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Taxpayers pay more than entire state pension fund

• Published September 17, 2008

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Yesterday I noted that even a loss of $130 million this week is a drop in the bucket for the state's pension fund. Later in the day, the taxpayers bought the bucket and then some, forking over more than the entire value of Washington's pension fund to bail out a single Wall Street firm.

The federal government planned yesterday to spend $85 billion – with the "b" – to shore up American International Group, Inc. the world's largest insurer. The state's combined pension investments amount to $78 billion.

This is where putting scale in context is quite difficult. $130 million is a lot of money, almost enough to build a monumental Heritage Center in Olympia, the stacked building at left below.

But the equivalent worth of that building only amounted to 0.17 percent drop in the pension fund. In turn the buyout of AIG is worth quite roughly the last six years of total state operating budgets? Something like that.

Let's put it this way: when the voters said yes in 2005 to a new tax of 9.5 cents on every gallon of fuel purchased every day in the entire state, they were putting up about $8.5 billion over the proposed construction period. That would one tenth of the public money spent to buy 80 percent of AIG last night.