Oct 29, 2012
Last month, Democratic Mayor of Los Angeles, Antonio Villaraigosa and the City Council cut the city workers’ pension system, increasing retirement age of new workers from 55 to 65. And existing city employees will face increases in their pension contributions from 6% to 11%. And spouses of retired workers will no longer be eligible for city-funded healthcare.
But these cuts to benefits were not enough for the wealthy. Not quite – billionaire Richard Riordan and his billionaire buddy Eli Broad came up with a new ballot measure that would increase contribution of the city workers’ pensions from 11% to 14%. And the new workers would have only a 401(k) system, which is gambling in the stock market.
The same day the council approved the pension cuts, they voted to extend a so-called "business tax holiday" for companies from 2013 to 2015. Initiated in 2010, this tax break gives about 17 million dollars to businesses every year.
This money lost to the city will be recovered from pension cuts or other cuts to workers’ income. Put another way: the money cut from pensions will be channeled to already filthy rich people.