After years of luring workers with the promise of lucrative pensions, state governments are now...


After years of luring workers with the promise of lucrative pensions, state governments are now scrambling to revamp public pension policies in the face of massive budget crunches. Since 2009, 43 states have increased contribution requirements or changed the age when a retiree can get benefits, and the moves are now triggering a spate a legal and political battles over whether states are reneging on their promises to millions of public-sector workers.

Comments (18)
  • DeepValueLover
    , contributor
    Comments (11221) | Send Message
     
    Libertarianism would have avoided this mess all together.
    1 May 2012, 08:07 PM Reply Like
  • OutandBack
    , contributor
    Comments (74) | Send Message
     
    In 1980 I took a huge pay cut and changed jobs do to the lucrative pensions offerings from my new employer. When I retired in 2009 I recieved about half of what was promised.
    I guess the states are now doing it to.
    1 May 2012, 09:11 PM Reply Like
  • surfnspy
    , contributor
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    Sorry to hear that. I hope that you are enjoying your retirement regardless.
    1 May 2012, 09:21 PM Reply Like
  • KJP712
    , contributor
    Comments (469) | Send Message
     
    The march to trumped-up charges leads to ways in which states can void the pension altogether.This is why an employee walks on eggshells during his career to protect the " Retirement Plan ".One slip-up can wipe out the portfolio with limited chances to recover the money.Promises for future payments hinge on a faceless entity who rules on amounts.The timing of the exit must be well thought out with a Plan B carefully researched.
    1 May 2012, 09:26 PM Reply Like
  • davidbdc
    , contributor
    Comments (3194) | Send Message
     
    Politicians reneging on promises??? Wow, thats news.

     

    I could care less what was promised to these so-called public servants. They willingly are participating in destroying our freedoms, stealing from our children, and are the US equivalent of the Communist Party members in the old USSR.

     

    You see Communist Party members lived in better houses, got cars quicker (along with other appliances), their children attended better schools, and their needs came before those in the "masses".

     

    We as a society have recreated this situation.... 15% of our citizens take part in stealing from the next generation. Guaranteed retirement plans of 70-90% of their final salaries or "best three years". Double dipping. Working for other agencies while collecting pensions. Gold-Plated health care benefits. All for (mostly) being paper pushers.

     

    The triumvirate of the politicians, bureaucrats, and financial elite are eating away at our freedoms and systemically bankrupting the country - all for their own personal gain.

     

    I shed zero tears for these folks. Personally I vote to cap any and all public pension at 50K per year. Don't like it? Quit.
    1 May 2012, 10:28 PM Reply Like
  • James Sands
    , contributor
    Comments (2689) | Send Message
     
    What some of you don't realize is that this is impacting firemen, policemen and teachers, local councilmembers, and all services that actually were created to support the public and many of our communities.

     

    In addition, all politics at most all levels, local, state, and federal impacts every aspect of where we work, and what and how we buy products in our consumer-culture.

     

    Government has/is/and will always be one of the primary driving forces shaping the direction of our nation and economy.
    1 May 2012, 11:36 PM Reply Like
  • davidbdc
    , contributor
    Comments (3194) | Send Message
     
    Actually its not impacting them. It impacts our children and our grandchildren. It also impacts those that don't receive services since a larger and larger percentage of tax revenue goes to pay, pensions, and health care for the supposed "public servants".

     

    I agree with your statement that government was one of the primary driving forces of the nation and economy as late as 20 years ago - Now I would disagree - It is basically becoming the ONLY driver - consuming more and more resources - trampling our freedoms - and lessening the future for our children and grandchildren.

     

    I have several friends that work for various levels of government. To a person they all admit they are overpaid and the benefits are absurd when compared to the private sector. There is zero chance of being fired for mediocre performance and retirement consists of planning 5 vacations a year on the public dime.

     

    Our biggest enemy isn't some foreign terrorists or China or Iran. Its the United States government that is taking our freedoms day by day.
    2 May 2012, 12:10 AM Reply Like
  • James Sands
    , contributor
    Comments (2689) | Send Message
     
    The fact is, the private sector makes significantly more money that any public sector job. Unless you think that the public press articles talking about executive level benefits running wild represents the millions of staff to cities, states, and federal positions.

     

    The average public employee who has been working for 15+ years has been the greatest benefactor of public service incentives. All employees who have just recently entered the profession (last 5 years or so) do not get the same benefits. So as I stated, policemen, firemen, teachers, city staff, etc. are not making anywhere close to what comparatives make in the private sector.

     

    For instance, in San Diego, new local staff make between $45-55k per year. In the private sector (government consultants) new associates make around $60-75k per year. Local staff must pay for their pensions, they do not get any beneficial payment anymore. Private sector associates get matching contributions for 401ks and profit sharing plans (free money).

     

    And as far as vacation time goes, public servants should not be allowed to have good vacation benefits?? Why? We don't work hard? The primary reason why one chooses to work in the public sector is to have an impact on the future and to have the opportunity for different lifestyle from the private sector.

     

    I chose to work in the public sector rather than make more money in the private sector because I value my family and my time. Those things are more important than money. I live 12 blocks from my job so I walk to work. My wife and I live in a tiny studio because we don't need anything more at the moment. We live simple and my government job is a big part of that.

     

    I don't live in a rat race. We live simply and comfortably.

     

    The enemy isn't the government, the enemy is selfishness and capitalism, consumerism and loss of values. The enemy is ourselves if we continue to be blinded by peer pressure, work ourselves to death and teach these dysfunctional values to our children and grandchildren.

     

    It's not about what profession you work in it is about what type of person you are. That is what will change things. Being critical of others doesn't change a thing because we have no business to change others, all we can change is how we impact our communities, and this will have a much greater impact on our children and grandchildren versus the government.

     

    We are not bound by our government and we have freedom to live in any way that does not conform. It just takes a lot harder effort now.
    2 May 2012, 11:08 AM Reply Like
  • davidbdc
    , contributor
    Comments (3194) | Send Message
     
    You say we aren't bound by our government, its just a lot harder effort now? Seems to me that you know the government is shrinking our freedoms and opportunities.

     

    And your just plain wrong about public employee compensation. Every reputable report that I've seen over the past two years says the same thing - current year compensation (which includes pay and health care) is higher than the private sector. Throw on top the pensions and its stupidly higher.

     

    Not sure where you get your numbers in terms of private sector employees starting at 65-70K - most entry level jobs I see are between 30-40K - and using your own public sector numbers of 45-55K and its not tough to see the problem. I certainly don't start people at 45-55K in my own businesses!!!

     

    You can wax philsophically all you want about your "sacrifice" - by your own admission you living the life you want - no stress at work - comfortable wages - nice vacations - and lots of free time (because hey we all know that 5pm is some magically time to go home), You and the rest of the 15% are stealing from my children and grandchildren and lessening my freedom at the same time.

     

    You ARE the enemy.
    2 May 2012, 11:52 AM Reply Like
  • James Sands
    , contributor
    Comments (2689) | Send Message
     
    Ok, thanks for your view. I'll leave it at that.
    2 May 2012, 11:58 AM Reply Like
  • Cincinnatus
    , contributor
    Comments (6187) | Send Message
     
    "The fact is, the private sector makes significantly more money that any public sector job."

     

    That's not fact. Federal employees make about 50% more than similar private sector employees. State governments aren't quite as generous, but they're still significantly higher than private sector averages.

     

    There's also an intangible that must be factored in, and that's the job security in the government sector that on average results in even higher lifetime earnings and retained retirement savings. In the private sector folks have to deal with periods of job loss and eating into savings to span periods when out of work. Most government workers never deal with such issues, and retaining one's job involves being able to prove that one can fog a mirror and little else (and for most even wrongdoing or outright incompetence can't get you fired http://nyti.ms/IUpBQ6).

     

    As you yourself admit you live better than you would working in the private sector. That's a characteristic common to Third World banana republics. We've skewed the incentive in the US to go into largely make-work jobs in the government sector rather than into private sector jobs that produce real goods and raise our global competitiveness and relative standard of living. It's a trend that must be reversed and soon.
    2 May 2012, 01:52 PM Reply Like
  • phxcrane
    , contributor
    Comments (763) | Send Message
     
    I thought the lure was that you weren't required to work and couldn't be fired. Go figure
    1 May 2012, 10:38 PM Reply Like
  • 1980XLS-2.0
    , contributor
    Comments (528) | Send Message
     
    Why should the people be obligated to honor promises that never should have been, by past politicians, that said anything to buy votes?

     

    That's what the bankruptcy process is for.
    1 May 2012, 11:03 PM Reply Like
  • Ron Myers
    , contributor
    Comments (255) | Send Message
     
    Even most radical libertarians understand the importance of a state for enforcing contracts and private property. Workers decided to take these jobs with the agreement that they would receive a pension as a portion of their compensation. Unfortunately there were numerous loopholes in these plans leading to actuarial losses and in addition states continued to "kick the can" rather than funding these obligations.

     

    As with private businesses the state should now be required to make good on these pensions or its assets should be liquidated and paid to the pensioners (and other creditors). Of course this is the issue with statism to begin with, that this can never happen.
    1 May 2012, 11:12 PM Reply Like
  • davidbdc
    , contributor
    Comments (3194) | Send Message
     
    No they shouldn't. What about my private property that will be confiscated to pay for these benefits? Where are my rights?

     

    There is zero reasons for governments to be raising taxes and reducing services to ensure that "public servants" get 90% of their last paycheck for the 30-40 years they live in retirement after working for 25-30 years. I might point out that they basically work 9-5, have flex-time, and when many of them work overtime they get overtime pay.

     

    Just like the Wall had to come down and the USSR broken up to restore some semblance of freedom to the Russian people, we will need something to happen to take back our freedoms from the state. Our bureaucrats are no different than the communist party members in the USSR.
    2 May 2012, 12:15 AM Reply Like
  • Cincinnatus
    , contributor
    Comments (6187) | Send Message
     
    Ron, as you likely are aware that these are "contracts" is a legal sham (so ruled of course by State judges that are beneficiaries of the very systems they're ruling on). The terms of these pensions were never contracts. They've been modified over and over through the years via legislation, and always to the benefit of fattening the government employees' obese and obscene benefits and to the detriment of the taxpayers. There's nothing about this that is one-way. Legislation can modify these down just as well as up.

     

    And any radical libertarian would tell you that you can't contract away the rights and property of future generations, which is the bs you're trying to pull off here. That you have no right to force a party into a contract without consent is the reason that government defined-benefit pensions should not exist. They should be fully funded defined-contribution plans or 401k type accounts.
    2 May 2012, 01:56 AM Reply Like
  • 447520
    , contributor
    Comments (103) | Send Message
     
    Bell, CA
    Vernon, CA
    And so it goes...
    1 May 2012, 11:31 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3527) | Send Message
     
    And one supposed advantage of the government pension funds was that the employee wouldn't have to rely on Social Security?
    1 May 2012, 11:57 PM Reply Like
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