MONTEREY — Are public employees, with the national spotlight on their salaries and pensions, getting a “bum rap” as the new “welfare queens?”
That was the view of several members of a panel when the CalPERS board met on Monterey Bay last week, one of two annual “off-site” meetings away from Sacramento to take a break from routine committee action and be briefed on issues.
The CalPERS chief executive, Anne Stausboll, opened the panel on national retirement security by outlining the gap between what private sector workers have for their retirement and what they need.
It’s an estimated $6.5 trillion shortfall, she said, dwarfing the public employee pension funding gap.
Stausboll said there is a growing acknowledgement among policy and business leaders of a “retirement security crisis,” including long-term funding for Social Security and Medicare, and CalPERS should identify its “voice” for the coming debate.
“Our objective is to bring back to you, the board, some time this spring a broad policy platform for the board to consider taking up in the national discussion,” she said.
Despite the attempt to set the stage for a discussion about retirement for everyone, most of the 90-minute panel was about how public employee wages and pensions are being wrongly blamed for state budget shortfalls.
The panel began with a Jan. 1 segment of the Rachel Maddow show on MSNBC that said public employees are the GOP scapegoat for a deep economic recession caused by the misdoings of Wall Street and bankers, leading to the housing bubble.
“A $100 billion bad situation (total state budget shortfall) is a direct result of the hoards of overpaid shiftless pensioners, public sector workers who are sucking the lifeblood out of the body politic,” host Chris Hayes said ironically.
It was the lead in to brief video clips of criticism of public employees and their unions by Steve Malanga of the Manhattan Institute and two Republican governors, Tim Pawlenty of Minnesota and Chris Christie of New Jersey.
Hayes countered with several points: Texas, a conservative state with weak public employee unions, has one of the worst budget shortfalls, $25 billion over two years.
A study found the average state worker salary is 4 percent less than the private sector average for the same work, with comparable age and education. Christie and other New Jersey governors chose not to make $14 billion in pension contributions since 2004.
“Public sector workers are the new welfare queens in American politics,” Dorian Warren of Columbia University said in an interview with Hayes, pointing to an article by Jonathan Cohn in the New Republic.
“They are an easy scapegoat that distracts us from the real sources of the problems that are affecting state and local government,” Warren said. He said the “real villains” are Wall Street, bankers and even politician promises to workers.
The CalPERS federal lobbyist, Tom Lussier, said he thinks the Maddow segment is a “good representation of what many of us feel” and is not, “I think it’s fair to say,” representative of what most of the media is saying about public pensions now.
“We come to this discussion I think at a time of real unprecedented attack on the public sector pension model,” Lussier said. “I think everybody in the room has either seen it, or felt it or certainly experienced the fact that it has intensified.”
CalPERS met at Monterey Best Western
A former congressman on the panel who specialized in public pensions, Earl Pomeroy, D-North Dakota, mentioned two recent national newspaper articles critical of public pensions.
The New York Times said the Securities and Exchange Commission is investigating whether CalPERS properly disclosed investment risk. A USA Today editorial said “lavish” pensions add to state fiscal woes.
Pomeroy said a bill by U.S. Rep. Devin Nunes, R-Tulare, requiring pension funds to report their debt using a lower “risk-free” earnings forecast, if a state wants to continue issuing federal tax-exempt bonds, is “hostile action” against public pensions.
He said a similar requirement that private-sector pensions use the “market” value of assets, rather than “smoothing” gains and losses over several years, drew bipartisan support in Congress because advocates said it would strengthen the funds.
As it turned out, Pomeroy said, the change was a “catastrophe” that may accelerate the end of private-sector pensions. He said corporations were required to shift more money into pensions, instead of investments that might help end the recession.
Pomeroy said the U.S. Chamber of Commerce joining anti-tax groups in supporting the Nunes bill suggests retaliation for CalPERS success in pushing corporate governance reforms, such as the selection of corporate boards.
He said the California Public Employees Retirement System, the nation’s largest public pension fund, has long been known for “best practices” in operations and investment management.
“You are getting a bum rap,” he said of recent criticism.
Pomeroy said the Boston College retirement center estimated that states have been spending 3.2 percent of their funds on pensions and now need to increase the spending to 5 percent.
In an article accompanying the USA Today editorial last week, a national union leader said state pension shortfalls are the result of reckless behavior on Wall Street and the failure of politicians to make proper contributions, not “lavish” benefits.
“It is projected that states must increase pension spending from about 4 percent of their budgets to just 5 percent in the future,” said Gerald McEntee, president of the American Federation of State, County and Municipal Employees. “Surely this is manageable.”
Pension contributions in Gov. Brown’s proposed budget for the new fiscal year beginning July 1 are 4.4 percent of the $84.6 billion general fund spending. With the retiree health payment, the cost increases to 6.1 percent.
But the California State Teachers Retirement System and the UC Retirement Plan, both underfunded, need contribution increases totaling several billion dollars, which if provided would probably push the state general fund share to around 10 percent.
The proposed budget expects the state contribution to CalPERS, which has the power to set the rate, to increase from $3.769 billion ($2.148 billion general fund) in the current fiscal year to $4.14 billion ($2.384 billion general fund) in the new fiscal year.
The CalSTRS contribution, $1.257 billion current year, is expected to increase to $1.35 billion in the new fiscal year, if an old benefit formula is triggered. All of the CalSTRS contribution comes from the general fund.
Unlike CalPERS, CalSTRS cannot set its own contribution rate, requiring legislation instead. The current rate is 4.5 percent of pay from the state, 8.25 percent of pay from school districts and other employers, and 8 percent of pay from teachers.
State retiree health care costs, nearly all from the general fund, are expected to be $1.394 billion this year, increasing to $1.554 billion next fiscal year, according to Department of Finance figures.
Last week CalPERS and CalSTRS both reported double-digit investment earnings for 2010 — respectively, 12.5 percent and 12.7 percent. But they still have not recovered from losses during the recession and stock market crash.
The CalPERS portfolio was valued at $225.7 billion at the end of the year, well below the peak of $260 billion in the fall of 2007. CalSTRS investments are worth $146.4 billion, below its peak of $180 billion in October 2007.
A day after the CalPERS panel in Monterey last week, two more articles critical of public pensions appeared in the national media.
Girard Miller said in his Governing magazine column that local governments, worried about rising pension costs, are skeptical of “dodgy” data from CalPERS, which uses a 15-year smoothing for assets, well beyond the five-year industry standard.
A page-one story in the New York Times said there is a behind-the-scenes move in Congress “to let states declare bankruptcy and get out from under crushing debts, including the pensions they have promised to retired public workers.”
Reporter Ed Mendel covered the Capitol in Sacramento for nearly three decades, most recently for the San Diego Union-Tribune. More stories are at https://calpensions.com/ Posted 24 Jan 11
Calpensions 
January 24, 2011 at 4:31 pm
The numbers tell the story. Here in Pacific Grove, our Calpers account should be at 100 million dollars to be fully funded.Calpers has lost PG 51 million of PGs’ fund in the last eight years. Unfunded deficits grow at the Calpers investment rate of 7.75% per annum. If Calpers earned 12.5% this year,following a crash,that is terrible. 7.75% is required. So in this plus year,only 4.75% will reduce the 51% deficit in PGs’ plan. If Calpers could earn even 4% per annum,that would be pretty good for a pension plan. But benefits are so high that cities would run huge annual deficits forever. If cities stay in Calpers,and if it incurs the annual deficits predicted,plans in cities like Pacific Grove will be drained in about a decade.Pacific Grove passed pension reform,so it is better off than any other city. Pacific Groves unfunded deficit is about 55% 3@50 and 45% 2@55,but if it did not have 3@55,its’ 51 million dollar deficit would be about 40 million.So 2@55+ or – for new hires will still add significantly to the deficits; it’s just a slower death for cities. Stay with the actual numbers. They tell the brutal truth.
January 24, 2011 at 4:54 pm
It’s always the jealous ones that complain. The ones that have not planned for their retirement and now their 401’s have tanked or are getting .3% interest. Too bad, you missed the boat.
January 24, 2011 at 5:26 pm
I read and understood the retirement package at tme of employment 27 years ago. The fiscally ill-responsible and spoiled continue to demonize us who have done the job of running the the state daily. While the politicians critisize, point fingers and continue to spend wildy. We pay into the PERS fund a major portion of our checks monthly. PERS has little to do with California or the mad money train of Sacramento and the fraud, waste and abuse of a system of govenrment gone wild. The welfare state, entitlements, inmate medical and free handouts to parasites needs to stop!
January 24, 2011 at 5:40 pm
If private sector employees saved and invested 20% of their salaries for 30 years (like public sector employees), and then bought an annuity, they would also have a sufficient retirement income stream.
January 24, 2011 at 5:41 pm
The problem is not so much public employee pensions, which by and large are both reasonable and reasonably funded for the long run; but, rather pension envy on the part of private sector workers who have seen their retirement security decimated by corporate actions that have made the wealthy much wealthier and the middle-class much poorer.
The 401-K debacle during the financial crisis is just a symptom of how poorly the average private sector worker has been treated.
Seldom is there any mention of how quickly CalPERS and CalSTRS investments have bounced back from their lows of a few years ago. At the bottom CalPERS investments lost $100 billion in market value. Now, less than three years later, the fund has recouped 70% of its losses.
January 24, 2011 at 5:48 pm
The CalPERS chief executive, Anne Stausboll, opened the panel on national retirement security by outlining the gap between what private sector workers have for their retirement and what they need.
It’s an estimated $6.5 trillion shortfall, she said, dwarfing the public employee pension funding gap.
Is Ms Stausboll aware that there are 5 times as many privately employed people as public employees? Of course the gap should be larger.
Is Ms Stausboll aware that the privately employed people are (at least now) required to make good on the public employees shortfall
Why would such a person be in any position where she could even comment much less influence the debate.
I guess i am jealous-as your pension tanked too but we are responsible. I hope this will change. Public sector workers amonst themselves consider private sector workers sucker
January 24, 2011 at 6:03 pm
CalPERS is a great place to work. The main core values are Quality, Respect, Accountability, Integrity, Openness, and Balace. There are strong green initiatives, and corporate governance initiatives. I thank God for the 10 years of my life I have dedicated to helping CalPERS fulfill it’s mission, and look forward to another 15 to 20. Could I make more in the private industry? Sure. But public service is more than a job. It is a mission. I am thankful everyday that CalPERS leadership strives to protect my defined benefit plan. I am also thankful that I have an opportunity to help my civil service brothers and sisters keep their defined benefit plan by doing all in my power to run this organization efficiently, and with compassion for the Average Joes. The Average Joes, like me and my husband. My husband works in private industry and the only retirement security he has is the 401K he contributes to with no matching…and sharing in my pension. Generation X, like us, cannot count on the Social Security safety net being there after the Boomers and the Feds (via private relationships with Wall Street lobbyists) suck it dry.
January 24, 2011 at 6:16 pm
As others have observed, this is clearly a case of ‘pension envy’. I would bet that only 5 or 6 years ago, when the real estate was booming and everyone was ‘raking it in’, polls would have reflected virtual non interest in this topic. In fact, government workers looked like suckers; with the State offering no raises for about 6 years in a row. However, I think the ‘topping on the cake’ is the group of Congressmen referenced in the New York Times, as well as Nunes. I may not be an expert on pensions or budgets, but I DO know the difference between right and wrong. What they’re proposing is morally reprehensible. The idea of ripping pensioners from their income ! These people have some serious psychological problems. I’ll be directly contacting my U.S. Senators/ Congressman and demand that this activity is immediately ceased.
January 24, 2011 at 6:23 pm
Quoting from the article …”In an article accompanying the USA Today editorial last week, a national union leader said state pension shortfalls are the result of reckless behavior on Wall Street and the failure of politicians to make proper contributions, not “lavish” benefits.”
It’s interesting how blanket comments such as ….not “lavish” benefits .. are thrown about without a shred of evidence to support it.
Why ? …. Because the statement is ludicrous. AT EVERY (yes EVERY) pay level (NOT just the higher earners) the employer (meaning TAXPAYER) paid-for share of the TYPICAL Civil Servant’s retirement package (pension and subsidized retiree healthcare) has a value at retirement that is 2 to 4 times greater than the employer paid-for share of the pension provided to the comparably paid Private sector worker retiring at the SAME age and with the SAME years of service …. and the 2 to 4 times rises to 4 to 6 times for safety workers due to their even RICHER pensions.
Sure it hard to adequately fund these RICH pensions….. because RICH pensions are VERY VERY expensive !
Reduce the pensions, for CURRENT (yes CURRENT) workers to a level comparable to what Private Sector workers get and appropriate funding might be possible.
January 24, 2011 at 6:38 pm
Well, Art, who is more qualified than the CEO of CalPERS, to participate in the debate? Sheesh!
I am glad to see CalPERS is meeting and discussing this situation. We should all know that, the best offense is a good defense. I wish they would have another CA Dialogue, like the one I attended in LA last Feb.
Anyone, who is interested in learning the truth regarding the cause of the current economic downfall, should be sure to seek out and view the documentary film, “Inside Job”. Anyone who has not seen it, is not qualified to point fingers at anyone, other than Wall Street.
January 24, 2011 at 7:02 pm
“A study found the average state worker salary is 4 percent less than the private sector average for the same work, with comparable age and education.”
But what is it when you add the additional benefits state workers receive, such as the medical, dental & vision?
January 24, 2011 at 7:43 pm
Phil Perry, such studies are including benefit packages. Studies on this subject have been mentioned by Robert Reish, former US Secretary of Labor.
January 24, 2011 at 8:11 pm
Give me a break! What a silly article and silly comments to follow. Unfunded liabilities are breaking our state!!!
January 24, 2011 at 8:17 pm
It’s always the jealous ones that complain. The ones that have not planned for their retirement and now their 401′s have tanked or are getting .3% interest. Too bad, you missed the boat.
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Translation, I’m a welfare queen public employee!
January 24, 2011 at 8:19 pm
If private sector employees saved and invested 20% of their salaries for 30 years (like public sector employees), and then bought an annuity, they would also have a sufficient retirement income stream.
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LOL…another welfare queen whopper! You dont invest 20% of your salary-NO PUBLCI EMPLOYEE does. If you invested ANYTHING (over half of public employees contribute nothing to their pensions) you woudl have maybe $150K, plus another $50K in returns. At MOST.
January 24, 2011 at 8:20 pm
The problem is not so much public employee pensions, which by and large are both reasonable and reasonably funded for the long run
===============
LOL..!!!…..GED Cops and firehwiners getting $5-$10 million dollar pensions at age 50= REASNOABLE!!!!
Hahahahaha…only in the mind of a GED feeble mineded gov employee could such baloney come…..
January 24, 2011 at 8:22 pm
As others have observed, this is clearly a case of ‘pension envy’. I would bet that only 5 or 6 years ago, when the real estate was booming and everyone was ‘raking it in’, polls would have reflected virtual non interest in this topic.
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Yet another GED gov trough feeder with the “I had a neoghbor make $500K in the real estate years”….blah….blah …blah…the avergae saary in CA is $33k for private sector-it is $44K for public sector, and with benefits that doubles.
I bet your “neighbor” also invented Google and Yahoo, and you skipped that $$$ for a steady gov paycheck~
January 24, 2011 at 8:23 pm
CalPERS is a great place to work. The main core values are Quality, Respect, Accountability, Integrity, Openness, and Balace. There are strong green initiatives, and corporate governance initiatives. I thank God for the 10 years of my life I have dedicated to helping CalPERS fulfill it’s mission, and look forward to another 15 to 20. Could I make more in the private industry? Sure.
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You could NOT make more flipping burgers, and that is all you could get in the real world with your GED.
January 24, 2011 at 9:05 pm
I have done fine outside of Calpers. But the numbers say Calpers is 34%( in all cities statewide) underfunded. Pacific Grove is now down 47% in its’ Calpers plan.Don’t assume that your city or county has done any better.Ultimately,the real estate parcels in each City and County will pay for the Calpers deficits. $50,000 per home will not be unusual. Police and Fire will be cut by two-thirds,like Vallejo and Camden. Every budget I have looked at is already cutting police and fire. Quit jabbering. Look at the numbers for your city . This is a survival issue for cities. So don’t be afraid to learn your citys’ unfunded deficit. Most of you will be shocked.
January 25, 2011 at 1:14 am
John, your real estate can only get extra parcel taxes with the permission of the voters in your district. No such thing will happen where I live. We are not in a rich area, like PG. My city is fine–salaries have always been low, in comparison with others.
January 25, 2011 at 1:17 am
Annoyed: No one forced you to look at the article. If you think all the comments are silly, why read them? Why don’t you come up with some good comments.
January 25, 2011 at 1:21 am
Rex, I didn’t see anywhere that the CalPERS employee stated her level of education. I will bet you a cool million that its higher than a GED.
January 25, 2011 at 1:22 am
For those who have been saddled with the horrbile 401K programs and the Social Secuirty retirement there is a solution. All the major Police departments, Fire departments and Corrections are now hiring and will get you that pension. Or perhaps that’s not the type of job you want or the risk you want to take. Hummmm…
January 25, 2011 at 1:28 am
None of this is a CalPERS only problem. It is a world problem–the perpetrators got away scott free and are still at it. Everyone who has not seen the documentary movie, “Inside Job”, should seek it out and view it. Rent it, if nothing else.
January 25, 2011 at 1:34 am
I see I already said that. Please forgive the repetition. I, obviously, am stuck on that movie–still mad.
January 25, 2011 at 2:02 am
SeeSaw said …”It is a world problem–the perpetrators got away scott free and are still at it.”
You’ve got that right, just you’ve got the wrong perpetrators.
The guilty parties are the Public Sector Unions and our self-serving, vote-selling, contribution-soliciting elected officials who approved these grossly excessive Pensions & benefits and sold the taxpayers down the toilet.
January 25, 2011 at 2:12 am
Monte, your …….”We pay into the PERS fund a major portion of our checks monthly.”…. pays for 10-20% of you outrageously generous pensions. The taxpayers’ contributions (together with interest earnings thereon) pays for the balance.
Taxpayers are wising up.
Expect this generosity to change, bigtime, and soon.
January 25, 2011 at 2:57 am
SeeSaw Prop 13 etc does not interfere with the ability(necessity) of a court to assess real prop. to collect a judgment against a City or County. Where do you live? Tell me and I will look up its’ unfunded liability. Are you up to it? The numbers will set you free.
January 25, 2011 at 3:46 am
What a joke, TL. Accusing the public employees of bringing down the economy of the whole world! You are going to give everyone a laugh, I guess.
January 25, 2011 at 3:49 am
John, I live in San Bernardino County. I prefer to keep my City location private. I keep up with the news on a daily basis, and I have never heard of any such thing happening here. I have no worries about it, but if you want to tell me something dire, I will sure check it out.
January 25, 2011 at 3:59 am
SeewSaw, No Public Servant GREED (along with support of enabling/corrupt elected officials) hasn’t brought the entire world to it’s knees (yet) …… only Yugoslavia, Greece, Portugal, Spain, Iceland, Italy, France (soon) ….. and the USA (very soon).
The Unions should pat themselves on the back …. for job well done !
January 25, 2011 at 4:43 am
TL, its obvious you never saw the movie.
January 25, 2011 at 1:31 pm
Joe Pension: I can’t wait till CA goes bankrupt and your pension goes Byby! You gov workers are nothing but welfare workers, stealing from our kids and grand kids.
January 25, 2011 at 1:36 pm
Monte, there should be no paid Firemen its a scam job. Privatize all the cops get rid of gov workers that are useless. A city in NJ just laid off half of their cops, lets see if crime really goes up. Most cops are useless too. The come a half hour after the crime has been committed big deal.
January 25, 2011 at 1:51 pm
Monte, get a clue, the tax payers pay for 100% of your pay, medical, and pension. You are clueless! You take money out of the money tax payers pay you to pay for a tiny bit of your retirement. But the tax payer pays for everything, including your portion that you put in. You are all way over paid, you should all be fired. Let the private sector hire for the best possible deal for the tax payers. No more scam jobs that the unions pull. Getting their buddies in office, then giving themselves and their buddies big raises. Scam job. You are stealing from someones kids and grand kids.
January 25, 2011 at 1:54 pm
““A study found the average state worker salary is 4 percent less than the private sector average for the same work, with comparable age and education.”
Union BS!!!!!!!!!!! You are paid almost twice as much. Wake up people, you’re robbing your kids and grand kids by not fighting these unions. They are stealing from your kids and grand kids future.
January 25, 2011 at 5:02 pm
LOL..!!!…..GED Cops and firehwiners getting $5-$10 million dollar pensions at age 50= REASNOABLE!!!!
Hahahahaha…only in the mind of a GED feeble mineded gov employee could such baloney come…..
__________________________________________________
I challenge you to learn how to spell.
January 25, 2011 at 5:11 pm
It must be fun berating real human beings behind the anonymity of the internet.
I highly doubt you would be this rude to a firefighter’s face, especially if it was your neighbor next door.
Try and remember the golden rule. It is okay to point out problems with the system, but not to personally insult people.
January 25, 2011 at 5:24 pm
SeeSaw: Luckily you don’t live in SB county. It is set to pay 31.23 of safety salaries for pensions (up 20 million per yr.),has a 160 million budget deficit and is laying off employees by the dozens on an annual basis. If you live in a city,your unfunded deficit is on average about 30 million per 10,000 population,if you have 3@50(90%) for safety and 25 million per 10,000 otherwise.deficits grow at 7.75% per annum for Calpers plans. The ominous key is this: At the bottom of the stock crash in Mar of 2009,the Dow was at 6763 and Calpers was down 29% for the year. The Dow is now at about 12,000 and Calpers earned only 12% in 2010. 7.75% of that is needed for the actuarial investment assumption,leaving only 4.45% of the gain to reduce deficits. In other words,when the market went up about 90%,the Calpers plan gained back only 4.45%. But keep in mind,about half of the Calpers deficits were caused because salaries increased twice as much as Calpers assumption of a 3.25% increase per year. What it all means is that as deficits compound,principal will be used to pay benefits. Mostly volunteer fire and police depts. will become the standard.
January 25, 2011 at 5:51 pm
Joe Public is mad he lost his rear in the new depression, bankers stole his money and his house is gone cause he milked it with a HELOC to buy cars, toys, vacations and now he wants to take what the responsible folks still have. Guess what? Ain’t happening, end of story suck it up. Like it’s mentioned above, go join a PD, FD, Corrections if you want a piece of the pie but unless you are unwilling to take those risks with your life and work the horrendous schedules then zip it, tired of hearing your whining like a kid in the sandbox who lose his shovel.
January 25, 2011 at 5:58 pm
TAXEDTODEATH – Yes, Camden, NJ is laying off half of it’s police force. Camden, NJ has the second highest crime rate in the US behind Detroit…ask the people of Camden if they want that. Make all public safety a private sector/lowest bidder job and see how many people sign up, and how fast they run to risk their life for you. NO ONE and I mean NO ONE is going to do that for low bid wages, possibly just for the experience to put on a resume for a new job. Don’t be stupid. If you could pay people to be cops for $12 an hour it would be happening but it’s not so wake up.
January 25, 2011 at 6:12 pm
The “met on Monterey Bay”? That right there tells a story. Why not Fresno, Sacramento, Bakersfield, etc?
January 25, 2011 at 6:12 pm
@Discouraged
“It must be fun berating real human beings behind the anonymity of the internet.”
Ha… you must be new… 🙂 Go back about 10-15 posts and check out some of those comments. We’ve got a couple resident “internet tough guys” around here that come and go… Today’s comments are pretty tame by comparison…
Facts seems to fly fast and loose on both sides but there can sometimes be some good dialog… and even when I disagree with Ed’s position on a particular topic I like his overall coverage of the issue at hand.
January 25, 2011 at 6:46 pm
RWD and TL: You don’t need to change your handles in the middle of the stream. The rhetoric didn’t change, so why bother.
John, I do live in SB County. You can spin off all the numbers you want. If people spent all day spinning out scary numbers, none of us could go on with our other daily activities. I have a very low-taxed house, due to Prop. 13, and there are no additional property tax assessments on the horizon, in my district. If scary things are predicted, I will know about it.
TTD: Don’t hold your breath, because you will die first. No legislators are asking for, or even considering State Bankruptcy.
January 25, 2011 at 6:52 pm
John, PG is, “La-la Land”. There is no way that volunteer PD and Fire Departments are going to happen in the areas where I live. Go out and enjoy you ocean view.
January 25, 2011 at 6:55 pm
TL, my apologies–it looks like it is all RWD.
January 25, 2011 at 6:58 pm
Hey everyone: Go out and view that movie I keep talking about. If you all did that, we would not need to talk any more about those awful pensioners. We could just get together and discuss the big ones that got away (and they’re still at it).
January 25, 2011 at 7:32 pm
SeeSaw, Can the movie be downloaded ?
I suspect it’s a (Roger Moore style movie about how Wall street conspired to rip off EVERYONE). I’d agree with that w/o even seeing the movie.
But it STILL won’t change the fact that if you have 2 workers (one Public Sector & one Private Sector) making the same pay, retiring at the same age and working the same # years, the Public sector worker’s pension will be 4+ times that of the Private sectro worker while taxpayers pay for 80-90% OF THE pUBLIC sECTOR WORKER’S PENSION VIA their CONTRIBUTIONS (AND THE INTEREST EARNINGS THEREON).
January 25, 2011 at 9:25 pm
TL: I don’t get into downloading movies on this small laptop–I think there are sometimes questions about legality, and I think it takes a long time.
The movie is in very limited release now. I last saw it listed in Irvine. It has been Oscar nominated in the documentary category, so perhaps it might be released in more places again. I hope it will come out on the rental market eventually. It is not a dull documentary–it is very well constructed, and will bring you to the boiling point before it is over.
You are right about the conspiracy. Wall street did conspire to rip off everyone. They succeeded and walked away with millions, while everyone else lost millions, and the whole country has to suffer for it.
January 25, 2011 at 9:33 pm
TL, I don’t buy the public vs private argument. It is always an apples vs oranges discussion. The bottom line is the fact that, the private sector has been raked over the coals by the large companies and CEO’s, and the public sector has received more fair treatment. It is up to the private sector to bring their workers back up into the middle class again, and stop trying to bring the public workers back down to pauper-status. There national group working to bring DB pensions to all workers in America. The director of that organization was a presenter at the CalPERS-sponsored CA Dialogue in LA last Feb. The haters should aim their attention at the efforts of that group, and leave the public sector alone.
January 25, 2011 at 10:13 pm
Spin the numbers??? I got the numbers off of the SB county web-site! You should sell your house and rent while you can. Good luck.
January 25, 2011 at 10:17 pm
SeeSaw, I will see if the movie is available locally, for rental or in a local theater.
As a trade, how about you read the book “Plunder” on the Home page of http://www.pensiontsunami.com. It’s also eye-opening, but obviously with different thoughts as to the main cause of the financial mess this country now finds itself in.
As to your other comment, I agree that the Private sector has been as you saw “raked over the coals” by corporate management … few in the Private Sector other that the most senior management have benefited from productivity gains of the past decade.
But it’s not just “pension envy”. Your getting more wouldn’t be as big a problem if the Private Sector contributions (together with the interest earned thereon) didn’t pay for 80-90% of your much richer benefits.
Nobody really expects everything to be perfectly “equal”, it’s just that it’s WAY too one-sided (in the Public Sector’s favor).
As someone who has lived the Corporate live for decades (in Management for most of it), there is ZERO , absolutely ZERO change that the “Traditional” style DB plan (like YOU have) will EVER come back to Corporate America. The newer “Cash Balance” Plans are technically DB Plans, but act, look, smell like Defined Contributions Plans, and generally accumulate to a value at retirement even less than straight forward 401K Plans.
January 25, 2011 at 11:54 pm
John, I should have used different words. You repeat numbers–one can’t spend their whole life looking at those numbers. I don’t plan to worry about them, and my house is paid for with very low taxes. I have it made, when it comes to shelter. No one is my area has even mentioned reassessing property to cover pensions. Don’t think I won’t be the first one at their desks is such should ever happen.
January 26, 2011 at 12:16 am
TL, There is really no use for me to read a book authored by a Libertarian. The ideology is totally opposite of mine. I do read some of the columns by S. Greenhut, so I cannot be accused of refusing to look at other viewpoints.
“Inside Job” is non a partisan story. There are plenty of crooks from both of the main parties.
You keep hammering that the private sector pays 80-90% of my pension, and that does not make sense. All of the benefits are coming from the combined amounts of interest on the Plan investments and the contributions that were already in my account when I retired. There is no line item amount in my former employer’s budget that is going to pay anything for my pension now. I inquired to them on that. (We do each have our own contribution accounts, contrary to what you believe. It will still last me another five years.) Then perhaps you can say the private sector is paying part of it–but I am among them, so I will support my own pension. The benefits that are paid to private sector workers for the 401K matches have to come from somewhere–like purchases made by public workers and pensioners, perhaps.
January 26, 2011 at 1:20 am
See-Saw; Like you,I have no financial worries. But I have children and grandchildren and there is no place for them to hide. During the great depression,we had a library. Now libraries,fire depts.,and police depts. are in the process of shutting down all over the state. The human suffering from Calpers is difficult to accept. Its. not the size of your pension that causes the suffering. Its’ Calpers losses and deficits,which its’ departed chief actuary stated,will bleed us for decade after decade.Actuarily,Calpers is financially dead.
January 26, 2011 at 4:46 am
John, I have children and grandchildren too, I love mine as much as you love yours. I agree that the whole country is suffering–especially, due to the fact that 50,000 US factories closed in the last decade. And especially, because the barons on Wall Street stipped us clean. I do not accept your accusation that CalPERS is at fault, and I do not accept your proclamation that CalPERS is financially dead.
January 26, 2011 at 5:41 am
Please enough of the pension reform. What you should be asking yourself why you have a crummy 401k that will never pay enough for you to live on. Most industrialized counties workers retire at 50 or 55, it is very common. These systems are just annuities, if you are willing to pay the percentage, why not. OCERS is one of the top retirement systems in the U.S. and just won an award for its approach to investing. OCERS one year return for 2010 is 9.45 and stocks really have completely rebounded yet. OCERS is so well funded that if zero County employees made no contribution and the County made zero contributions it could still pay full payouts with COLA’S for the next 20 years for current retirees and future retirees. Again the pension are not the problem the working middle class is getting attacked by the rich whether you work in government or private industry! Wake up People you are being fooled by multinational corporations that pay for high priced PR firms. They want you to work for free and you agree with it-idiots!!!
January 26, 2011 at 5:58 am
Quoting Josh …”Please enough of the pension reform. What you should be asking yourself why you have a crummy 401k that will never pay enough for you to live on. Most industrialized counties workers retire at 50 or 55, it is very common. ”
Oh …. you must mean the European “PIIGS” (Portugal, Ireland, Italy, Greece, and Spain), ALL of which have or are on the verge of INSOLVENCY….exactly because they have acquiesced to Public Sector Unions demanding the financially impossible … a VERY RICH pension with payout beginning between age 50 and age 60.
DOo yiu EVER read the papers, or listen to a news cast ?geginnin
January 26, 2011 at 3:56 pm
Here’s one item missing from Mr Mendels many fine reports. Yes, Calpers is down 30-40%,but the cities and counties have unfunded deficits of 30-48%. The deficits of the cities and counties are ASSETS to Calpers. Does anyone,including Mr. Mendel know the sum of the unfunded deficits that are owed to Calpers. The deficits accrue(grow) at the investment rate of 7.75%,but meanwhile the liquid part of Calpers assets are used for investment and to pay benefits. Has Calpers reached a point where its asset growth is heavily based on growing city and county unfunded deficits. You can’t eat the deficits and the cities and counties can’t pay them.
January 27, 2011 at 5:14 am
John Moore, Mistaken is putting it mildly. The cities have paid the Calpers the bills they have been presented with. They “owe” CalPeERS nothing, so on CalPERS balance sheet the are no assets categorized as IOU’s from member cities.
The 30-40% underfunding means that using actuarially smoothed assets (not the actual market value of current assets … which would make underfunding even greater … because recognition of the full impact of 2008 stock losses has been deferred to future years) the assets are 30-40% less than the estimated amount of money that should be in hand TODAY to pay for (as they come due) the pensions ALREADY EARNED by current and retired CalPERS participants.
January 27, 2011 at 6:07 am
I see,so Pacific Grove doen’t owe Calpers the 48 million dollars they say that it owes. If you can get that in writing,we could start providing civic services. Wow,this is great news. By the way,as to anyone who knows anything about this issue,no one is suggesting reducing pensions earned for past services. What is at issue is getting some control over pension costs for work not yet performed. Also,to quote Calpers,smoothing increases unfunded deficits. I hope that you can understand that.
January 27, 2011 at 8:59 am
John, PG must have been letting pension obligations slide. I know that a public entity’s budget must include a line item amount to fund the pensions–a certain percentage of total payroll. That is something that should be paid every year. As far as I know, my former employer pays its pensions obligations yearly. If the projected revenues don’t match the projected liabilities, it must adjust its programs and negotiate with its employees, so that the budget can be balanced. Its hard to imagine that PG could be that much in the hole, because it is a small entity.
January 27, 2011 at 5:07 pm
You are right about Pacific Groves’ unfunded deficit . It is disproportionately large compared to any other city or county. That is because its’ city managers and city attorneys’ were unusually deceptive and failed to inform the city councils about the incredible financial risks involved in defined benefit plans. So in PGs’ 100 million dollar pension plan ,Calpers has lost 48 million in eight years and it grows at 7.75% per year. And the 11.2% rate increase will not help,because PGs’ salaries increased too much,so the rate increase won’t even cover the pension cost of the salary increases. Like Vallejo, PG has no choice except to make dramatic cuts in the size of its’ fire and police dept. By dramatic,I mean 50 to 75% in 4 years. All PG needs is a tumble-weed machine. It is so sad for the young people.If PG leaves Calpers,it will take 30 years of bare bones city staff (One-third of current) to pay off Calpers,but it will be worth it.The alternative is to have a bare-bones staff and services forever. Most cities and counties have an unfunded pension deficit of 30-35%,not 48% like PG. For a little town like PG,that difference is enormous.
January 27, 2011 at 5:27 pm
John, how sad it is that your city would rather have lessor than better employees. Why not save all those millions trying to leave CalPERS and put them into getting back on its feet with CalPERS. PG obviously didn’t have very good managers. My City saw the writing on the wall in 2005 and amended the PS Plan for new hires at that time. Then, last year they went back to pre-1999 pensions. PG could have done that. Entities who adopted the new pension formulas after SB400 were doing it in good faith, because they, and no one else, knew that the tornado was going to hit in 2008. Those Wall Street barons did not know either, how far they could go in taking us all down the creek until they got the hang of how to package and repackage those loans, that left them all rich and everyone else decapitated. The term “unfunded liability” should not be used as a scare tactic. If PG has an unfunded liability of 48%, why don’t they start making payments? What is going to be so wonderful without CalPERS? The economy is only as good as the sustainability of its participants, and it looks like PG is doing everything it can to non-participate.
January 28, 2011 at 12:51 am
Pacific Grove actually sold Pension Bonds for Part one of its’ unfunded deficit of 19 million dollars. It pays 1.6 million per year for thirty years. The 19 million was paid to Calpers and it lost half of it. With interest,the 19 million became 38 million. So PG is tapped out. A local PHd in Math from Caltech did an analysis of defined benefit plans which showed that if such a plan takes a big hit of 10% or more it is almost impossible to get out without another bubble. We got the second bubble and could have got out but didn’t. Now PG needs another bubble or must go Chap 9 to get out. PG can’t even keep its’ Library open,which is barbaric. As for getting good employees,28 have been let go. The rest are a dime a dozen. We get hundreds of high quality applications for the police at half the price,but the staff blocks their hiring. The worst are the leaders,who simply can’t count. I know it sounds easy to you,but it isn’t. Signing off.
January 28, 2011 at 1:07 am
John: It confuses me when you say that PG paid 19 million to CalPERS, and CalPERS lost half of it. I know that CalPERS lost a lot of money, just like all entities in the world. But, the Plan is expected to fluxuate with the ups and downs of the economy. Why is it that a specific CalPERS loss is pinpointed to PG? Aren’t the losses overall? I understand that CalPERS will be asking for higher contributions, but doubling the previous liability? I don’t get it.
I assume your local officials realize that Chapter 9 should be a last resort. Everyone has followed Vallejo, and there have been no voices of satisfaction coming from the citizens there. PG should just cut itself as close to the bone as it can, and soldier on. No Chapter 9!
January 28, 2011 at 5:58 pm
Believe me,PG citizens have spent hundreds(1,000s) of hours on this. The reason PG is in worse shape than other 3@50 cities,is that it adopted 3@50 with retroactivity,after the tech crash,so it did not have surpluses like other cities and took an immediate hit because of it. In addition,the city manager made elections that held rates down,but created a bigger deficit and higher rates.. Then,the city manager pushed thru pension bonds right before the real estate market crashed. All of this violated the debt limitation of the Ca. Constitution(Art 16,sec.18) but the citys’ lawyers evidently didn’t have a clue. PG is in terrible shape,but,,because it passed pension reform,if it gets out of Calpers,it will be in the best financial condition of any city in the county. The only reason PG would go into Chap 9,is to help it get out of Calpers.I am a retired ,but licensed lawyer, and consult with a professor in math(Ph.d Caltech). We don’t do the name calling thing,but are very vigilant about protecting this beautiful city. I am glad that your city made hard decisions at the time others did not. If PG had not gone into 3@50,it would have a deficit,but would not be terminal. The electorate voted in pension reform,but the near term pension costs are going up another 1.3 million per year,plus the 1.6 million per year for bonds(all for PAST services), so deep job cuts will go on forever,unless we have another bubble,or get out of Calpers immediately. In my view, all of the surrounding cities,except Carmel,are comparitively worse off than PG,but homeowners in Pebble Beach are in the best position of all(no Calpers).Wish us luck.
January 28, 2011 at 8:15 pm
Not one comment on the presentation of government worker pensions vs. the private sector, as usual with every single article over the years. For about the same contribution by employee and employer per year, Social Security pays at age 67 about 1/4-1/5 of any government pension at about age 55+!!!!! Usually, government employees also have medical benefits at least covering 55-65 when Medicare kicks in. Why is the disparity of private pensions, since none exist any more except for SS, not ever mentioned? Ever.
January 30, 2011 at 1:16 am
Ok, Robert, here’s one:
” If you “do the math” ….
The total “value” of benefits at retirement is the present value of all future payments, be they pensions benefits, healthcare premium subsidies, or anything else. Some of these future cash flows are definitively known at the time of retirement (e.g., fixed monthly pensions), and others need to be estimated (e.g., healthcare premiums, the incremental value of future COLA pension increases, etc.). However, all of these future payments can be reasonably estimated (sometimes with several options such as the low, medium, and high liability estimates routinely provided by the Social Security Administration). Once all known and estimated future payments have been determined, they can be discounted to the point of retirement at an assumed interest rate and an assumed mortality rate (for those payments that cease upon death). The interest rate used in this calculation is very important, but actuaries routinely do calculations of this sort and the range of reasonable interest assumptions for this purpose is fairly narrow.
The present value of all retirement pension and benefit payments can be looked at as the answer to the question ….. How much would an insurance company charge in a single payment at the time of retirement to take on the guaranteed responsibility to make all future payments in lieu of the former employer.
If we examine two 30-year service, age 55 workers (one Private Sector & one a Policeman or Fireman) making $100,000 in base pay + $20,000 in overtime at retirement, what would these present values be?
Being somewhat versed in the subject of employee benefits I’ll describe the “likely” pensions & retirement benefits afforded each and then estimate their present values.
Let’s assume the Private Sector worker is one of the few lucky enough to still have the older traditional-style defined benefit pension plan, and does NOT contribute towards its cost (common practice in Private Sector plans). With 30 years of service and with a typical formula that takes into account wages above and below Social Security “covered compensation”, this worker would likely receive about 40% of final 3-year average pay at normal retirement age, and overtime would NOT be included in benefits-bearing compensation.
Here’s how the Present value would be calculated …
Assume $95,000 is the AVERAGE of the last 3 year’s base salary, so 40% x 95,000 = $38,000. But this would be payable only if the employee waited until his plan’s “normal retirement age”. Let’s assume that his plan’s normal retirement age is 60. Since he will start collecting his pension 5 years early, there would be an “actuarial reduction” of 4 to 6% per year (just like Social Security applies when someone starts collecting early at age 62). Let’s assume the yearly reduction is 5%. So … we now have an annual pension of $38,000 x .75 = 28,500.
Now, to convert this to a “present value” we need to apply a life annuity factor (which incorporates the interest and mortality discounts discussed earlier). For someone retiring at age 55 this “factor” would be a multiplier of about 15. So … the present value of this worker’s pension is $28,500 x 15 = $427,500.
We will also assume there are no post-retirement healthcare benefits, as such benefits are VERY rare in the Private Sector.
Now let’s calculate the present value of the Policeman’s pension & benefits.
The pension formula for the policeman is often 3% of the last year’s salary (including overtime) per year of service and with no “actuarial reduction” for collecting benefits at age 55 (unlike for the private Sector worker). So … we have ($100,000+$20,000)x.03×30 =$108,000. But, we’re not done …
The policeman’s pension includes a provision for post-retirement COLA increases (while essentially NO Private Sector plans do so). Although this may surprise the reader, the “value” of this added benefit is VERY significant. Even with a modest long-term inflation assumption of 3%/yr, the addition of a COLA benefit for life increases the value of the pension by at least 50%. Hence, the levelized annual pension (with the COLA) is now $108,000×1.5=$162,000.
Using the same annuity factor of 15 (as used in the Private Sector workup above), we have a present value of 15x$162,000=$2,430,000.
But wait, we’re still not done (2 more items to adjust for) …
First, in fairness, the policeman contributes a percentage of his pay toward his pension (unlike the Private Sector worker), and the accumulated value (at interest) of these payments at retirement should be subtracted from the above $2,430,000 for a fair comparison. For this policeman whose final total pay was $120,000, I have calculated the accumulated value at retirement date of his contributions to be roughly $400,000. Hence the present value of this officer’s pension (offset by the accumulated vale of his contributions) is $2,430,000-$400,000=$2,030,000
Second, this officer gets free or heavily subsidized retiree healthcare for himself AND his family. Since he is not eligible for Medicare until age 65, his healthcare premiums are very expensive and are expected to increase annually at 8-12%, triple the rate of regular (non-medical care) inflation. The present value of this benefit and the post Medicare age healthcare subsidy is roughly $500,000.
Hence, the present value of this officer’s pension AND retiree healthcare benefit is $2,030,000+$500,000=$2,530,000.
Now, let compare the present value for these 2 workers making the SAME pay, working for the SAME number of years, and retiring at the SAME age.
The Private Sector worker’s EMPLOYER-PROVIDED retirement benefits are worth (as a present value on the date of retirement) $427,500.
The Policeman’s TAXPAYER-PROVIDED retirement benefits are worth (as a present value on the date of retirement) $2,530,000.
The crisis associated with funding Civil Servant Pensions and benefits is NOT a revenue shortfall issue. It is CLEARLY one of EXCESSIVELY GENEROUS pensions and benefits as the above calculations demonstrate.
For 2 similarly situated workers (in pay, years of service, and retirement age) the Policeman’s package of retirement benefits costs the TAXPAYERS almost SIX TIMES what the typical Private Sector employer is willing to pay.
Clearly, if the Private Sector employer provided the same benefits to his workers that the policeman receives, his company would likely go bankrupt in short order.
These unreasonable benefits have been provided due to a political structure that rewards politicians for “giving-away-the-store” of not their own, but TAXPAYERS’ money, for personal gain. This “gain” may simply be to feed their ego, garner the union support needed to get re-elected, or perhaps worse … for current or future personal financial gain.
In any event, the current situation is without doubt unsustainable and without MAJOR REDUCTIONS to the benefits provided CURRENT (not just NEW) public employees, towns, cities, and states will be filing bankruptcy with increasing frequency.
Unfortunately, since difficult change is delayed and delayed and delayed to avoid the confrontation (with very aggressive unions), important public services will suffer tremendously until action is FINALLY taken.
I’m sure there will be Civil Servants (with vested interest in the status quo) that will say my figures are wrong. Estimates are necessary, and small variations in assumptions will change the figures to a minor degree, but the final relationship is quite accurate …. TAXPAYERS are forced (via their taxes) to pay almost SIX times as much as the Private Sector employer is willing to pay.
By-the-way … any qualified actuary can verify the reasonableness of my figures and conclusions, …. and I would welcome the actuary who offers to do so ……
Bye-the-way ……… I didn’t mention it above, but it’s worth a comment …… Civil Servants often take advantage of what’s commonly called “spiking” to unfairly boost one’s pension just before retirement. This takes many forms: large last minute promotions and/or raises, excessive/unusual overtime, cashout of sick and/or vacation days with the payout included in “compensation” for pension calculation purposes, or inclusion in “compensation” of miscellaneous “allowances” (housing, vehicle, parking, uniform, etc.).
None of this is EVER allowed in Private Sector employer-sponsored plans (employers are spending THEIR OWN money, not TAXPAYER’S, and would never be so foolish). For every $10,000 of “spiking” that works its way into the above Policeman’s “compensation”, it costs the TAXPAYERS an additional $10,000x.03×30×1.5×15=$202,500 ! “
January 30, 2011 at 2:10 am
Tough Love: Your hypo for safety understates the experience in Pacific Grove. We have five retired police chiefs and fire chiefs and all are doing much better than your example. One was just elected sheriff at $325,000 per yr. and because most of his service was with PG,it will get hammered for that . Our 2@55 asst.-city manager just retired last year at $159,000 per year. Even a retired sargent beats your hypo. But don’t forget that it was the excessive raises and stock losses that created much of the deficits. In 8 years,out of a 100 million in its’ pension plan,PG, counting this latest plus year,has a 48 million dollar deficit. 35 million would be normal for a city our size. A real problem is once a country becomes unstable,with a lot of boom and bust, no plan will work to provide a medium retirement. The immediate solution is to leave those who have retired alone, and slash public safety,prison guards,etc salaries by 40 to 50%. If they all quit,there are hundreds of thousands of veterans and MPs’ who would love to replace them. And they won’t quit. PG just passed pension reform that limits the citys’ contribution and liability to 10% of salary. This applys when any MOU expires.Not one safety employee has quit. We are in court,but will win. If not,we will reduce salaries by 50% +,whatever it takes to get the library open.PG will probably need to file a Chap 9,but ONLY for the purpose of getting out of Calpers(that’s a complicated story) 80%+ of the citizens of PG are behind pension reform and getting out of Calpers. We are a determined group. The alternative to getting out of Calpers is to become a run down,high tax,no business,no real estate value community. Only a fool would invest here while PG is in Calpers. But once its’ out,the sky’s the limit for this beautiful place.
January 30, 2011 at 2:55 am
John,
My example was not intended to show absolute dollar pension payouts (although a $2.5 Million package for a career cop with a final salary of $100K + $20K in overtime is certainly enlightening).
My point was to DEMONSTRATE the absurd RELATIONSHIP between comparable Public & Private sector workers. In this example, a retirement package SIX times larger for the PUBLIC Sector worker.
January 30, 2011 at 6:38 am
If there is a mythical private sector retiree who is a counterpart to me, receiving six times less than I receive, he/she is going to need Section 8, Medi-Cal, and Food Stamps.
January 30, 2011 at 2:50 pm
SeeSaw, There are MANY …. you’ll find them under the heading “Private Sector Taxpayer”.
By-the-way, your use of the word “mythical” in your comment suggest you find my SIX-times workup inaccurate. While there seems to be some issue that the $20K overtime is not “pensionable income, this would only bring the SIX times down to FIVE times (big deal!), but some other commenters have pointed out additional issues that I missed that would raise the multiple back OVER the SIX times. Specifically;
(1) I deducted $400K as the accumulated value of the Policeman’s contributions, while in many locals, the town/city picks up these as well as it’s own, and
(2) The pensions is in most cases a rally a 2-life “Joint & Survivor” Life Annuity with an UNREDUCED pension continuing to the Policeman’s spouse. In Private Sector Plan, you’ll get about a 15% REDUCTION in payout if you elect this 2-Life “Joint & Survivor” Annuity
************************************
So tell me SeeSaw, what’s not accurate ?
January 30, 2011 at 9:06 pm
As I pointed out on January 11, you’re mistaken about the General Fund’s contribution to STRS. It’s 2.017%.
See http://www.calstrs.com/legislation/funding_calstrs_benefits.pdf
Facts matter.
January 31, 2011 at 6:20 pm
To Keen Observer:
The state general fund contribution to CalSTRS is 4.5 percent of pay.
The regular pension plan gets 2 percent. An additional 2.5 percent goes to inflation protection for retirees.
A click on the link in the post marked “from the state” goes to the “Fast Facts” page of the CalSTRS website. Look under the section labeled “Defined Benefit Funding.”
February 2, 2011 at 10:07 am
Lies, Darn lies and statistics. I think TL’s math missed some compound interest.
But also, why is no one questioning the Military pensions? They have no money being put aside by military personnel, but huge payouts after 20 years of service and huge medical benefits. It must dwarf the Public Sector issues.
February 2, 2011 at 11:47 pm
Dear Cousin It,
Nope, didn’t miss anything. Sounds like you’re one of those riding this gravy train.
Really Pisses you off when someone outs the hard FACTS in front of you …. doesn’t it ?
February 4, 2011 at 6:23 am
There are so many different public employee jobs I cannot understand why people want to generalize and demonize all state employees. My husband worked hard for his pension. As an ASE certified auto mechanic I’m sure he could have made much more money in the private sector. Instead he opted for a job with the Bureau of Auto Repair. One of his jobs was to respond to consumer complaints and verify if the consumer had a legitimate complaint and to make sure that the business owner was afforded the opportunity to rectify the problem in a reasonable manner. This was not a cushy job. One call that he responded to, the shop owner blocked his vehicle and held him hostage for a short time. This was very frightening. Shortly before this incident state employees responding to violations at a sausage factory were shot and murdered by the factory owner. My husband believed in his work. My husband’s pension amounts to $1,000 per month. That is not a very lucrative retirement. He also contributed to a 401K plan that lost 50% of it’s value during the market bust. Some gravy train. There are no COLAs and no benefits. Shame on the people that blame state workers for the financial problems of the state.
May 10, 2013 at 2:02 am
The issue isn’t who saves, it’s Who Pays! .. The 80 percent majority, private sector employees who may very well be getting robbed by their employers and Wall Street are watching their public sector friends who didn’t compete for their jobs or even succumb to virtually ANY performance standards, go golfing in perpetuity at the age of 55 and not in the state they “worked” in, if you call 10 weeks paid vacation and accrued sick time worth tens of thousands of dollars, WORK…..so what’s the difference between them and Wall Street scum, their both a protected minority class of takers!