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The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

wsj.com

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Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#31

Post by abledon »

How much money does one need to live in retirement? If they are doing daily exercise(1-2hr), cut out most processed foods and sugar , no alcohol , cook all their food from scratch using cheap staple ingredients , entertain themselves with books , community , local events and cut out expensive vacation plane trips (only an invention of the past century). An ‘uncomfortable’ lifestyle shift but doable for a human.

[edit] Yes for people who are permanently injured, its great we have these systems in place. But for otherwise healthy retired individuals, I think the 21st century western 'retired' lifestyle is a bit rich in comparison to what the rest of the world is living.

Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#32

Post by prolikewh0a »

sushid wrote: post #13
justaman wrote: post #4

Its funny that the government is as bad with money as the people. Truly a good representation.

It's nice for the previous generations that got something out of nothing. Too bad that "nothing" is my generation and we'll be putting our "contributions" into a pit that will give us actually nothing in return when it's time for us to retire. As I get older I realize why people say if you're not a liberal at 20, you have no heart but if you are not a conservative by 30, you have no brain (or something to that effect…

>As I get older I realize why people say if you're not a liberal at 20, you have no heart but if you are not a conservative by 30, you have no brain (or something to that effect).

Being liberal and conservative is what got us here in the first place. Expansion of political ideas is only now becoming popular as this generation really feels the effects of wishy-washy American liberalism and conservatism that favors the already extremely wealthy.

Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#33

Post by sykhic »

Overal taxation in the U.S. is low compared to other OECD countries [1]. We, as a nation, decided that low taxes was the goal. As a result infrastructure is poor, toll roads are increasing, privatization of prisons, intelligence gathering, war, etc. are rising too. Yet Americans falsely believe they are overtaxed. The situation is easy to fix in economic terms but not in political terms. The road to an Ayn Randian paradise in which everyone fends for themselves will lead us to ruin.

Corporations have largely shunted the responsibility for retirement savings onto individual workers. Now said workers have no pensions and have uncertain retirements. Instead of asking why they have no pensions they seek to equalize status by falsely believing we can't afford any sort of pension.

As a nation we need to seriously rethink the role and purpose of government and how taxation is a part of the proper functioning of government.

[1] https://www.taxpolicycenter.org/briefing-book/how-do-us-taxe...

Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#34

Post by rayiner »

safgasCVS wrote: post #12

If I paid for WSJ and this is the low quality journalism I got I'd be peeved. This article barely touches on how it got to be so bad. Excuse me but no - a single paragraph stating the obvious 'benefits promised were too rich' doesn't cover it. How is it possible that a solvency ratio can drop from 100% to 75% in 18 years? This doesn't just happen because eh seemingly every pension administrator just decided. How much…

Three major reasons are: 1) deferred/missed contributions; 2) expenses growing faster than originally expected, due to benefit increases and rising healthcare costs; and 3) unrealistic projections of future return that are being revised downward over time to be more realistic.

Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#35

Post by repsilat »

safgasCVS wrote: post #12

If I paid for WSJ and this is the low quality journalism I got I'd be peeved. This article barely touches on how it got to be so bad. Excuse me but no - a single paragraph stating the obvious 'benefits promised were too rich' doesn't cover it. How is it possible that a solvency ratio can drop from 100% to 75% in 18 years? This doesn't just happen because eh seemingly every pension administrator just decided. How much…

This topic comes up in the WSJ every couple of months. Not every article can cover every side of the story, and this particular piece isn't aimed at the underlying causes -- it's not an exhaustive or investigative history, it's analysis on the recent/current figures.

Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#36

Post by lr4444lr »

betterunix2 wrote: post #9

The choice is raising taxes, reducing spending elsewhere, or demanding workers give up the pensions they were promised. Somehow I doubt anyone is going to agree to pay more in taxes to cover pensions in their state or city. After all, why should the government keep its promises (especially if it means we have to pay for it)?

There is also simple attentuation. Workers have to pay more and for longer to be vested. They will receive a bit less, plans will be a little less generous. It has already happened in the NY teacher pension system. The sky isn't falling.

Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#37

Post by DuskStar »

aurailious wrote: post #30
ngould wrote: post #23

Earlier quoted context omitted.

Care to enlighten us pension finance non-experts on what the article misses?

Laws were changed to intentionally weaken pension funds and then articles like this are funded to further destabilize trust in them. Another way of saying it: rich people were unhappy they have to pay taxes.

Wow, I didn't know that the anti-pensioners had so much influence in California!

Another way of saying it: I don't think your summary is particularly fair or accurate.

Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#38

Post by taurath »

safgasCVS wrote: post #12

If I paid for WSJ and this is the low quality journalism I got I'd be peeved. This article barely touches on how it got to be so bad. Excuse me but no - a single paragraph stating the obvious 'benefits promised were too rich' doesn't cover it. How is it possible that a solvency ratio can drop from 100% to 75% in 18 years? This doesn't just happen because eh seemingly every pension administrator just decided. How much…

What I can't understand is that the stock market in the past 8 years has been one of the best in history. Wouldn't that make up for losses somewhat, and what would happen if the market tanked during that time?

Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#39

Post by SamReidHughes »

DuskStar wrote: post #37
aurailious wrote: post #30

Earlier quoted context omitted.

Laws were changed to intentionally weaken pension funds and then articles like this are funded to further destabilize trust in them. Another way of saying it: rich people were unhappy they have to pay taxes.

Wow, I didn't know that the anti-pensioners had so much influence in California! Another way of saying it: I don't think your summary is particularly fair or accurate.

They passed Prop 13.

Re: The Pension Hole for U.S. Cities and States Is the Size of Japan’s Economy

#40

Post by jimjimjim »

you know that research test they do where the subject can have $5 now or $50 at the end if they don't take the $5 and a disappointing amount of times they go for the $5.

The problem is everyone cheers on the politician that says you can have the $5 AND the $50.

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