Pairing Pension Reform with Taxes

Nancy Pyle wrote an op-ed for the Mercury News
this week, and in it the San Jose councilmember suggests the always-popular proposal of raising taxes.

Her reasons are as follows: The city has an out-of-date business tax model; San Jose collects a million dollars less in property taxes than it did before the subprime mortgage crisis; and population has grown by about 45,000 since that time, which, Pyle noted, is like tacking on an extra Gilroy—and who really wants another Gilroy?

“We can fix this problem,” Pyle writes. “For example, a city-sponsored half-percent sales tax increase would raise about $72 million a year. San Jose would keep 100 percent of this money, enabling us to provide our residents the services they need.

“It is important that we act now, for the June ballot. We know that there will be multiple tax measures on the November ballot, and it is unclear at this time how or if any of them will help the city. We need to do everything we can to avoid the confusion created by a ballot containing multiple tax measures.”

Pyle has consistently beaten the drum about increasing San Jose’s revenues with taxes. And now that pension reform is set for a ballot measure in June, increasing the sales tax might become more seriously discussed by the council in the coming months.

But that isn’t to say the city and unions have stopped focusing on pension reform and ballot measures.
Some interesting letters were exchanged this week
between the city’s deputy director of employee relations, Gina Donnelly, and union leaders. In a letter to AFSCME’s Yolanda Cruz and LaVerne Washington on Dec. 12, Donnelly writes:

“It is important to recognize that time is of the essence and the mediation process cannot be open ended. Consistent with the completion of impasse resolution procedures, the
City Council approved the terms of the ballot measure on December 6th. Absent any agreement to the contrary, the measure (in its current form) is now scheduled to be placed on the June 3, 2012 ballot and, consistent with its “sunshine” requirements, the Council will be unable to introduce changes in the measure after February 21, 2012. Therefore, any further mediation or other procedures must be completed no later than mid February, 2012, to ensure that any agreed-upon changes to the measure can be made before ballots are printed.”

On Wednesday, a statement from Mayor Chuck Reed stressed the need for pension reform through a ballot measure after a
report was released Joe Nation of the Stanford Institute for Economic Policy Research (SIEPR)
. The report’s analysis of the pension crisis is grim.

“... [T]he probability of San Jose’s systems fully meeting obligations is only 12 percent,” Nation writes. “In fact, the likelihood is 33 percent that the systems (federated employees and public safety) will fall short by a combined $10 billion in the next 16 years.”

Josh Koehn is a former managing editor for San Jose Inside and Metro Silicon Valley.


  1. Nancy,

    I appreciate you standing up to Chuck and saying no.  We do need pension reform along with many other reductions but I think you agree this is not about PUBLIC SAFETY PENSIONS, this is about all city retiree pensions.  Go ahead and reform pensions for new hires but do not attack retirees who have been granted and approved retirement benefits.  Mayor Reed was on these councils and approved these contracts.

    Very few stay the long road to max out of their retirement pensions.  And yet Chuck and Deb put all the blame on public safety.  I encourage everyone to go to the SJ city website and see how many other city managers are getting huge pensions.  Heck, the librarian made 250+K a year.  The Mercury publishes pensions from prior top level employees such as COP and Fire Captain to try to cry for reform.  How about the lower level employees that get a low level city pension.

    After 30 years you max out, so no reason to stay with the city and seek work else where.  So don’t cry double dipping.  Pete Constant is the poster child fotr this.  His Back problems seemed to have healed very well.

    I would investigate the retirement board who hands out disability retirements like candy at 50% tax free.  Why is Council Constant sitting on this very board that gave him a disability retirement from the police department.  Why is he allowed to vote on pension reforms when he is receiving one. Do I need to go on?

    Why is the city council AKA: RDA paying money out of the general fund to bail out this agency.  Why is the city giving away land for a penny on the dollar to get a ball park.  Why is the city funding a Earthquake stadium?

    Why is the south valley police staying not open?  Yes Vice Mayor said no monet, then sell it!  92 million is a lot to stay closed.

    • Is move the PD down to the sub-station. That sub-station was built to state of the art standards for public safety.  It is far more modern than the campus that currently houses the PD and dispatchers.  I would suggest that they co-locate San Jose and county PD, Sheriff, and fire dispatch in the current police building by the Sheriff’s office, use the rest for other city functions, and move the rest of the PD down south. 

      The city could then either consolidate other city departments in the old PD building or sell it off.  I know for a fact that many many hours were spent designing the sub-station to provide the best possible environment for police work and the most efficient use of space.  It seems a shame to just unload it at bargain basement prices to somebody who will tear out all the PD related equipment.  The current police campus is outdated and in desperate need of updating anyway.  Be smart San Jose, don’t waste the sub-station, use it for its intended purpose.

  2. Pyle needs to get back on her meds if she thinks voters will tax themselves for SJ.  Does she have even a small clue that the ballot will be overrun with proposals for tax increases at City, County and State levels?

  3. No pension fund anywhere in the United States uses a discount rate of 5.5%.  One could call every pension fund in the country underfunded if that assumption is used. Most use a rate around 7.5%.  The study uses a middle discount rate of 6.2% and a high rate of 8%. Perhaps someone out there can point to a government pension plan anywhere that uses a 6.2% rate. My guess is that if I were to ask the mayor that question all I would hear is the sound of crickets as my answer.  If this mayor were honest he would admit to the excessive amount of bonds that have been issued by San Jose in the past 2 decades as part of the problem.  Unfortunately like most politicians, he refuses to admit his and other city leaders part in causing the problem. He instead focuses on the impotent city worker as the cause of San Jose’s financial crises. It is not the fireman or policeman who is to blame for taking what city politicians gave them.  City politicians (including Reed) could have gone to the ballot long ago to change arbitration rules and pension benefits. They also could have used the same conservative assumptions when it came to servicing their construction bonds with income from their pet projects.  The city hall at 400 million dollars is one of the most expensive city halls ever built in the United States.  In fact I could find none that were more expensive.  How much income does it bring in comparison with the old city hall? Answer = zero.  What is the annual debt service?  Answer = almost twenty million dollars.  Who is responsible? (according to the actions taken by Mayor Reed).  Answer = the San Jose city worker.

    • There is a chart that shows the Public Safety system earned an average of 8.1% for the last 40 years but they want to use 6.2% to make the system look underfunded. If for 40 years that is what it was why on earth would you use 6.2?  Do you not all see why this is partly smoke and mirrors? That is like you converting your 30 year mortgage to a 15 year mortgage then claiming a structural deficit because your payment doubled!

    • The problem is in the spending. It has ALWAYS been in the spending and mismanagement of the taxpayers money. I wonder why taxpayers are not seeing this? They are so focused on the pensions that they are letting the fox get away with the hen.

  4. I cant wait until this case makes its way to court. i am going to sit in the court room and whatch as the Cities leaders are forced once after another to explain how they make their money and the deals.  The Mayor has spent over a million dollars on lawyers in an attempt to claim every item of City business is attorney client and should be kept from the public.  There will come a time when the failure to answer will create so much pressure from the public it will cause an investigation.  We will get to see how every dime of the Cities tax dollars are spent no more hidden codes and back door meetings. 

    This will be the single greatest thing Reed will do for the city. With his arrogance he will cause the city to expose all of its dirty laundry.

    • “The Mayor has spent over a million dollars on lawyers in an attempt to claim every item of City business is attorney client and should be kept from the public.”

      Obama has spent $3million on attorneys to the public from seeing his college transcripts, which must show what a mediocre student he really was.

  5. I KNEW they would come up with something to counteract the Cheiron(sp?) report. I was just waiting to see what it would be. Is reed a Stanford alumni.

  6. The POA and IAFF Local 230’s response to the City is that while all the City’s actions so far have been unlawful, there is a “golden opportunity” to reach an agreement on pension reform, given the new forecast on the City’s financial outlook. Most importantly, the POA and Local 230 have called for negotiations to be conducted openly and publicly. Given this is the “Sunshine” mayor, the city shouldn’t have a problem with that, should it? If the City doesn’t agree to negotiate publicly, it’s becasue they don’t want you to see for yourself that they haven’t been negotiating at all. They don’t want you to see the bulls**t the unions have had to endure through this sham of a process. Reed keeps building his house of cards, and you, the taxpayer, will be stuck with the bill when it collapses, not him. Let him and the Council know you want open negotiations. Since they insist they are in the right, they shouldn’t have a problem with it.

  7. should just let them put it on the ballot. As soon as it is voted in, in June, they should then file suit. It will be held up in court until the judgment is made. Unions…don’t bargain away anything. Notice how they are push, push, pushing, so fast. Something smells. Let it go to ballot. We will win in court and will be better off when it gets rejected in court than we would be if you bagain away stuff. It will be held up in court for quite a while.

  8. Well the city of San Jose assumed a large chunk of the county in the Burbank area.  The idea was to be able to staff it with additional officeers.  Now lets see… we assumed the area and have reduced the size of the department.  What is the city doing withh all that xtra cash they are pulling in from the area patrolled by the sheriffs departmentin the past?

    • I’m glad someone is pointing this out. This area isn’t exactly a place one would go walking at night.. Or even day for that matter. Where did that extra revenue go? I’m sure it’s not going towards pro active Police work..

  9. I’m pretty sure that even part-time professors at Stanford have access to that thing called the “Internet”.  A simple Google search of recent news about San Jose’s pension plans would have shown that projected pension costs for this coming year have declined by $55M dollars and will be dramatically less over the next 5-years than what the City projected.  This fact compelled the Mayor and City Manager to call off their vote for a “fiscal emergency”.

    Mr. Nation, in his thirst for media attention, fails to recognize the substantial pay cuts San Jose employees have taken, uses plan assumptions that are completely false and misleading, and gives no credence to the credible and substantial proposals made by employees’ to lawfully reform our current pension plans.  That’s a shame. 

    While Joe Nation excels at fuzzy math, he gets a failing grade when it comes to academic ethics by releasing knowingly outdated and inaccurate data.  Chasing research dollars by chasing headlines doesn’t make for good public policy.  I’d offer to pay for Joe Nation to enroll in a remedial math and basic research course at Stanford if he promises to tell the truth in his next report. I hope the Executive Committee of Stanford’s Public Policy Program will carefully review Mr. Nation’s political agenda executed under the guise of academic research in the name of Stanford University.

    It’s no wonder that State Treasurer Bill Lockyer resigned from Mr. Nation’s advisory board. “Lockyer agreed to join the advisory panel because he believed SIEPR was interested in producing more thoughtful, evidence-based reports,” Lockyer spokesperson Joe DeAnda said. “Unfortunately, that turned out not to be the case.” “SIEPR clearly has a public pension agenda, and it doesn’t include legitimate research,” DeAnda said, noting that Lockyer’s concerns about methodology and other issues were ignored.

    To add to the considerable criticism by State Treasurer Bill Lockyer, CalPERS in reviewing Nation’s flawed “report” has found serious shortcomings as well.  The CalPERS immediate response finds that Nation’s mathematical model “is inconsistent with the Governmental Accounting Standards Board and current actuarial standards.”  Everyone knows how strongly the Mayor and City Council in San Jose feel about ensuring our pension plans conform to GASB and actuarial standards.  Thus, they should read Joe Nation’s report with a skeptical eye. 

    Here is just a sampling of where Joe Nation gets it wrong:
    1.  Joe Nation uses numerous financial assumptions and plan financial figures which are woefully out of date.  For example, executive summary p. vii, states that San Jose’s public safety plan is 80% funded using an 8% discount rate.  UNTRUE!
    •  The plan is actually well over 85% funded on both a market and actuarial basis using an even more conservative discount rate.

    2.  Joe Nation uses an arbitrary 6.2% “middle-case” discount rate for many of his cost projections. FABRICATION!

    •  This rate has no basis in fact or forecast, and no connection to the Plan’s actual results, investment allocation or projected returns. The retirement board’s independent actuary reported that the actual “middle-case” (50% probability of happening) for the Public Safety plan is 7.26%. Any analysis using a 6.2% figure is pure conjecture that intentionally paints a false and misleading view of reality.

    3.  Joe Nation states: “San Jose’s Federated system uses a 7.95 percent discount rate and the Safety system currently uses a 7.75 percent rate.”  FALSE!

    •  San Jose’s Federated system uses a more conservative 7.75% discount rate and Safety uses a more conservative 7.5% discount rate. 

    4.  Joe Nation reports: “Over the past two years, City of San Jose Department of Retirement Services staff have been advocating for a rate of return in both plans of about 6.75%”.  LIE!

    •  Staff’s most recent recommendation was 7.25%. (December 1, 2011). This rate includes prefunding (saving up) for costs that were previously not pre-funded, making the plan even more fiscally stable.

    5.  Joe Nation advocates in his “report” for the use of a simple “middle” discount rate of 6.2% as opposed to the current 7.95% for Federated and 7.75% for Public Safety.  INACCURATE!

    •  The Federated plan discount rate is 7.75% and for Public Safety it’s 7.5%. Nation’s insistence on using 6.2% as the middle rate demonstrates the lack of thoughtful analysis necessary to produce a truthful report as opposed to one driven by politics and personal ambition.  6.2% has no correlation to any analysis of the plan’s assets, investment allocation, or expected cash outflows and is used to artificially inflate projected costs.

    6.  Nation continuously compares “actuarial value” vs. “market value” of plan assets and its funded ratio. DISINGENUOUS!

    •  In the Police and Fire plan those two figures are now virtually identical, with actuarial value equal to market value, meaning that there is no unrecognized loss or gain.  The plan is currently 85% funded, either on an actuarial or a market basis.  Again, Nation’s report and his research are woefully out of date and inaccurate.

    7.  Nation’s chart depicting a forecast of the plan’s expected contribution rates is completely, wholly, fully and in all other ways inaccurate and out-of-date. It’s as if Mr. Nation pulls numbers out of thin air to justify his pre-determined outcome.

    The San Jose Police & Fire Plan was recently rated as the 3rd most conservative plan in the state of California, and that was prior to the plan’s recent decision to adopt even more conservative earnings assumptions: (

  10. Councilmember Pyle is correct concerning the local control of funds generated from a “one-half cent” sales tax increase. Governor Brown is slated to “extort” public safety and educational fears of the disappearing middle class with the same “one-half cent” sales tax. The difference is that if the Governor acts first and receives voter approval, the “state” is the revenue winner. The sad part of Councilmember Pyle’s argument is that she is part of the incompetence at city hall that has run the city’s finances into a ditch. Of course the undisputed morons of the tragedy that grips city hall are the incredible jackasses known as the City of San José voters who do not participate in their municipal affairs and then elect the these dinosaurs who waste taxpayer money instead of being responsible stewards of the public’s trust.
        With the sole exceptions of the SJPOA , Local 230 (San José Fire Fighters), and the Association of Legal Professionals; the remaining unions who “represent” city employees are the closest approximation of mentally retarded thieves and or wastrels; who act in concert to assert their self serving, selfish, mean-spirited incompetence and thereby influence city employees, city operations and municipal government officials.  No one with a brain should respect these swine and their pathetic masters; the pig-like, ünter-mench of the extorted-union -dues based hierarchies represented as “South Bay Labor.”
      The Office of Employee Relations and the entire Office of the City Manager should be summarily exterminated by the taxpayers via a ballot initiative to amend the city charter. These archaic institutions are the true costs to reduction of services. Since the Office of the City Manager is incorporated into the City Charter, this office has grown faster and more virulent to the taxpayers than any form of pancreatic cancer known to modern medicine.  The really sad part is the patient, the taxpayers, suffer a needless and prolonged illness with no relief. Why? Because the taxpayers deserve the self inflicted and injurious illness brought on by their careless and reckless disregard for the health of their political lives.
        As to Mayor Reed, his goofy “Six Senior Policy Advisors at about a 150K per copy” and Stanford University’s pedestrian attempt to get public record research information for free concerning public pensions, go pound salt with your ballot measure.
      As a retired city employee, I heartily mock all of you to the height and breadth of heaven.

        I further ridicule all of you,  without measure or remorse, as to your combined idiocies if you rely on the San José Mercury News or the Metro’s misfits of reporting the “real news at city hall” to wit your philistine intellects and opinions as to the issues at bar are based.
        None of you currently understands city hall, city operations, the combined corruptions that influence the same and or the requisite jurisprudence, to exercise your God given abilities to integrate all of the aforementioned, in real time, to then entertain a cogent response to expeditiously and with analytical precision, formulate a battle plan for change.

      So, go ahead and waste our taxpayer money on Mayor Reed’s ballot measure. All my retiree brothers and sisters will still get paid and you, the taxpayers, will still be the incredible jackasses that you are albeit, somewhat poorer.

        The services you enjoy will soon vanish into the ether unless you start participating in our great democracy by educating yourselves; by attending the six (6) council committees, reading all reports, talking to countless city employees , going to council meetings, giving speeches and writing letters until your fingers fall off. Democracy is not easy, it is not for the faint hearted. Democracy requires you to get off your worthless, dead, good- for- nothing asses.
        As to the “one-half cent” sales tax, it is certainly not going to solve the problems at city hall. It will only serve to finance more of them.  What is needed prior to any revenue increase at city hall is leadership. Absent an informed and participatory citizenry,  leadership will be as foreign to city hall as all of you.

        Come to city hall meetings, I will see you there.

    David S. Wall (12.15.11)

  11. Hi Josh.  Thank you for responding to Councilwoman Pyle’s letter on revenue generation for the city.  I have to agree with her that revenue generation is important along with pension reform an other innovative measures to reduce the city’s on going deficit.  There are other ways besides just placing a sales tax on the ballot that needed to be found and validated.  But the citizens need to see the work and what choices they have.  The city, mainly the Mayor, Manager and some council have only focused on pension reform as being the sole solution to the on going deficit.  They have not brought to the table any other ideas.  If they have where is the detailed information at.  Under the city’s home page are numerous articles, letters and information including statistics and projections on how the pension system is hurting the city’s bottom line and what the desired city’s fix is.  But under the open government that the Mayor has valued there is almost nothing in comparison to the volumes of information posted on city employees salaries and the cost of the pension system.  I will give one example.  The ballpark, show me that by putting a downtown ballpark in the city the revenue projections that might be gained over a five or ten year period.  They were able to provide the information on the projected cost of the retirement system through 2016, yet no revenue projections for the ball park.  How can anyone decide which way to vote if they do not have all the information.  This is why the path of pension reform seems to be one sided.  With the recent agreed to pay cuts and continued talks between labor and the city on pension reform everyone will know.  To be consistent with the Mayors open government philosophy all city actions made by the elected officials should be made public.  At least Councilwoman Pyle is one of the first to say out in the open that other options to revenue generation need to be explored.  Thank you Councilwoman Pyle for your ability to do more than one thing at a time.  I can only hope that some of the other council can try and do the same.

  12. Having moved back to San Jose recently, I know very little about Nancy Pyle.  In an effort to gain a little more insight before penning this missive, I chose to take a look at her City of San Jose web page.  On said page, Nancy and her minions claim she, “takes an innovative approach to solving today’s challenges through creativity and collaboration.”

    I contend a tax increase to solve budget problems is anything but creative, Madame Pyle.  In an area when most people are belt-tightening, you propose having taxpayers fork over more.  That sounds like the same tired approach most politicians go to when it comes to budget woes.

    Eat cake, Madame Pyle.  Incroyable!

  13. I suggest everyone read the article in todays (Friday) mercury news byTom Cochran

    It is on the bottom of of the opinion page.  Tried to post it here but I guess it was not appreciated or approved.

    Good fact finding article, educate yourselves.

  14. Some facts to consider:

    Since 2006-07, San José’s cost-per-employee has grown from $106,981 to $141,919 today – a difference of $23,170. Cost per-employee increased 33% while inflation and population growth have together increased 11% over the same period. If per-employee costs rose at 11% instead of 33% the city would have saved $125,118,486.

  15. It’s about new jobs and businesses, not new and higher taxes –  Council dummies

    Increasing city taxes year after year is the same old tired ” dumb and dumber ” Council solution along with:

    – overspending for available taxes,
    – Council making promises without future taxes to pay for promises,
    – city administration that could not add up political promises and warn Council and public before it was too late ,
    – building fancy City Hall and too many city owned buildings to maintain,
    – building too much low income housing which attracted more low income low skill people without taxes to provide them services,
    – millions wasted on downtown and economic development with few new jobs or new taxes
    – overtaxing high skill higher income residents and their growth businesses while providing lower level higher cost city services that caused many these businesses and resident owners to leave San Jose reducing city tax revenues

    –  that got San Jose into budget problems

    Just about everyone in U.S. except San Jose City Council and city administration gets it:

    – High taxes drives away businesses, jobs and residents to lower taxes cities especially when lower tax cities provide better services, business friendly government, less regulations and higher quality of living

    – Even very desirable San Francisco gets it and is providing business tax breaks, lower taxes and making city government business friendly

    it is time Council dummies GET IT – It’s about new jobs and businesses and business friendly city, not more city taxes for less services

  16. Nancy,

    Yes, many small business people agreed that “The city has an out-of-date business tax model;” 

    San Jose charges too much in time, aggravation and money to deal with very unfriendly city government and should lower costs for lower level of services for high taxes and fees required

    There is a reason that San Jose has low rental rates and much higher vacancies that other Silicon Valley cities few if they had a choice want to do business in San Jose and rental rates and vacancies reflect the business community unhappiness with San Jose city government’s policies, attitudes and city imposed costs

    We knew the way to San Jose and we also know the way out of San Jose as thousand of business have left to cities that want us and provide better, easier, and lower cost services

  17. Tom leaves out some inconvenient truths about how labor contracts were actually achieved is his Mercury opinion

    An example can show how badly the city’s and state political leaders have strayed from our basic constitutional principles of public service vs special interest service against the public interests .

    Imagine the city has a 20-year lease for a complex of office buildings. The rental rate is negotiated between the building owner and city’s representatives paid by city and rent is fixed at $1 million the first year plus 3 percent for every subsequent year.

    Later the city finds out its representatives were bribed by building owner to negotiate and approve a higher rent and yearly rate increase

    After checking with attorneys the city finds out that bribing the city representatives is legal in California but not other states and that the California courts will most likely up hold the higher contract rates since bribery is legal in California

    Then the city encounters financial problems. They inform the landowner that they intend to reduce the rent to $500,000 a year plus 1 percent for future years.

    The landowner protests: I have a contract. The city replies: Yes but you bribed our representative to get a higher rent and yearly increase

    Landlord replies: Yes I did bribe your representatives and it in legal in California and you are stuck with the contract

    If you won’t pay, we will take you to court and court will impose a fine and damages for not paying the higher rents until you give in and accept a the higher lease.

    Do you think a court would uphold this strategy?  In California – Yes

    Do you think bribing city / state representatives is right although legal in California – No

    Most Voters do not think it is right to bribe our representatives although legal in California and state laws need to be changed to make bribing representatives illegal and resulting contracts null and void

  18. Pension reforms wont pay for the new stadium.  Once city workers get beat down by the voters in March, Chuck and Deb have already realized it wont be enough to build the minor league ballpark of their dreams.  Need a new money soiurce for that….TAXES….hahahahaha.  Play ball…P.O. you still are the greatest!!!!

  19. I did some research and for 2010 the Police/Fire pension investments earned 24.9 % return. This year is not over just yet, but all points to even a better rate of return! The City only counts on a 8% return. So why are pensions unsustainable with such a great return?? Something smells rotten? Mayor Burns knows why!

  20. Forget about raising taxes, how about getting everyone to pay taxes? Yes I’m talking about all of those taco stands on the sidewalks of east San Jose. Are they paying sales tax? I’ll answer that, HELL NO! And the Vietnamese restaurants in Grand Century Mall (cash only) They only pay a fraction of what they really owe. What has happened in this great state of California is that has become accepted, no, expected to cheat the system out of taxes and at the same time entitlements run amok. Hey city council people, the number one mission of city government is to protect it’s citizens. If the city agreed to give its employees a pension, it should hold true to that agreement. Get rid of the other “percs” such as: Ball Parks, Mexican Heritage Plazas, Hayes Mansions….ect! thanks for listening.

  21. Chuck and Deb want you to believe by putting forth a ballot measure it will attack public safety pensions.  In reality, it attacks every pension of every employee retired form the city as well as all future employees.

    Yes we need to adjust pensions for any new employees if the city every hires again, but Don’t punish ALL city workers who gave their heat and soul to the city only to get pushed to the curb, given pink slips or just got fed up and walked away.

    The city has cut over 2200 jobs, how are these folks suppose to live on a reduced pension?  Establish new hiring guidelines and save the city millions when the courts rule the ballot measure was illegal from the start.  Of course Chuck and most of the council will not be around when the courts over turn their ill will and make us all pay.

  22. This Mayor is as Crooked as they come . He would have you believe that all of San Jose’s woe’s come from its “evil employees” and “the Pensions Of Doom” . Do we need pension reform ? YES we do………LEGALLY! What this City needs is Open Discussion between workers and City Hall . Not the Fake kind that allows Mr. Burns to continue to push his agenda, real “Open to the public” Discussion , No Secrets , No Lies , No misrepresentation ,  and then let the residents decide who has been telling the truth all along , who has wanted and actually proposed true legal pension reform.

  23. It didn’t begin with Bush.

    It all began in the late 70’s with Jimmy Carter and the Community Reinvestment Act.

    “Activist groups were encouraged to agitate by the Carter-era Community Reinvestment Act, which enshrined in law a kind of lending protection racket. Banking regulators were given the power to make trouble for banks that failed to lend enough money to so-called underserved communities. Banks that paid enough—whatever that means—got left alone, but banks that didn’t, got their legs broken.

    After CRA came into effect, Saul Alinsky-inspired “community organizer” groups such as Greenlining, ACORN, and National Council of La Raza got into the shakedown business.”

    “The Clinton administration has turned the Community Reinvestment Act, a once-obscure and lightly enforced banking regulation law, into one of the most powerful mandates shaping American cities—and, as Senate Banking Committee chairman Phil Gramm memorably put it, a vast extortion scheme against the nation’s banks. Under its provisions, U.S. banks have committed nearly $1 trillion for inner-city and low-income mortgages and real estate development projects, most of it funneled through a nationwide network of left-wing community groups”

    And guess who was one of Clinton’s enforcers in the 90’s?  Why none other than Eric Holder!

    “Eric Holder and the head of his Civil Rights Division, Tom Perez were both protégés of Janet Reno who launched a similar attack on banks in the early years of the Clinton Administration. That led to an expansion of the Community Reinvestment Act, CRA, and an explosion of forced lending to low-income, poor credit risk borrowers and the sub-prime mortgage industry that collapsed in 2008.”

    A few years go by and the subprime warning bells start to go off.

    Remember Fannie Mae and Freddie Mac?  The 2 GSE’s at the heart of the sub-prime mortgage debacle that led to the meltdown?

    Here’s Barney Frank and the congressional black caucaus shutting down any attempts to rein in Fannie Mae and Freddie Mac in 2004.

    BTW, Barney Frank was literally in bed with an executive at Fannie Mae.  [Write your own jokes here]

    “One chapter in this story took place in July 2005, when the Senate Banking Committee, then controlled by the Republicans, adopted tough regulatory legislation for the GSEs on a party-line vote—all Republicans in favor, all Democrats opposed. The bill would have established a new regulator for Fannie and Freddie and given it authority to ensure that they maintained adequate capital, properly managed their interest rate risk, had adequate liquidity and reserves, and controlled their asset and investment portfolio growth. “

    “Why was there no action in the full Senate? As most Americans know today, it takes 60 votes to cut off debate in the Senate, and the Republicans had only 55. … But in a 45 member Democratic caucus that included Barack Obama and the current Senate Banking Chairman Christopher Dodd (D., Conn.), these votes could not be found. “

    “As a senator, he [Obama] was the third largest recipient of campaign contributions from Fannie Mae and Freddie Mac, behind only Sens. Chris Dodd and John Kerry.”

    “James A. Johnson was CEO of Fannie Mae from 1991 to 1998. After Johnson left the company, regulators later discovered that Fannie Mae had engaged in fraudulent accounting practices in 1998 which manipulated its earnings so that executives could earn performance bonuses (up to $1.9 million in Johnson’s case) they would not otherwise have been entitled to.

    In May 2008, Senator Obama tapped James Johnson to be one member of a three-person panel tasked with vetting potential vice-presidential running mates. Johnson resigned from that position shortly afterwards when news accounts reported that he had received more than $2 million in home loans at below average market rates from Countrywide Financial (a partner of Fannie Mae).”

    And there you have it.  Ah, not so fast. 

    Warning – you may need to sit down for this one.

    “The 1990s may have brought us supercharged politicized lending, but Eric Holder’s Department of Justice is taking the game to an entirely new level, and then some. The weapon is a “fair lending” unit created in early 2010, led by special counsel Eric Halperin and overseen by Civil Rights Division head Thomas Perez. “

    Graft and shakedowns of this magnitude would make another Chicagoan, Al Capone, proud indeed.

  24. Absolutely Beautifully Stated! So let me understand , Either It was Really Bad Math on the City’s part or The Mayor Weed Lied , Either way the residents of San Jose must start asking the hard questions of this Dishonorable Administration. People now have to Question , The Ballpark financing , Illegal Ballot Measure,Improper shifting of RDA debt to General Fund (Reed sits on both Council and RDA as do other council members, No Conflict there!),real estate gift to Billionaire , rezoning to continue to build Low income housing(Favors for Reeds Developer Buddies , City Manager (Unearned/gifted)Benefits. This is just a small list of things that need to be looked at closer…………………….Lets see out Open the Mayor and Council are to “Open Gov/Sunshine”??? How bout Mayor and Council giving away millions 26 million real estate to Billionaire developer for only 6 million dollars like Austin Powers! How bout Council’s excessive Redevelopment 5.2 billion dollar spending? How bout the 152 business enterprises that are popping up all around City of San Jose Marijuana Pot Clubs, which are a direct violation of Federal law. Yet City and Council are allowing these businesses under lawn care logo? Ya mr boringstein, now u can blame the City of San Jose employees! So now councilwoman Denver Pyle wants to tax residents more and Council and Mayor Weed want to spend, spend, and tax more!

  25. I think the business tax model etc. are not the problem but the problem lies with the fact that tax money is not properly used according to the plan and so every year to fill such gap more tax are imposed. They should firstly work on use of tax money and then should calculate other things.

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