Public employee pensions – where is the outrage?

2013

No, I’m not talking about outrage aimed at workers or even outrage by taxpayers, but rather outrage directed at politicians who made commitments and promises they did not and could not keep. Politicians approved, even encouraged in some cases, overly generous pensions and health benefits, and in many cases failed to fund these commitments. They were not funded because they were unaffordable, because money needed to be spent on more short-term obligations or other promises.

In Detroit, retirees face the likely possibility of losing the larger portion of their pensions in that cities bankruptcy. In Illinois, legislation aims to cut benefits and future COLAs, in NJ and Rhode Island and cities in California similar events have occurred.

According to the Bureau of Labor statistics the typical private sector defined benefit pension costs $0.91 an hour, while a defined benefit pension among state and local governments costs $3.48 an hour, more than four times as much. Factor in $2.65 an hour for health insurance in the private sector compared with $4.96 an hour for public employees and retirees and there is a clear picture of unaffordable mismanagement.

In most cases this has come about in a pro union, progressive, liberal environment and as usual without regard to the long-term implications for everyone, especially the workers and retirees who will be harmed the most. The real shame is that in most cases workers have contributed to these pension promises. 😟

And what if all these grand promises were fully funded? Well, then taxpayers would be paying more, much more; taxpayers who rarely have their own pension.

So, where is the outrage? 😡😡😡

Nowhere, we just look to blame some non-person entity or institution and move on seeking the next collection of populist promises that shift more burden to the next generation. Think I’m wrong? Keep an eye and ear out for rhetoric from Sen Elizabeth Warren.