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A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

nytimes.com

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Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#51

Post by Spooky23 »

rayiner wrote: post #22
rootusrootus wrote: post #3

My mom is a PERS retiree. Not one of the rich ones, though she did retire at the perfect moment and she has a livable retirement income. One thing a lot of people (who do not work in gov't) don't recall is that while the economy was roaring back then, Oregonians working for the gov't went for years without so much as a cost of living adjustment. Some of the perks they got from PERS were in lieu of getting a raise. So…

For the most part, government work does not pay poorly.[1] For example federal employees without advanced degrees earn a lot more in government than in the private sector: https://www.google.com/amp/s/www.washingtonpost.com/amphtml/... [1] I’m willing to entertain the idea our economic system as a whole undercompensates secretaries and overcompensates executives. That’s a different issue.

The federal government isn’t state and local. Also note that the Feds no longer have generous pension plans and rely on 457 plans similar to 401k.

Someone in my family ran a fire department in the 80s and 90s. They had no money and in this state arbitration made negotiations difficult for management to win. So they gave away pension and health concessions that were cheap then.

The number one issue with these systems are public safety pensions, because of the amount of overtime earned by these employees. Administrative staff and professionals are mostly exempt and not that big of a deal.

Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#52

Post by ojbyrne »

tantalor wrote: post #18
rootusrootus wrote: post #3

My mom is a PERS retiree. Not one of the rich ones, though she did retire at the perfect moment and she has a livable retirement income. One thing a lot of people (who do not work in gov't) don't recall is that while the economy was roaring back then, Oregonians working for the gov't went for years without so much as a cost of living adjustment. Some of the perks they got from PERS were in lieu of getting a raise. So…

Borrowing from the future is not a good strategy.

Much of western civilization is built on borrowing from the future. Actually I believe that the words “credit”,”mortgage”, “financing”, and actually “borrowing” are all synonyms for “borrowing from the future.”

Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#53

Post by stale2002 »

rayiner wrote: post #22
rootusrootus wrote: post #3

My mom is a PERS retiree. Not one of the rich ones, though she did retire at the perfect moment and she has a livable retirement income. One thing a lot of people (who do not work in gov't) don't recall is that while the economy was roaring back then, Oregonians working for the gov't went for years without so much as a cost of living adjustment. Some of the perks they got from PERS were in lieu of getting a raise. So…

For the most part, government work does not pay poorly.[1] For example federal employees without advanced degrees earn a lot more in government than in the private sector: https://www.google.com/amp/s/www.washingtonpost.com/amphtml/... [1] I’m willing to entertain the idea our economic system as a whole undercompensates secretaries and overcompensates executives. That’s a different issue.

I think that it depends on the industry.

For example, I doubt that software engineers are competively paid, when compared to industry. But that is more of a function of how ridiculously high industry pay is.

Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#54

Post by charleslmunger »

jinfiesto wrote: post #16
ebbv wrote: post #6

What a pathetic ploy to divide the working class against each other. The reason states are short on cash is the race to the bottom we’ve all been participating in since the 1980s when government policy and general economic policy moved from focusing on keeping the middle class healthy to massive tax breaks and cuts for corporations and the wealthy. For the last nearly 40 years every state has been playing the game of…

I'm not sure why this is so heavily down-voted. Pensions are surely a problem, but they are clearly a drop in the bucket compared to the revenue that states miss out on when they let corporations pit them against each other in race to the bottom behavior.

How much money would you consider to be a reasonable pension? LA's payment of pension obligations is 31% of their city budget. Many other cities see significantly more, and it's going to keep getting worse as more workers retire.

https://calmatters.org/articles/commentary-surging-pension-c...

Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#55

Post by ekianjo »

toomuchtodo wrote: post #35
pessimizer wrote: post #32

Earlier quoted context omitted.

You always borrow from the future.

This is a profound comment, even if off the cuff. Consider tens of trillions of fiat in worldwide liabilities, and how the entire world is relying on people yet to be born to carry the torch through taxes to pay for the debts we’ve amassed.

It's rather delayed bankruptcy in our case. The idea that these trillions are going to be paid back one day is preposterous and we all know it.

Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#56

Post by shkkmo »

jinfiesto wrote: post #16
ebbv wrote: post #6

What a pathetic ploy to divide the working class against each other. The reason states are short on cash is the race to the bottom we’ve all been participating in since the 1980s when government policy and general economic policy moved from focusing on keeping the middle class healthy to massive tax breaks and cuts for corporations and the wealthy. For the last nearly 40 years every state has been playing the game of…

I'm not sure why this is so heavily down-voted. Pensions are surely a problem, but they are clearly a drop in the bucket compared to the revenue that states miss out on when they let corporations pit them against each other in race to the bottom behavior.

My guess is that the opening line is pure political rhetoric: "What a pathetic ploy to divide the working class against each other."

While I agree with the overall point of the comment. I down voted it because of the tone with which it was made and it's lack of attempt to brings any facts or references to bear in reinforcing its claims.

A prime example of states spending their money poorly to the benefit of big businesses is another HN topic. The headline is about eminent domain, but the article talks about the 3 billion "investment" that was given to Foxconn that seems unlikely to pay for itself even in an optimistically estimated 25 years.

Edit: Also, several of the "factual" claims made were... hard to believe without any numbers to back them up.

Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#57

Post by 0x445442 »

blitmap wrote: post #9
rootusrootus wrote: post #3

My mom is a PERS retiree. Not one of the rich ones, though she did retire at the perfect moment and she has a livable retirement income. One thing a lot of people (who do not work in gov't) don't recall is that while the economy was roaring back then, Oregonians working for the gov't went for years without so much as a cost of living adjustment. Some of the perks they got from PERS were in lieu of getting a raise. So…

This is absolutely true. I have several members of my family who work in the gov, and I have witnessed years of inadequate inflation raises - nothing else. The "trade" was a nicer retirement and better health benefits.

Non government employees have had inadequate inflation raises but without nicer retirements nor better health benefits.

Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#58

Post by jaggederest »

I mean, the obvious solution is to move to purely defined-contribution plans and haircut the existing people down to actual returns on invested balance for them.

But I have to imagine in a lot of cases that would lead to people being impoverished later in life, which is not especially humane.

Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#59

Post by mythrwy »

cma wrote: post #29
dasil003 wrote: post #4

Without actually showing some statistics on the pension payments and how the overall budget breaks down, I can't help but feel manipulated. Yes it's easy to paint an ugly picture of the privileged outliers, but I suspect the correlation between school and infrastructure cuts and money going straight into rich pensioners pockets is not quite as cut and dried as NYT would have us believe.

The numbers I found: Oregon population: 4,000,000 Pension deficit 2017: $25,000,000,000 Per-capita share: $6,250 Assuming a large portion of the pensions will get spent on goods, services, and donations in state, it doesn't seem like a huge disaster, depending on how it grows.

4 million people. How many working people with enough income to pay tax? Half? Less?

So maybe ~13K per tax paying person in outstanding pension obligations alone?

That is a big deal.

Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash

#60

Post by ekianjo »

blitmap wrote: post #9
rootusrootus wrote: post #3

My mom is a PERS retiree. Not one of the rich ones, though she did retire at the perfect moment and she has a livable retirement income. One thing a lot of people (who do not work in gov't) don't recall is that while the economy was roaring back then, Oregonians working for the gov't went for years without so much as a cost of living adjustment. Some of the perks they got from PERS were in lieu of getting a raise. So…

This is absolutely true. I have several members of my family who work in the gov, and I have witnessed years of inadequate inflation raises - nothing else. The "trade" was a nicer retirement and better health benefits.

> "nicer"

That does not even start to describe it fairly. "Extremely sweet" would be more accurate since civil servants and the like get to retire with almost their best pay ever, while the rest of us get something averaged over dozens of years.

> and I have witnessed years of inadequate inflation raises

So you think the private sector gets "adequate" inflation raises? Not everyone works in tech.

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