What Do Pensions Have to Do With Pot?

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There are still three months to go in 2010, but it's not too soon to award the weirdest op-ed piece of the year to Gov. Arnold Schwarzenegger.

Writing in the LA Times last week, Schwarzenegger connected two hot-button California issues that don't often end up in the same sentence: the legalization and taxation of marijuana (on the November ballot via Prop 19) and the problem of underfunded pensions for state workers.

What connects these? Not much, except California's broken budget. In the piece, Schwarzenegger expresses frustration at America's biggest union, the Service Employees International Union (SEIU), which represents state workers, for supporting the marijuana legalization measure -- which will bring in money to the budget -- while opposing the governor's pension reforms, which would produce even more money for the state. Schwarzenegger asks why the union supports an initiative that could put California at odds with the federal government while it opposes measures to save more money.

The answer should be obvious, even to Schwarzenegger: SEIU represents state workers, and the pensions of future workers would be affected by the governor's pension reforms. And SEIU needs more money in the budget, and the marijuana legalization provides that. Heck, a marijuana industry could produce more jobs for SEIU (through new government employees to oversee marijuana regulation) and for SEIU's union brothers, the Teamsters, who are strongly backing Prop 19 as a jobs measure.

As a pure budget measure, Schwarzenegger is probably half right and SEIU is half wrong. Pension reform would help the budget, and SEIU is selfishly protecting measures by opposing it. But a marijuana tax might produce more revenues too. Whether Prop 19 is well-designed -- and there's reason to think it's not -- is another question.

Of course, why a governor would want to make the case for pension reform, a difficult subject by itself, by tying it to another controversial and difficult subject, is beyond me? Better to keep it simple, governor.

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