The Great Cash Balance Hoax

In an attempt to calm public employees in New Jersey over reforms proposed by a Study Commission one of the commission’s members, Larry Sher, wrote an opinion piece on nj.com asserting:

Some public employees have expressed concerns with the New Jersey Pension and Health Benefit Study Commission‘s proposal to provide future retirement benefits through “cash balance” plans because “a 401(k) cannot fund retirement for an average worker.” The cash balance plans recommended by the commission, however, are not 401(k) plans. While the two plan types have some similarities, the distinguishing characteristics of the proposed cash balance plans address many of the public employees’ concerns with 401(k) plans.

Yes the 401(k) has a bad name as it was never intended as a primary retirement vehicle.  Books like The Great 401(k) Hoax debunk their myth:

The American public was hoodwinked: 401(k)s were established to satisfy corporations, not the interests of working Americans. Portrayed as a perpetual wealth machine, the 401(k) was meant to satisfy the needs of every employee. Yet, it was an impossible promise to fulfill: It was the great 401(k) hoax. According to William Wolman and Anne Colamosca, this was the latest act in the gradual erosion of the nation’s retirement system.

Yet in the public sector 401(k) plans with a pre-defined match or employer contribution are much preferable for public employees concerned with security to Cash Balance plans for one simple reason:

Cash Balance plans are Defined Benefit plans and in the public sector there are NO enforceable funding rules for Defined Benefit plans.  Mr. Sher may claim:

Funding of the cash balance plans will also be far more predictable, stable and responsible than pension funding has proven to be in New Jersey. The current pension benefits are defined as a percentage of final average salary, regardless of what salaries turn out to be or the actual performance of the plan’s investments. The need to take into account uncertain future salaries and investment returns inevitably injects subjectivity into pension funding. Over the years, both employers and employees have taken advantage of this subjectivity to excuse underfunding or justify benefit enhancements, or even worse, as happened with 2001’s 9 percent pension increase, to excuse underfunding while enhancing benefits.

But that is not the worst problem for the New Jersey Retirement System.

Of course funding methods for public sector Defined Benefit plans are a joke with inflated interest rates, open-amortization periods, and willful blindness to the benefit shenanigans politicians and their cronies get up to but all that only erodes funded ratios over an extended period of time.  In New Jersey if politicians want to ignore putting in even a woefully inadequate ‘required’ contribution, they can, and if they want to pass a law saying that the woefully inadequate ‘required’ contribution HAS to be made as a contractual obligation, they can’t.

In New Jersey the main fault is not in the methods but in the meatheads running these plans.

 

83 responses to this post.

  1. Posted by Anonymous on October 24, 2015 at 6:08 pm

    http://www.nj.com/politics/index.ssf/2015/10/assembly_aims_to_override_christie_gun_bill_veto_a.html#incart_2box_politics

    Remember in November, the dams leaking and no GOPs will step up to plug the holes.

    Once again on point to the topic of retirement in this country and why the 1% are negatively impacted the rest of us. Their insatiable GREED resulting in unprecedented wealth accumulation, as a percentage and in real dollars!

    Furthermore the Great Recession crushed the cash balance of Public’s (everyone’s) pension funds at a time when the benefit payments exceeded (and continue to) NJ’s (yes, taxpayers) contributions into the system. That is why the market recovery was the time for NJ to contribute and realize significant gains on a higher “fund” balance. Opportunity lost, again!

    P&B reforms including a dedicated ARC revenue stream (ie tax increases) are inevitable. Well at least the counter point might agree with this general statement but the devils in the details.

    Reply

    • Posted by Tough Love on October 24, 2015 at 7:14 pm

      Quoting Anon (or BH, or The Resident Nutcase … or whoever you are today) ……..

      “Once again on point to the topic of retirement in this country and why the 1% are negatively impacted the rest of us. Their insatiable GREED resulting in unprecedented wealth accumulation, as a percentage and in real dollars!”

      Yes, the 1% are …”negatively impacted the rest of us” …. ALL of us (BOTH Public AND Private sector).

      But the PUBLIC Sector Middle Class is ALSO negatively impacting the Private Sector middle Class”. And it is THEIR “insatiable greed” by insisting on keeping their grossly excessive, unnecessary, unjust, unfair, and unaffordable “pensions & benefits” even for FUTURE service not yet worked that is (along with their taxpayer-funded “Platinum+” retiree healthcare benefits that VERY few in the Private Sector get any longer) strangling the PRIVATE Sector Middle Class.

      Reply

  2. Posted by skip3house on October 24, 2015 at 6:44 pm

    Time passage behooves us to understand eventual equal non-existance here, along with natural living drives for survival and sex.
    Civilization has proven the best system for creating opportunities for secure incentives to accomplish these drives mutually, to any degree individuals may aspire.
    Maintaining this civility requires fair taxation based on how well our government meets needs of law abiding citizens.
    Wealth has been the chosen source of needed government funding ever since we left farms and hunting.
    Wealth is limited by government taxes for creating infrastructure, security, and laws to serve all in the cause of The Common Good.
    Inheritance issues are not government business, and should be of private concern using wealth left after needed taxing based strongly on ability-to-pay, decided by elected officials with only the Common Good as the special interest.
    We cannot hoard wealth at the expense of security, education nor all other requirements for advancing civilization.
    The best inheritance is living in a country populated by law-abiding, educated, patriotic citizens, doing their individual and collective best, for their time here.

    Reply

  3. Posted by Anonymous on October 24, 2015 at 7:13 pm

    The participants will get a 401a and 403b just like NJABP, presently there are six providers. Cash balance employer contributions with withdrawal restrictions. Stable value accounts.

    Reply

  4. Defined benefit plans involve an open ended promise where someone other than the recipient is liable for any shortfalls. Without funding commitments, they become a Ponzi scheme. At some future date it will be up to the Courts how much, if anything, the State has to pay to pensioners.

    Commissioner Sher has clearly explained the problems with the current method of accruing benefits under the defined benefit pension plans.

    My concern with the cash balance plans is that they retain the same flaw as the current defined benefit plans – investment risk is transferred from the recipient to the taxpayer. Regardless of what the solution is called, professional management is necessary and should not be left to the discretion of participants. Like any investment vehicle, the tradeoff for reduced risk is lower returns. If the cash balance plans are designed so that the split is 75/25, with 75% of the returns (and risk) staying with the participant, I have no major conceptual objection.

    Comments on the pension fall into 2 main camps – employees don’t deserve anything because…, and we have contributed out part and met our obligations. Unfortunately, this perpetuates the standoff and doesn’t get us to a resolution. The most important issue to end the current pension system, which continues to accrue liabilities while the state refuses to meet its funding obligations. This is kicking the can down the road with potentially catastrophic consequences. The second is to resume appropriate funding of current and accrued liabilities. There is no perfect solution and compromise is appropriate so long as these two aspects are addressed. The secondary issues involve the transfer of pension funding back to localities and the integration of public safety officers into social security so all are on the same basis.

    The choice with funding of teacher pensions is either a higher State income tax or higher property taxes. There isn’t room in current budgets regardless. The issue is compounded because State payment acts as a subsidy, and doesn’t enter into salary negotiations. The Commission has proposed a cutback in health benefits as a way for towns to afford the increased pension expense. The issue remains distorted, with the solution in effect a cutback absorbed solely by employees without addressing the structural problem. Better to leave health care aside and set a plan for a gradual transition of the pension costs from the State to local payment. There’s no free lunch and no perfect solution – lock the parties in a room till they hash out a compromise which everyone hates.

    Reply

    • Posted by Tough Love on October 24, 2015 at 11:58 pm

      (1) Quoting …. “Comments on the pension fall into 2 main camps – employees don’t deserve anything because, and we have contributed out part and met our obligations. ”

      Baloney. Those who support Public Sector pension reform (such as myself) never say … “employees don’t deserve anything”. I call for EQUAL, BUT NOT BETTER (pension & benefits) than what comparable Private Sector workers get in pensions (and subsidized retiree healthcare benefits) from their employers. EQUAL yes, but there is ZERO justification for “MORE”, on the Taxpayers’ dime.

      (2) Quoting …. ” The second is to resume appropriate funding of current and accrued liabilities.”

      I strongly disagree. It is easily demonstrated (and I have done so several times in comments on the Blog-site) that Public Sector pensions are TYPICALLY 3x-4x (4x-6x for Safety workers) greater in value at retirement (given the much richer “formulas” AND much more generous “provisions”) than those of Private Sector workers retiring at the SAME age, with the SAME pay, and the SAME years of service. These grossly excessive pensions are CLEARLY the result of COLLUSION between the Public Sector Unions and our Elected Officials, with the favorable votes (on Public Sector pay, pensions, and benefits) of the latter BOUGHT with the Campaign contributions of the former.

      Taxpayers should fund NO MORE than that share of these grossly excessive promised pensions that likely would have been granted in the absence of that collusion. A good proxy for that amount is a pension EQUAL TO what comparable Private Sector workers get from their employers …… which is typically 1/4 to 1/2 that promised Public Sector workers.

      (3) Quoting … “The choice with funding of teacher pensions is either a higher State income tax or higher property taxes. ”

      OR ….. A pension freeze (as proposed by the NJ pension Commission) or a VERY material reduction in the pension accrual rate for the FUTURE Service of all CURRENT teachers (and all other Public Sector workers)…. and well as VERY material reduction in active and retired workers healthcare subsidies.

      (4) Quoting …. “The Commission has proposed a cutback in health benefits as a way for towns to afford the increased pension expense. The issue remains distorted, with the solution in effect a cutback absorbed solely by employees without addressing the structural problem. ”

      WHAT ? You’re not paying attention. The grossly excessive generosity of current Public Sector worker pensions and benefits IS THE STRUCTURAL PROBLEM. Reducing these pensions & benefit promises INDEED addresses the structural problem.

      (5) Quoting ….” There’s no free lunch and no perfect solution – lock the parties in a room till they hash out a compromise which everyone hates.”

      Yes, but that “solution” must be in the nature of …. EQUAL, but NOT better”.

      Got a problem with EQUAL:?

      Reply

      • Posted by Anonymous on October 25, 2015 at 7:38 am

        Private sector 401k schemes were never meant to fully support retirement, so TL your “equal to” argument is severely flaw at the gate. Lower earners are the true victims in retirement from private sector jobs, they become dependent on public taxpayer supported safety net programs. It appears there are opportunities to use your expertise to reform private sector 401k programs.

        Reply

        • Posted by Tough Love on October 25, 2015 at 9:50 am

          Quoting ….. “Private sector 401k schemes were never meant to fully support retirement, so TL your “equal to” argument is severely flaw at the gate. ”

          When you have no meaningful response, you respond with nonsense like that. It doesn’t matter in what form (or product-type) Private Sector retirement benefits are provided. PUBLIC Sector workers should get nothing of greater value.

          EQUAL…. but NOT better.

          Reply

          • Posted by S Moderation Douglas on October 25, 2015 at 12:28 pm

            Nope. Nope. Nope.

            “Take from the poorest and give to the slightly less poor” won’t work.

            Anonymous (if I only knew which one) is one hundred percent correct:

            “Lower earners are the true victims in retirement from private sector jobs, they become dependent on public taxpayer supported safety net programs.”

            We will always need people to sweep our floors, prepare and serve our meals, process our paperwork, etc. This is often difficult, tedious, and sometimes hazardous work. There is no valid reason these people, working full time, should not be able to support themselves AND provide for their retirement without resorting to government assistance. “Safety net programs” are needed for those too young to work, disabled, elderly, or simply unable to work due to a shortage of jobs.

            Anonymous is correct. SeeSaw is correct, it is a race to the bottom.

            Your

            “Private Sector with 85% of all workers, and where employers freely compete for talent, that set “market rate compensation”

            Doesn’t work. It’s not a “free” market if the WalMarts and MacDonald’s, and others rely on government programs to subsidize their employment costs.

            It should be beyond a doubt by now that the lowest paid government workers are THE cause of the alleged “23 percent” advantage of “average” state workers.
            ____________________________________

            “But since when is government assistance an acceptable substitute for paying employees a living wage – particularly when those employees themselves work for the government?”

            http://www.msnbc.com/msnbc/government-privatization-hurts-middle-class

            ¿Got a problem with EQUAL:?

          • Posted by Tough Love on October 25, 2015 at 2:40 pm

            S Moderation Douglas,

            Sorry, but as usual your reasoning is wrong.

            No matter HOW you slice or dice it, the Public Sector janitor (et. al) deserves no greater compensation than their Private Sector counterpart.

            Taxpayers should refuse to remain the suckers in the equation by considering your BS as a reasonable position.

          • Posted by S Moderation Douglas on October 25, 2015 at 4:04 pm

            Timothy Noah, Labor & Employment editor at POLITICO

            “A generation later, the federal government employs more than three times as many contract workers as government workers, and state and local governments spend a combined $1.5 trillion on outsourcing. One result, according to Demos, a nonprofit public policy organization, is that the federal government effectively pays $12 or less to nearly two million contract workers – “more than the number of low-wage workers at Walmart and McDonalds combined.”

            So.

            Now we have “private sector workers” doing the same job, for lower wages, or for similar wages with fewer or no benefits. AND, we subsidize them with food stamps, section 8 housing, Earned Income Credit, MedicAID, free cell phones, etc., etc., etc.

            Equal?

            Are we saving taxpayer money? Not if the worker makes $12 hr., but their employer (a PRIVATE SECTOR company) bills the government $24 hr. to cover expenses and profits. (and ….taxes… on their profits; how ironical is that!!!)

            We have met the enemy and he is us.

          • Posted by Anonymous on October 25, 2015 at 4:23 pm

            SMD IS RIGHT, no it’s not surf puppy!

            Taxpayers don’t be fooled by TL’s echos of the larger GOP platform mantra!

            Less government is a hoax, it’s just a redirection of $ to private sector outsourcing. Where the contract vendor owner(s) and upper management, consisting of the 1%, benefit at the expense of lower paid with no benefits workers.

            Question is who and where are you in the food chain?

          • We live in a democracy …put the pension issue on the ballot and let the taxpayers decide how much they can afford to pay …

          • Posted by Equal Time on October 25, 2015 at 8:53 pm

            As you know, Tough, private sector workers receive a wide array of pension benefits – they are not a homogeneous group. A majority of private sector workers receive only Social Security, some that plus a DC plan (some with an employer match, others without an employer match), a smaller group a DC plan, and then there are the middle and top managers who also receive stock options, other benefits cashable upon retirement and separation bonuses, So just what equal are you referring to, since there is no universal equal in the private sector?

          • Posted by Anonymous on October 25, 2015 at 9:54 pm

            There is reliable research that private sector 401k need to be reformed for lower wage earners. The real inequality for private sector employees is in the 401k design, there needs to be changes , insurance-based guaranteed income. TL is clearly anti free market regarding wages and benefits.

          • Posted by Anonymous on October 25, 2015 at 11:06 pm

            Remember in November, DD.

        • Posted by Anonymous on October 25, 2015 at 5:35 pm

          Consider this with extreme prejudice.

          The ANNONS may be few or many and the TL, MJ, PSD, et al may be few or many.

          Any supporter of the Public’s position is refuted by primarily TL and others as being a self interested position, ie they or someone close to them are a Public.

          The readers have only the, for lack of better description, anti-Publics “word” that they’re working middle class and not the 1% I and others allege them to be.

          Food for thought when digesting all of the posts.

          Reply

          • Posted by Tough Love on October 25, 2015 at 7:15 pm

            And does that (being in the 1%, even IF true) impact the undeniable fact (via demonstrations posted on this blog) that Public Sector pensions are TYPICALLY 3x-4x (4x-6x for safety workers) greater in value at retirement than those of comparable Private Sector workers when retiring at the SAME age, with the SAME pay, and the SAME years of service ?
            ——————————

            What a load of crap posted by the PUBLIC Sector “takers” commenting on this blog.

          • Posted by S Moderation Douglas on October 25, 2015 at 8:55 pm

            GIGO is still GIGO.

            “…TYPICALLY 3x-4x (4x-6x for safety workers) greater in value at retirement than those of comparable Private Sector workers…”

            Means nothing when cited out of context with total compensation. We now know that many public sector workers with “pensions 3x-4x greater in value at retirement” are paid less in total compensation than their private sector peers.

            The whole “SAME age, with the SAME pay, and the SAME years of service” rant is, for lack of a better word, a “load of crap”. Always has been. Always will be.

            If you’re worried about your alleged “23% advantage” you can eliminate pensions and healthcare for all those workers with jobs requiring a high school education or less. Advantage gone.

            Good luck with that. It won’t work because it is an unworkable solution to an imaginary problem.

            “See my long answer above.”

          • Posted by Anonymous on October 25, 2015 at 10:24 pm

            TL don’t forget to flush after you blog, it’s getting pretty deep where you are.

    • Most of the posters are still looking at this from two opposite positions. That maintains the status quo and exacerbates the pension issue. The State can skip payments to the accrued liability but not the actual pension payments themselves. Every day the current system stays in place increases that future liability. Even aside from the funding issue, defined benefit programs are subject to abuse and shift the investment risk to the taxpayer. In order to induce public workers to voluntarily convert to 401ks, there needs to be compromises in other areas – including a sharing of the burden by taxpayers who have benefitted all these years from the underfunding.

      Reply

      • Posted by Tough Love on November 4, 2015 at 10:02 pm

        Quoting ….”The State can skip payments to the accrued liability but not the actual pension payments themselves. ”

        Sounds like you are a NJ worker or retiree still in “denial” mode.

        When the Plans assets run out in about 5 years, to continue pension payouts to retirees (on a pay-as-you-go- basis) out of annual tax revenue will require roughly a $10 Billion increase in taxes.

        There is ZERO chance that will happen (regardless of what any NJ Court says) , and the pensions will indeed be materially reduced. Prior to that you will have already been put on notice as your retiree healthcare subsidy will already have been all but shut down.

        But if it helps ….. keep dreaming.

        Reply

      • Posted by Tough Love on November 4, 2015 at 10:08 pm

        Quoting ….” In order to induce public workers to voluntarily convert to 401ks, there needs to be compromises in other areas – including a sharing of the burden by taxpayers who have benefitted all these years from the underfunding.

        There never was any REAL benefit to taxpayers by …..”all these years from the underfunding” ….. because the pension promises, ROUTINELY being 3x-4x greater than those of their Private Sector counterparts were never reasonable, necessary, or justifiable to begin with.

        It’s a good bet that taxpayer contributions to date have indeed been sufficient to fund their share of the pension that likely WOULD HAVE been granted in the absence of the Public Sector Union/politician collusion.

        Greed HAS consequences.

        Reply

  5. Posted by Tough Love on October 25, 2015 at 12:54 am

    http://www.wirepoints.com/super-chapter-9-bankruptcy-start-following-the-debate-wp-original/

    Time for Congress to authorize Bankruptcy filings for STATES like NJ so we can dump the financial noose around our necks …… the grossly excessive Public Sector pension & benefit promises.

    Reply

  6. Posted by Anonymous on October 25, 2015 at 8:33 am

    Dysfuntionality Washington, they can’t even tie their shoe laces or slip on their heels. The Donald would be a good one to push this through with all of his personal bankruptcy experience.

    Reply

  7. Posted by S Moderation Douglas on October 25, 2015 at 6:13 pm

    Cash balance is unlike 401(k) in several respects, but:

    401(k) may be beneficial for those in higher income groups, and/or as a supplement for those who also have a DB plan. But for the lowest paid among us, it is a sick joke.

    I have seen this quote before in a blog, but it was not attributed.

    The original author was TERESA GHILARDUCCI:

    “Not yet convinced that failure is baked into the voluntary, self-directed, commercially run retirement plans system? Consider what would have to happen for it to work for you. First, figure out when you and your spouse will be laid off or be too sick to work. Second, figure out when you will die. Third, understand that you need to save 7 percent of every dollar you earn. (Didn’t start doing that when you were 25 and you are 55 now? Just save 30 percent of every dollar.) Fourth, earn at least 3 percent above inflation on your investments, every year. (Easy. Just find the best funds for the lowest price and have them optimally allocated.) Fifth, do not withdraw any funds when you lose your job, have a health problem, get divorced, buy a house or send a kid to college. Sixth, time your retirement account withdrawals so the last cent is spent the day you die.”

    Until the day you die.

    Right now, lower paid public sector workers are protected from some of these dangers because saving for retirement is not an option. Typically 5 to 10 percent of their wages is withheld and it cannot be touched by the worker unless he leaves his job.

    45 percent of Americans today have NO retirement savings, either DB or DC. And many of those who do have some, do not have enough.

    Reply

    • We have off-shored most of our menial “good paying” jobs so the collective standard of living for those who do not have the brain power to be a doctor or trial lawyer or hedge fund manager is going to continue going down until we are in balance with the rest of the developed and developing world.

      But while this is happening lets continue to raise taxes so that the public sector does not have to participate in this economic “race to the bottom.”

      Reply

  8. Posted by Anonymous on October 25, 2015 at 6:29 pm

    http://www.nj.com/politics/index.ssf/2015/10/christie_face_the_nation.html#incart_river_mobile_home

    More BS from the false prophet, says he’ll back up first responders! Yeah we see what that promise got NJ’s finest!! GOP and America, not perfect together!!!

    Reply

  9. Posted by Anonymous on October 25, 2015 at 10:32 pm

    It’s really great blogging with ya’ll anti-publics. Maybe if we got a reality TV show we could put this thing to bed!!!

    Reply

  10. Posted by Anonymous on October 26, 2015 at 4:30 pm

    • Posted by Tough Love on October 26, 2015 at 4:58 pm

      And why do you think the ARCs are so great?

      It’s because Public Sector pensions are grossly excessive and ALWAYS multiples greater in value at retirement than those of similarly situated Private Sector workers. There isn’t now, never was, and never will be sufficient money to fund them.

      But not for Taxpayers to worry about, as we haven’t been actually PAYING in an amount sufficient to fund these absurd promises …… and certainly never will.

      These absurdly generous pension promises will likely be cut by at least 50%….. and that’s after your retiree healthcare subsidies have been reduced by at least that much.

      Reply

      • Posted by Anonymous on October 26, 2015 at 5:57 pm

        Not w/o a GOP override b/c if baby boy Gov doesn’t exactly get his way he’s taken his veto pen and going home.

        Reply

      • Posted by S Moderation Douglas on October 26, 2015 at 6:19 pm

        “And why do you think the ARCs are so great?”

        Those tiny blue lines on the above chart (or the missing blue lines in some years), answer that question. If the formula was reduced by 50 percent and the state paid NOTHING this year, the ARC would continue to increase.

        “These absurdly generous pension promises will likely be cut by at least 50%….. and that’s after your retiree healthcare subsidies have been reduced by at least that much.”

        To be fair, those with pensions under $50,000 should be left intact.

        Reply

        • Posted by Tough Love on October 26, 2015 at 7:20 pm

          So who is paying “nothing” ?

          Just MORE of your BS.

          Reply

        • Posted by Tough Love on October 26, 2015 at 7:25 pm

          Quoting ….”

          To be fair, those with pensions under $50,000 should be left intact.”

          No. ALL Public Sector pensions should be re-calculated by using a formula (AND provisions) common to Private Sector workers in comparable jobs.

          I have ZERO doubt that pensions so-calculated would be 1/4 to 1/2 of the grossly excessive promises currently made to Public Sector workers. Taxpayers should fund a Public pension NO GREATER than that re-calculated amount and at ALL income levels.

          If Publics want more ….. pay for it yourself.

          Reply

          • Posted by Tough Love on October 26, 2015 at 7:27 pm

            ooophs, in my above comment, I left out the quote from S Moderation’s comment”.

            That quote should be …”To be fair, those with pensions under $50,000 should be left intact.”

          • Posted by Anonymous on October 27, 2015 at 11:14 am

            TL take a break go look at the fall foliage. Repeating the same rant loses energy. The members of the Christie Administration that could help recovering that sinking ship. Cash balance or money purchase the answer i already in place, reform private sector 401k.

        • Posted by Anonymous on October 26, 2015 at 8:01 pm

          SMD in the TL’s of this world perfect Tea Party scenario they won’t be satisfied until there’s nothing left but bones. No crumb feeders, strictly the haves (1%) and the have nots (the rest of us, privates & public’s).

          Of course, in anticipation of the standard rebuttal, they’ll ALLEGE to be part of the working middle class. Now that’s BS for sure!

          Reply

          • Posted by Tough Love on October 26, 2015 at 8:21 pm

            Sorry if you insatiable greed makes it difficult for you to accept or understand, but the Public Sector Middle Class ais ripping-off the Private Sector Middle Class via their grossly excessive Pensions & Benefits ……. and it needs to end, and for all CURRENT, not just new workers.

    • You need to show a companion graph comparing what drone pensions should be (pursuant to rational collection age and monthly benefit amounts) vs. what the idiot crooked legislators and unions have concocted. Then the above shortfalls would not look nearly as bleak.

      Reply

      • Posted by Tough Love on October 26, 2015 at 8:44 pm

        Exactly …… and perhaps no shortfalls AT ALL …….. because THAT’s how excessive these promises are.

        Reply

      • Posted by Anonymous on October 26, 2015 at 8:45 pm

        PSD you stopped to soon, but the shortfalls would still exsist and so would this conversation. You can’t reform what you don’t commit to fund, that my friend is indeed a ponzi scheme.

        Reply

        • Posted by Tough Love on October 26, 2015 at 8:50 pm

          It’s quite possible that total contributions-to-date would be right on target (i.e., zero shortfalls) to fund a pension EQUAL to those typically granted comparable Private Sector workers.

          The ROOT CAUSE of the low funding ratios is the ludicrous generosity of current pension promises.

          Reply

          • Posted by Anonymous on October 26, 2015 at 8:52 pm

            Stop with your general BS & provide the real numbers to back up CRAP!!!

          • Posted by Anonymous on October 26, 2015 at 9:04 pm

            And while your at it what would the funding levels look like if not for Wall Street”s insatiable GREED proceeding the Great Recession and an almost 50% drop in the overall market. Let’s put things on an equal level and just to be fair let those responsible pay for it.

            Yeah that’s laughable the RICH pay for their misdeeds.

          • Posted by Tough Love on October 26, 2015 at 9:27 pm

            Sorry BH, but the grossly “generosity” of Public Sector pensions is undeniable. THAT must be addressed.

            Funding shortfalls are not the CAUSE of the pension mess we are in, but are a CONSEQUENCE of the Root Cause …. grossly excessive “generosity”.

          • Posted by S Moderation Douglas on October 28, 2015 at 2:18 am

            Sorry, but the grossly “generosity”, whatever that is, is ….not…. undeniable.

            That is still just an opinion.

  11. Posted by Anonymous on October 27, 2015 at 9:20 am

    Talk about delusional, the leader of our State on National TV in 11th place with 1% of the vote saying he’s going to be the GOP nominee? Now that’s meaningless to this Country and more importantly our State!!!

    Reply

  12. Posted by Anonymous on October 27, 2015 at 11:05 am

    http://www.nj.com/politics/index.ssf/2015/10/most_nj_residents_unaware_of_next_weeks_elections.html#incart_river_mobileshort

    Don’t forget to vote, I’m sure TL’s beloved Unions are urging their members to do so, Democratically speaking!!!

    Reply

    • Posted by Tough Love on October 27, 2015 at 3:05 pm

      More like ….. NJ allows retired teachers to return to the classroom to replace lost retiree healthcare and 50% of their pensions.

      Reply

      • Posted by Anonymous on October 27, 2015 at 4:17 pm

        We’ll see, one think for sure there’ll be a shortage of both in the coming years…that should help the local economy and property values!!!

        Reply

  13. Posted by Anonymous on October 28, 2015 at 8:17 am

    Several things I notice is that certain bloggers like to keep referring to Walmart and McDonald’s workers being eligible for government benefits. These types of jobs were not meant to support families but rather to provide employment for students, older folks who still want to work and supplementary incomes to primary breadwinners. Someone else noted correctly that most of our better paying factory and/or manufacturing jobs etc have moved overseas in our race to the bottom, so if one doesn’t have the brain power for the more technical jobs available, Walmart and McDonald’s type jobs, part-time employment and the such have become the new normal for a lot of folks just to survive. I don’t see how this can possibly compare to an average public worker making 60K per year, full health benefits, early retirement, more sick time and vacation than any Walmart worker………just remember whether you like it or not the Walmarts and McDoanlds put money into state coffers which in turn pays your salaries. I’m sure you all shop at Walmart for the cheapest price…..the very high cost of the lowest price.

    Reply

  14. Posted by Anonymous on October 28, 2015 at 8:22 am

    http://watchdog.org/243506/camden-double-dippers-sheriff/

    Let not forget these folks with the million plus retirement pay outs ,full time salaries and all the other perks they take….not to mention working all of the their jobs that they don’t need thus taking opportunity away from one of those Walmart worker who I’m sure could qualify to be a sheriff.

    …….and they wonder why the pension system is going belly up!!

    Reply

  15. Posted by Anonymous on October 28, 2015 at 9:00 am

    I to find it very intriguing that most of the bloggers citing excessive State and Local governments P&B also predict the imminent collapse of SS. Yet no mention of ALL Federal pensions.

    Curious what percent of Tea Party types are current or retired military receiving a Federally funded taxpayer pension? I’m not bashing them for their dedicated service to our Country. But I’m calling them out for their fiscal hipocrisy! Sure the Feds can continue to print money with potential dire National and Global economic impact.

    Another interesting point, again I’m not generalizing based on selective observation. On a few occasions, while dining out, I’ve noticed senior citizens quick to bash Obama on spending, etc. Question is how would they react IF their SS and/or Medicare were cut for budgetary reasons. I know they (most of us) paid into the system and maximum benefits have a much lower cap than most DBP pensions. The point is, no matter what it is in life, everybody thinks something is a good idea until it negatively impacts them.

    The lower paying jobs which were never meant to be careers have become the norm because of bad trade policy and excessive GREED by business owners and executives. They are the one group that has NEVER suffered in down times. And in good times their salary and bonuses are ridiculous.

    So if we want a fair and equal conversation on this topic it MUST be all inclusive. Otherwise it’s just more of the same old rhetoric with ALL special interests watching out for their own (Unions and 1% included) without regard for the greater good.

    Reply

    • Posted by S Moderation Douglas on October 28, 2015 at 12:18 pm

      It’s a mixed up, muddled up, shook up world (Except for Lola.)

      Federal government IS cutting back on military pensions, or trying to.

      AND

      Cutting back on other defense spending. Good news?

      Not to thousands of (ahem) “private sector” workers in the military industrial complex. Like my brother in law in Mississippi who lost a good private sector job with Navistar (International Harvester) several years ago when they cut back on troop carriers.

      War is hell, but very profitable for the right people.  

      Military pensions:

      http://www.govexec.com/pay-benefits/2015/09/lawmakers-reach-deal-cut-dod-workforce-overhaul-military-retirement/122411/

      Reply

    • Posted by MJ on October 28, 2015 at 5:34 pm

      The senior citizens are always bashing Obama while at the same time clamoring for more, more, more. Hip and knee replacements at 85? Dental implants at 78? Heart surgery at 89? Really, sorry to say the senior citizens are sucking up as much as they can, my relatives included. At what point is a cost benefit analysis considered for all of these senior services. Nobody has a family who can help care for them or help with medical bills. SS is failing for the basically the same reasons as the public pensions, way to much promised to way to many for way to long without any adjustments. Most of the seniors I know directly and indirectly are living very well in retirement but boy do they love to bash Obama.

      Reply

      • Yes; Medicare (and Medicaid) need to be rationed. So much $ per beneficiary per year. Otherwise the social process of going to one specialist or another three times per week will not stop until we are all living in cardboard boxes.

        Reply

      • Posted by Tough Love on October 29, 2015 at 2:43 am

        PSDrone,

        MJ is wrong. SS hasn’t promised too much. In fact, for all but lower income workers, it’s a real lousy return on your payments into the system. The problem with SS is that the excess SS Tax collections (over many decades) have always been “invested” in special-series US treasuries (not assets that can be sold on the open market to generate the cash from others needed to make the SS payments when due) with the cash collected and deposited into the US treasury commingled with other tax revenue and SPENT annually.

        PUBLIC Sector pensions are a far cry from SS in generosity….. many multiples greater. THAT’S where the “promises” have indeed been FAR to great, unnecessary, and unaffordable.

        Sure, SS needs some adjustments to get back on track, but relative to the disaster brewing for almost all Public Sector DB pensions, it’s easily manageable. In fact, if absolutely NOTHING is done, SS could FOREVER continue to pay 75-80% of promised benefits.

        Reply

  16. Posted by skip3house on October 28, 2015 at 9:19 am

    Anon…?
    Thoughtful, at least compared to many here.
    Wish thought were also put into cruel regressive school property tax system in NJ. We just had NJ State Sen Doherty, on NJTV, trying to say ‘use the income tax’…well, sure, if NJ would double it and eliminate all home/rentals school property tax to make his thought practical. Would also stop unneeded Rebates then !

    Reply

  17. Posted by MJ on October 28, 2015 at 5:25 pm

    Totally agree. The problem in a nutshell is the natural order of things is so out of balance that one must wonder how long until the train runs off the tracks. UGH!

    Reply

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