Hard Times Ahead for San Francisco
Steven Malanga at Public Sector Inc. highlights a new study on San Francisco’s pension burden:
A new study by Stanford University Public Policy Professor Joe Nathan says the situation in the city by the bay is even more dire than originally thought. In addition to its pension promises, the city owes an estimated $4.364 billion in retirement health care benefits it has pledged to workers but not bothered to set aside any funds for, Nathan estimates. The city’s health and pension costs, already at $514 million a year on a $4 billion budget, will double to $1 billion in just five years, Nathan projects. [Public Defender Jeff] Adachi, who commissioned the study, is laying the groundwork for another ballot initiative to address the city’s rising cost of employee retirement benefits.
One of the most depressing aspects of San Francisco’s pension woes is that it has led to a tremendous amount of middle-class flight. In 2009, Joel Kotkin placed this problem in a broader context for The American.