It is one of the potential flaws in the structure of a state workers’ compensation fund; the agency, or quasi-independent company, responsibly establishes reserves to protect their customers and workers from future and unknown calamities. Then greedy, grubby, ignorant, sticky fingered politicians drool over those funds and try for an unmitigated cash grab, believing they can better spend the funds than the people who collected them.
Or in the case of Oregon, cover their asses by shoring up really stupid decisions of the past.
Once again the Governor of Oregon is reported to be considering the seizure of $1.4 billion from the state owned workers’ compensation insurer, SAIF (some SAIF employees bristle at their company being referred to as a state fund). The money would be used to help “save” (really can’t use that term honestly for reasons I shall cover) the state’s lavishly generous retirement fund, the Public Employees Retirement System (PERS).
More accurately, the funds would be used to shore up the flailing pension funds for school districts around the state, but they are all part of the broader PERS system. And that system currently has unfunded liabilities of around $26.6 billion.
That’s billion, with a “B,” folks.
This is not the first time this particular insurer has faced this issue. And it is not the only state fund to have encountered this problem. Politicians just cannot seem to help themselves. When they see money “lying around” they have an innate need to acquire the cash and use it for reasons other than for which it was intended. They believe the money to be theirs, and they always know better what should be done with it.
In this case, it would be a likely illegal move that represents an undeclared tax on employers. That money was provided by them and is held for their benefit. If it is ultimately to be spent, it should be for their workers who were injured, or in a return as dividends. The state has no right to that money.
Try telling that to irresponsible politicians.
Of course, in Oregon, where essentially one party rules all, they have demonstrated in the past that lawful behavior is not always mandatory. Absolute power corrupts absolutely, and it doesn’t matter of that power is liberal or conservative; in the absence of effective opposition bad things can happen.
And they’re considering something bad in Oregon.
The really sad thing is that the $1.4 billion they are considering is a drop in the bucket and would simply serve to delay the ultimate problem by mere months. The PERS system is fundamentally flawed as a retirement program, and in the private sector it would never have seen the light of day. But politicians are great at making promises with money that is not theirs, and states and municipalities all over the nation are seeing huge pension obligations that they simply cannot afford. One of these days, someone is going to have to pay the piper.
The reserves of SAIF and its counterparts around the nation should not be the ones picking up that tab.