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Subscribe to RSSAs hard as the economic downturn and volatile stock market have been on ordinary investors, public pension funds have fared much worse.
The Pew Center on the States estimates public pension funds are collectively short by $1 trillion. Some economists think that's an overly rosy picture and say the shortfall could be as much as $3 trillion. Unfortunately for the managers of these funds -- as well as the millions of public employees depending on them for retirement income -- the Fed's initiative intended to lower long-term interest rates will only widen that chasm.
"They've been exposing themselves to equity market underperformance, and they've been exposing themselves to a secular down trend in interest rates," says Jeremy Gold, a pension consulting actuary. With the Fed's new plan piled on top, he says that $3 trillion shortfall could grow by as much as an additional trillion dollars.
"This is probably going to hurt pension funds even more," concurs Pamela Villarreal, senior fellow at the National Center for Policy Analysis. "Now that the Fed has tinkered with their portfolio allocation, that means these pension funds are going to have to come up with a lot more money" to maintain their current rate of return, she says.
Much of public pension funds' troubles are self-inflicted: When states face a budget shortfall, funding obligations can get the short shrift. Some fall into the trap of believing a few banner years are representative of long-term gains, and some have dabbled in risky investments that turned out to be losers. They can also succumb to the same kind of emotion-driven, irrational decision-making that financial advisers warn individual investors not to do.
The other big hitch is the way these funds do their math. Although public pensions are guaranteed, risk-free to retirees, funds are allowed to assume returns of 8 percent — a number that's not representative of low- or no-risk investing. It's a discrepancy that's currently being examined by the body that oversees public pension funds.
"The Governmental Accounting Standards Board has been undertaking a review of accounting standards and there's been a very heated debate," says Girard Miller, senior strategist at the PFM Group. "It will tend to raise the visibility of this issue."
For public pension fund managers, a regulatory mandate to take off the rose-colored glasses is going to mean crunching some tough numbers and coming to grips with the need for much more capital.
States and cities have already begun altering their pensions to try and staunch the red ink, requiring employees to pay more into the system, delaying retirement age and cutting benefits for new workers. Villarreal says public defined-benefit pensions will give way to the defined-contribution plans that are now the de facto retirement plan in the private sector.
But these changes may not be enough. "To the extent that the long-term Treasury bond yield is falling, there's an impact on both public and private funds," Miller says.
One silver lining is that the longer-term descent of interest rates had already motivated fund managers to move some assets out of Treasuries and into higher-earning investments. But two other major components — stocks and corporate bonds — are much more vulnerable to a poor economy. Combined, economists fear these factors could create the perfect storm for public pension funds.
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"For public pension fund managers, a regulatory mandate to take off the rose-colored glasses is going to mean crunching some tough numbers and coming to grips with the need for much more capital". This means higher taxes at the state and local level to make up for the short fall
Let's again talk about the Yonkers, NY Police Officer that made a base pay of $35K per year. Two years before he retired he accumulated an astronomical amount of overtime and vacation buy back which sored his annual pay to $105,000 per year! His pension is now based on that $105K! See what's wrong here folks? It is high time to turn over the remaining moneys to the municiple unions and say, "Here, take care of your own!" Then watch what happens!
All defined benefit plans, public or private should be outlawed. Private plans that default are backstopped by the Pension Benefit Guaranty Corp. which is just another government goober created in 1974 under the Employees Retirement Income Security ACT or ERISA for short. What Congress did back then is exactly what they do now. They guaranteed failing plans with a government run agency and then allowed corporations and states to use unrealistic actuarial assumptions to determine whether or not the plans are adequately funded. Most are not. Do you think the taxpayer will not also be on the hook in some form for failing federal, state, and local plans?
Retirement should be funded by a savings vehicle where the employer makes contributions to an employee owned plan where the employer has no ability to raid the funds, and where the employees have to contribute to their own fund and are not allowed to spend it until retirement.
Even social security funds have been spent by Congress and replaced with absolutely worthless IOU's. What those IOU's represent are the borrowings needed to turn the IOU's into a benefits check. And so the lies continue. There is no way to prevent an employer, not even the federal government, from raiding the funds of a defined benefits plan, or from declaring the plans fully funded when that is not the case. So those types of plans should not be allowed to exist. All defined benefit plans are just more Ponzi schemes where the taxpayer will end up taking the hit. I'm tired of it.
When one retires give them a handshake and point them towards Wal-Mart. They can earn their pension as a greeter!
Glen-974637
The employers have already been allowed to "raid" the funds through John Boehner's infamous "Pension Protection Act" which allowed the companies to change the payout formula in their favor by adding a Corporate Bond Rate to the formula. This change in the formula basically allows the companies to payout much lower pensions to their hard working employees. All of this made nice and legal by Boehner's bill and the subsequent passage by our wonderful Congress.
I would think that if there was one individual from Chicago (the article about 1 day of work after leave of absence, 158K per year, etc...?) that bilked the HELL out the system, there are certainly more.
But hey, don't worry about fallout.... as long as you get yours before the shoe drops....
Two main factors the article has not touched upon. Pension fund managers got greedy in order for them to expose themselves to such financial risk with Wall Street. Then the scams Wall Street has been running to $crew the world out of money have been blatantly obvious. They indulged in predatory lending to pile up hundreds of thousands of junk mortgages with the goal of foreclosing on buyers. The mortgages/loans were bundled together, then grossly over rated by rating agencies. They were lying their butts off about those bundles. There is now public access to the Wall Street executive emails from Goldman Sachs where they were caught BRAGGING about cheating people with "crap" bundles.
The pension fund managers that exposed themselves to this high level of risk need to be fired. Wall Street has not been held fully accountable for scamming the global economy out of $20 trillion. They need to get ripped a new orifice. That includes prison time for the main crooks. Wall Street giants need to be divided up so there are no corporations that are "too big to let fail."
"When one retires give them a handshake and point them towards Wal-Mart. They can earn their pension as a greeter!"
And when you are ready to retire, we'll just put you out of our misery.
Live To Ride wrote "Let's again talk about the Yonkers, NY Police Officer that made a base pay of $35K per year."
The base pay is too low given the high risk of bodily injury and death as well as working outdoors at odd hours. Should a corporate receptionist make more with a pretty smile? The primary reason the bases pay is accepted is because the officer expects to make more with overtime/night pay (that's why it's so rare to see female officers working weekends and nights) and a fat retirement package.
Pension spiking is a practice that needs reform. The trouble is that every state official in that position does not want to alter the practice, be it averaging the salary for ten years before. An example is one told to me by a highway patrol officer. 2-3 years before retirement, an officer is promoted to sergeant and a higher base pay.
Officers and government employees need to be paid what they are worth in a more straightforward manner.
mountainmike wrote " Pension fund managers got greedy in order for them to expose themselves to such financial risk with Wall Street."
There is no reason for the pension fund manager to exist. Simply hold all pension fund contributions as cash. By investing in any volatile market, tax payers, as we have already seen at the city level, are forced to shore up the funds in bad times while pension fund contributions are cut at every corner.
The state employee pension fund contribution should be 10-15% of salary in pre-tax dollars with no opportunity to take loans from that account. If they want tohigher in earlier years and leaner during the later years, contribute 10%.
Blame it on Obama and the Fed!.............Remember: You voted for "Change You can Believe in". LOL!
Crash started in 2007. Obama didn't become president until 2009.
Didn't Reid, Pelosi and the Democrats take leadership roles in January of that year?
This economic tragedy we now face was set in motion back in 1971 when Richard Nixon chose to sever the dollar completely from the gold standard rather than face actual spending cuts.
It seems many here forgot the vision of Hank Paulson racing down to Congress with the sweat running down the crack of his ass during KING GEORGE the Second's Reign! .....and then?.........and then?........he begged Pelosi for 750 BILLION DOLLARS to bailout NOT the little guy investing on Wall Street who lost a Trillion dollars total in their savings but GAVE THE MONEY TO THE GOD DAMN INVESTMENT BANKS TO BAIL THEM OUT.!!!!
You boys either have SHORT memories; Lost your memory; or tried to change history.
Read the book "All the Devils are Here" by Bethany McLean and Joe Nocera. There's PLENTY of blame to go around. You Cement Heads point your fingers in the only convenient direction you prefer. What you end up doing is making yourselves look stupid.
I'm a tax payer from the PRIVATE sector. Public pension funds are just about the last thing on my list of concerns. I am taxed out!!!! Can ya hear me NOW!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!Run local, state and fed government just like a business. If it doesn't stand on its own, let er fall. What is going on now is proof that it will anyway.
It is actually amazing how many people fail to recognize the simple truth. As soon as you have retired you are living on investment income. It might be your own direct investments, or it might be investments that an annuity or fund makes for you. But you are going to be living on the income from investments. All the corporate profits that people love to hate are the source of their own future security.
Taxed out? I'd like my taxes to be lower, but the truth is USA income taxes remain at the lowest rates now compared to over the last several decades.
Allen Greenspan retired very rich. Too bad! So Sad!
Politicians made promises that us peasants are supposed to keep, but we don't have any more money. Cut pensions, fire workers, eliminate programs, break promises, default -- there's no other way out.
just great- punish the poor and working class that are already suffering. get rid of more jobs- yea- that will fix things. how about we follow the money trail... when we found out who ran off with all the money we boil oil and fry them on the spot.
There are actually only four ways to create wealth for a society. You can harvest from nature above the ground, extract from nature below the ground, you can transform existing things into things of higher value (industry), or you can invent something new. All other human activities merely transfer wealth among individuals or consume wealth that someone else created. Why then do we give highest values to those other things and demean the very people who are creating the financial basis for our society?
Bill wrote:
Fair enough. Take back the TARP funds (much has already been paid back, believe it or not), the stimulus funds, eliminate all corporate subsidies, eliminate foreign aid, close military bases. People will lose jobs and that will hurt, both them and them and the rest of us, but I see no other way out. We have run out of other peoples' money(OPM).
Are younger people really going to pay me and tens of millions of other boomers to play golf -- miniature golf in my case -- for 25 years? If the answer is yes.... well, I'll think less of them. Get off your knees and act! Do what my generation failed to do, though some of us tried.
Regardless, good luck. We're gonna need it. The wheels are coming off the train. You ain't seen nothing yet.
So TARP was almost paid back. How about all the other alphabet soup of programs? How about almost free money from the Federal Reserve? How about buying Fannie, Freddie, and the banks worthless securities? We are spending 1.3 trillion more per year than we have coming in. I do agree the wheels are coming off. The Europeans are leading the way. We are only seem to be doing a little better than them because we have been using QE like a dope addict. Not that it works.
yeah, blame Obama, blame the old, blame the sick, blame anyone else . . . just not the guy in the mirror.
These new right wingers, the Tea Party folks and the Republican cowards that get into line on demand really want to eliminate SocSec., Medicare, pensions and unemployment benefits. In fact, these Republicans/Tea partiers don't like the cost of any government: financial regulation, the cost of clean air, the cost of food monitoring, the cost of public supported health care, or the cost of environmental monitoring. (They recently conceded that they can only bring up a few items at a time, or else they will scare away middle America. But in time, my friends, in time, they will strip away every protection you have won over the years.)
And your complaint? The lowest taxes in generations are too much. Ok. Ride around in your new foreign autos, expand your MacMansion, plan that next vacation, and ignore all of the pain around you. That's the new right wing America. How proud you all must be.
But remember this: There is also a cost to an unbalanced society, where the poor already vastly outnumber their wealthy friends and have been armed to the teeth by conservatives! (Fear and anger has been their currency. They may eventually pay for this dearly.) We're living through yet another example of conservative wishful thinking. Ask the Japanese who cheated to avoid the cost of environmental controls, or the Middle East rulers who let their people starve while they piled up excess wealth. The future will only be as bad as you make it by trying to avoid the real costs of progress. But that's the conservative way, isn't it? Create a disaster and find some way to blame anyone but the guy in the mirror.
Bill ... you've fallen and you can't get up. Fallen for the liberal lies ...
Assuming you own anything ... just have a look at what you keep from every $1.00.
Income tax ...
Fuel taxes ...
Sales tax ....
Property tax ..
Fees (tags, tolls,etc) ...
State income tax? ....
How much do you keep that isn't being taxed or charged as a fee ????? VERY LITTLE!
Don't blame me those YOU voted for have wasted, promised, and defrauded US out of money ... it's time to pay up .. and those public pensions deserve to be on the wayyyyyy back list.
Why would Tea Partiers want to do away with social security and medicare, Bill?.....many of them are beneficiaries of these programs. The difference with Tea Partiers, is that they're generally not completely dependent on government programs. Most had the sense during their working years to build some sort of retirement nest egg. It's called personal responsibility.
We are the most environmentally regulated country in the world. Enough already! You libs are always happy to spend everyone else's money to fund your delusions. Get lost and if you want to pay more then donate to the cause of your choice but leave the rest of us alone. It's not your money nor is it the Government's money. It belong to the people who earn it to provide for themselves and their families. We are taxed to death and we're going to do something about come Nov 2012 wait and see. There will be hell to pay and you won't know what hit you and the rest of the clowns in DC. The complaint box is hanging by the door so drop it in on your way out!
"We are the most environmentally regulated country in the world."
Every western European country and Japan is much heavily regulated than the USA.
JimJ,
No we are NOT the most regulated, environmentally or otherwise, country in the world. Not only do Western Europe (actually, any Euro dollar country) and Japan have more regulation, but so do India and China. Further, per NAFTA, Mexican and Canadian environmental regulations are synchronized to ours.
But like India and China, our miners, drillers, refiners and processors either ignored the regulations or bought their way around them. And if you don't believe that this country is fundamentally polluted and fouled, look at the EPA SuperFund maps. Then realize that some of spots plotted represent dozens to hundreds to thousands of square miles of airborne toxins, groundwater or aquifer contamination, or poisoned watersheds.
Regarding taxes, you are a rank amateur when it comes to getting taxed. Ronald Reagan promoted trickle-down economics, cutting taxes for the wealthy but increasing taxes for the poor and middle-class. At the same time, Reagan threw money at the military, borrowing all of it. As a result, the stifling high interest rates of Jimmie Carter continued all the way through H.W. Bush. And not only did Reagan raise taxes, so did H.W. despite his election pledge. Taxes were stable under Clinton and the economy boomed. Regulations increased under Clinton and the economy boomed. Taxes were cut and regulations ignored under G.W. Bush, and the economy tanked. And contrary to popular opinion, the loss of American jobs to Mexico, China and other off-shore countries accelerated under G.W., as did illegal immigration into the United States. Our economy started to decline in real terms (employment and real GDP) in 2001 and accelerated along with the national debt.
After World War II, income taxes reached their highest levels, but the United States, under a truly conservative Republican, Eisenhower, repaid almost all of its war debt by 1960 while rebuilding Europe and Japan. 90% top tax rate bracket (even higher one year). But between pent-up demand from WWII rationing and GI Bill benefits, industry came back and wages grew slowly but steadily.
So teach me again about the relationship of taxes to the health of the economy.
When a volatile stock market can lead to an economic downturn, another recession is a self fulfilling prophecy.
Pension funds have the resources to create a new stock exchange, one that prohibits hedging, short selling, and
high-frequency trading; i.e., the tools of the trade that allow traders to leverage fear mongering and hype for the sake of making a quick profit.
Public pension funds have a unique opportunity to create a new stock exchange that encourages long-term wealth creation, and provides corporations efficient access to capital that is essential for economic expansion.
most if not all of the retirement plans lost most of their money when the stock and financial markets crashed under bush. the wealth of the wealthy skyrocketed in the last 10 years and execuetives still got huge bonuses and golden parachutes. class warfare- yes, the rich are in the final battle of doing in the poor. wealth re-distribution yes, the rich have taken just about all of it. next thing will be the rich actually eating the flesh of the poor for dinner.
Even in down markets, these pensions pay out a rate of return of 8%.
This isn't about Obama or Bush, or rich or poor. Pols of all stripes have made commitments to government workers that cannot be met. When the pension funds dry up there are contracts in place to still make the payments. Who is on the hook? The taxpayers.
Make it fair? Have government employees make contributions to Social Security and give them the option to open a 401k (or 403b as it were). When the unions that make the donations to the pols aren't getting anything from a broke SocSec system, it'll be addressed.
John, they don't pay that in my state.
Third wheel, Federal and most State government workers do pay Social Security, in fact, federal government retirees not collecting Social Security yet pay into Social Security. You should get the facts on government pension systems before you start making assertions not based in fact.
Please do not ignore the mortgage derivatives market, CDO's, in this process. Two public pensions in Indiana lost about 1/4 of their capital to the largest banks over these "toxic" assets, bundled and sold as triple-A securities. Have we seen any indictments for this fraud? No, only settlements with some state Attorney Generals. Meanwhile, real money exchanged hands for these bogus bonds. And we still don't have a law against the practice.
Third Wheel : Already exists. " Make it fair? Have government employees make contributions to Social Security and give them the option to open a 401k (or 403b as it were)." It's called FERS + TSP , research it.
Lets see:
Public Pension funds assume a Rate of Return of 8% per year, through down markets too. Who here makes 8% guaranteed on there 401k?
Look at the news from Chicago yesterday with these Union leaders: Work 1 day, get a $136k pension. Other people that were making salaries of $55k a year getting $100k+ pensions. People getting pensions while still being employed and raking up there second pension.
The pensions will NEVER be funded enough to pay all retirees because THEY DON'T CONTRIBUTE ENOUGH!!!!
In order to collect 136k from my 401k every year from retirement at 50 until I die, I would need over 30 million in my account. So, over a 25 year working career, myself and my employeer would have to deposited about 500k per year into the 401k. I seriously doubt any public union employees contribute that.
Your math is awful. Go back to school.
Reg is right. Your math is bad. I think three-point-something million dollars would cover it. I agree with your main point though. We cannot afford this level of corruption and are in no way morally obligated to pay it.
Regulator -
My math may not be perfect, but its a good example.
Please show me the math then on how a public union official can make 15k a year and collect a $100k+ a year pension?
Or how about 55k a year and get a 136k+ a year pension?
Can you show me the math behind that?
How much would the Average American have to put into there 401k (if they made 55k a year) to collect $136k a year in there retirement?
John wrote "Public Pension funds assume a Rate of Return of 8% per year, through down markets too. Who here makes 8% guaranteed on there 401k?"
The assumption is based on long-term stock market indices such as SP500. However, such investment requires overhead in management to mirror the fund or investment in a fund that does the mirroring. 8% over the long term is a lie. This lie is retold to make skimming easier and keep pension fund "managers" employed.
Can we just go back to the days when there were NO governments?
It sure would solve most of the world's problems.
Just have everything voted on by the people WHO CARE and do away with government for anything!
And in what mechanism would the vote take place? Who would prepare the ballots, count the votes, and reliably report the results? What would we vote on and who would carry out our wishes?
Government is simply the mechanism by which we carry out our collective wishes, particularly at the local level.
more2bits,
Who would build roads, enforce laws, provide for common defense, etc.? Life without government is called anarchy, which is basically amoral, lacking any judgement of right or wrong. If you wish to live under such a system, I suggest you try Somalia or parts of Yemen. Even in those regions, you will find a de facto government, based either on warlords or tribal organization.
Bill, amoral beats immoral, which is what we have now.
Its always as predictable as the day is long...when times are tough, private sector workers pile up on the public worker's pension benefits...clearly out of jealousy. Hey, did you know that when time are good, and you private folks get huge bonuses, and raises, us public sector works get nada! No bonuses, nothing. So, while you all cry about our pensions, guess what...at least for us NYr's who have a well funded and solvent pension fund, it's not going anywhere! Take that! And I'm on year 13 of a projected 40 year career in my legal gov't job, which means at reirement, I will in effect be collecting my take home pay of the average three highest years, until I die! Ha Ha!
Yes, people are mad as hell at the rich, But also mad as hell at the corruption and thief by the unions!!!! Your days of nobility are over and your business as usual must change for the good of society. You deal in amoral bargaining that no longer apply to the modern work force and laugh (Ha! Ha!) at those of us left to pay. YOU and your entire mind-set of unthinking collective bargaining thugs ARE the new problem.
Even here in NYC people are done with you (unions), the trains coming down the tracks and I can only hope you al remain so arrogant you refuse to get off the tracks.
patHuntingtonNY, Don't count your chickens before they hatch! I'll give it five years and your party will be over with! Let's just say that you are represented by NY's CSCA union. I'd be willing to bet that you don't pay $125.00 a week for health care insurance like I do! Let's also talk about your "bonus days off!" One extra day off each month for perfect attendance? That's 12 extra days off per year! I also just got my new school tax bill from my school district, a 38% increase for teachers (CSCA) benefits? The leach party is coming to an end, soon?
Smug Pat will be like the tens of thousands of Grecians rioting in the streets because the government can't afford to pay them what they think they're entitled to. Hey Pat! A lot can happen in the 27 years you have left! HA HA! And public employees wonder why they're being chastised by private employees.
No you won't. By then I assure this ponzi scheme using these un-sustainable payout rates will be defunct. You better save money like the rest of us.
What so many of these "talking heads" who oppose the public workers fail to realize is that those "generous public pensions" are really deferred compensation - payment for reduced salaries during the employees' working years. The government benefited up front by having lower salary costs. Upon retirement, some of this reduced compensation was repaid in the form of retirement pensions. Now, after the government has benefited from the agreement, they want to change the terms of the contract to renig on the original terms. That's breaking a contract - something the private sector doesn't support. Do I smell hypocrisy here?
Reduced salaries for getting the pensions?!?!? ROFL. Puhlease.............
Huge bonuses for Private sector workers??? Not in the last 10 years.......
How come private sector employees can't get it written into the states constitution (like it is in IL) that they get a guaranteed pension? If my boss guaranteed (via a legal contract) me 3% raises per year along with a pension and free health care after I retire............. I would vote him into office also.
Perfect Storm? Try penson funds RUN INTO THE GROUND by corrupt union thugs
____________________________________________________________________________________________
Not one DIME of Taxpayer money should go from Government Unions to Government Reelection Campaigns ("thug-2-thug")
Just like the BPA lost 16 mil or so for scholarships for young kids and such and its still un accounted for. Because its a bowling asso no body is really paying any attention to it but kids are going to school now wanted to get the money they were awarded and not getting it. Money is gone and much more unaccounted for.
MSN should really run a story on that one as well.
Not one DIME of Taxpayer money should go from Corporations to Government Reelection Campaigns ("thug-2-thug")
Madison from NY.
Oddly, the article was neither about unions or fund mismangement. If you had read the article, it was about the basic, legally required, assumptions underpinning the collection and investment of pension funds. It seems that these assumptions were out of step before, and just wrong in the current economy. Yet you have pull out anti-labor, Tea Party bs.
But of course, the federal legislators are not at risk... they are guaranteed their pensions by the taxpayers..... wonder why?
Cry me a freaken river. This is yet another reason to vote Obama out in 2012. Otherwise, the few of us taxpayers left will be bailing these poorly run pensions out on our dime.
You make me laugh in a Sad clown sort of way. Anyone who is so F-ing stupid to not realize that these type issues have been going on for YEARS with all politial parties being involved. Like most ideas, they were started with good intentions. Work, put in money, retire get some back. They have been corrtupted by the people who learned, work 1 day and get super pension. Now we all know these are the sad exceptions to the rules, but the sad fact is, our lawmakers accross all Parties should instantly upon seeing that right a simple 1 paragraph ammendment to their laws forbidding it. Congrats to those have manipulated the system, but going foward it will not happen. If we can start dong these type things little by little, we will start to reduce the waste. Will it cure all of our woes, of course not, but we have to start somewhere.
@Obama Lies and the GOP/TP don't? LOL
Both sides are in the wrong, not just the one, get a clue bro.
I am so glad to live in a pay-as-you-go state. When revenues fall, so do expenditures. Our public pensions are all defined contribution, with pension fund revenue forecasts based upon prevailing returns, not pie-in-the-sky predictions or fixed rates of return that are unrealistic. In addition to the standard pension, the employee may choose to contribute to a 401k style savings plan that will increase their pension, but it has no employer contribution. Our health benefits expand and contract with the economy (mostly contracting, lately), so in bad times we get less for our money, just like private sector workers. We haven't had a raise in three years, because there has not been money for it.
I know not all states manage their affairs in this manner, but it can and should be done. The Federal government could run the same way, but the public would have to be willing to endure it. Unfortunately, all every level of our society, we have become too accustomed to having the government stepin whenever there is a problem. We have become so used to it that we no longer believe that we can handle our own problems; we cannot even conceive of it.
There are no easy answers to resolve the difficulties we face as a nation. It's time to pull up our big boy pants, face the problems head on, and make some tough choices. If we cannot do that, we will cease to exist as a nation. It won't be fault of the Republicans, or the Democrats, or the Tea Bag Party, or big business, it will be our fault. All of us that allowed it to happen.
Another Obama and Democrat attack on senior citizens. Those of us responsible enough to prepare for retirement are:
1 Seeing half a Trillion being removed from Medicare to pay for the uninsured
2 Getting nothing (no interest) on our savings
3 He wants to reduce the amount of money going into Social Security by cutting the payroll tax
4 Now he wants to tax us more when we sell some stock or mutual funds that we bought years ago for our retirement.
Obama and the Democrats have declared war on responsible seniors so they can continue to give handouts to the welfare crowd.
I think you're posting in the wrong thread.
Eric Cantor and the GOP has staged that war with the grand stand of the debt ceiling crisis. The GOP house majority leader is invested through his wife and mother in law in a hedge fund that profits from the devalue of treasury bonds and a recession. WAKE UP
Steve and Spider: Good response. Bill is in need of kool-aid to take away the bad feeling and give good feelings.
I live in NYC the- the land of the most generous pension funds in this country, and for many years now I have watched my ff/cop/corrections/and sanit workers walk away after much less than the 20 years with so many different versions of the disability pension. I know one ff that worked 7 years - went out on temp disability to study for the Officers exam, came back , was promoted and then retired with his tax-free disability of $92K /yr. That was 10 years ago. At a social last week he was complaining about the illegal immigrants and people on welfare. This pension (nor the medical benefits) never go down - regardless!!!! - and will only go up with cola. I am so sick and tired of the governmental work force thinking they are owed these benefits (over over overinflated and most times illegally calculated) at the cost of increased taxes. The GOVERNMENT and the mindset of the workers is unbelievable to me. I remember growing up in a vey blue-collar area of the city being told by my friends and their fathers that the city/union jobs didn't pay well but you had security on the back end. When did so much change, and more importantly how did so much change? It's true that every level the government is corrupt and we are no longer a government for the people but a people for the government. God help the USA because the cancer within has destroyed us.
I think we all have similar stories of people doing this. I have several from people I know including relatives and it's sickening, especially in times like this.
It's always sickening. Always has been to me. This is not news.
Right ON! Could not have said it better myself.
Pucker up tax payers!!! The labor party is coming for your wallet.
Hah! My company solved that problem!!! They just said: "We're not paying your pension any more! Tough luck! Here's a pittance, go invest it and live off it!" Of course, they told me this two years ago, when the stock market was down, and just finally gave me the money last month when the market started going insane. Wow, compassionate capitalism in action once again.
Of course the pension they were going to pay me was less 15% of my present income, since I've only worked here a mere 15 years. I guess from that you figured I'm not a union employee. You figure correctly. However, I figured the people running this company are going to bankrupt it anyway, so I was just going to pull out any money from my pension fund anyway, so I got my money early.
You mean your definition of a perfect storm is politicians promising contributors they are going to give them a 'free lunch' and then failing to make even a nominal effort to fund those promises? That's your definition of a perfect storm?
Wow. Fairyland is still here. One would think that a reporter for MSNBC wouldn't be quite that naive.
These are Americans. More POWER to the working class of this country. INVEST in AMERICA. AMERICAN JOBS, AMERICAN INFRASTRUCTURE. Why is someone in IRAQ making 80,000 off US government contract. Mexico jobs raised by over 90%, Canada over 50% with NAFTA. And 800,000 jobs along with companies move and destroy the American manufacturing business. Get mad at the RIGHT people and the WRONG legislation.
suz...Did rich people write these public pension laws that guarantee 8% interest per year even when the money isn't earning a dime, "money-match" stipulations where the employer matches employee contributions, and all the other benefits that cannot be sustained? No. Who did write these lavish pension fund promises that amount to nothing more than Ponzi Schemes? And, who, year after year, demanded that more and more pension benefits be added as well as cost of living adjustments on a yearly basis? The answer is spendthrift governments that always promise more than they can deliver and the public unions. So, yes, more power to the working class. Blame the rich? Get your head out and blame those who are really responsible for the coming collapse of public retirement systems.
You are wrong JessieL. Our pensions come directly out of our checks. 1/3 of every check goes to my retirement. How many private sector employees pay that much for their pensions?????
Nina, are you saying you "contribute" 1/3, or it's taken out of your check involuntarily?
Nina, private sector employees usually have 40lks and the employee usually the bulk of money. Most employers contribute 3 % of salary and the employee all the rest,
Don,
You conveniently left off the limits on 401k contributions. These are $ 16 500 for employees under 50, and $ 22 000 for employees over age 55 acoording to the IRS. However, many employer plans cap 401k contributions to 7%. And many employers have suspended or eliminated their match.
Nina - Don't try to snow the snowman.
1/3 of every check goes into an unfunded retirement fund?
Hah!
Nina,
I seriously doubt you put 33% of your paycheck into your pension. Maybe 3%..............
Public employees will be forced to go to the posthumous retirement plan, like most of the private sector. That is just reality asserting itself. So long, golden years. The idea that someone could retire for decades and never have to work again was always financial nonsense anyway. No generation can expect that kind of cushy deal. Sorry if that is news to anyone, hate to burst your bubble.
I might be very lucky...but I worked for a municipal police department in Florida for 27 years and retired at 100% of my salary before 60 yoa. That pension fund is fully funded and is managed by a committee of half employees and have citizens appointed by the municipality. I contributed to SS and just started receiving benefits at 62. I put in alot of shift work and dangerous situations so I feel I earned this "cushy deal". I plan on riding this bubble for the next 30 years.