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"Christie isn't cutting fast enough..."
Christie has not cut spending, instead choosing to give $400 million in subsidies to an indoor ski slope and $261 million to a casino.
Isn't Christie the Governor of New Jersey, Socialist?
The small city of Central Falls, R.I., appears to be headed for a rare municipal bankruptcy filing, and state officials are rushing to keep its woes from overwhelming the struggling state.
The impoverished city, operating under a receiver for a year, has promised $80 million worth of retirement benefits to 214 police officers and firefighters, far more than it can afford. Those workers’ pension fund will probably run out of money in October, giving Central Falls the distinction of becoming the second municipality in the United States to exhaust its pension fund, after Prichard, Ala.
“Time is running out,” warns Robert G. Flanders, the state-appointed receiver, who recently closed the public library and a community center to save money. He has no power to cancel the city’s contracts with workers, so instead he has begun approaching retired police officers and firefighters with what he describes as “the Big Ask”: will they voluntarily accept smaller benefits in the name of saving Central Falls?
This is a great article about Atlanta's pension problems. I found NYC's unfunded pension at 122bln quite astounding. Check out Philly with 9.7bln unfunded and running out by 2015!
"fair share" "shared sacrifice"
City sewer engineer paid $775k in 2010, more than any NYC employee; thousands of workers get backpay
BY REUVEN BLAU, ERIN EINHORN AND TRACY CONNOR
DAILY NEWS STAFF WRITERS
Tuesday, September 6th 2011, 7:57 AM
Getty - FILE PHOTO
NYC sewer engineer cleans up
Should there be a cap on civil employees' earnings?
No. He did the work, he deserves the pay.
Yes. Everyone deserves a chance to make the big bucks, but this is crazy.
Residents fight to keep FDNY ladder
Bloomberg, Quinn unveil 'firetraps' overhaul
City Island residents don't understand FDNY moves
Agencies don't unite to fight firetraps
Council extends firefighter age to 35
Rally against proposed Bronx FDNY closings
A city sewer worker made more last year than the police commissioner, the schools chancellor and the mayor - combined.
Senior engineer Gerald Mistretta's pay was $771,841 - and six of his co-workers raked in nearly as much - thanks to a wage settlement with the city.
His bottom line for the fiscal year that ended in June included a base salary of $109,850 a year, $173,000 in overtime - and nearly half a million dollars in back pay.
The Brooklyn father of three said the one-shot windfall - which made him the top earner among city employees last year - made up for 16 years he went without a raise.
"I know it looks like a whole lot of money," Mistretta told the Daily News. "But people don't realize the hardships we went through.
"It was a very difficult period. We have families, and colleges to pay for, and mortgages."
Mistretta and other sewer workers labored without a contract since 1995 because of a dispute over their base salaries. A deal struck in 2009 after years of litigation gave them retroactive hikes.
Six other senior Department of Environmental Protection workers made more than $700,000; 13 made in the $600,000 range, and 47 earned in the $400,000 or $500,000 range.
About a thousand more got lesser payments.
Mistretta said his lump-sum payment meant he got soaked on taxes - and now his paychecks are back to normal.
"We would have gladly taken a contract back in 1993 or 1994," he said. "Imagine in 2009 still making what you made in 1993?"
Local 1320 President James Tucciarelli said the city has no one to blame but itself for the huge payouts.
"You can't hire skilled trade people to do the jobs ... and then string them out for eight or 13 years without a pay increase and then not expect to see exorbitant back pay numbers," he said. "They were deep in debt. Any back pay that they got is already gone."
DEP spokesman Michael Saucier said, "It was important to reach this agreement so these dedicated and highly skilled employees could focus on their important jobs."
Sewer workers weren't the only city employees to cash in on labor disputes.
Radio repair mechanics, mostly in the Fire Department, won a settlement last year after city Controller John Liu found they made less than private-sector peers.
The ruling catapulted 150 working stiffs to the upper echelons of city wage earners.
Richard Bazant, who has worked for the FDNY since 1995, said his base pay is about $80,000 - but last year he got $364,815 because of the deal.
He was surprised the settlement cash didn't go further.
"Taxation is brutal," he said, adding that he would have done better if the money had been parceled out from 2002 to 2008, the period the settlement covers.
Still, for the father of three from Queens, the payout let him pay his daughter's college bills and put a down payment on a house.
Bazant was one of 13 radio repair mechanics who made more than $300,000 last year - more than the police commissioner or schools chancellor. And 26 got in the $200,000 range.
FDNY mechanic Humberto Nunez broke the $400,000 mark - what President Obama earns - with his salary, OT and the settlement.
"I do think we deserve it," Bazant said. "We served the city very well."
Most city workers spend decades in public service to build up modest pensions. But for former labor leader Dennis Gannon, the keys to securing a public pension were one day on the city payroll and some help from the Daley administration.
And his city pension is more than modest. It's the highest of any retired union leader: $158,000. That's roughly five times greater than what the typical retired city worker receives.
a Tribune/WGN-TV investigation has found that Gannon is eligible for the lucrative pension deal only because City Hall rehired the former Streets and Sanitation Department worker for a single day in 1994, then granted him an indefinite leave of absence.
Terrance Stefanski, who oversees the city's municipal pension fund, confirmed that the city helped Gannon qualify for an inflated pension by hiring him for a day. But he said he has no control over city hiring and must follow the pension laws.
"Once the city rehired him and he went on a leave of absence to work for the union, he was eligible under the law," Stefanski said.
Streets and San officials provided a statement about Gannon's one-day hiring: "This was a personnel matter that happened more than 16 years ago, and at this time we don't have all of the details needed to determine exactly why these decisions were made."
401ks are NOT more cost effective than pensions for govt. workers:
"Making a complete shift from a DB to a DC structure does
nothing to close any funding shortfalls, and can actually
Socialist - I don't know anything about you but that link you just posted is ABSOLUTE garbage. You'd have to be a complete idiot to not realize in 30 seconds that it's completely biased nonsense.
Municipalities go to DC structures to save money long term - duh.
There are three ways to fix our pension issues. 1. Inflation. 2. Bankruptcy. 3. Restructuring.
Our corrupt government officials have over-promised. If you are planning on living off a government pension in the future then you're as dumb as I would be if I were to plan on living off my social security checks. Just like my checks won't be there in full neither will pension checks.
Face it, the 20 somethings aren't going to be willing (or even able) to pay for all of the social security and pension benefits that the baby boomers have promised themselves. You hear of class warfare in today's media - wait until the "generational warfare" starts. The boomers will prove in the end to be the worst/greediest generation in the history of our country and the gen Yers won't put up with it.
>There are three ways to fix our pension issues. 1. Inflation. 2. Bankruptcy. 3. Restructuring.
4 - The older members of the union can screw over the younger members of the union by recruiting new members, having them pay dues, and selling them out with low wages and low benefits so that the employer can pay higher wages and higher benefits to the older workers (and to the union bosses).
Socialist - I don't know anything about you but that link you just posted is ABSOLUTE garbage. You'd have to be a complete idiot to not realize in 30 seconds that it's completely biased nonsense.
Oh, hey Brooks2, you were quiet for a few days. Travel? Tough round the clock negotiations at the office? Hospital stay? Held prisoner in Wbottom's dungeon?
City Comptrolelr John Liu: Pensions more efficient than 401ks:
A summary of the report:
He's very pro-union and looking to run for mayor. This report which the unions are lauding and passing around will surely help in his effort. Some of the claims being made here appear anecdotal at best. NY Pensions have come under fire in the past for under performance and sweet heart deals to manage assets. At the state level Harry Wilson pointed out a number of governance issues in his run for State Controller.
Every year, New York State issues a report that depicts its pension fund at the peak of health — not a penny short of what it needs to pay retirees their benefits. In some years, the report even shows a little surplus.
But now a Republican candidate for state comptroller, Harry J. Wilson, says those rosy numbers are little more than an accounting illusion. In fact, the pension fund is papering over a shortfall in the tens of billions of dollars, says Mr. Wilson, who has an M.B.A. from Harvard.
When the state takes its snapshot of the fund, he says, it makes several mistakes, including two big ones. First, it counts money that is not in the fund — hoped-for investment gains that may or may not appear and future contributions from workers and taxpayers. Second, it does not take into account that the state pensions are worth more than other such promised money because they come with a constitutional guarantee.
The difference in dollars is huge, Mr. Wilson writes in a paper due out on Thursday. If New York recalculated its pension numbers with the stricter standards that companies use, it would come up $30 billion to $80 billion short, he says.
The coming public pension crisis is the largest financial problem our nation faces at the state level,” he warns in the report, adding that it would eclipse the cost of the bailouts of companies like the American International Group and Fannie Mae, or the savings-and-loan industry in the 1980s.
New York’s retirees will not have their benefits cut, Mr. Wilson says, citing the constitutional guarantee. But over time, residents will see more cuts in public services and less money for infrastructure maintenance as public dollars are diverted to fill the hole in the pension fund.
The state’s plan to borrow billions more from the pension fund to get through this year’s fiscal squeeze, meanwhile, will drive the fund deeper into the hole.
Economists who were shown the paper said Mr. Wilson’s analysis of the problem was sound.
“That part of it is exactly spot on,” said Joshua D. Rauh, an associate professor of finance at the Kellogg School of Management at Northwestern University who has written extensively on the accuracy of state pension numbers.
Oct. 6 (Bloomberg) -- New York’s 8 percent assumed rate of return on its pension investments is so unrealistic that the city may have to spend even more than the $1 billion it has in reserve for its retirement plans, Mayor Michael Bloomberg said.
“We are staring into the abyss of $5 billion deficits going forward without more of a problem from the pension system,” Bloomberg said.
One thing that the pro 401k, anti pension people tend to forget is that having a 401k style pension in govt. will lead to higher turnover, which will mean more money having to be spent in recruitment and training. A pension is good for the govt. since it shackles their employees to the job and makes them far less likely to leave for higher paying jobs elsewhere due to the fact that you cannot take a pension with you to your new job. For this reason, govt. jobs have significantly lower turnover rates than most private sector employers.
ore money having to be spent in recruitment and training
-offset by lower pay. in many of these jobs the training time is measured in months and not years. contrast this with the increasing percentage of NYC budget dedicated to pensions. The issue is not so much the annual cost per employee, but the duration of the benefit. Considering current longevity statistics, vesting a union employee in his retirement benefits before age 65? makes very little sense and speaks very much to what's going on in Greece. Of course it would also benefit all parties if we empowered the worker to take control of his retirement benefit via 401k(lower taxes /greater retirement benefit/ empowering the worker)
"Of course it would also benefit all parties if we empowered the worker to take control of his retirement benefit via 401k(lower taxes /greater retirement benefit/ empowering the worker)"
Why? So he could pay huge fees to Wall Street? As I argued before, most Americans are too stupid to manage their own retirement. They will take the money and blow it on flat screen tvs or houses they can't afford.
"Hey, look honey. That new S Class is so wonderful. We can't afford it now, but if we cash some money out of our 401k, we can buy it."
Union workers are stupid?
95% of Americans are stupid. Union, non union, does not make a difference. Plenty of union workers bought houses they could not afford.
So this could all be solves via education(e.g.if the union advised it's members appropriately.) Tax payers win, union members win. The only people who benefit from the current system are those getting sweet heart deals to manage assets.
"The only people who benefit from the current system are those getting sweet heart deals to manage assets."
Like hedge fund managers?
The older workers in a union too. Their all-in wages are above the sustainable rates. And the best evidence isn't the auto industry bankruptcies, or the outsourcing of manufacturing, or municipal stress.
The best evidence is the fact that the older workers in a union have negotiated lower wages for new union members - the new union members are paying part of the wages of the older union workers.
Eleven people were charged on Thursday in an enormous fraud scheme in which hundreds of Long Island Rail Road workers falsely claimed to have disabling injuries, with some of them collecting tens of thousands of dollars in annual pensions while spending time playing golf, law enforcement officials said.
The fraudulent payouts in the scheme, officials estimate, could end up costing a federal pension agency more than $1 billion if fully disbursed.
Ten of the defendants were taken into custody early Thursday at their homes by agents from the Federal Bureau of Investigation and state investigators, officials said. They included seven former railroad workers, including a former union president; a former federal railroad pension agency employee who helped the workers file claims; a doctor; and a doctor’s office manager. A second doctor is expected to surrender on Friday.
The former chief executive of MF Global Holdings Ltd., who resigned in 2008 after the firm lost more than 90% of its market value, was quietly hired in September by New York City Comptroller John Liu to help manage the city's pension investments.
Kevin Davis, who led MF Global for a decade, was made head of commodities in the comptroller's Bureau of Asset Management, which helps advise the city's five public pension funds on their combined $120 billion in assets. It is his first job since stepping down from the brokerage firm.
He was hired by Lawrence Schloss, who served on MF Global's board of directors at from September 2007 until he joined Mr. Liu's office as chief investment officer in January 2010.
The appointment of Mr. Davis, and to a lesser extent, of Mr. Schloss, has drawn criticism from some stakeholders in the city's pension system. Soon after its value plummeted, MF Global was sued by four public pension systems outside New York that claimed the firm misrepresented its risk-management practices to investors. A Manhattan federal judge approved a $90 million settlement in that case last month.
For those that trust the government with their pensions and social security..
Portugal has raided €5.6bn (£4.8bn) of pension fund assets in a controversial scramble to meet its deficit targets.
2010 budget was met by shifting three pension plans from Portugal Telecom on to the public social security system. The liabilities don’t count, yet.
There have been no complaints from Eurostat but Raoul Ruperal from Open Europe said: “This can’t be seen as a future revenue stream in any way.”
"Making a complete shift from a DB to a DC structure does
nothing to close any funding shortfalls, and can actually
true, the best way to cut the gap is through cuts in health care benefits cause they are not guaranteed and there's a ton to cut to bring them up to what the private sector receives.
Argentina did the same thing, and amazingly voters didn't complain much.
ultimately what voters fail to understand is that in case of insolvency, those that pay most of the cost of default are the creditors. and that includes retirees!!! those guys are creditors to an insolvent government, hence they take a hit. you'd think in an ideal world retirees or near-future retirees would understand this and be more fiscally conservative. they would not support bubble types of economies like we just had (housing bubble), favorting low stable growth instead.
And by lowering rates to 0-1% Government is sowing the next crisis, by making impossible to fund our health insurance and retirement benefits. They'd rather transfer wealth from those that are funding these costs to banks and debtors. Dumb and short sighted in my opinion.
be aware of riversider...a known liar.
California (BCAX) has paid Lina Manglicmot $1.5 million since 2005, an average of $253,530 a year, to work as a prison nurse in the agricultural town of Soledad.
Manglicmot is one of 42 state nurses who each made more than $1 million in those six years, mostly by tapping overtime, according to payroll data compiled by Bloomberg News. Together, those nurses collected $47.5 million. In 2008, Manglicmot was paid $331,346, including $211,257 in overtime.
The extra pay that allows some nurses to triple their regular compensation underscores a broader trend in California, where government workers are paid more than in other states for similar duties and civil-service job protections hamper efforts to close budget gaps. Governor Jerry Brown said this week that revenue will fall short of expectations, triggering $1 billion in cuts to school busing, libraries and care for children, the elderly and the disabled, among other programs.
“California taxpayers should be outraged,” said Lanny Ebenstein, an economics lecturer at the University of California at Santa Barbara and president of the California Center for Public Policy, a research institution critical of public-sector compensation. “Taxpayers should insist that this is no longer acceptable because what government does is important and it’s important that government run effectively.”
It's hilarious how that article, in its attempt to incite anger at a grand total of 42 "overpaid" nurses, has to sum up their wages over 6 years to find the existence of "millionaire nurses". There's probably some "millionaire Wal-Mart greeters" as well if you sum up all of their wages and overtime over their entire career.
should decrease those 6 figure pensions to 50% or lower, none of those lazy guys deserve it
In Los Angeles the median nursing salary(r/n) is $73,000 according to salary.com so in six years that would be $438,000. The article states salaries paid out of more than double that during the six year time period, and in one cited instance more than triple. Huge tax-payer waste that would not occur in the private sector unless there was fraud involved.
>There's probably some "millionaire Wal-Mart greeters" as well if you sum up all of their wages and overtime over their entire career.
No, Wal-Mart and every large retailer is very careful to make sure employees don't go into overtime.
What? No waste in the private sector? HA! That's a good one. I can't tell you how many times I have been taken out to dinenr by people who put the restaurant tab on the comapny credit card. They said they will tell their boss that the dinner was for "recruitment."
So you are saying that no private company has ever tried to recruit you?
"In Los Angeles the median nursing salary(r/n) is $73,000 according to salary.com so in six years that would be $438,000. The article states salaries paid out of more than double that during the six year time period, and in one cited instance more than triple. Huge tax-payer waste that would not occur in the private sector unless there was fraud involved."
And now an important lesson on math. The median is the salary that half of people earn less than and, the important part here, half of the people earn more than. You are pointing out that 42 out of probably thousands of people got paid more than twice the salary that half the people get paid more than. That this should be surprising or even interesting to anyone is the most surprising part of this discussion.
The median is the salary that half of people earn less than and, the important part here, half of the people earn more than.
Yes, the concept of median is well understood, implication is that they either hired the the best or overpaid even more. Usually an employer looks to hire a skill for the least amount of money not the most, unless the person hired is above average in skill. Even then competitive bidding be such that it may you would think they would be going after the 60t percentile, not the 99th or above.
Uhh, the story tells you exactly why they earned so much--overtime. In other words, they worked a lot more than average and so they got paid more.
People always try to justify bankers high salaries because they work such long hours, but I guess if nurses work long hours helping sick people and get paid a million bucks over six years they're doing something wrong.
So the taxpayer shouldn't be worried that system is being run inefficiently because a private sector employee or group of employees makes a lot of money paid for by their shareholders?
Socialist points out that someone at a private company bought him dinner and stole or cheated on his expenses. But how is that our problem if we aren't owners of that company?
“So far, the market doesn’t care,” said Edmund J. McMahon, the director of the Empire Center. “The market seems to assume, on the basis of nothing, that at some point all of these places are simply going to stop paying retiree health benefits.”
imho the mkt is exactly right. health care benefits are going to be the 1st ones to disappear. the general public is not protected by them, so instead of being sympathetic with union retirees, politicians will win votes by cutting them (hence releasing the general taxpayer from the burden).
so when calculating how much the pension gap is, i'd put a small weight on health care benefits. after 65 they will have to rely on medicare like everyone else. those union retirees under 65 are going to be hard hit, but non-union tax payers have very little sympathy for those imho.
"Socialist points out that someone at a private company bought him dinner and stole or cheated on his expenses. But how is that our problem if we aren't owners of that company?"
Oh, but youd did pay for my dinner. It's a healthcare company that get s all their reveue from Medicare.
And Medicare will pay more if someone spends another $20 on dinner for you? If that's so, then that's the wrong way for a government program to exist.
That said, the mayor did sound his usual alarm over the city's growing pension obligations. He said the city cannot afford to offer the same benefits to new employees going forward.
“Right now our pensions system is fairly described, I think, as a ticking time bomb,” said Bloomberg
So. Fucking. Stupid. And scary.
One area where this liberal thinks public sector employees are out of their God damned minds, and need to be stopped. Not the Scott Walker/Tea Party way, mind you.
Looks like cuomo is backing away from a 401k style option in favor of a two tier retirement system..
Gov. Andrew Cuomo has outlined a major pension reform for new city and state workers that could offer desperately needed relief. It would change pension offers for future state and local workers, including teachers and fire and police personnel, bringing their contributions and benefits closer to those of employees in other states.
Under the proposal, new hires would contribute 4 percent, 5 percent or 6 percent of their salaries for their pensions depending on their pay levels, compared with 3 percent for workers hired recently.
Many government employees in the state can currently retire at age 62 and receive a full pension. Mr. Cuomo would increase the retirement age for most employees — except for police and fire personnel — to 65. In New Jersey and Maryland, retirement age for most workers is 65, and in Rhode Island it will be 67 starting in July.
And instead of retiring on 60 percent of salary after 30 years of service, the payout would be about 50 percent — closer to New Jersey, Illinois and Vermont. The new law would also stop employees from loading up on overtime and other payments in their final working years to increase their retirement allowance. Those changes make sense.
Mr. Cuomo said on Monday that he could be flexible about parts of his proposal, like his desire to create a 401(k)-type plan for new employees. That’s fine, but he must hold the line on the fundamentals: bringing the retirement age and employee contributions into line with other states. There is no other way to tackle the crushing pension burden
seems reasonable to me...although i think defined benefit is better than defined contribution. i'd rather the money go into an annuity than a defined contribution since there is some level of guaranty with an annuity, thoughts?
Depends if you are looking at this as what's best for the union or what's best for NYS tax-payer
Federal employees have the annuity system, and it works just fine. States should NOT be in the business of managing pension funds. This has been a disaster for many, many states and cities.
States don't have the power of the printing press, so I would certainly agree. Personally I like the 401 system, but think workers should be allowed to transfer the funds at regular intervals to an IRA. There's no great reason employers should have any control over vested money.
Which state can I move to that has
1 - Low debt and future retiree obligations
2 - Can educate my grandchildren
3 - Does not have tornadoes?
On Monday, Rockland County sent a delegation to Albany to ask for the authority to close its widening budget deficit by issuing bonds backed by a sales tax increase.
On Tuesday, Suffolk County, one of the largest counties outside New York City, projected a $530 million deficit over a three-year period and declared a financial emergency. Its Long Island neighbor, Nassau County, is already so troubled that a state oversight board seized control of its finances last year.
And the city of Yonkers said its finances were in such dire straits that it had drafted Richard Ravitch, the former lieutenant governor, to help chart a way out.
Even as there are glimmers of a national economic recovery, cities and counties increasingly find themselves in the middle of a financial crisis. The problems are spreading as municipalities face a toxic mix of stresses that has been brewing for years, including soaring pension, Medicaid and retiree health care costs. And many have exhausted creative accounting maneuvers and one-time spending cuts or revenue-raisers to bail themselves out.
glimmers or hopes?
Taxpayers probably are going to be paying more for state government and school district employee pensions beginning in July.
A committee of the California Public Employees' Retirement System board voted 6 to 2 on Tuesday to cut the assumed annual rate of return on investments that it uses to calculate the contributions that need to be collected from the state and some 2,000 other public agencies.
The committee set the new benchmark at 7.5%, down from a two-decade-old rate of 7.75% but higher than the 7.25% recommended by its own chief actuary, Alan Milligan.
This is a result of Bernanke's zirp policy
Searching for higher returns to bridge looming shortfalls, public workers’ pension funds across the country are increasingly turning to riskier investments in private equity, real estate and hedge funds.
But while their fees have soared, their returns have not. In fact, a number of retirement systems that have stuck with more traditional investments in stocks and bonds have performed better in recent years, for a fraction of the fees.
“We can’t put it in Treasury notes and bonds; that’s just not making any money,” said Sam Jordan, the chief executive of the Austin Police Retirement System in Texas.
Public retirement systems are struggling to earn sufficient returns with interest rates near record lows and more and more workers qualifying for retirement. Their pension costs are growing fast, but state and local government returns are not keeping up.
One nice thing about pension obligations: When you know the number of employees and their ages, the actuarial estimates start falling into place. The mystery is the investment return a pension fund will earn over time.
A second, often overlooked time bomb merrily ticking for governments nationwide is the cost of health insurance for all those retirees. That number, too, is hard to gauge, because health care costs — like future investment returns — are unknowable. Yet governments typically don't put aside money for future health care, as they do for future pensions. The culture is to pay-as-you-go.
In Illinois, that means pay-as-you-go-even-more-broke. The Illinois Policy Institute, a right-leaning think tank, now is releasing 133 pages of frightening data — we obtained a copy Thursday — that project yet another devastating hit to taxpayers: Beyond that $83 billion in unfunded pensions, state government alone faces an unfunded liability of more than $54 billion in retiree health liabilities over the next 30 years.
> The culture is to pay-as-you-go.
yep, a time bomb on the backs of those paying property taxes. in illinois is estimated conservatively at $15k per person. hence a family with 4 members should imho offer $60k off the asking price given that those liabilities are there, just off-the-books. why not bring them to light?
wonder how much these off-the-books liabilities had been inflating asset prices in many different ways. take public employees bidding on REOs, catching falling knives taking for granted their unaffordable pensions will be there for them. take public companies borrowing cheaply to fund their pensions. it's a time bomb that will explode soon imho.
I hate it. Hate it.
"New California Taxes Pay for Pensions, Not Schools"
why do you hate it jason? voters make promises, use services, ... and the bill shows up eventually.
same story is going to happen with the ponzis of SS and Medicare. and the great news is that with FICA at the needed 30%, 2nd earners will be able to opt out from wage earning without much to lose. that's a great subsidy on leisure.
The pension fund obligations are not the result of voter promises. Gov't officials promise big pensions to blocks of unions members in exchange for the block votes, and then saddle the entire tax base with the obligation. It's one big reason why unions don't work in the public sector. It's just a scheme to help some officials get elected using other people's money. FDR warned against the dangers of collective bargaining with unions in the public sector.
>why do you hate it jason? voters make promises, use services, ... and the bill shows up eventually.
I think you are confusing voters who make promises with taxpayers who pay the bill. The groups overlap, but they are not the same.
"why do you hate it jason? voters make promises, use services, ... and the bill shows up eventually."
What a stupid fucking question. I hate that California is so stupid, that is what I hate dummy.
"same story is going to happen with the ponzis of SS and Medicare. and the great news is that with FICA at the needed 30%, 2nd earners will be able to opt out from wage earning without much to lose. that's a great subsidy on leisure."
Bullshit. SS and Medicare are NOT in the same boat. Even when the SS trust fund runs out in 2030, the system will still take in enough money to pay 79% of current benefits - INDEFINITELY! The rate of increase is about nominal GDP. Raising the cap to $150k-$250k and/or increasing the retirement age slightly would erase that shortfall immediately.
Its a typical right wing bait and switch to lump medicare, which does have a large actuarial shortfall, in with SS, which does not and is not growing faster than GDP (which medicare is.)
Further, a Ponzi scheme is where the ratio of payers to payees keeps shrinking, whereas with SS and Medicare, it will stop in about a decade or so.
> SS and Medicare are NOT in the same boat. Even when the SS trust fund runs out in 2030, the system will still take in enough money to pay 79% of current benefits - INDEFINITELY!
wow, stop using dummy assumptions on the key variables. that will help you a lot when it comes to facing reality.
> Further, a Ponzi scheme is where the ratio of payers to payees keeps shrinking, whereas with SS and Medicare, it will stop in about a decade or so.
if you want to stop being delusional, start by assigning realistic values to key variables such as fertility rates, immigration rates, age at which retirees claim benefits will help you out.
also becoming aware that wage increases went nowhere and that your stupid numbers are assuming healthy wage increases going forward can help you out too.
check out immigration that's assumed to help out with population aging. what's the net immigration from mexico 2005-2010? ZERO. that's right dummy... you wouldn't be so delusional if you were intellectually honest about the assumptions you are using.
US fertility rate? basically under-replacement level during the last 30 years and going lower.
If you are still a believer on entitlements, then you are just a math illiterate. Sorry about that!
While Americans are typically earning less than 1 percent interest on their savings accounts and watching their 401(k) balances yo-yo along with the stock market, most public pension funds are still betting they will earn annual returns of 7 to 8 percent over the long haul, a practice that Mayor Michael R. Bloomberg recently called “indefensible.”
Companies now use an average interest rate of 4.8 percent to calculate their pension costs in today’s dollars, according to Milliman, an actuarial firm.
Now public pension funds across the country are facing a painful reckoning. Their projections look increasingly out of touch in today’s low-interest environment, and pressure is mounting to be more realistic. But lowering their investment assumptions, even slightly, means turning for more cash to local taxpayers — who pay part of the cost of public pensions through property and other taxes.
Jeremy Gold, an actuary and economist who has been an outspoken critic of public pension disclosures, said, “If you’re using 7 percent in a 3 percent world, then you’re still continuing to borrow from the pension fund.”
Mr. Bloomberg said during a trip to Albany in late February. “If I can give you one piece of financial advice: If somebody offers you a guaranteed 7 percent on your money for the rest of your life, you take it and just make sure the guy’s name is not Madoff.”
Public retirement systems from Alaska to Maine are running into the same dilemma as they struggle to lower their assumed rates of return in light of very low interest rates and unpredictable stock prices.
They are facing opposition from public-sector unions, which fear that increased pension costs to taxpayers will further feed the push to cut retirement benefits for public workers. In New York, the Legislature this year cut pensions for public workers who are hired in the future, and around the country governors and mayors are citing high pension costs as a reason for requiring workers to contribute more, or work longer, to earn retirement benefits.
but RE will appreciate 10% a year.. so buy RE..lol
another ticking financial bomb for NYC city and surrounding burps
Cash-strapped US states will see the reported shortfalls in their public pension funds grow sharply under new accounting standards likely to be approved on Monday that could add up to $600bn to official estimates of the holes in states’ pension funds.
> another ticking financial bomb for NYC city and surrounding burps
make it for the whole country! i'm very interested in the fact that those that think these promises are payable are used to spending much more than they should ideally. their savings rates for one should be much higher, but also the income to support real estate carrying costs, for example, will not be entirely there.
so in this credit cycle, these bloated promises to boomers and older act like a powerful feedback loop on the way up and also on the way down. entitlements, public and private pensions are liabilities after all, the biggest debt component in our credit-based economy. it's fascinating!!!
Fascinating or frightening
> Fascinating or frightening
my take is fascinating as i think i have room to position well, and i'm not one of those expecting benefits. so from my point of view, this is a roller-coaster on steroids, with one mile high loop that we are about to fall from. so tighten your seat belt! & imho avoid being long anything that's credit-dependent.
I am in a similar position as you, but the masses are not. The implications will be huge and unpredictable
Reminds me of an old quote by GF, " a government that is big enough to give you everything you want s big enought to take everything you have"
Or saying of that ilk
I'm not sure why people are saying that Social Security is going bankrupt considering that it can be permanetly fixed with the stroke of a pen by raising or eliminating the cap on income that subjected to SS taxes. The only people who think SS is borken are those who want to privatize it.
socialist, your views are about as valuable as the houseguest that never leaves.
Or the brother in law that does not pay you back
"I'm not sure why people are saying that Social Security is going bankrupt considering that it can be permanetly fixed with the stroke of a pen by raising or eliminating the cap on income that subjected to SS taxes. "
in part cause "considering that it can be permanetly fixed with the stroke of a pen by raising or eliminating the cap on income that subjected to SS taxes" is simply not true. this issue of measuring how sustainable these pensions and entitlements are reveal how math & finance illiterate the population had become.
they can be staring at a ponzi few inches away and yet claim "but, but... it's just fine! it'll all work out at the end!!!"
>Or the brother in law that does not pay you back
You expect to be paid back by family?
why do you have the need to post under so many different names?
Under how many names do you believe I post?
you tell us.
I should tell you how many names you believe I post under? Well, yesterday you said I post under the names Jim and Lucille. So I guess you believe I post under 3 names.
"Cash-strapped US states will see the reported shortfalls in their public pension funds grow sharply under new accounting standards likely to be approved on Monday that could add up to $600bn to official estimates of the holes in states’ pension funds."
This is fantastic news. The politicians, particularly in NYS, have been playing games buying votes with this money... the public needs to know.
> This is fantastic news. The politicians, particularly in NYS, have been playing games buying votes with this money... the public needs to know.
indeed. they will also need to pay for those shortfalls. imho property taxes will lead the way in terms of funding sources. fun!
They *always* needed to pay for these shortfalls... that hasn't changed. The difference is, there will be transparency, and folks will know of the debts they are building.
But, of course, more property taxes! Great for RE!
notadmin, you are the math-illiterate one. SS will be able to pay at least 79% of current benefits INDEFINITELY if nothing is changed by 2030 or. That is not bankruptcy or ponzi-scheming. That is reality. So the choices are some combination 1) cutting benefits 2) raising the retirement age 3) raising the payroll tax rate 4) raising the income limit of said payroll tax.
Socialist is correct that #4 alone would not only eliminate the problem if made "infinite" - it would in fact give SS a permanent SURPLUS.
#1 by itself would mean exactly that - everyone would just get 21% less.
#2 by itself would mean raising the age to above 70.
#3 - you could actually do the OPPOSITE of #3 if you did #4 - by raising the income limit, you could LOWER the rate and still balance things out.
If you did both #2 & #3, you could lower the rate further.
People like you like to conflate medicare, which IS in trouble, with SS, which is not.
> SS will be able to pay at least 79% of current benefits INDEFINITELY if nothing is changed by 2030 or
based on what? ah yeah... like i think i already told you, unrealistic assumptions. go ahead, your math should be enough given that's not rocket science if you finish high-school. change those assumptions for realistic ones and tell me what's in store.
hey, actually, i don't want to convince you. if you like the system go ahead and contribute as much as you can. even send some donations, i bet they accept those.
> People like you like to conflate medicare, which IS in trouble, with SS, which is not.
people like me are not lazy enough not to go to the reports, see the scenarios, whether they are realistic, adjust and do the math right. so far baby i got it right each single year! yep, that's right, it's that easy. no surprise for me each year they adjust when the system cannot deliver or whether it's in red.
i mean, it's THAT easy! it wasn't even time consuming. but hey, like i said, the more resources to pour into that ponzi, the less you compite with me for real assets, so go ahead :-)
"based on what? ah yeah... like i think i already told you, unrealistic assumptions."
The non-partisan CBO. Its not too difficult to see what they base this upon. Everything else you write is nut job conspiracy BS.
> "based on what? ah yeah... like i think i already told you, unrealistic assumptions."
The non-partisan CBO. Its not too difficult to see what they base this upon.
exactly. adjust their least rosy scenario to reality, if you dare :0-). anyway, we both know you will not do it, and instead keep on contributing as much as possible cause you will be getting such an awesome deal!!!
> Everything else you write is nut job conspiracy BS.
i don't blame your ignorance. SS/medicare and pensions are discussed with the religious fervor that housing was once upon a time.
No, you idiot. MEDICARE, as I said, is in trouble. SS is not. You are the zealot on this.
Anyway, back to the actual topic:
"Mediation Fails, Pushing Stockton Toward Bankruptcy"
question, is pension income taxed as regular income?
question, is rent subsidy taxed as regular income?
> No, you idiot. MEDICARE, as I said, is in trouble. SS is not. You are the zealot on this.
just cause i know how to adjust variables that matter to a range that reality can deliver? get a life, if you like it, keep it! why would i care?
i'm out cause i realize it has a ponzi structure and i'm not into ponzis. you are buying into projections that are not realistic. just like when young boomers think their pensions are just fine cause there's this 8% annual return they will deliver. am i going to convince them about not believing in it? what for? it's their choice.
accepting what the CBO assumes is for wishful thinkers like you, not for reasonable people. did it take you by surprise that there has been nill to negative immigration from mexico since 2005? it didn't surprise me 1 iota. did it surprise you that we have high youth unemployment? it didn't surprise me at all. are these 2 key variables being accurately reflected in the projections you accept as "reasonable"? of course not! there's been no real wage increases during the last 30 years... but wait, given that boomers are retiring and SS needs funding CBO will assume that there will be real wage increases. do you know what "reverse engineering" means? it's done so people like you don't freak out and instead promote this ponzi in blogs like this one.
being young it just doesn't work for me, and also i have a "no ponzi" policy. maybe you don't like that expression of freedom? if you care about us joining the system in earnest, work making it as good a deal for the young as it's for those retired right now.
>> No, you idiot. MEDICARE, as I said, is in trouble. SS is not.
21% shortfall isn't "in trouble"? What is the threshold? 40%
"San Bernardino third California city to seek bankruptcy"
I guess this is is how it will end up being solved. California, ironically, is leading the nation in fixing the pension problem as cities go bankrupt one by one and forcibly lower them. Not pretty.
The city of Scranton, Pa., sent out paychecks to its employees Friday, like it does every two weeks. But this time the checks were much smaller than usual. Mayor Chris Doherty has reduced everyone's pay — including his own — to the state's minimum wage: $7.25 an hour.
> "San Bernardino third California city to seek bankruptcy"
> I guess this is is how it will end up being solved. California, ironically, is leading the nation in fixing the pension problem as cities go
> bankrupt one by one and forcibly lower them. Not pretty.
imho defaults are the only way to adjust all main costs (housing, education, entitlements, pensions) to what young working families can afford to support. it's a big adjustment, but it has to happen given that big real wage increases will not materialize any time soon.
Bankruptcies are a wonderful part of our economic and legal system, just as forest fires are an important part of nature. Screwing with them, like Obama did in Detroit, creates bigger disasters down the road.