Why Employee Pensions Aren't Bankrupting States

Washington - From state legislatures to Congress to tea party rallies, a vocal backlash is rising against what are perceived as too-generous retirement benefits for state and local government workers. However, that widespread perception doesn't match reality.

A close look at state and local pension plans across the nation, and a comparison of them to those in the private sector, reveals a more complicated story. However, the short answer is that there's simply no evidence that state pensions are the current burden to public finances that their critics claim.

Pension contributions from state and local employers aren't blowing up budgets. They amount to just 2.9 percent of state spending, on average, according to the National Association of State Retirement Administrators. The Center for Retirement Research at Boston College puts the figure a bit higher at 3.8 percent.

Though there's no direct comparison, state and local pension contributions approximate the burden shouldered by private companies. The nonpartisan Employee Benefit Research Institute estimates that retirement funding for private employers [...]

Full article at truth-out.org

Thanks, Jennifer. :) While I'm all for 'reform', which I wish could instead be looked at as 'modernization' or 'evolution', in education, and while I wish unions weren't necessary to ensure that educators were given their due, we'll make better decisions all the way around if we look at the facts (as this article does) and realize that no matter what's 'not wrong' - the, 'it's fine the way it is' argument - what's important is what's not right and more specifically what we can do to rectify those things, as well as where things could just be better.

I like this point especially, "States having the biggest problems with pension obligations tend to be struggling with overall fiscal woes [...] Many states are now wrestling with underfunding because they didn't contribute enough during boom years." Huh. Imagine that. And suddenly just like that it looks a little better to some to stop placing blame and start dealing with the issues. Funny how quickly a little transparency shifts our focus. (They say that at nudist retreats people tend to look you in the eye. :))

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