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My Body Isn’t 40 Anymore: Three Faces of Retirement

11:12 am in Pension by Gary Cohn

It’s official: America has entered a retirement crisis. Or, as Forbes understatedly put it, “the greatest retirement crisis in the history of the world.”

And, while the causes are manifold — the demographic bulge of baby boomers leaving the fulltime workforce; greater worker longevity; the disastrous, 30-year shift from traditional defined benefit pensions to costly 401(k)-style plans — most experts agree that the national retirement implosion has gone critical, with an estimated 75 percent of Americans who are nearing retirement age having less than $27,000 in their retirement accounts.

Even John C. Bogle, the founder of the $2 trillion mutual fund and 401(k) behemoth Vanguard Group, recently admitted that the system of retirement plans that rely on 401(k)s is broken.

“[401(k)s were] designed as a thrift plan, and it doesn’t work as a retirement plan,” Bogle declared.

So it is with some irony that a Texas hedge fund billionaire/former Enron trader and a politically ambitious Northern California mayor have teamed up to cripple one of the few parts of the retirement story that still works — California’s public-sector pension system. Last month San Jose Mayor Chuck Reed filed papers with the state attorney general’s office to begin the qualification process for what Reed called the Pension Reform Act of 2014.

The measure, which was financed with a $200,000 down payment from John Arnold, the Houston billionaire and right-wing libertarian, seeks to rewrite California’s constitution to effectively empower the state and local governments to gut retirement benefits for current employees for the years of work they perform after the changes go into effect, should the measure pass.

Reed and his billionaire backers (including Silicon Valley venture capitalist Michael Moritz) will have to move quickly, however, if they want to make their claims stick about the “unfunded liability” of California’s public pension structure. According to the California Public Employees’ Retirement System (CalPERS), the system was 101 percent funded before the 2008 crash and is today well on its way to a full rebound, even during this sluggish recovery.

The new ballot initiative’s dry run came last year when Reed persuaded 69 percent of San Jose voters to pass Measure B, his municipal pension-cutting measure that forces city workers to cough up an additional 16 percent of their take-home pay into their pensions while paring benefits for new hires — or it will, if the measure can survive a gauntlet of lawsuits challenging its constitutionality.

If Measure B is any indicator, and if Reed’s new effort qualifies for next year’s ballot, California voters can look forward to a barrage of claims from Reed’s anti-pension forces who will employ his voter-tested mix of statistics, distorted bookkeeping and exaggerationabout the prodigal lifestyles enjoyed by public pensioners, and the unsustainability of such taxpayer largesse.

These campaign strategies include cherry-picking the six-figure retirement compensation packages of top-tier city and county executives to create poster children for “skyrocketing pension costs.” Yet according to CalPERS, the average pension for state workers is about $25,000 per year and that half of CalPERS retirees receive $18,000 per year or less in benefits.

While Reed and company aren’t explicitly articulating their vision of how the Golden State’s public retirees are supposed to survive on less during their golden years, Frying Pan News recently spoke with some former state, county and municipal workers for a picture of how their retirements have been living up to their expectations.

Norma Anders, Long Beach

Retired career librarian Norma Anders’ eyes light up when she speaks of her 30 years in the City of Los Angeles’ public library system. “We make a big difference,” she declares proudly. “We’re one of the forces that’s giving our country an educated workforce, an informed citizenry. [It’s how] we’re going to be able to keep our [nation] growing and growing.”

Norma Anders (Photo: Bill Raden)


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California Interpreter Bill Would Help Save Lives Lost in Translation

7:50 am in Healthcare by Gary Cohn

Hospital bed

A language barrier can have serious consequences for medical care.

Maria Guevara had been trying to get pregnant for three years when she saw a doctor at Los Angeles County General hospital in 2008. She was understandably thrilled, then, to learn she was indeed three months pregnant at the time of her visit. As Guevara later recalled, when the doctor asked her in English if she wanted to keep the baby, “without hesitation I replied ‘yes’ to his question. Before leaving the hospital, the doctor prescribed me medication that I thought was prenatal care. That lack of communication between the doctor and me has changed my life forever.”

Guevara took the prescribed medication, and experienced violent pain and bleeding. She returned to the hospital, where another doctor told her the bleeding was the result of a miscarriage.

“My baby was dead. The medication the initial doctor prescribed to me was not prenatal care but medication to induce an abortion,” she told a press conference in April at the University of California Davis Medical Center in Sacramento. “Not speaking any English, I was unable to understand his question to me. He did not speak Spanish and no interpreter was provided.”

This occurred at the largest single health care provider for a county where 37 percent of the population is comprised of Spanish-speakers.

“Losing my baby forced me into a deep depression,” Guevara said. “I could not bear looking at or holding babies because the thought brought back painful emotions.”

Although California has some of the strongest laws in the nation spelling out a patient’s right to an interpreter, stories like Guevara’s are far from unique. Day after day, non-English speaking patients are seeing doctors and nurses throughout California without the aid of medical interpreters, sometimes with tragic results, a Frying Pan News investigation has found.

Hardly a day goes by when Julio Perez doesn’t think about his joyful little brother Aldo, an energetic five-year-old who loved watching cartoons – and how Aldo might be alive today if his parents had been able to communicate with doctors.

Both brothers got sick one day in March 2008, and their mother first took them to a clinic with a Spanish-speaking doctor in South Gate, about seven miles southeast of downtown Los Angeles. Each of the boys was given a shot. Julio got better; Aldo did not. Their mother took Aldo back to the clinic, then to two hospitals. At the second hospital, Long Beach Memorial Medical Center, which had more sophisticated medical care available, an interpreter was summoned to explain the liability forms. Once the forms were signed, Julio recalls, the interpreter left and never returned.

None of the doctors or nurses the family dealt with at LBMMC spoke fluent Spanish.

“I had to be the interpreter,” Julio says. As he remembers, doctors said that his brother had a serious bacterial infection. Numerous medical procedures followed, as doctors tried to save Aldo’s life. He died on April 14, 2008.

“I feel that my baby brother’s death was an injustice,” says Julio Perez, now 24. He believes the hospital kept his family in the dark about Aldo’s condition. “If we had proper interpreting services . . . my parents could have asked questions.”

California Assemblyman Dr. Richard Pan (D-Sacramento), a pediatrician and chairman of the Assembly’s Health Committee, says that Maria Guevara’s story, which he heard firsthand in April, epitomizes the need for an effective statewide system of medical interpreters. “That story tells you the horrendous consequences of not being able to communicate between a patient and a health care provider,” he says in an interview.

Such problems are systemic and widespread. In a month-long investigation, Frying Pan News has reviewed 75 case studies from across California in which a qualified medical interpreter was not present. In all of the cases, the health professionals were fluent only in English; the patients spoke a variety of languages, including Spanish, Russian, Mandarin, Cantonese, Samoan, Vietnamese, Khmer and Hmong.

California is the most ethnically diverse state in the nation, and an estimated 40 percent of the population speaks a language other than English at home. The need for qualified medical interpreters, moreover, is expected to increase when millions of people who don’t speak English become eligible for health insurance under the Affordable Care Act. Experts stress that many of those newly enrolled won’t be able to communicate with their doctors and other health professionals unless interpreters are readily available.

“The Affordable Care Act will exacerbate this issue,” says Dr. George Flores, program manager for prevention at the California Endowment, a Los Angeles-based private statewide health foundation that works to expand quality health care for underserved individuals and communities in California. “A good portion of those eligible speak a language other than English. This will put more pressure on a system already bereft of language capability.”

State Assemblyman Philip Y. Ting (D-San Francisco), who held a forum on language access last week, agrees.

“This issue will become even more critical in the coming years,” says Ting, “as three million new patients who speak only limited English enter the health system.”

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How Enterprise Zones Are Killing the California Dream

10:14 am in Enterprise zones by Gary Cohn

The following story is part of California Exposé, an investigative series from Frying Pan News.

John Thomas and Hans Burkhardt have a lot in common. For more than 17 years each man had a good paying union job, with health and pension benefits, near San Francisco Bay. Thomas worked as a warehouseman for VWR International, a medical supply company with a warehouse in Brisbane, south of Candlestick Park. Burkhardt also worked as a warehouseman, for BlueLinx, a building products company with a facility across the bay in Newark.

The similarities don’t end there. Both Thomas and Burkhardt are now collecting unemployment, having lost their $22-an-hour jobs after their employers moved to take advantage of California’s enterprise zone plan, a controversial state program that is supposed to create jobs.

The enterprise program, established in 1984, provides $700 million in tax breaks for companies that set up business or move to one of 40 zones within the state. It is operated by the state but administered by local governments. The program gives companies tax credits of up to $37,440 per person hired in one of the zones, which are intended to create jobs and spark investment in economically distressed areas. Yet interviews and public documents reviewed by Frying Pan News reveal that some of these zones are located in relatively well-off areas, including San Francisco’s Financial District and the city’s hipster-packed SoMa neighborhood, which is home to many software and technology firms. In Southern California, enterprise zone areas encompass parts of Hollywood and the corporate center of downtown Los Angeles.

The program has been under fire for years from critics who say that it simply rewards employers for moving jobs from one location to another — and who echo the charge that several of the so-called enterprise zones aren’t really in economically distressed regions.  According to sources with knowledge of the program, other businesses that have applied for enterprise zone credits include two strip clubs, Gold Club Centerfolds and Déjà Vu Showgirls.

The two gentlemen’s clubs are located in Rancho Cordova, a largely middle-class suburb just east of the state’s capitol, Sacramento. Gold Club Centerfolds advertises itself as “Sacramento’s All Nude Adult Entertainment,” while Déjà Vu Showgirls, which is part of a national chain of clubs, offers “1000’s of Beautiful Girls and 3 Ugly Ones.” It isn’t known whether the applications were approved because, like so much of the program, the names of recipients aren’t public information. (The two clubs have not responded to requests for comment; neither have VWR or BlueLinx.)

[Update, May 28 7:26 p.m.: Documents received by Frying Pan News today show that Gold Club Centerfolds did receive approval of its application.]

In fact, because the program falls under the purview of tax codes, much of its day to day workings, including the names of businesses that receive the enterprise zone tax credits, aren’t publicly available. Overall, 61 percent of enterprise zone tax credits were claimed by corporations with more than $1 billion in assets. People familiar with the program say that recipients include huge retailers such as Walmart. The total amount of enterprise tax credits received by Walmart is one of those facts cloaked in the program’s tax secrecy.

Numerous studies have raised questions about the value of the enterprise zone program. The nonpartisan Public Policy Institute of California concluded in 2009 that enterprise zones had no effect on job creation.

“On average, enterprise zones have no statistically significant effect on either business creation or employment growth rates,” the study said. “The absence of evidence of a beneficial effect of California’s enterprise zones on job and business creation clearly calls into question whether the state should continue to grant enterprise zone tax incentives.”

Other critics say that the worst thing about the program is the human toll it takes on workers. Both John Thomas and Hans arwere willing to move with their companies, but under the provisions of the enterprise zone program the companies cannot take their current workers and still claim the tax credits.

“They should have taken people with them who wanted to go,” says Burkhardt. “I would have gone.”  The union jobs that Burkhardt and Thomas and their fellow workers had at the BlueLinx and VWR locations paid, on average, about $20 an hour, plus benefits. They were replaced with non-union positions that paid about one-half of that, with non-existent or substantially reduced benefits.

“I’ve been up here four years, and this is the most abused program I’ve seen,” says state Senator Jerry Hill, (D-San Mateo), whose district includes Brisbane, where VWR had its warehouse.

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