> I don't cause the government to write its contract with me to be the way it is. It's negotiated between my union and the state Department of Education.
Exactly. So one group of state government employees (your state's DoE) meets another group of state government employees (your union) and decide to give each other an incredible defined-benefit pension deal that nobody outside of government can even dream of.
State government employees are giving each other dream pension plans, that are unsustainable and wildly over-budget even if they were well-managed (which generally they are not).
You know why nobody outside government has defined benefit pensions? Because they were proven to be unsustainable decades ago. Yet government employees keep conferring them upon themselves.
Then, when the inevitable deficit arises, as any economist would predict, you have a great solution: me and my peers in the private sectors should pay more taxes to bankroll your party!
I hope this slow-motion trainwreck would be a wakeup call, but either way, know this: there is no amount of taxes that will prop up your unsustainable pension plans. State and local governments wasted billions mismanaging these funds, that are unsustainable even under the best management.
Any more taxes you collect will just fuel this fire for a couple more years, before the inevitable next crisis arises.
You can't fix fiscal irresponsibility with more money, because all that money (and no accountability) is what created fiscal irresponsibility in the first place!
Your state government needs to start applying the same basic fiscal responsibility that every single business in your state is adhering to.
Pensions are not inherently unsustainable. They exist in the private sector in other countries and there are still some well funded private sector pensions in the U.S. They don't work well if they are not properly funded. Corporations got rid of pensions not because the concept is inherently unsustainable but because it's more profitable to do away with them.
My pension plan is not a good one. You characterization of one group of state employees giving a dream set of benefits to another is not based in reality. Administration does not negotiate strongly with us the contract won't be approved by the legislature or signed by the governor. Our wages relative to buying power has not been going up or remaining steady.
If pensions are inherently unsustainable then you must conclude that it is unsustainable for a society to care for itself.
> If pensions are inherently unsustainable then you must conclude that it is unsustainable for a society to care for itself.
How do you figure?
It is unsustainable for us to support all people over e.g. 60. But we can support the 5% over 60 who really need the support and can't look after themselves.
Supporting that 5% who really need it would effectively be a means tested pension system. The point of a pension (retirement savings) is to prevent masses of destitute elders. The goal is to have a society in which masses of elderly are not left without means to live at a reasonable standard. That’s the purpose of a pension system. If the goal can be effectively accomplished in another way then I support it. I’m not personally tied to the notion of a pension system.
Defined Cost pensions are sustainable. That's what we in the private sector have: 401k and Roth.
Defined Benefit pensions aren't sustainable. That's why nobody outside of government has them, and the ones sponsored by the government suffer huge deficits and are slowly but surely edging towards bankruptcy.
Exactly. So one group of state government employees (your state's DoE) meets another group of state government employees (your union) and decide to give each other an incredible defined-benefit pension deal that nobody outside of government can even dream of.
State government employees are giving each other dream pension plans, that are unsustainable and wildly over-budget even if they were well-managed (which generally they are not).
You know why nobody outside government has defined benefit pensions? Because they were proven to be unsustainable decades ago. Yet government employees keep conferring them upon themselves.
Then, when the inevitable deficit arises, as any economist would predict, you have a great solution: me and my peers in the private sectors should pay more taxes to bankroll your party!
I hope this slow-motion trainwreck would be a wakeup call, but either way, know this: there is no amount of taxes that will prop up your unsustainable pension plans. State and local governments wasted billions mismanaging these funds, that are unsustainable even under the best management.
Any more taxes you collect will just fuel this fire for a couple more years, before the inevitable next crisis arises.
You can't fix fiscal irresponsibility with more money, because all that money (and no accountability) is what created fiscal irresponsibility in the first place!
Your state government needs to start applying the same basic fiscal responsibility that every single business in your state is adhering to.