Report calls L.A. a city in decline, warns of crisis in leadership

[alp227]

Source: LA Times

Los Angeles is a city in decline, strangled by traffic, weighed down by poverty and suffering from "a crisis of leadership and direction," according to a report released Wednesday by a 13-member citizen panel.

The Los Angeles 2020 Commission, convened by City Council President Herb Wesson to examine the city's economic woes, offered a harsh assessment of civic decision-making, warning that Los Angeles is heading to a future where local government can no longer afford to provide public services.

The panel, chaired by former U.S. Commerce Secretary Mickey Kantor, said Los Angeles lacks a coherent approach to economic development and trails other major cities in job growth. City government spending is growing faster than revenue and the pension benefits of city employees are at risk, said the report, titled "A Time For Truth."


Read more: http://www.latimes.com/local/lanow/la-me-ln-report-los-angeles-budget-20140107,0,2124833.story

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Kantor served in the Commerce Dept during the Clinton administration.

[okaawhatever]

1. I hope LA takes heed. I think most major cities face pension issues. The paying for pensions through

growth days are over. Cities like LA aren't growing and their pension obligations are eating up a larger part of their budget. I don't want to see Detroit-like cuts to pensions so I hope LA addresses this now.

[OrwellwasRight]

5. More bogus right wing rhetoric.

"Pensions" are not what is wrong with cities. "Pensions" don't inhibit job growth or cause poverty. These are the two major things the report identified as issues in LA. Quit bashing public servants and go spew your anti-working class rhetoric elsewhere.

[okaawhatever]

6. Wow, angry much? I don't think you understood what I was saying. I was referring to the portion of

the report that said if they didn't do something now they'd have trouble paying for their pensions. Many major cities have used growth to fund pensions rather than put aside enough money for them. Like social security they count on more people contributing next year so the budget will allow for the current workers plus pension demands. Problem is, you come to a point where you can't grow anymore, or like Detroit, have other issues that erode the tax base. When that happens there isn't enough money to fund the pensions and the workers get screwed. Several cities and states right now are woefully underfunded in the pension area. The right wingers want to drop pensions (especially since the court in Michigan gave the city/state the right to forego pension payments under bankruptcy). I want to see pensions funded at adequate levels so this doesn't happen anymore. Until pensions are adequately funded the right wingers and corporations will constantly battle the government worker. Just like social security and safety net programs, corporate America wants to do away with those programs because if they don't corporate America will have to start paying taxes again. If corporate America paid what they used to as either a percentage of profit or a percentage of GDP many of our safety net programs wouldn't face any problems. That's a multi-billion dollar savings for corporations if they can keep the status quo. I'm not a right winger nor am I anti-worker, exactly the opposite, but we must be real about the problem and realize that if something isn't done about the cities that have funding shortfalls the workers will get screwed in favor of the corporations.

[OrwellwasRight]

14. Yes, very angry.

Many major cities have used growth to fund pensions rather than put aside enough money for them. Like social security they count on more people contributing next year so the budget will allow for the current workers plus pension demands. Problem is, you come to a point where you can't grow anymore, or like Detroit, have other issues that erode the tax base.

You misunderstand. It is nothing like Social Security. "Funding through growth" doesn't mean growth of the city or growth of the workforce -- it means growth through high returns. In other words, cities VIOLATED their promises to put in x% of the payroll and instead counted on the extremely high growth of the stock market to make up for the loss of actual cash. Many cities did this throughout the 90s and 2000s. It was an accounting gimmick and never how pensions were designed. Pensions are designed to grow through three things: employee contributions, employer contributions, and through the investment itself making money (e.g., interest/dividends/capital gains). When cities failed to contribute their employer share and instead relied on extraordinary rates of return, they abdicated their duties (i.e., fucked up). It is complete and utter bullshit to blame workers for this and to cut their pensions to "make it right."

The right solution is to increase employer contributions. That is what YOU'd have to do if YOU failed to contribute your personal share. And it is what cities like LA have to do. And to fund it, they'll have to raise taxes. But right wingers don't want to pay more taxes, they just want us to hate public servants. And so long as you keep repeating their bullshit that this is the fault of generous pensions and advocate cuts for workers, you are doing their work for them.

[okaawhatever]

18. I've read several articles about pensions and city expenses and revenue in general. While I don't

think I fully grasped the accounting b.s. the cities were pulling to reduce their share of contributions to plans, there was a lot of talk about cities routinely hiding or minimizing the problems through growth of population and revenue. Maybe they were trying to not raise taxes by assuming that "next year" when there were higher revenues they'd make up the difference in pensions. Of course, we all know that "next year" never really comes, constantly being put off.

I'm not repeating right wing rhetoric. If I were doing that I'd be saying that the public workers made too much money and how the pensions are why normal tax payers don't have _____________ (fill in the blank with outrage du jour). I'm genuinely concerned about gov't workers getting screwed on their pensions.

[hack89]

7. Their expenses are growing faster than their revenue

If they do not find ways to grow the economy and increase revenues then they will not be able to afford current services. That includes pension obligations. Basic economics.

[OrwellwasRight]

12. And pensions didn't cause the bad economy and shouldn't get the blame.

That's basic truthiness. Gee, I failed to contribute the lawfully required employer portion to the pension fund, and now I am caught with my pants down. I guess I should blame public servants and cut the pensions they reliably contributed to, earned, and were promised. And I'll also blame the city's problems on the workers. Yeah, that's a good solution.

[hack89]

16. Not a matter of blame

If the money is not there then the money is not there. It then become a question of what to cut. Schools, police, fire, infrastructure , social services are all competing for a smaller pot of money.

[OrwellwasRight]

20. "Money is not there"?

What, like the weather? Government revenue doesn't happen by chance, osmosis, or magic. It is planned for in a budget, and when the budget isn't enough to provide the necessary services the government wants to provide, it changes the revenues (e.g., increases taxes). What you do not do is renege on contracts made with people who gave their lives to public service and kept up their end of the bargain.

And yes, it is a matter of blame, because if cuts are to be made, you first cut the accounts that are the cause of shortfall -- since pensions are not the cause of budget shortfalls except in the minds of the right wingers, they should not in fact be cut.

[hack89]

22. Did you bother to even read the article?

The entire point is that due to poor government, LA is not doing those things necessary to grow the economy - which means their tax base is not growimg fast enough. You need people with good jobs to tax - higher and higher taxes on a shrinking portion of the population is a receipe for disaster. For one thing they will vote in politicians that promise them lower taxes.

So you would cut schools and social services before pensions? Nothing wrong with that but can you understand why some people have different priorities?

[OrwellwasRight]

24. Have you ever lived in LA?

There are PLENTY of people with giant incomes that are not being taxed--unlike NYC, LA has no city income tax. Plenty of hotel rooms to tax. Plenty of retail outlets to tax. The "poor governance" of LA has to do with the refusal to make tough decisions necessary to run a government responsibly, which means a refusal to tax adequately. That is governing out of fear, not leadership.

The City of LA does not fund schools. Schools in California are funded at the state level so the City can't "cut schools." And who do you think works at schools anyway? It's people with pensions. I have already said that taxes should be increased rather than pensions cut. If cuts need to be made, they should be made to things like tax rebates for film production, like sweeps of homeless campsites (let 'em be), like coffee at city council meetings and car allowances for city council members and salaries for the highest paid bureaucrats. Other than that, there isn't much to cut. LA already has part time libraries, unmaintained sidewalks, and less park space than any other city in the nation.

But yes, let's instead cut working people's incomes instead, so they have less money to spend, and produce less sales tax revenue. That'll help save LA. Not.

[Psephos]

10. This kind of approach is not conducive to a good discussion. n/t

[OrwellwasRight]

13. And who are you?

The discussion police? I am so sick of anti-union, anti-worker, anti-public servant bullshit on this Board. I am not putting up with it any more in the name of peace with the Rahm Emanuel wing of the party. Block me if you don't like me, but telling me to shut up and take anti-union bullshit is pointless and ineffective.

[Psephos]

15. I'm the guy who had to sit next to you in high school. n/t

[OrwellwasRight]

21. No, 'cuz none of those guys tried to boss me.

They knew it wouldn't end they way they wanted.

[runfastandwin]

2. I have been hearing this for 30 years now.

At some point maybe it will come true, but LA has been a city on the verge of collapse for as long as I can remember. More Chicken Little...

[upaloopa]

3. When ever I see pensions mentioned in these stories

I feel the original intent is to do away with the pension systems.
Pensions are a part of the problem but become the major discussion item.
Three things caused pension fund shortages. The stock market decline lowered pension fund growth, retirees are living longer and governments used pension obligation money to pay for other budget items. Now people want retirees to take the hit.
The average person would not see any change in their standard of living if pension shortages were made up by increasing tax revenue. But retirees will become much poorer if the pensions were taken away.

[tblue]

11. That's a bingo!

They want every city to go the way of Detroit. Hell no!!!

[starroute]

4. Kantor was centrally involved in the creation of NAFTA

And as far as I can tell, he's never stopped insisting that it was a good thing. He's also got some Monsanto skeletons in his closet.

(And there's a thoroughly scathing put-down of the current review at http://jwalshconfidential.wordpress.com/2013/11/14/rutten-to-the-core-the-ghost-of-mickey-kantor-haunts-the-los-angeles-daily-news-mickey-kantor-picks-ex-la-times-columnist-to-write-the-kantor-report/)

http://www.international.ucla.edu/article.asp?parentid=25322

June 06, 2005

Mickey Kantor served as U.S. Trade Representative, 1993 to 1997, and as Secretary of Commerce under Bill Clinton, 1996 to 1997. Kantor was the lead U.S. negotiator in the creation of the World Trade Organization, the North American Free Trade Agreement, and the Asian Pacific Economic Cooperation Forum. He oversaw some 200 trade agreements between the United States and other countries. Kantor served as national chairman for the Clinton-Gore campaign in 1992, and is a member of the board of several prominent corporations including Monsanto. . . .

A major implication of globalization, Kantor said, is a weakening of sovereignty. "What we are doing day after day, inexorably, is wiping out sovereignty in the world to some degree. Wiping out borders. Issues that used to be thought of as only internal to the nation have become issues that, of course, affect many nations. So therefore countries are going to have to harmonize their standards, their certifications, their testing, their various other things in order to continue to build on this global economy.


http://www.commondreams.org/headlines/090300-03.htm

Published in the March 7, 1999 issue of In These Times
The Monsanto Machine

But the company may have secured its biggest coup in 1997, when it brought onto its board Mickey Kantor, the former secretary of commerce and one of Bill Clinton's closest advisers. Kantor joined two other Washington insiders on the Monsanto board--William Ruckleshaus, former director of the EPA, and Gwendolyn King, former head of the Social Security Administration.

Monsanto compensates its directors handsomely: Kantor receives nearly $100,000 a year. But that relatively small investment brings Monsanto lucrative returns. It was Kantor who opened the doors to the White House and pushed the administration to pressure the EU over Monsanto's genetically engineered grain.

Kantor's new law firm, Mayer, Brown & Platt, watches out for the company's interests in matters of international trade, food safety and product labeling.

[Ash_F]

17. Credibility goes poof! /nt

[DisgustipatedinCA]

9. You're at the wrong website.

Illegal immigrants typically only displace the least competent of our workforce, as they get the shittiest jobs, paid under the table, and so on. If illegal immigrants took your job, you didn't have much of one to start with.

If you want to address problems in LA County, you might want to start with the rabid dogs who self-identify as the LA County Sheriff's Department.

[bemildred]

19. Sorry Mickey, we don't want to be Detroited. nt

[JI7]

23. downtown LA has been doing really well and worth checking out for tourists

there are many parts which are not doing well and look like they have been abandoned long ago.

but i think it's always been this way.