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

nytimes.com

141–150 of 277 posts

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

#141
post #38

Earlier quoted context omitted.

A 7.5% return seems irrationally optimistic for something like a pension fund. Is that really what they budgeted on?

You should see how they abused the dotcom bubble to push up their bogus projections: "Davis, who was elected in 1998 with more than $5 million in campaign contributions from public employee unions, says that if he had it to do over, he would not support the pension improvements." http://www.latimes.com/projects/la-me-pension-crisis-davis-d... "... how in 1999 the California Public Employees’ Retirement System orchest…

2018 – Dow 25,000, California budget surplus.

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

#142
post #22

Earlier quoted context omitted.

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.

In California many/most public employees earn over 6-figures in total compensation. This includes government employees, teachers, police, Fire, etc. Yea, it’s insane. Don’t believe me? Look it up - https://transparentcalifornia.com/salaries/2017

If you want good people, you need to compensate them, and you need to compensate them relative to the high cost of living in California. Otherwise, the good people will stay in the private sector and government jobs will be filled by people who couldn't succeed in the private sector.

That's happening to some extent already, but there are a lot of people who would do very well in the private sector who choose public service. For society's sake, we don't want that to be such a big sacrifice that nobody smart would do it.

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

#143

Earlier quoted context omitted.

I don't get this entitlement to retire at 55 or even 50. The retirement age should be 65.

You can't do most blue collar jobs at 50, much less 65. Shoveling asphalt, laying track, climbing on top or under heavy machinery, or chasing criminals is backbreaking work. The bodies of these people are permanently worn out by the time they hit 55. Some are promoted into management, but most org charts are naturally pyramids, so there aren't enough of those jobs for everyone. So what to do with someone who is now t…

I am just a casual observer of American politics and I don’t have an opinion on it. But here in Denmark the retirement age for a police officer is 65. That these people should be particular worn out is not something that is in public discussion.

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

#144
post #10
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.

In California "More than 200,000 civil servants became eligible to retire at 55 — and in many cases collect more than half their highest salary for life. California Highway Patrol officers could retire at 50 and receive as much as 90% of their peak pay for as long as they lived." http://www.latimes.com/projects/la-me-pension-crisis-davis-d... This seems like a pretty big budget item, especially since most CA governme…

It should be plain unconstitutional to raise a tax on someone to pay a benefit to another. Whatever the court rules on the state not defaulting on its debts, pending that cost to someone that does not get, or want, the same benefit, should be equally pernicious for the law.

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

#145
post #22

Earlier quoted context omitted.

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.

In California many/most public employees earn over 6-figures in total compensation. This includes government employees, teachers, police, Fire, etc. Yea, it’s insane. Don’t believe me? Look it up - https://transparentcalifornia.com/salaries/2017

That source has obvious serious data quality issues, which are dramatically evident if you filter by “University System”; the three highest paid entries with that filter, which are the same person [0], three times with the same job title and slightly different total comp figures. The same person appears twice more on the first page, too, with significantly different pay (but the same title, etc.)

[0] https://en.m.wikipedia.org/wiki/Jim_L._Mora

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

#146
post #29
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.

I assume that's over many years of the pension payment. Assuming average of 20 years of pension payment, that's about $300 per year per person.

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

#147

Earlier quoted context omitted.

I don't get this entitlement to retire at 55 or even 50. The retirement age should be 65.

You can't do most blue collar jobs at 50, much less 65. Shoveling asphalt, laying track, climbing on top or under heavy machinery, or chasing criminals is backbreaking work. The bodies of these people are permanently worn out by the time they hit 55. Some are promoted into management, but most org charts are naturally pyramids, so there aren't enough of those jobs for everyone. So what to do with someone who is now t…

They just get thrown in the unemployed pool and their income average drops dramatically with severe ripercussion on the final pension calculations

I know because in europe we have an unrealistic retirement age and my father like many other lost his job in the 2008-2012 crisis. Been unemployed ever since.

What happens is that in the 50-65 braket you’re a huge liability with severe productivity drops and companies tries to fire you at the first chance they get.

The european system at least has some protections against unreasonable terminations, so we aren’t fully appreciating the maddnes it would be a free job market, but company closing or figuring out how to fire the old employees in masse drops huge chunks of unemployed for life into the society.

This is becoming a serious issue and it is going to peak in 20 years when all the people like me that don’t enjoy full time national contracts and their protection will get past their productivity prime.

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

#148

Re the ongoing debate here about government pay (and whether it's high or low): I'm not super familiar with city and state government jobs, but I do know something about military and federal compensation. They frequently pay less in salary, but have better benefits. This makes it an apples to oranges comparison when trying to talk about what they pay in comparison to non government jobs. I was a military wife for a l…

Is there a standard measure of disposable income after taxes and necessities like food, housing, education, healthcare? It seems comparing how much people have available for discretionary spending would be useful in many cases.

I'm not aware of one and your question touches on some of the hidden forms of compensation that can be hard to measure (and can vary over time for the same person -- for example, we were sometimes in housing on base and sometimes not). The below examples are off the top of my head from memory as a military spouse and may be very out of date.

The military will cover 75% of tuition for active duty members. Most states charge military members in-state tuition. When my ex took college classes at low cost community colleges in California, his books typically cost more than tuition. His tuition was practically pocket change.

When he was stationed in a designated war zone, we got a tax break for that.

When we were in on base housing, we did not get a housing allowance. We also did not get a water bill or electric bill. We only had to pay for a phone.

While stationed in Germany, I got free dental care on base even though spouses usually don't get free dental anymore. Similarly, we could have gotten free braces for my oldest son while stationed at a different remote location.

When shopping on base at a px or bx, you pay no taxes. They may or may not also have lower prices on some items.

I routinely had a Power of Attorney so I could handle my husband's affairs while he was deployed. I never paid for such. We had access to legal assistance for free for such items.

Medical coverage for the family is free, including out patient doctor's visits and most prescription medication. Further, I am alive when by all rights I should be dead in part because we got stationed at Travis AFB just as the shit was really hitting the fan. The hospital there is a teaching hospital that serves all military branches for eight western states.

Most people have no idea how well developed the military medical system is and the sorts of resources that can be made available in cases of serious medical crisis. I have a genetic disorder that was diagnosed late in life. My husband's medical benefits alone were practically like a second income for us because I was in the ER all the time at zero cost. This was true even when visiting relatives who happened to live near military bases. I just went to the nearest military medical facility, even if it was a different branch of the military.

Military personnel are sort of outcasts when deployed elsewhere in the US. We tend to not have a local bank account and military spouses have high unemployment rates because locals don't want to hire them. The military does what it can to make up for that, such as offering free check cashing on base at the bx or px.

When in on base housing, I was able to check out a lawn mower and other items for free for purposes of maintaining the yard to the standard required by the military. I didn't have to buy any of those things. They even provided grass seed for free so we could reseed our yard when the 115 degree summer heat in the High Desert killed our grass.

There are so many things you get for free in the military for just flashing your ID card that some people who leave after a single stint are shocked at how poor they are after leaving. A much higher percentage of a military check is discretionary than is the norm for most jobs. If you stay in 20 years or more, you will get retirement benefits without doing any retirement planning or savings whatsoever.

As a young military spouse, 90% of my budgeting concerns was making sure we had enough food in the house. Retirement planning, stressing about medical bills and other normal issues for most Americans was simply not a part of my life.

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

#149
post #24

Earlier quoted context omitted.

It’s impossible to reform pensions without reducing government union power in states like California and Illinois.

Illinois is also a special case in that pensions are written into the state Constitution. Pension reform requires changing the Constitution.

Changing the Constituion...or Bankruptcy.

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

#150

Earlier quoted context omitted.

I don't get this entitlement to retire at 55 or even 50. The retirement age should be 65.

You can't do most blue collar jobs at 50, much less 65. Shoveling asphalt, laying track, climbing on top or under heavy machinery, or chasing criminals is backbreaking work. The bodies of these people are permanently worn out by the time they hit 55. Some are promoted into management, but most org charts are naturally pyramids, so there aren't enough of those jobs for everyone. So what to do with someone who is now t…

>...You can't do most blue collar jobs at 50, much less 65.

The vast majority of blue collar jobs are in the private sector and they don't get pensions with COLA and free medical when they turn 50 or 55. It doesn't seem fair that government workers are treated differently.

If someone is disabled there are government programs to help them, but I see little evidence that the many of those government workers retiring at 50 are actually disabled or incapable of work since many go on to have another career.

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