporation. Nine school building were leased by the District to the Corporation for some nominal amount, and then leased back to the District by the Corporation. The lease payments by the District to the Corporation are designed to match the bond payments due by the Corporation.
The bonds are therefore secured by the revenue stream provided to the Corporation by the lease payments from the District. What shows up on the financial statements of the District aren’t the COPs, but the lease payments, which are budgeted annually, not as a formal, long-term commitment.
Investors, of course, are not fooled by this. The entire term of the lease shows up on District’s Comprehensive Annual Financial Report (CAFR) as a Capital Lease, as a long-term obligation (see Note 10, p. 66), not just the next year’s payment. They show up directly, as “Certificates of Participation” on the District’s Debt Capacity Schedule 9 (P. 114). If the payments are missed, it will damage the credit rating of the District.
To be fair, JeffCo is far from the only jurisdiction to use this mechanism to get around the ban on general obligation debt. Denver City Council used a similar mechanism to launder its own obligations that it incurred when it backed debt for the Union Station redevelopment project, in order to secure federal funding. This appears to be a legal means of side-stepping the constitutional limitation.
The State Constitution recognizes the danger inherent in debt, which is why bond issues need to be approved. If investors don’t treat the Corporation as a separate entity from the District in evaluating creditworthiness, why should the state?
Note:
Here is the relevant paragraph from the debt issuance, describing the shell game, and showing that it specifically contemplates the ban on general obligation debt and is designed to avoid it (emphasis in original):
Neither the Lease nor the Certificates constitutes a general obligation indebtedness or a multiple-fiscal year direct or indirect debt or other financial obligation whatsoever of the District within the meaning of any constitutional or statutory debt limitation. Neither the Lease, the Indenture nor the Certificate have directly or indirectly obligated the District to make any payments beyond those appropriated for any Fiscal Year in which the Lease shall be in effect. Except to the extent payable from the proceeds of the sale of the Certificates and income from the investment thereof, from Net Proceeds of certain insurance policies and condemnation awards, from Net Proceeds of the subleasing of or a liquidation of the Trustee’s interest in the Leased Property or from other amounts made available under the Indenture, the Certificates will be payable during the Lease Term solely from Base Rentals to be paid by the District under the Lease. All payment obligations of the District under the Lease, including, without limitation, the obligation of the District to pay Base Rentals, are from year to year only and do not constitute a mandatory payment obligation of the District in any Fiscal Year beyond a Fiscal Year in which the Lease shall be in effect. The Lease is subject to annual renewal at the option of the District and will be terminated upon occurrence of an Event of Nonappropriation or Event of Default. In such event, all payments from the District under the Lease will terminate, and the Certificates and the interest thereon will be payable from certain moneys, if any, held by the Trustee under the Indenture, any amounts paid under the policy of insurance, and any moneys available by action of the Trustee regarding the Leased Property. The Corporation has no obligation to make any payments on the Certificates.
Jefferson County Schools Propose Retirement Plan Default
Posted by Joshua Sharf in Colorado Politics, PERA, PPC on November 25th, 2012
Welcome, Instapundit readers! While you’re here, take a look at posts on Certificates of Participation. Perhaps your state has something similar…
On Thursday, November 8, the Jefferson County School Board voted to ask teachers participating in its Supplemental Retirement Program to take a buyout for what would amount to about 64 cents on the dollar.
By following other public pension systems into what amounts to a default – albeit partial – JeffCo Public Schools join the parade of cautionary tales for those relying on the promises of public programs like PERA. As Glenn Reynolds of Instapundit is fond of reminding us, promises that cannot be kept, won’t.
History of the Plan
Quoting from a 2009 RFP for a plan financial advisor (emphasis added):
The Supplemental Retirement Plan was created in 1999 for employees who worked in full-time or job-share positions which were covered by an association. It was designed to replace a bonus-type program for retirees who met age and service requirements, with a tax-advantaged vehicle. Benefits are intended to supplement, not replace, PERA retirement benefits. Participation in the plan was immediately frozen upon its creation.
The District had originally committed to fund $90 million dollars toward a combination of pension plan benefits and sick and personal leave payouts at a rate of $9,000,000 per year for 10 years. However, budget cuts reduced the annual plan contributions and stretched out the plan’s original funding timetable. The plan has been underfunded since its creation. In 2007, the District purchased certificates of participation and deposited the funds into the plan for the purpose of meeting its stated funding obligations and has now exceeded its original funding commitment. Further contributions to the plan are not likely to be made. Subsequently, existing retirees and employees who met the full vesting requirements of 20 years of eligible service and age 55 were offered a one-time ability to have their benefits satisfied with a lump-sum payout at the plan’s stated discount rate. As a result, participant count, liabilities and assets have decreased in the plan and the overall funded status of the plan has improved. It is anticipated that at some point the plan will need to declare actuarial necessity and terminate or reduce plan benefits for non-vested participants. After the lump-sum payouts, the plan amended its investment policy to be more conservative, in an effort to protect the funding of benefits for existing retirees and vested participants.
The plan wasn’t underfunded for lack of district contributions. According to the latest available plan financials, also from 2009, the district met or exceeded its annual contribution every year until 2009, with the exception of a slight shortfall in 2004. The combination of payouts and lower-than-necessary returns kept the plan funding under 32%, until the 2006 issuance of $37 million of Certificates of Participation (more about that in a coming post) reduced the outstanding obligations starting in 2007.
As of the 2009 report, the plan had $20.8 million in obligations, $7.4 million of which were unfunded.
Issues with Transparency
There appear to be a number of significant transparency issues with the way the plan has been handled.
The November 8 meeting itself raises issues of transparency and obligations of full disclosure to the public. The meeting discussion was held in a 45-minute executive session. Executive session is supposed to be reserved for legal advice, not for general discussion of motions before the Board. It is unthinkable that the Board received a 45-minute legal briefing, after which it proceeded directly to a vote.
Moreover, at least the topic of an executive session is required by law to be posted in advance of the meeting. Here’s the notice that was posted outside the Board’s meeting room the evening of November 8:
There is, evidently, case law to suggest that the recording of the Executive Session should therefore be made public, since the session – although not the vote – were conducted in violation of statute.
The most recent financials available online date from 2009, three years ago. Even in the absence of significant financial changes, plan financials from the most recent year should always be available.
Also note that the teachers were offered a buyout in 2006 – which the smart money, including current Superintendent Cindy Stevenson took – the 2009 statement RFP for a plan financial advisor all but admits that the plan will terminate and default on the remaining obligations at some point. Whether or not this likelihood was made clear to the teachers who chose to remain with the plan in 2006 is unclear. What it clear is that Stevenson, and possibly current Board member Jill Fellman, were made whole during the 2006 buyout offer, while other teachers were not.
UPDATE: According to the FY2011 Comprehensive Annual Financial Report, in 2011, the Board decided to terminate benefits for anyone who hadn’t reached the thresholds of age 50, and 20 years of service as of the end of the 2011 plan year, 8/31/2011. “The plan is still operational for active and deferred vested participants and beneficiaries in receipt of payment.” It is those members who will be asked to take a cut in their benefits. The district has also “determined that additional contributions for the foreseeable future would not be made to the Plan.” (Note 16, P. 72)
The funded ratio has fallen to 50.6%, and the unfunded liability as of August 31, 2010 is $8.8 million.
Correction: No vote was actually taken at the November meeting. (I left early because of the descent into executive session.) It is likely that there will be a vote at the December or January meeting. Stay Tuned.
A Retention Vote for Morris Hoffman
Posted by Joshua Sharf in Colorado Politics, PPC on October 25th, 2012
I’ve never made any secret of the fact that I usually vote against retaining judges. It’s not out of any personal animus, of course. For citizens who are asked to keep track of so much when they vote, it’s almost impossible to learn enough law, let alone enough about every judge, to make a truly informed decision on a given judge. But we have retention votes for a reason, and it’s helpful to judges to be reminded every so often that the law belongs to the people, not to the lawyers, or even to the legislature. As long as the retention voters weren’t close, a No vote was a reasonably safe protest vote that would only tip the scales if other, well-known information about that particular judge pushed a lot of other people to vote the same way.
But times have changed, the retention votes have gotten closer, and it’s important now to reward judges who’ve actually done a good job on the bench.
So I’ll be voting to retain Morris Hoffman as a Denver judge, and I would ask all those voting in Denver to do the same.
I had the pleasure of sitting in Hoffman’s court eight years ago as he decided Common Cause v. Davidson – an attempt by Common Cause and other Democrat groups to hijack the voting rules in Colorado in order to prevent certain basic ballot security measures – and was impressed with Hoffman’s humor and ability to keep things moving without cutting people off. The opinion is readable even by laymen – not an easy thing for a judge to do when time is short and the pressure to be right is long. And the ruling itself was a model of understanding both of the role of judges and of the nature of voting.
I quoted some of the salient bits at the time, but they’re worth quoting again:
But the Court has also recognized that the right to vote, unlike some other individual rights that are exercised in essential opposition to the state, is a right that has meaning only in a highly regulated social context. A vote is not merely one individual’s casual expression of political opinion at any particular time on any particular subject. Votes count, and because they count they must be sought and given in a structured environment that allows the votes of all other proper voters to count….
Maximizing voters’ access to the process is just one part of the compelling interest the state has in regulating the architecture of elections. Preventing voters from voting more than once, preventing otherwise ineligible voters from voting, and preventing other kinds of election fraud, is part and parcel of this same compelling state interest, as the Burdick Court expressly recognized when it included the words “fair and honest” at the very beginning of its litany of state interests in structuring elections. Professor Chemerinsky had it only half right, and perhaps not even that, when, in the aftermath of the controversy of the 2000 election, he wrote “What good is the right to vote if every ballot isn’t counted?” (Erwin Chemerinsky, Fairness at the Ballot Box, 40 TRIAL—APRIL 32 (2004).) A complete description of the state’s interest in regulating elections should have included something like, “What good is the right to vote, even if every ballot is counted, if the votes of duly registered voters are diluted by the votes of people who had no right to vote?”
…
It may or may not be true, as Plaintiffs claim, that as an historical matter actual voter fraud has been rare in Colorado. But the state has a legitimate, indeed compelling, interest in doing what it can to make sure that last month’s fraudulent or no-longer-eligible registrant does not become next month’s fraudulent voter. Ms. Davidson and local election officials testified that once a fraudulent regular ballot is cast, and the voter’s identity forever divorced from the ballot, there is no way to remedy the fraud. The fraudulent vote will count. That is, election fraud must be detected before fraudulent regular ballots are cast and fraudulent provisional ballots are counted.
…
Nor do I think it likely that Plaintiffs will be able to demonstrate that the identification requirement is discriminatory or will have disparate impacts…. Plaintiffs’ suggestion that the identification requirement will “chill” people without identification may be true (though there was absolutely no credible evidence of that), but then again it may also “chill” fraudulent voters. Whether one kind of chill justifies the other is precisely the kind of public policy choice that must be made by legislators, not by judges legislating under the cover of strict scrutiny.
…
In what must surely qualify as one of the understatements of the year, even Plaintiffs’ own witness, a Denver election official, testified that allowing voters to vote in any precinct they wished “could be problematic.”
…At the moment, if I were to try to design a system that maximizes the chances that fraudulent and ineligible registrants will be able to become fraudulent voters, I’m not sure I could do a better job than what Plaintiffs are asking me to do in this case—allow voters to vote wherever they want without showing any identification.
(My own emphasis added throughout.)
For better or for worse – and probably for the much worse – courts across the country haven’t accepted these basic tenets of how a voting system ought to work, but that doesn’t make the reasoning here any less correct.
I don’t want to go overboard here. We’re talking about one decision, one data point, in a much longer judicial career. But given the stakes of the case, it’s a pretty large data point, and it’s one more than most of us will have on most of the judges. Let’s reward it.
Obama Campaign Flying on Auto-Pilot
Posted by Joshua Sharf in 2012 Presidential Race, Colorado Politics, National Politics, PPC, President 2012, Senate 2010 on October 21st, 2012
There’s a saying among pilots: Plan your flight, and fly your plan. If you’ve done your homework beforehand, your plan is the surest way out of trouble and to your destination.
Nevertheless, any good flight plan includes alternatives in the case of, say, unexpected headwinds.
For several months, it has been clear that the Democrats’ closing argument was going to be about abortion and birth control. With the economy still in the tank, and foreign policy not a top-line issue for most voters, there was no place else for them to turn. Now that foreign policy has turned obviously and embarrassingly sour, all the moreso.
The demographic reasons for this are obvious – abortion and “free” contraception are largely issues for younger, single women, and the “gender gap” is as much as “marriage gap” as anything. The Democrats know that the best way to get a woman to start voting Republican is for her to get married (which also probably explains about 95% of “Julia”).
The Democrats knew this at the beginning of the year, when George Stephanopolous asked Mitt Romney repeatedly about states banning contraception in that debate, and when the HHS issued its mandate that employers buy contraception for their women employees.
They knew this because they were trying to replicate the success that Michael Bennet had here in Colorado in 2010, winning re-election to his Senate seat in a Republican year, and doing it by beating his Republican opponent Ken Buck up on abortion. Guy Cecil – his campaign manager and now head of the DSCC – repeatedly said so. Bennet himself said so at the DNC, and more recently when introducing Joe Biden up in Greeley. The NY Times said so. Rachel Maddow said so. From the beginning of the year, they’ve made no secret of the fact by this point in the election cycle the cries of “contraception” and “abortion” would be so loud you couldn’t hear the math.
My wife used to be a registered Democrat, and so ends up getting almost all the Democrat mailers. Four mailers, all about abortion and contraception.
And it’s not just the race for president where the Dems have adopted this carpet-bombing strategy. The only ads I’ve seen attacking incumbent Republican Congressmen Scott Tipton and Mike Coffman have centered on abortion and contraception.
The problem is, it’s not working.
Yes, there’s still a gender gap, but with women only giving Obama a slight plurality, and men overwhelmingly supporting Romney, the numbers just don’t seem to be there for the Democrats at the Presidential level. And if this is their primary attack in Senate races – so far, I’ve seen it used in Ohio, Virginia, Connecticut (with a woman Republican nominee), Montana, North Dakota, and of course, Missouri – there’s good reason to think the Dems are setting themselves up to lose the Senate, too.
To return to the flight metaphor, the Democrats are flying their plan, but they didn’t count on those headwinds, and they’re now running out of fuel without any alternate airports around. They have no alternative strategy except to continue to amp up the volume, with cries of “Romnesia” by the President, and the possibility of a an October Surprise not in Iran or Libya, but by Gloria Allred. I’d be surprised if that works, mostly because it’s already been factored into people’s votes.
The Democrats are flying their plan, but instead of remaining engaged, looking for alternatives, staying abreast of the weather reports, they’re flying it on auto-pilot.
Which as any pilot will tell you, is a great way to not reach your destination.
PERA Gains a New Client Group
Posted by Joshua Sharf in Budget, Business, Colorado Politics, Economics, PERA, PPC on October 19th, 2012
What makes it so hard to fight the growth of government is its ability to create client groups seemingly at will, with the money of the very people it’s seeking to co-opt. I see it myself all the time at the JCRC, where what had been private, service groups are reduced to begging for scraps and favors in front of legislative committees. At one time they thought it more expedient to do that than to make the case for the value of their work to the community they served and represented. Now they’re caught, and even when they’re not temperamentally inclined to go along with the leftist agenda, they often do because they can no longer imagine doing business without government support.
So it happens with PERA, too, which has announced the Colorado Mile High Fund, a fund geared towards investing in Colorado entrepreneurs who have partners, but are also having a hard time finding additional capital.
“We heard from businesses around the state during the development of the Colorado Blueprint that increased access to capital is critical to their success and that of our state’s economy,” said Gov. John Hickenlooper. “The creation of the Colorado Mile High Fund will improve that access to capital and we are pleased that Colorado PERA’s partnership will benefit and help grow companies here in Colorado.”
The risks to the taxpayers and the foolishness of this sort of government adventure are all around us, but it’s hard to tell if that’s a bug or a feature of this plan. I don’t think PERA’s out to deliberately lose money, but investing in high-risk start-ups may not be the best decision for a defined benefit retirement fund.
Even if this turns out to be one fund in the option and under-used 401(k) option, entrepreneurs and start-ups will now have a reason to support increased funding for a government-sponsored employee retirement plan, whose money much come from the pockets of the taxpayer. The most dynamic sector of the state’s economy will be effectively recruited on behalf of its most stifling.
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