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Pensions Aren’t the Problem for State Budgets
This is a crosspost by AFSCME Secretary-Treasurer Lee Saunders from Huffington Post.
Rupert Murdoch’s Wall Street Journal, the Pravda of the 1 percent, is at it again, continuing its push to gut the retirement security of millions of middle class workers across the country while enriching the Wall Street moneymen who just three years ago took our economy over the cliff.
Virtually everyone agrees that our nation faces a retirement security crisis, but the Journal last week published a shameful op-ed calling for the elimination of pensions for nurses, firefighters, corrections officers and others who still have them. Having punched private-sector workers retirement in the gut, these folks won’t be happy until the whole concept of a secure retirement for working Americans is a thing of the past.
The typical AFSCME member — men and women who plow our streets, care for the sick, protect our children, clean our buildings and keep our communities safe — receives a pension of approximately $19,000 a year after a career of public service. The employees have earned and paid for these pensions. Employee contribution rates commonly amount to 3 percent to 10 percent of their paychecks. These contributions, combined with investment earnings, usually account for 75 percent or more of all pension benefit funding.
The economy’s collapse in 2008-2009 took its toll on everyone’s retirement savings. But our nation’s public pension systems, which were fully funded before the crash, continue their robust recovery earning their highest returns in decades in fiscal year 2011. Pensions continue to provide irreplaceable retirement security to millions of Americans who provide public services. Yet, the corporate-backed
opponents of pensions are creating a myth that the system is falling apart and that state and local governments are going bankrupt because of the $19,000 pensions sanitation workers are earning.
That is simply not true. According to the Center for Economic and Policy Research, the size of the projected state and local government pension funding shortfalls is manageable. In most states, the total shortfall for the pension funds is less than 0.2 percent of projected gross state product during the next 30 years. Even in states with the largest shortfalls, the gap is less than 0.5 percent of projected state product during that period. And, because pension payments are made over generations of workers,
funding can remain stable over long periods, and funding challenges managed over decade long periods, despite short-term economic setbacks. These are facts that the opponents of public pensions simply ignore, as they seek to punish workers for Wall Street’s psychopathic behavior.
Read the full post here.
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11 Comments
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Another right wing lie.
http://www.forbes.com/sites/rickungar/2011/02/25/the-wisconsin-lie-exposed-taxpayers-actually-contribute-nothing-to-public-employee-pensions/
Lee Saunders writes a clear, concise, well-thought-out and knowledgeable article about what is really going on.
Lee Saunders’ explanations are NOT what any of us would hear from Establishment infiltrator O’Bam-ya.
If we are to counter the Repugnant mafia cult Partisans, then we must use the logic and historic truths that Lee Saunders has presented to us. His is the example of how we must focus our activist efforts at resurrecting the entire ideal of Democracy, whereas, the Repugnants always say “This is not a Democracy, this is a Republic” and the Repugnants are right… far right… because a Republic IS NOT A DEMOCRACY!
the problems is that taxes are not enough to pay for the benefits.
Pensions are not funded by tax dollars. They are funded by the employees themselves through deferred payment programs; much like 401k’s.
what you need is more taxes or less government . I am for less government.
You’ve already been countered on that so many times that nobody cares what you want, Anus-throat.
What’s needed is to Replace the entire 535 members of Congress and screen all new possible replacements and have each sign a contract giving the American people the authority to sell their assets should they be found guilty of misrepresenting “we the people” by a Jury selected by American working people. This is NOT unreasonable considering the damage our current Congress has done.
We have a smaller government then bush administration.
The problem is we have to many republicans and right wing conservatives who want to ram their neonazi agendas down our throats. They want to privatize everything for profit and take away democracy from working people. Maybe if they would stop outsourcing jobs these states would realize that they are losing taxes to support their programs.
I am for private take overs. The government has a soon to be 16 trillion deficit. They prove cannot run anything right.
Yes you are right the republicans can’t run things right. George w put us in a hole alright. He had a $236 billion surplus and put us trillions in debt. You want things privatized you need your head examined. Then everything would be ran like insurance and corporations.