Piling On Christie

It’s the third Wednesday of the month so the Board of Trustees of the New Jersey Public Employees Retirement System (PERS) met today.  Traffic must have been light around Trenton (no bridge closings or the like that might have kept attendance down at the TPAF meeting earlier this month) since all nine trustees made it and we know that because it has just been reported:

The Public Employees’ Retirement System voted 6-0 to hire private attorneys and “take all necessary and appropriate action to compel the governor” to make $3.8 billion in payments to the strained pension system over two years, instead of the $1.38 billion Christie is proposing amid a budget crisis.

Those appointed to the board by the targets of this proposed lawsuit – gubernatorial appointees Ronald Winthers and Ned Thompson III along with the Treasurer’s appointee and Susanne Culliton – all recused themselves while the state Attorney General’s Office notified the PERS board that it could not represent it in court since it is already defending Christie’s plan from the union lawsuits.

Which brings up the question of who those trustees, the Attorney General, and even the governor are really working for.

Aren’t the trustees supposed to be working exclusively for the benefit of plan participants?

Isn’t the Attorney General supposed to be protecting law-abiding citizens.

Isn’t the Governor supposed to be a law-abiding citizen?

 

 

32 responses to this post.

  1. Posted by Anonymous on June 18, 2014 at 5:32 pm

    Exclusive benefit is their fiduciary duty, as far as I know. The actuaries and staff have responsibilities to other stakeholders.

    Reply

  2. Posted by Tough Love on June 18, 2014 at 6:10 pm

    And 4-th (and MOST importantly) ……. isn’t the pension Plan generosity NOT supposed to be grossly excessive (and sticking the Taxpayers with the bill) because the worker’s Unions have BOUGHT the favorable votes of our elected officials with campaign contributions and election support ?

    Reply

    • Posted by Carlos on June 18, 2014 at 7:00 pm

      Unions and corporations are people the SCOTUS said. When a corporation gives money to Christie or some other pubbie They Want Something for it. Most of the time that is less regulation they are seeking. When a union gives money to a politician they want something for it. It’s not rocket science or dastardly,it’s how the world of politics is run. Honestly I shake my head in dismay at how utterly naive you are that you really think some underhanded,special,wicked,evil thing has taken place. Name one thing that was not done by the letter of the law. Just name one. You can’t. Just as I have told you before crying and posting on a blog ( one that most people don’t even read I might add ) has never changed anything. Run for office or help get people with your mind set elected. What you are doing now doesn’t help you at all and just seems to upset you.

      Reply

      • Posted by Tough Love on June 18, 2014 at 9:42 pm

        Carlos, I’m hardly naive…. and I feel almost as upset by Corporate buying political influence than I do of the Public Sector Unions’ influence-buying.

        However, the impact of Corporate influence-buying (though undoubtedly very costly) is less direct and measurable than Union influence-buying …. as easily measured (by those trained to do so) in their grossly excessive pensions & benefits.

        And we both no that 2 “wrongs” do not make 1 “right”. Corporate misdeeds will never justify the financial “mugging” perpetrated upon taxpayers by Public Sector Union/worker greed and the BUYING of favorable votes from our elected officials.

        Reply

        • Posted by Tough Love on June 18, 2014 at 9:50 pm

          And to all the “Anonymous” sure to correct me, yes, I know that “no” should have been “know”.

          Reply

          • Posted by Anonymous on June 18, 2014 at 10:04 pm

            dont forget, than should have been as. I am too lazy to proofread the rest of your posts as are you, yourself.

  3. Posted by LGreene on June 18, 2014 at 8:42 pm

    While the name calling and fingerpointing go on, the taxpayers AND the workers suffer. Someone should calculate ( maybe toughlove?) how much the pension fund would have earned in the past two years if the full amount of the ARC would’ve been paid. For example, if the Governor underpaid by $1B and the fund earned 15%,, then that is 150Million not available in the retirement fund.

    Reply

    • Posted by Tough Love on June 18, 2014 at 9:45 pm

      The flaw in your suggestion is ignoring the effect of the granting of these grossly excessive pension in the first place. That’s BECUASE the calculation of the ARC is a function of Plan generosity.

      Funding requirements FOLLOW from Plan generosity.

      Reply

      • Posted by LGreene on June 19, 2014 at 10:23 am

        Thanks for thoughtful response, but one doesn’t preclude the other. The question I am posing is how much has been lost due to underpayment. This would have created more resources in the present. Benefit restructuring can still occur if it can be worked out.

        The current efforts by the Governor is to NOT make payments AND to lose the amount that would have been earned on those investments. .. EVERYONE loses in that scenario. This is just convenient scapegoating and not real problem solving.

        Reply

        • Posted by truthnolie on June 19, 2014 at 11:48 am

          At last, someone who gets it……it is is impossible to tell how much has been lost but it has to be many millions. The state did not contribute their share for nearly a decade…..think of all the lost COMPOUNDED interest on that money that would have accrued in that time.

          Don’t bother trying to make sense or have a thoughtful conversation with Tough Love….her mantra is to continually blame the public employees for the mess and not accept the fact that the plans would be in fine shape if the state had made the required contributions every year which were neglected (while every public employee was forced to pay in via every paycheck).

          Her problem is with anyone who gets anything more/better than she can have and she would still be complaining that pensions/benefits were too generous even if the plans were 100% funded – this is obvious in her envious, rage filled posts denigrating pubic employees……anyone with a modicum of intelligence can detect the undercurrent of jealousness & chagrin in her mindset.

          By the way…..she has called for all PE’s to sacrifice for the good of the taxpayers/plans…..but when I pointed out that Social Security is in trouble and suggested that she agree to cut her SS benefit severely or freeze it her answer was………..crickets……chirp…….chirp

          Reply

          • Posted by marbs on June 19, 2014 at 1:16 pm

            Good post could not have said it better…..Thank You

          • Posted by dentss dunnigan on June 19, 2014 at 2:41 pm

            You haven’t lost a penny .every cent you put into the fund can be accounted for and could be returned to those who put the monies in .So explain what money have you lost ?

          • Posted by dentss dunnigan on June 19, 2014 at 2:45 pm

            And I might add your money that you invested is guaranteed ,unlike private pensions or IRA or roths they could lose everything …..

          • Posted by Tough Love on June 19, 2014 at 4:27 pm

            truthnolie, Saying things such as … “she would still be complaining that pensions/benefits were too generous even if the plans were 100% funded” demonstrates your fundamental lack of understanding.

            Plan generosity is not determined by it’s funding level, whether it’s 10% 50%, 100%, or 200%. Just to clearly demonstrate, suppose your pension Plan was 10 times MORE generous than your current Plan (likely making it 20-50 times more generous than the pension Plans of comparable Private Sector workers), and suppose Taxpayers (or miraculously high stock market returns) were such that it was 100% “funded”. Under your logic it would not be too generous. Really ?

            “Generosity” is NOT determined by the Plan’s funding level but by comparing the benefits promised under YOUR Plan to those typically granted Private Sector Taxpayers … who are typically responsible for 80-90% of the total cost of your pensions. And as I stated in my 2-nd response to LGreene …”Public Sector pensions are always multiples greater in value at retirement …. most often 3x-4x greater (4x-6x for police) …. and clearly the result of the Public Sector Union’s BUYING of the favorable votes of our elected officials with campaign contributions and election support”:

          • Posted by S & P 500 on June 19, 2014 at 6:28 pm

            If you send your kids to college at U of Michigan or UCLA the tuition is $4500 per quarter–I assume you won’t mind, since those institutions also have underfunded pension plans. Both UC and the state of Calif. stopped making payments into the UC pension plan in 1992 because they couldn’t afford it, or perhaps because they didn’t want to raise tuition. Of course if you think UC retirees shouldn’t be getting huge pensions like NJ public workers then you can simply tell your kids they can’t go to college.

          • Posted by LGreene on June 19, 2014 at 7:41 pm

            YOU SAID: At last, someone who gets it……it is is impossible to tell how much has been lost but it has to be many millions. The state did not contribute their share for nearly a decade…..think of all the lost COMPOUNDED interest on that money that would have accrued in that time……..

            THATS MY POINT, I would like to see the data and the compounding so we can see just how much that is. The State might’ve had to make smaller payments in the future had it made its proper payments in the past. If we’re going to point fingers of blame, lets at least be accurate about it.

        • Posted by Tough Love on June 19, 2014 at 4:13 pm

          LGreene, I not sure if you are really looking to understand my earlier response to you or simply a Public Sector worker benefiting from the current structure (of grossly excessive pensions & benefits) and simply not wanting it changed ….. (as is commentator truthnolie).

          But to try again,,,,

          The ARC is comprised of 2 parts, the “Normal Cost” which is an estimate of the value of additional pension accruals earned in the year, plus an amount estimated to amortize any existing unfunded liability. Both pieces are “estimates” because actual experience as it develops over time will never exactly match the assumptions that go into the calculation of these 2 items.

          Putting aside the 2-nd piece for the moment (to simplify this discussion), lets just look at the “normal cost”. Since the normal cost is an estimate of the value of additional pension accruals earned in the year, clearly it is a function of the generosity of the pension Plan. The more generous the Plan, the greater the “normal cost” (other things held equal).

          So when you say, what would the investment earnings have been had we paid in the full ARC (or here, just the “normal cost” since for discussion purposes only, I am ignoring the unfunded liability … or assuming it to be zero) and are suggesting that we (the Taxpayers) should have paid it in full annually, you are implicitly ALSO saying that we (the Taxpayers) should accept the associated generosity of the underlying Public Sector pensions.

          THAT’S where either you did not understand me, or we simply disagree. As I have stated (and mathematically demonstrated) many times, when Public and Private Sector pensions (of workers in comparable occupations), are compared, it is eminently clear that Public Sector pensions are always multiples greater in value at retirement …. most often 3x-4x greater (4x-6x for police) …. and clearly the result of the Public Sector Union’s BUYING of the favorable votes of our elected officials with campaign contributions and election support.

          As such, I CANNOT accept the Plan generosity as reasonable and feel we (the Taxpayers) should refuse to fund such grossly excessive pension promises so clearly negotiated in bad faith to the Taxpayers by our own elected officials. And, if I refuse to accept the promised generosity, it simply follows that I cannot accept the associated “normal cost” (or the ARC if there are also unfunded liabilities) as something that should be paid.

          Reply

          • Posted by LGreene on June 19, 2014 at 7:36 pm

            Thanks again. This is a great and thoughtful response. I will admit that I dont like your ‘more ” personalized ” style of comments ( made to others) but it seems some of you know each other very well on this blog. You and others here are better informed than most on this subject. I would love to see your comparisons of the public and private pensions you mention. I also would like to see a comparison of the 300+ companies in the SP500 that have DB plans and compare their benefits. Many who claim that PE’s should have corporate plans seem to overlook that many Private Firms have DB plans.

            I still don’t think our perspectives are mutually exclusive.

            My SOLE point is that if the State had paid the ARC ( especially last 2-3 years) there would be millions more in the plan. That money isn’t available to pay for ANYTHING, and the argument about liabilities is still going on. SOMEONE should compile the spreadsheet and just show what payments weren’t made and how much it would have returned in past 3 years, 5 years, 10 years, 20 years. Albert Einstein called Compound Interest one of the great wonders of the world. I am more interested in the recent past, but to avoid ” piling on Christie” I would like ot see the longer time period as well.

            For Example ” How much Money the pension fund doesn’t have because of Christies Funding Approach?” ( I am assuming that it would show a net loss over his tenure, but I don’t know)… The State is still on the hook for the liabilities, and it has fewer assets.

            YOUR point seems that you are indifferent on the Lost Investment Returns because you philosophically believe that the payments are unfounded since they are being used for ” overly generous benefits”, and shouldn’t have been paid anyway even if the market were to have increased 35% in the past year.

            I am still curious about the lost investment amount, and you sound like someone that is intellectually curious and has the skill to produce it. This would also help make your case that it is the taxpayers that provide 80-90% of the pension benefit.

            It would also seem that NJ would be the epicenter for understanding and solving some of these issues given the Universities, Insurance Companies, and Hedge Fund managers and highly educated community that live and work there.

          • Posted by Tough Love on June 19, 2014 at 8:19 pm

            LGreene, I thought I would oblige your request to post one of my comparisons of the public and private pensions. You will find it just below. Such comparisons can be shown in different ways. For example, it can be a direct comparison of TYPICAL pensions for a Public and Private Sector worker making the SAME pay, with the SAME years of service, and the SAME age at retirement, or it can be a calculation of how much a Private Sector worker (with a lower pension formula and less generous provisions) would have to earn in cash pay to generate the SAME pension as the Public Sector worker (with a much richer pension formula and provisions). I have put together both types of demonstrations. The demonstration below is of the latter type. This particular demonstration is for a Police officer’s pension in California. To be fair, CA Police pensions are about 15% more generous than current NJ police pensions (and if the COLA suspension in NJ is not reversed by the Courts, that will lower the Police advantage further).

            ———————————————————
            In California the typical recent Pubic Safety retiree’s pension starts at just about $100,000 and is COLA adjusted thereafter. By looking at a table of life annuity factors, such a single life immediate annuity has a value or cost upon retirement of just about $1.8 Million (18 times the annual pension). One way to judge if that is reasonable (or “appropriate and fair”) is to answer the question … What would be the necessary INCOME LEVEL (or Final Average Salary … FAS) of a Private Sector worker with the TYPICAL Private Sector DB pension (for the few Private Sector workers lucky enough to still be covered by such a pensions) to obtain a pension from his/her employer with the SAME $1.8 Million “value” upon retirement ?

            Assume the CA safety worker has the typical 3% of final average pay per-year-of-service pension factor, had a final average salary of $111,111, 30 years of service and retired at age 55… resulting in the starting pension of $111,111 x .03 x 30 = $100,000. Next, let’s assume the Private Sector worker’s DB pension formula is 1.25% per year of service (a quite typical formula), is NOT COLA adjusted (routine in PRIVATE Sector Plans), and has a full unreduced retirement age of 62 (with a 4% reduction in pension payout for each year of age that you retire begin collecting your pension before age 62).

            For a given Final Average Salary (FAS), this Private Sector worker’s annual pension (P) is given by the formula P = (FAS x 30 x .0125)x (1-((62-55)x.04)), with the latter part of that formula being the adjustment for early retirement at age 55. Shortening that formula, we have P = (FAS x 30 x .0125) x 0.72.

            From above, we saw that the Safety worker’s pension (being COLA-increased) has a lump sum “value” of 18 times the annual STARTING pension. With no COLA increases, the lump sum “value” is only 13 times the annual pension. Therefore the Lump Sum “value” of the Private Sector worker’s pension is given by 13 x P, and since we are SETTING that value equal to the $1.8 Million value of the safety worker’s pension we have $1,800,000 = 13 x P, and solving for P, we have P= $1,800,000/13 = $138,462. This Private Sector non-COLA-increased annual pension of $138,462 can be looked at as being mathematically equivalent to an otherwise identical pension starting at $100,000 that includes 3% annual COLA increases (i.e., the Safety worker’s pension).

            Now since we know the annual Private Sector worker’s annual pension “P”, we can plug it into my above formula of P = (FAS x 30 x .0125) x 0.72 to solve for FAS. Doing so we have, $138,462 = (FAS x 30 x .0125) x 0.72, from which

            FAS = $138,462/(30 x 0.0125 x 0.72) = $512,822

            What this shows is that a Private Sector worker (with a TYPICAL DB pension formula and provisions) would need to have a final average salary of $512,812 to generate a pension from his/her employer with the SAME $1.8 Million “value” as the TYPICAL Safety worker pension …. or $512,822/$111,111 = 4.62 times the Safety worker’s salary.

            And for the skeptics that say …. this can’t be correct …. we can just reverse the order of calculations and SHOW that this $512,822 PRIVATE Sector salary is indeed necessary to generate a pension with a “value” equal to that (the $1.8 Million) of the Public Sector Safety worker … as follows:

            (a) Private Sector worker’s Annual (non-COLA-increased) pension = $512,822 x 30 x 0.0125 x .72 = $138,462
            (b) Lump sum value (using the 13 times life annuity factor applicable to non-COLA-increased pensions) = $138.462 x 13 = $1.8 Million

            While most reasonable people would suggest that (give the nature of the occupations) Safety workers should receive pensions equivalent to Private Sector workers with salaries say 10% or 25% or 50% greater than they, I find it incredulous to believe that ANYONE would feel it appropriate to provide the TYPICAL CA Safety worker retiree with a pension equivalent to that of the Private Sector worker making over $500,000 annually. Taxpayers (who pay for all but the 10-20% of Total Coat Public Sector pensions typically paid for by the worker’s own contributions and the investment earnings thereon) simply cannot afford anything even remotely close to this level of generosity.

            And to preemptively address the anticipated comeback ………… the 4.62 times greater CA safety pension is NOT a function of the Officer’s final pay. It would remain 4.62% even if the officer’s final pay (and hence starting pension) were 10%, 20% or even 50% lower.

            The 4.62 time greater CA Safety worker pension results from the MUCH richer Formula and MUCH more generous “provisions” as follows:

            (1) Benefit from the richer “formula” of 3% vs 1.25% = 3.00/1.25= 2.40 greater
            (2) Benefit from only the CA safety worker getting COLA increases = 18/13 = 1.3846
            (3) Benefit from no CA Safety worker pension reduction for full (unreduced) retirement at age 55 = 1.00/0.72 = 1.3889

            The above beneficial ratios are multiplicative, giving the overall advantage of 2.40 x 1.3846 x 1.3889 = 4.62 times.

          • Posted by Tough Love on June 19, 2014 at 9:41 pm

            LGreene, Responding to your other points above…

            (1) It has been pointed out (usually by Public Sector Unions/workers) that quite a few SP500 companies still have DB pension Plans. Yes that’s true, but what the Unions/workers won’t tell you is that VERY VERY few of those Plans are open to new hires and the majority of them have also ceased granting future service (and salary increase) credits for the FUTURE service of CURRENT workers. Essentially, the majority of Private Sector DB Plans are in a run-off mode for a Closed Block of current workers earning no future pension credits.

            (2) You are certainly correct that IF the state of NJ (meaning Taxpayers) had in all years paid the calculate ARC there would indeed be far more Plan assets. But keep in mind that the ARC is calculated with interest rates (used in the discounting Plan liabilities … as well as for estimates of earnings on invested assets) that are considered far too high by both Moody’s, and the investment community (including Warren Buffet). Use of overly high interest rates (in addition to NJ’s shorting of pension contributions) is a major source of the large current underfunded liability.

            But there is a more sinister aspect to use of much higher-than-reasonable interest rates to discount Plan liabilities. Specifically, it materially makes the TRUE COST of Public Sector pension promises look much smaller than the true cost that will ultimately emerge. All the stakeholders (EXCEPT the Taxpayers footing most of the cost) like it this way because by making the Plans look cheaper, the politicians can promise greater benefits (currying the favor, votes, and campaign contributions from the Unions), and by understating annual contributions (via use of these same high interest rates), more money is freed up in annual budgets for Public Sector raises. It a REALLY perverse structure.

            (3) addressing your question if I would still think Public Sector pensions would too generous if investment returns we so great (actually they would need to be 35% for several years in a row given our VERY low current position) that the Plans were fully funded

            Intellectually yes, but of course there would be little “stink” frorm the Public if that were the case because (while the more astute would still realize that Public Sector pension are for more generous than their Private Sector counterparts) Private Sector workers would likely be seeing those same high returns in their 401K Plan and private savings and not think much about it (ala 1999 and 2007).

            (4) You also asked …”This would also help make your case that it is the taxpayers that provide 80-90% of the pension benefit. ”

            We hear lots of talk that “investment earnings” “PAY FOR” the bulk of pension costs. Anyone well trained in financial mathematics quickly see the fallacy in that argument. While the Unions and their supports will protest the concept that “Interest follows Principal” to the grave, suffice it to say that experienced financial professional understand that there are ONLY 2 sources of contributions to pay for Public Sector pensions, the employees and the Taxpayers, and investment earnings should proportionately be considered (as additional contributions) from the employees and Taxpayers in proportion to the dollar amount of their public Sector pension contributions because, had those dollar contributions NOT been made, the investment earnings thereon would have stayed in the pockets of the contributors.

            Yes, I have stated many times that the direct pension contributions from Public workers (INCLUDING the investment earnings thereon) will RARELY accumulate to a sum at retirement sufficient to pay for more than 10-20% of the total cost of their promised pensions. The 80-90% remainder is the responsibility of the Taxpayers (via THEIR contributions and the investment earnings thereon). Be careful here…. I’m not saying that the Taxpayers have actually made those payments (the lack thereof being one source of current Plan underfunding), but unless the promised pensions are reduced, indeed, 80-90% of total Plan costs become the obligation of the Taxpayers.

            I’m guessing that you can surmise that I’m capable of reasonably complex mathematical calculations. If you want to verify my statement that employee contributions (Including investment earnings) will ……” RARELY accumulate to a sum at retirement sufficient to pay for more than 10-20% of the total cost of their promised pensions”, you’ll need to develop a spreadsheet to do it.

            Briefly, for each year of say a 30 year career (retiring at age 55-60 as is typical for Public Sector workers) create a spread sheet with columns as follows:
            (1) year by year annual cash pay
            (2) employee pension contribution as a % of pay (e.g., 0.05)
            (3) (1)x(2) giving each year’s pension $$$ contribution
            (4) Accumulate each of the figures in col (3) to the date of retirement (end of the 30-th year) at say 6% compound interest. (you can test he impact of other rates as well). If you want to be particularly accurate, assume each annual pension contribution is made mid-year and adjust your interest compounding formula accordingly.

            The sum of the figures in col (4) is the accumulated value of the employee’s contributions including investment earnings. Now, you want to determine what percentage this is of the total cost of your pension. While the proper way would be to create another spreadsheet where you “SOLVE” for the lump sum amount such that with annual pension payouts and with interest credited (at the same 6% rate) on the remaining asset balance after each pension payouts, the asset balance reaches zero exactly at the employee’s life expectancy.

            Since the above can be rather involved (and requires some facility with EXCEL), a shortcut to determine the total value of the worker’s promised pension would be to see what annuity issuers would require upfront in one single payment to guarantee an annual payment equal to the workers STARTING pension. Note that I have made an assumption here…. that being that the added value of the Public Sector worker’s COLA increases is just about offset by the annuity writer’s conservative pricing assumptions for (interest, expenses, and profit).

            Simply divide the accumulated employee contributions by the cost to purchase the annuity to calculate the share of total Plan costs paid for by the employee.

          • Posted by Anonymous on June 19, 2014 at 11:19 pm

            I think we can all agree on one thing………Tough Love has WAAAYYY too much time on her hands……

  4. Posted by Anonymous on June 18, 2014 at 9:07 pm

    Everything is fine, there are no problems in Jersey, why else would Christie travel to New Hampshire to campaign for and raise money for Walt Havenstein who is running against Andrew Hemingway in the Republican Primary. New Hampshire is also the first Presidential Primary state hmmm. Sorry Walt you lose. Hey when Christie came down to Florida Gov Rick Scott ran away from Christie whenever he saw a camera. LOL

    Reply

  5. “The Public Employees’ Retirement System voted 6-0 to hire private attorneys and “take all necessary and appropriate action to compel the governor” to make $3.8 billion in payments to the strained pension system over two years, instead of the $1.38 billion Christie is proposing amid a budget crisis.”

    This isn’t a budget crisis. This is a good year under the new normal.

    Reply

  6. Posted by george on June 19, 2014 at 5:09 pm

    Off topic but amusing

    Detroit creditor wants to know personal finances of retirees
    http://m.freep.com/localnews/article?a=2014306190135&f=1232

    Reply

  7. Posted by Anonymous on June 19, 2014 at 11:22 pm

    I think, based on her responses above, we can ALL agree on one thing……Tough Love has WAAAYYY too much time on her hands.

    Reply

  8. Posted by Anonymous on June 20, 2014 at 3:29 am

    She drinks heavily as well. And blames spell check almost as much as pensions.

    Reply

  9. Posted by LGreene on June 20, 2014 at 9:17 am

    According to Steve Malange of the Manhattan Institutue ” not paying off the remaining unfunded liability as soon as possible carries an opportunity cost to taxpayers of lost investment return.” … Lets quantify that cost if possible.

    Reply

    • Posted by Tough Love on June 20, 2014 at 9:50 am

      The cost to Taxpayers is far lower than either paying it off now (or later), if we (the Taxpayers) successfully stand our ground and refuse to fund all costs of Pubic Sector pensions (and benefits) that are associated with the excess portion (i.e., that in excess of what comparable Private Sector workers typically get) granted only as a result of the Public Sector Union/Politician you-stratch-my-back-and-I’ll-scratch-yours collusion.

      Reply

      • Posted by LGreene on June 20, 2014 at 10:15 am

        Correction: The quote is from Steve Eide of the Manhattan Institute…I think your last comment clearly states your position.

        Reply

        • Posted by Tough Love on June 20, 2014 at 10:49 am

          Yes it does …. and I believe it justifiable specifically BECAUSE of the collusion.

          Reply

          • Posted by LGreene on June 20, 2014 at 11:06 am

            IF you are correct and you ” successfully stand your ground”, then you may be right. But what is Plan B? Not funding the plan today may only make it worse for taxpayers and retirees tomorrow. If there are abuses or ” excessive generosities” then they should be reviewed, but to just say ” scrap the DB plan” seems to be a little extreme.

          • Posted by Tough Love on June 20, 2014 at 12:35 pm

            LGreene,

            There are tons of arguments put forth (mostly by the Unions) why DB Plans can’t or shouldn’t be frozen, with the employees switched to DC Plans (comparable to what Private Sector Taxpayers typically get from their employers) for their FUTURE service ….. with few being of substance under close examination.

            Since I know believing me is problematic for those supporting the status quo, I direct you to the following article on this subject:

            http://reason.org/news/show/pension-reform-defined-contribution

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: