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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

#81

Post by cma »

mythrwy wrote: post #59
cma wrote: post #29

Earlier quoted context omitted.

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.

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

Then that would be an obligation of about $300 per tax paying worker per year over their working lifetime. The average yearly salary in Oregon is $50,000. The article makes it out through anecdote that this is why they didn't have gas to send trucks out for a road repair.

In the last 20 years Oregon has had near 1% per year population growth as well.

The article is focused on outlier pensions for a collegiate athletic director paid partly out of sports merchandising and a medical school head who was an eye surgeon.

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

#82

Post by cc439 »

dindumuffin wrote: post #45
toomuchtodo wrote: post #35

Earlier quoted context omitted.

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.

Thankfully, those who are yet to be born will be many more numerous and possess better technology with which to pay the debt we charge up.

"Thankfully, those who are yet to be born will be many more numerous"

The 3rd world will be more numerous, the current citizens of the first world will not. We're already seeing societal strains rising from the introduction of 3rd world peoples intended to make up for the missing offspring of existing 1st world peoples so I highly doubt things will work out as easily (and peacefully) as you assume they will.

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

#83

Post by garmaine »

ekianjo wrote: post #55
toomuchtodo wrote: post #35

Earlier quoted context omitted.

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.

Why? Debt is paid back over time. New debit is also acquired so the balance is never zero. But are you saying you expect T-bills to be in default? That’s a rather big statement.

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

#85

Post by garmaine »

tedsanders wrote: post #47
toomuchtodo wrote: post #35

Earlier quoted context omitted.

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.

A fascinating digression. I conceptualize borrowing oppositely. When you borrow, you borrow from someone else's past/present labor and obligate your future labor. (Where 'you' can be an individual, organization, or society.) In my view, borrowing is always from the past. You cannot borrow that which has not yet been created.

Sadly that’s not how money actually works at the macro level. The fed magics the money into existence in return for a promise for the treasury to repay with taxpayer money 10 tears down the line.

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

#86

Post by cma »

Scoundreller wrote: post #40
cma wrote: post #29

Earlier quoted context omitted.

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.

Assuming the pensioners stay. Why stay completely when you can spend change your domicile to a zero-tax sunshine state or WA?

Family and friend networks.

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

#87

Post by rdl »

cc439 wrote: post #77
rdl wrote: post #48

Earlier quoted context omitted.

Borrowing from the future is an excellent strategy in a lot of cases, you just need to explicit that you're doing so and make sure it makes sense.

It's an excellent strategy (when executed correctly) in times of unparalleled stability and economic predictability like those of 1948 to ~1976 and ~1982-2008 but it's a terrible strategy when returns on pension fund investments are virtually guaranteed. Even in those times it didn't make logical sense to assume everything over the next 30 years would play out exactly how everyone assumed it would. That and the "stic…

Yeah, in the case of pensions I agree having disproportionately high pension comp vs. current comp makes no sense -- particularly bad when a city declines in size.

There are plenty of non-pension cases where debt is an effective tool, i.e. borrowing to make efficiency/productivity improvements which exceed the cost of servicing and repaying the debt. Imbalanced pensions are more like borrowing to pay for operational expenses.

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

#88

Post by bannedaccount »

shkkmo wrote: post #56
jinfiesto wrote: post #16

Earlier quoted context omitted.

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 busin…

There's such a double standard, but no one is ever called to back up a claim like "small government is better for the economy" which I believe is just empirically false. You can plainly see states/countries that spend more on pensions and social safety nets have wildly better outcomes for their citizens. Yet don't see conservative making any reasonable arguments just well wore platitudes about "fiscal responsibly," but they never are forced to elaborate on what they mean by that or flagged or down-voted because this is a highly conservative that serves to reinforce the beliefs as opposed to challenge them.

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

#89

Post by seanp2k2 »

Someone1234 wrote: post #50
megaman22 wrote: post #20

Earlier quoted context omitted.

The way most pensions work, you collect a percentage of your 3-5 highest salaries ever, assuming you've been there long enough. A good reason department heads in education shuffle every three years

> The way most pensions work Most pensions historically . People entering the job market today (or even most of the millennial generation) were never offered these final salary pensions. Instead we get defined contribution plans, 401Ks, or nothing at all. The key difference being that defined contribution plans (and 401Ks) are always only worth what was contributed (and investment performance profits). Things like yo…

>It is a better system from a larger society perspective (nothing is "loaned") but may result in few actually being able to afford retirement.

We'll see how this plays out with baby boomers retiring to give some indication as to what the younger generations may be up against.

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

#90

Post by pfranz »

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.

Funny, the bottom of the article recommends this[1], a more recent article saying the opposite. (I don't bring this up to discredit your post, I just find it funny. Your article actually says, "Various studies, using different methods and different sets of data, have reached widely varying conclusions.")

[1] https://www.washingtonpost.com/news/powerpost/wp/2018/04/11/...

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