*Solving the state's pension crisis - well, maybe

An outfit called the California Foundation for Fiscal Responsibility is proposing a hybrid system that combines a monthly pension check with a modified 401(k) savings plan - a system that generates billions of dollars in savings. Such hybrids have been brought up before - last February, the Little Hoover Commission recommended a plan that would cover current and future employees and be made up of three components: a small defined benefit pension program, Social Security (which public workers do not currently receive), and an employer-matched 401(k). Another group, California Pension Reform, plans a November 2012 ballot measure that would cap government pension contributions at 6 percent of an employee's salary for all except those working in public safety, for which the limit would be 9 percent. These are all reasonable ideas, but as you might guess the unions aren't thrilled. They also question the motivations of the folks who have been financing pension reform efforts. The California Foundation for Fiscal Responsibility, as an example, is being bankrolled by John Arnold, a former Enron trader who became a billionaire by buying and selling natural gas. From Bloomberg:

Arnold, who formed hedge fund Centaurus Advisors LLC in Houston after leaving Enron, started a foundation that Meredith Simonton, a spokeswoman, said has given $150,000 to the California group. The organization set up by Arnold and his wife, Laura, a lawyer, plans to be involved in pension-overhaul efforts around the U.S., Simonton said by telephone from Houston. State and local governments confront "massive financial distress" from the gap between assets and promised benefits, she said.

The Arnolds are not right-wing flakes. They've pledged to donate a majority of their wealth to philanthropic causes, the same pledge that's been made by Warren Buffett and Bill Gates. And the person heading their California organization is a Democrat.

*Well, let's just say that they don't seem to be flakes, though the truth is very little is known about their politics or motivations. Meanwhile, it's worth noting that backers of the ballot measure have a Republican bent, as do many groups pushing for public pension reform. Witness what happened in Wisconsin.