Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Schwarzenegger: Public Pensions and Our Fiscal Future

online.wsj.com

Post reply on HN
Print view View original

61–70 of 191 posts

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#61

Post by _delirium »

mark_l_watson wrote: post #11

About 25 years ago in California, Orange Country went bankrupt and public employees had to do "give backs" of (if I remember correctly) about 1/2 of their retirement funds and other concessions. I think that this will be the model for the future, but a state levels. It may not seem fair to change the rules on public employees, but effectively the rules have changed for private employees because the economy at federal…

> It may not seem fair to change the rules on public employees, but effectively the rules have changed for private employees

It's possible this has happened some places, but not at any major companies I know about. Companies that have phased out defined-benefit pensions have generally not done so retroactively, but only closed them to new hires. Phasing them out retroactively would be a breach of contract, since the employee performed work for you under the expectation that you'd honor the employment contract they signed, including the pension terms. Pension is a kind of remuneration, so you can't decide not to pay it after receiving the work.

Much easier legally to simply stop making those pension promises to new employees, but not breach the ones you already made.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#62

Post by jerf »

pg wrote: post #20

I have a feeling these graphs do more to explain the problems that Berkeley professor wrote about ( http://blogs.berkeley.edu/2010/08/24/a-letter-to-my-students... ) than the explanations he proposed.

This is the reason my replies on that topic focused so much on total outlay issues, rather than education spending directly, which seemed more directly on topic. I had a hard time expressing my logic, but it was pretty much the issue of the amount of spending on potentially useful things getting crowded out. It's easy to frame it in terms of people not wanting the government to have their money, and I felt the professor tried to establish that with some of his phrasing, but that's not the real problem that needs solving. The problem is allocation.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#63

Post by 16s »

philk wrote: post #19
hammmatt wrote: post #12

Can someone confirm that indeed 80 cents of every tax dollar goes to pensions?

From the article: roughly 80 cents of every government dollar in California goes to employee compensation and benefits So that's salaries as well as pensions (and salaries will be making up the lions share of the 80%). To quote Felix Dennis "Overhead walks on two legs".

Employees are the biggest expense for any business, not just governments.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#64

Post by _delirium »

ryanwaggoner wrote: post #60
CWuestefeld wrote: post #28

Earlier quoted context omitted.

I'm sympathetic to your point, but you can't really make this comparison, because it's apples-to-oranges. The set of jobs in each set is quite different. For example, there are few farmers in the government employ. However, we can still reach interesting conclusions from the data. For example, I would expect that regardless of the salary of the job, benefits such as healthcare insurance would be fairly constant for e…

For example, there are few farmers in the government employ. If only. http://en.wikipedia.org/wiki/Agricultural_subsidy

The low-paid immigrant farm workers effectively being paid by the government via subsidies count as "private-sector" employees for statistical purposes, though.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#65

Post by kenjackson »

mark_l_watson wrote: post #11

About 25 years ago in California, Orange Country went bankrupt and public employees had to do "give backs" of (if I remember correctly) about 1/2 of their retirement funds and other concessions. I think that this will be the model for the future, but a state levels. It may not seem fair to change the rules on public employees, but effectively the rules have changed for private employees because the economy at federal…

I knows probably more than 100 private tech employees that regularly make more than $1M/year (salary plus stock/bonus). I don't know any federal tech employees that make more than $150k/year.

Either you only know private tech code monkeys or have found the highest paying federal agency that no one has ever heard of.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#66

Post by aresant »

furyg3 wrote: post #51

The "job losses" graph is basically trash, since there are far more private sector workers than public sector workers. Better would be to rate it by percentage. I'm slightly shocked that the WSJ would print it (the graph, not the article).

Here's the real data which is still striking, eg private is 2x the rate of public:

Job losses June 2008 to June 2010

State government

Statewide: -8,800 / -3.3%

County government

Statewide: -18,500 / -5.1%

City government

Statewide: -14,100 / -4.9%

Private sector

Statewide: -1,200,000 / -9.3%

Via

http://www.signonsandiego.com/news/2010/aug/23/government-jo...

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#67

Post by illumin8 »

kenjackson wrote: post #65
mark_l_watson wrote: post #11

About 25 years ago in California, Orange Country went bankrupt and public employees had to do "give backs" of (if I remember correctly) about 1/2 of their retirement funds and other concessions. I think that this will be the model for the future, but a state levels. It may not seem fair to change the rules on public employees, but effectively the rules have changed for private employees because the economy at federal…

I knows probably more than 100 private tech employees that regularly make more than $1M/year (salary plus stock/bonus). I don't know any federal tech employees that make more than $150k/year. Either you only know private tech code monkeys or have found the highest paying federal agency that no one has ever heard of.

Yes, but those private employees making more than $1M are probably some of the best talent in the industry, where as the federal employees could have any range of talent from "breathes, and has a pulse" to "rockstar developer."

Also, the private employees when they retire get no health benefits and have to fund their own retirement from a 401k, whereas the federal employees have guaranteed health care for life and a guaranteed pension. The health care and pension alone are worth at least a few million if you live to a decent age.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#68

Post by irons »

mark_l_watson wrote: post #11

About 25 years ago in California, Orange Country went bankrupt and public employees had to do "give backs" of (if I remember correctly) about 1/2 of their retirement funds and other concessions. I think that this will be the model for the future, but a state levels. It may not seem fair to change the rules on public employees, but effectively the rules have changed for private employees because the economy at federal…

You're right: voiding other people's contracts because they (collectively) negotiated better deals than you did doesn't seem fair at all. Arnold knows exactly how to push your buttons.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#69

Post by illumin8 »

lr wrote: post #52
jordanb wrote: post #27

Earlier quoted context omitted.

It's worth observing that: 1) Orange County went bankrupt by cooking the books. After the scandal broke, their treasurer went to jail. 2) The Republican administration turned a blind eye to the Democratic treasurer's malfeasance because it was allowing them to keep taxes very low, which was making their government very popular. 3) The government refused to raise even a temporary tax to avoid bankruptcy, as that posit…

This is a GOP strategy called "starve the beast", and Paul Krugman has been writing about it for years: http://www.google.com/search?q=starve+the+beast+krugman

Ah yes, I never understood why on earth anyone would elect someone to public office that hates government so much they would try to destroy it... It would be like hiring a developer that hates code so much he would delete it from your repository to reduce kloc counts.

Re: Schwarzenegger: Public Pensions and Our Fiscal Future

#70

Post by aswanson »

kenjackson wrote: post #65
mark_l_watson wrote: post #11

About 25 years ago in California, Orange Country went bankrupt and public employees had to do "give backs" of (if I remember correctly) about 1/2 of their retirement funds and other concessions. I think that this will be the model for the future, but a state levels. It may not seem fair to change the rules on public employees, but effectively the rules have changed for private employees because the economy at federal…

I knows probably more than 100 private tech employees that regularly make more than $1M/year (salary plus stock/bonus). I don't know any federal tech employees that make more than $150k/year. Either you only know private tech code monkeys or have found the highest paying federal agency that no one has ever heard of.

I knows probably more than 100 private tech employees that regularly make more than $1M/year (salary plus stock/bonus)

Where? Serious question.

Post reply on HN