Archive for the ‘Public Pensions – General’ Category

French penison égalité

Spending a long weekend looking for parking spots in Boston gives one time to think, in my case about France and public worker pensions which provide benefits of about 75 percent of pay at age 62 after 43 years of service and presumably would not change. What would change:

[T]here are also 42 “special regimes” for a range of workers including civil servants, dockers, lawyers, and employees of state rail operator SNCF and the Paris public transport operator RATP. They provide for earlier retirement and more advantageous pensions originally offered as compensation for arduous work.

Main objection from the rioters:

Unions say Macron’s proposal for a single-pension system would force millions of people in both the public and private sectors to work well beyond the official retirement age of 62.

After circling Boyston Street for the eight time a couple of things hit me:

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Grand Bargain for U.S. Pensions?

Marc Levine, former chairman of the Illinois State Board of Investment, spoke to Barron’s about investing and touched on how to save save U.S. pension systems that included this prediction:
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Full Q&A on pensions:
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America’s Pensions

The latest edition of the Economist has a story on public pensions in the United States that it titles State of denial spotlighting situations in Illinois and Kentucky though New Jersey does get a mention.

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Kentucky Pension McGuffin

Election day means no real news even when there should be.

There is a close governor’s race in Kentucky, a state that has a lot of coal miners and public employees who need bailouts of their endangered pensions, yet coverage (at least by PBS – see full segment from Newshour at bottom of this blog) continues to distract with occasional truth seeping though. For example, another indication that a bailout of multiemployer plans is coming:

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No Will on Pension Reform

In plugging his new book George F. Will made the point:
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I now have the book and Donald Trump is indeed not in the index. What does appear (once) is the word ‘pensions’ on page xxx.

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Consolidating Illinois Pension Problems

What can be done with all those badly funded Illinois public pension plans? A task force says to merge them and they put out a report on why it makes sense to them that Mary Pat Campbell debunked nicely including this note:

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Funded Status of Local Pensions per CSLGE – 2018

Based on an analysis of 190 major pension plans (114 state and 76 local) that represent over 95 percent of total U.S. state and local pension assets and membership, the Center for State and Local Government Excellence (CSLGE) released a brief concluding:

Fundamentally, the path of the funded ratio for public plans depends upon the growth of actuarial assets relative to the growth of actuarial liabilities. Liability growth slowed dramatically from 2001 to 2018, but still exceeded asset growth over the period – driving down the funded ratio from 103 percent in 2001 to 73 percent in 2018. While more stringent funding methods would have modestly improved the trajectory of plan assets from 2001 to 2018, significant change requires also using a lower assumed return.

Nothing alarming here (though significantly less upbeat than the last update) but that might have more to do with CSLGE’s funding than those of the plans. A footnote accounts for that rosy 73 percent figure:

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