POWIP Piece of Work In Progress – Former Abode of Dan Collins

Public Pensions, Finance, and Union Spew 5 May 2011

Cinco de Mayo!!!!!

WOOOOOOO!!!!!

And you know what's the perfect thing to kill the party spirit -- yeah! DOOOOOOOOOOOOOM!!!!!

Okay, kick it.

UNIONS AND THEIR FRIENDS

Washington Examiner opinion piece -- Abuses Happen When Unions Have Government Friends.

A letter: public employees are just like you. Yes, when I screw up majorly, I get protected from firing and I can retire with a DB pension in my mid-50s. Just like me. Oh, and I can opt out of Social Security. There are services that perhaps should be controlled directly by the government, but it seems to me that much of this stuff can be outsourced to private companies, just as my company outsources its payroll operations, for example. If the public employees are just like the private ones, seems like if the private ones are cheaper, it's in my interest as a taxpayer to get the cheaper one that gives me the same service.

Way to shoot yourself in the foot, dipwad.

Want to see other ways public employees are just like you? Just check out the various perks some get, like million-dollar home loan concessions.

BOOMER (NON-)RETIREMENT TWADDLE

Sure, one of these things is not like the other, but thought I'd throw it in here. A too-precious NYT review of a book on the "encore stage" for Boomers. For we Xers, this is the "dammit, do we have to get out the hook to yank them off the stage?" stage.

FINANCE SINKING US ALL

Steve Forbes on middle class tax hikes to bailout public pensions. And you can't tax the rich because 1. there's not enough of them and 2. the middle class has more money, collectively.

PENSIONS ON THE WHOLE

Just a note -- we've been seeing a lot of public pension fund managers leaving to go into the private sector. HMMMM. You think they know something? I think what they know is that the private sector pays more, is less political, and is actually a lot lower-profile.... especially as some ugly financial battles are upcoming.

On the Pew report on public pensions: state pension gap continues to grow.

CALIFORNIA

John Dickerson at YourPublicMoney.com has been detailing the failure of public financial management in Mendocino County. Check out his latest issue (currently on the three levels of financial problems - how, once the county got into debt, it wasn't dealt with... my never heard anything like that before.)

California employees trying to defend their "modest" benefits. Thing is, guys - if it's $1,000 for 1,000 people, that's $1M. A lot of little "modest" benefits can add up, and if proper provision is not made, even "modest" benefits can be unaffordable. And here's the kicker: something can look like a small amount of money, but if it's going to be paid out monthly over a period of 40- 50 years.... and inflation-adjusted.... yeah.

Interesting: a councilman requests a legal analysis of San Bernadino's pension obligations, which the council as a whole rejects. But as some of the councilmen note, it's becoming a squeeze between current services and benefits paid for past services.

Now is not the time for a $4-million retirement package. Dude, you picked a poor time to be in the public sector.

That said, politicians look out for their own as they nix a proposal to yank benefits from corrupt officials. Hey, =they= could be those corrupt officials in the future!

DELAWARE

Governor signs bill that requires employees to contribute more to their pension and health benefits.

FLORIDA

More modest pension reform bill sent to the governor.

GEORGIA

The case of the missing pension docs

ILLINOIS

Public employee unions trying to make PR case to avoid getting hit by budget cuts. Here's a thought -- let taxes be raised just on you guys to cover the expense, and you don't get cut! I'm all about the win-win.

And here are the unions trying to protect their pensions. Guys, you should've thought of that when the pension obligation bonds were being issued instead of real contributions being made. Blog post on this from Capitol Fax. It looks like this will be a very interesting legislative season in Illinois.

Oh look what ex-mayor Daley is up to: dumping all his pensionable service into one bucket. Read the comments on the story for some fun. A Daley spending any time off the public teat? You must be joking. Special extra bonus Daley puke: Daley's farewell speech.

One of the worst pension funds in the country -- Illinois Teachers Retirement System. Always been in crappy financial position...follow the timeline from 1973 (before I was born).

KANSAS

In current negotiations, a 401(k)-style pension option for state employees is off the table. Lots of negotiations ongoing, stalls, etc.

MICHIGAN

Mayor Bing of Detroit has unveiled his deficit-cutting plan. Changes to retirees benefits (medical and pensions) are a big part of this plan. More on Detroit budgeting.

NEW HAMPSHIRE

Negotiations are ongoing in the state legislature over pension reform. (I know, I know... exciting!) The House is cramming its bill with all sorts of reform measures that the Senate has rejected (ain't that the way). This part is unlikely to pass, but this is the most intriguing reform measure I've heard of:

The House added two controversial items to the Senate bill. One would punish public workers if unions sue over the reform, forcing them to absorb a major hike in their pension contribution rate they take a challenge goes to court. Opponents have called it a “poison pill” clause. If employers challenge the reform, there would be no similar penalty.

NEW JERSEY

A very short video courtesy of John Bury and a recent actuarial meeting - don't worry, no scary number-crunching, though it is scary. Here is a key exchange:

John Bury says: "What tools do the actuary need or should the actuary have to handle New Jersey?"

NASRA's Keith Brainard: "New Jersey would make a terrible place to make a pension policy"

....
Mr. Brainard ended his response to my question by saying:
“We get the government we deserve and New Jersey voters ought to stand up and demand better.”

[Dan, if you could embed the video, that would be great]

Yes, the voters of NJ got the government they deserve good and hard.

Of course, who am I (New Yorker ... BY CHOICE... to talk).

OKLAHOMA

Legislators approve plan to require pension cost-of-living adjustments to be funded. You'd think that would already be required, but you'd be wrong. Many COLAs are "funded" by being amortized over a very long period... and the person who received the bump may be long dead while the benefit is still being paid for. Yay. An opinion piece approving of the move.

RHODE ISLAND

News flash: fixing the pensions may mean CHANGING THE BENEFITS! whoa. Never thought of that. (yes, and this includes current employees.... and though she doesn't say it explicitly, current retirees.) More from the state treasurer on this issue.

Criminal investigation of a disability pension being paid to a firefighter - looking into whether it's fraud. Fun factoid: accidental disability pensions such as this on make up more than half the pension payments the Providence FD makes this year -- almost 60%, in fact.

WASHINGTON

Even in Washington State, double-dipping isn't looked upon kindly.

WEST VIRGINIA

After Pew released its updated report on state pensions this year you're going to see more of these stories as each state sees where it falls out. And West Virginia gets to shout We're #2! We're #2!

CANADA

There was an election in Canada recently, and a bunch of MPs (not me!) lost their jobs. But don't worry about them! They've got cushy pensions to fall back on. No, really, they'll be okay.