California’s Unemployment Insurance (UI) Trust Fund that pays out state benefits is now “structurally insolvent,” according to a recent report.
The Legislative Analyst’s Office noted the debt crisis involving the California Employment Development Department’s (EDD) UI trust fund on July 7.
The state report was released following last week’s “May Fund Forecast” report by the EDD. It said that a temporary surcharge, which state businesses are currently paying to cover the agency’s multi-billion dollar debt to the federal government, may continue to be in place for some time.
The additional taxes being paid by employers will offset the $20 billion in federal loans taken by the state to cover UI benefit payments during the pandemic and related stimulus measures.
The money that California is using to pay claimants’ benefits, is already guaranteed by the feds, no matter what financial condition the EDD is in.
California is one of the two states that has remaining debt from the pandemic and accounts for 73 percent of that debt nationwide, with New York accounting for the rest.
According to California Globe, the EDD has been called one of the most mismanaged agencies in the state, with government insiders allegedly calling it “the place where state careers go to die.”
California Will Take Years to Pay Off Debt
The EDD said that even without the debt incurred from the state’s pandemic response, which is the cause of the latest insolvency and tax hike, California would still have had to borrow money over the next few years.
The report said this would continue even in a “good” economy and that the structural insolvency would need at least two to five years to fix.
“Historically, benefit payments have only exceeded contributions during major economic downturns—most recently, during the pandemic and Great Recession,” the EDD report said.
“For the first time, the fund is expected to be out of balance during a period of job growth.”
The EDD believes that the surcharge fee will now last about 15 years and not the six or seven years as originally projected in order to pay back the $20 billion borrowed from Washington.
California lost about $40 billion to unemployment fraud during the pandemic, most of which could have been prevented early on, with a state fraud prevention identity security system.
However, the disgraced former labor department chief Julie Su, who was aware of the problem the whole time, waited months to install an anti-fraud system.
Taxpayers Paying for State Mismanagement
The EDD expects to take in about $5.3 billion in UI tax money over the next couple of years to pay off some of the debt.
The unpopular surcharge tax will cost each California employee about $1,500 over the next 15 years, with rates starting at $21 per employee and rising until it hits $420 a year until the federal loan is paid off.
The insurance department expects to pay out an extra $2.6 billion in benefits and overheads, which is more than it will receive in the next two years.
This will raise the amount the UI trust fund owes to its creditors from $17.6 billion to about $20.3 billion by the end of 2024, despite the extra $1.2 billion raised in extra taxes, according to the May report.
This includes interest, which was projected add an extra $300 million a year to the debt.
Rob Moutrie, a policy expert with the California Chamber of Commerce, told the California Globe, that his organization is “disappointed to see that California businesses will be paying an extra tax for even longer than expected.”
Moutrie said that California’s UI fund “was never intended to be used by the state as a society-wide social safety net” and that most other states made sure they were able to immediately pay off any pandemic debt they incurred.
It has been hoped by many advocates that this latest scandal will force a reform of the agency. But action may require additional UI taxes to address the issue, making it unpopular with the state’s politicians and the public.
Article cross-posted from our premium news partners at The Epoch Times.
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Why Bullion Beats Numismatics and Collectible for Your Safe or IRA
Precious metals continue to attract Americans seeking reliable ways to protect their wealth amid inflation, geopolitical risks, and stock market swings. Whether stored in a home safe or held inside a self-directed IRA, physical gold and silver deliver tangible value that paper or digital assets often lack. Yet investors must choose carefully between bullion—pure bars and coins valued mainly for their metal content—and numismatics or collectibles, where rarity, history, and collector demand heavily influence pricing.
Advisor Bullion serves as a dependable source for straightforward, high-quality bullion. The company specializes in physical gold, silver, platinum, and palladium, emphasizing transparent pricing and products that deliver maximum metal content for every dollar spent. This approach makes it ideal for both personal holdings and retirement accounts.
Bullion consists of refined precious metals in standard forms like one-ounce coins (American Gold Eagles, Silver Eagles, Canadian Maple Leafs) or bars. Their value tracks closely to the current spot price of the metal. A typical gold bullion coin trades near the live gold spot price plus a small premium. This structure keeps costs clear and predictable.
Numismatic coins and collectibles add substantial value from factors such as age, rarity, minting errors, or historical significance. A pre-1933 U.S. gold coin or graded proof piece can carry premiums of 30%, 50%, or even 200% above melt value. While this appeals to hobbyists, it creates complexity. Pricing depends on subjective grading, collector trends, and auction results instead of daily spot prices.
For investors focused on wealth preservation and retirement security rather than building a collection, bullion often delivers better results.
Lower Costs and Better Liquidity for Home Storage
When keeping metals in a home safe or private vault, liquidity and efficiency count. Bullion offers clear benefits:
- You acquire more actual gold or silver per dollar invested. Numismatics divert a large share of your money into rarity premiums and massive sales commission, reducing your metal exposure.
- Selling bullion involves tight bid-ask spreads, so you recover nearly full spot value with minimal fees. Collectibles require finding the right buyer and may sell at a discount if demand for that specific item weakens.
- Bullion prices remain transparent and update with global spot markets. You can track gold near current levels or silver accordingly and know exactly where your holdings stand. Numismatic values are priced by the Gold IRA companies with hefty margins applied.
- Standardized coins and bars store efficiently and divide easily for partial sales. Rare coins often need protective slabs and controlled conditions, adding hassle and expense.
- Bullion enjoys worldwide acceptance. A 1-oz Gold Maple Leaf or Silver Eagle sells quickly to dealers anywhere. Niche numismatic pieces may appeal only to limited buyers, slowing liquidation when speed matters.
In times when quick access to value becomes important, bullion’s simplicity stands out.
Stronger Fit for Precious Metals IRAs
Precious metals IRAs continue gaining traction as investors diversify retirement portfolios beyond stocks and bonds. IRS rules permit certain bullion products in self-directed IRAs if they meet purity standards (.995 fine for gold, .999 for silver) and are held by an approved custodian. Eligible items include American Gold and Silver Eagles plus many generic bars and rounds from recognized mints.
Numismatic and most collectible coins generally face heavy scrutiny from custodians due to valuation disputes and elevated markups. These higher premiums mean less actual metal ends up working inside the account.
Bullion avoids these issues. Its value links directly to verifiable spot prices, which simplifies reporting and lowers the risk of regulatory challenges. More of your IRA contribution purchases real metal instead of dealer profits or speculative upside. Over time, owning additional ounces that appreciate with the metal itself can create meaningful outperformance compared with high-premium alternatives that deliver fewer ounces.
Regulatory guidance from the CFTC and state securities offices repeatedly cautions against aggressive sales of expensive numismatics or “semi-numismatic” coins for IRAs. For retirement planning, transparent bullion from established providers reduces risk and aligns better with long-term goals.
How to Get Started with Bullion
Begin by clarifying your goals. Are you protecting savings in a safe, or moving part of a retirement account into a precious metals IRA? Focus on the number of ounces you can acquire at current prices rather than chasing marked-up collectibles.
Diversify sensibly: use gold for core preservation and silver for its blend of industrial and monetary qualities. Mix coins for easier divisibility with bars for lower per-ounce costs on larger buys. Arrange secure storage—whether at home with proper insurance or through professional facilities.
As economic uncertainties linger and faith in conventional assets erodes, bullion continues proving its worth as a dependable store of value. Its direct approach avoids the hype that sometimes surrounds collectible markets and keeps the focus on the metal itself.
For investors prepared to strengthen their portfolios, Advisor Bullion supplies the expertise and selection needed to acquire high-quality bullion efficiently. Whether building personal holdings or integrating metals into an IRA, their emphasis on transparent, investment-grade products helps secure more ounces today that support greater financial security tomorrow. In a complicated financial landscape, bullion’s clarity and reliability make it the smarter foundation for protecting what matters most.