Warren Buffett discusses ‘disaster’ contributing to Bay Area exodus in CNBC interview

[IsailedawayfromFR]

Warren Buffett described unfunded public pensions as a “disaster” that companies and individuals must consider when deciding where to expand or move.

While corporate America’s traditional, defined-benefit pension plans are no longer the problem they were 10 or 20 years ago, “in the public sector, you know, it’s a disaster,” Buffett told CNBC this week in discussing Amazon’s (NASDAQ: AMZN) decision to ditch New York City for a major expansion.

California’s unfunded public pensions are a hot topic, with taxpayers on the hook for making up any shortfalls in employee contributions or investment returns.

“If I were relocating into some state that had a huge unfunded pension plan, I'm walking into liabilities," Buffett said. "'Cause I mean, who knows whether they're gonna get it from the corporate income tax or my employees — you know, with personal income taxes or what. That liability isn't gonna — you can't ship it offshore or anything like that. And those are big numbers, really big numbers.
https://www.bizjournals.com/sanfrancisco/news/2019/02/26/warren-buffett-public-pensions-exodus-mck-wfc-core.html?ana=yahoo&yptr=yahoo

Buffett is tackling Blue States head-on.

Bet those states are reacting to being pointed out rather than solving the underlying problem.

[LMAO]

Buffett is tackling Blue States head-on.

Bet those states are reacting to being pointed out rather than solving the underlying problem.

The debt crisis that hit southern Europe the last decade will play out in many states.  Governors and legislators in the states are basically people standing on the beach watching a massive tsunami coming their way and they can’t run away from it. There is really absolutely nothing at this point that they can do.

[IsailedawayfromFR]

The debt crisis that hit southern Europe the last decade will play out in many states.  Governors and legislators in the states are basically people standing on the beach watching a massive tsunami coming their way and they can’t run away from it. There is really absolutely nothing at this point that they can do.

Oh yes they can by feverishly getting Democrats elected to federal positions in Executive and Congress.

They do this by allowing illegals to vote in their states, and keep unions bankrolled and powerful enough to sway elections.

Once in control of the federal government, the Democrats will assume control of the state debt, meaning all the other states who have dealt responsibly with their debt will now be funding the likes of Illinois, California and NY state employees pensions.

It will be our demise.

[LMAO]

 And the states are going to be bailed out  by the Federal government.  Which means you and I, foreign investors, and the printing press will bail the states out. I’m not saying I agree with bailing them out, but California itself represents the fifth largest economy in the world. Is the federal government going to let that collapse?

[dfwgator]

Buffet is a Rat who is partially responsible for this mess.

[jmyrlefuller]

Once in control of the federal government, the Democrats will assume control of the state debt, meaning all the other states who have dealt responsibly with their debt will now be funding the likes of Illinois, California and NY state employees pensions.

New York has already pawned off much of their pension fund onto county and local governments. That's part of the reason 1) New York property taxes are among the highest in the nation and 2) why their pension fund never has serious shortfalls—when the stock market goes down, the county and local governments get soaked for the difference, who in turn are allowed to ignore the "tax cap" to raise taxes however much they need to cover the difference.

[skeeter]

New York has already pawned off much of their pension fund onto county and local governments. That's part of the reason 1) New York property taxes are among the highest in the nation and 2) why their pension fund never has serious shortfalls—when the stock market goes down, the county and local governments get soaked for the difference, who in turn are allowed to ignore the "tax cap" to raise taxes however much they need to cover the difference.

This is what worries me - our savings are largely tied up in our primary residence. I expect sooner or later the powers that be will chuck the rules keeping property taxes down, crank them up higher than they already are to make up for the shortfall, and destroy the value of real estate around here.

[IsailedawayfromFR]

And the states are going to be bailed out  by the Federal government.  Which means you and I, foreign investors, and the printing press will bail the states out. I’m not saying I agree with bailing them out, but California itself represents the fifth largest economy in the world. Is the federal government going to let that collapse?

In the government we live in, which is based upon being a Democratic Republic, a state is free to collapse of its own doing.