Earlier quoted context omitted.
Private companies do it all the time, it’s called freezing the pension plan.
And that should be considered fraud.
Why would that be considered fraud? Pension freezes still pay out accrued and agreed upon benefits.
How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
61–70 of 109 posts
Re: How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
#62Earlier quoted context omitted.
It adds transparency and accountability. And it’s up to the government employees if they want to bring in a private company. As a taxpayer, and employer of government employees, I would like a clear accounting of how much payroll is. I don’t want politicians buying union votes with unsustainable promises that get kicked down the road 20 years later, and I don’t want to hear “my predecessors didn’t properly fund the p…
> If a private entity can’t afford to offer annuities without the power to increase taxes, then they are obviously a very, very expensive benefit, so why should only government employees get them? Because the government can provide them more cheaply than a private entity by its very nature - shouldn't it make use of that competitive advantage? Better pension schemes are one of the ways government are able to offer a…
The government can't provide them more cheaply. There is an unaccounted cost of corruption, vote buying, erroneous assumptions (intentionally and unintentionally), that we are seeing play out now.
If governments could provide it more cheaply, then we wouldn't be hearing about this massive problem in the first place. The very existence of this extremely widespread problem proves that taxpayer provided defined benefit pensions are not cost efficient and allow for the fleecing of taxpayers.
Re: How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
#63My mom is retired and part of the Kentucky Retirement System. Fun fact most people don't know about some of these- you forfeit your social security benefits when you participate. Because of this my mom cannot draw my dead fathers benefits. https://www.courier-journal.com/story/news/education/2018/03...
I want to say something beyond, “this is wrong”, but I haven’t the words. Does Kentucky not want teachers? There are shortages in some states.
No, they don't. To most of Kentucky's ruling class, public schools are evil. They'd love to see them all fail, so they can shift school funds to vouchers for Christian schools.[1][2]
1 - https://www.courier-journal.com/story/news/local/joseph-gert...
Re: How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
#64Earlier quoted context omitted.
> I don’t see what the benefit of that system is as opposed to paying someone market price for their labor. The benefit is that Beamte are locked in to the state. It's rare that the private sector snatches Beamte away from the state. This means that, unlike in the private sector, the state does not have to worry that its most competent employees suddenly vanish.
The same can be accomplished by paying them market wages. In addition, it would provide a transparent accounting of expenditures and prevent politicians and union leaders and others from scamming taxpayers like they currently are.
> The same can be accomplished by paying them market wages.
No. Even with paying market wages, there can someone come along and flood the market with cheap money. Then the state has to massively counteract and waste taxpayer money.
Beamtentum is the core of German societal stability, as a result.
Re: How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
#65Earlier quoted context omitted.
The same can be accomplished by paying them market wages. In addition, it would provide a transparent accounting of expenditures and prevent politicians and union leaders and others from scamming taxpayers like they currently are.
> The same can be accomplished by paying them market wages. No. Even with paying market wages, there can someone come along and flood the market with cheap money. Then the state has to massively counteract and waste taxpayer money. Beamtentum is the core of German societal stability, as a result.
I don't know what "flooding with cheap money" means, but by definition, if a buyer is outbid by another buyer for something, then the market price has changed so the previous buyer needs to update to the new market price. I don't understand how this is a waste of taxpayer money, since it properly indicates to people where resources need to be shifted (in order to bring prices down). Without this market mechanism, you actually have a waste of taxpayer money since you don't know what you're overpaying/underpaying for.
The societal stability part should be offered to all taxpayers, not just government employees, so I don't see why that would be tied to an employer at all.
Re: How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
#66When it comes to pension funds, investing in anything volatile like hedge funds is an incredibly irresponsible thing to do. I’m kind of flabbergasted it’s even allowed in the first place. Pension funds should have steady, modest gains year over year and minimize risk of dips as much as possible.
Pensions needed to reach for yield with the fed funds rate scraping zero for the better part of a decade. > Pension funds should have steady, modest gains year over year and minimize risk of dips as much as possible. This is what hedge funds were built for - hedging.
What? No. Hedge funds are named for making highly risky investments. The short term risk of doing this is offset by hedging across markets and by using specific investment products. Works great until events like the housing market cause a market wide collapse and kill your hedgefund.
Whoever concentrated the money in such funds was likely corrupt, otherwise grossly incompetent.
Re: How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
#67If any private company wanted to sell a financial product akin to public sector pensions they would be arrested and charged with fraud. Come to IL -- plenty of pension games to play here
Re: How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
#68If any private company wanted to sell a financial product akin to public sector pensions they would be arrested and charged with fraud. Come to IL -- plenty of pension games to play here
the big story in Illinois is that even with proper management the Chicago pension system will be broke in about two years. however we cannot just vilify Illinois as many public employee pension systems have been built upon promises that are not sustainable and will leave millions with no real retirement as each fund implodes
Re: How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
#69Pensions are Ponzi schemes, plain and simple, with government playing the role of Ponzi. Buried deep inside the idea of a government pension is the idea that individuals are incapable of saving for their own retirement. That government needs to care for its people in old age because they won't take the necessary steps themselves. Questionable assumptions aside, this article and many, many more like it demonstrate tha…
Well, you're not wrong. You're just pointing some inconvenient truths.
1. Most people are incapable of saving for their own retirement, because they either lack the discipline or the skill set to do so.
2. Because of (1), people want the government to take care of it. But government does a mediocre job of most things.
3. Elected politicians have an incentive to get in bed with unions of government employees and screw taxpayers by cleverly mis-evaluating the present cost of future retirement payout streams.
4. Bad actors in the world pray on everyone involved: the employees, the pension funds, the government, individuals, etc, to get management fees from the corpus of retirement programs.
Re: How a Gang of Hedge Funders Strip-Mined Kentucky’s Public Pensions
#70When it comes to pension funds, investing in anything volatile like hedge funds is an incredibly irresponsible thing to do. I’m kind of flabbergasted it’s even allowed in the first place. Pension funds should have steady, modest gains year over year and minimize risk of dips as much as possible.
>>When it comes to pension funds, investing in anything volatile like hedge funds is an incredibly irresponsible thing to do. Ideally. But then you have things like: https://www.mercurynews.com/2016/11/01/bart-janitor-grossed-... and look at stories here: https://hn.algolia.com/?query=pensions&sort=byPopularity&pre... Mostly unions graciously award over time work, and other benefits to people about to retire in the l…
The thing the galls me the most about that article is it doesn't once stop to try to say or find out how much the guy is working to bring in that much, spoiler it's going to be a lot of hours given it's overtime and his base compensation is only 50k.
Pensions are a fine tool but they have to be funded responsibly, states liked to use them as an incentive but then refused to properly fund them banking instead on large returns. Companies did the same thing for a long time but they've been allowed to cut benefits to retirees when they run dry and have since moved on to 401ks if they offer any thing at all.