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US Cities Face Pension Fund Crisis

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Mary Jander
Mary Jander  
12/19/2013 11:40:21 AM
User Rank Staff
Re: At loggerheads
Points taken, Terry. One problem with the pension fund situation is the politicization of the issues, which makes both sides dig in deeper. It's not a helpful approach. IMO, we need to detoxify the issue by taking ideology out of it.

clientsideart
clientsideart  
12/3/2013 12:49:31 PM
User Rank Village Voice
30yr employees retire w/ million
 i worked city,county,state government...i see spike pensions..they hire each other while collecting...rampant insiders cover for each other...you read in paper one who get caught...the other 70% never get caught...i asked a boss dept. head ...he said" aHH AHH HA ha  ahhha hha hhahha.

Resurgent phoenix
Resurgent phoenix  
11/30/2013 11:17:07 AM
User Rank City Slicker
Pensions shortsightness
Public Pensions in 2013, so much went wrong.  One thing was the governments saw this big pot of money and thought is was undestroyable.  They were scheduled to make regular contributions and did not, pushing it too the next elected official.  Secondly, where I live the population working for the City government went from 20,000 employees to around 9,000 employees.  Even though salary and wages are larger the 9000 cannot contribute enough to support the more than 10,000 who are retired and collecting pension.  If we had continued to grow we would not have a problem with pension.  If governments had made the scheduled contributions timely the conversation would be different.  There is a long list of how we got here and how to move forward.  There is a quote, "When you get to Attorneys in the room they should not agree or there is not need for one of them"  They definitely are making decisions today about how to deal with the pension problem that may bring massive litigation in the future.

Terry Sweeney
Terry Sweeney  
11/29/2013 12:49:44 AM
User Rank Blogger
At loggerheads
This is exactly the issue that Wisconsin Gov. Scott Walker took on a couple years ago, except it was for state employees, not municipal personnel. His politicization of the issue (during a presdiential election cycle) led to a standoff with the state legislature, which as far as I can tell, remains largely unresolved. Also absent in Mary's report is any mention of the way unions hobble the discussion or impede its resolution. There's clearly a problem here, and neither side wants to budge from positions that are untenable over the long term.

kq4ym
kq4ym  
11/26/2013 8:49:10 AM
User Rank Urban Legend
Saving For A Rainy Day
Most of us just are not great at saving today for future gain. And add politicians and bureacuracies to the mix, and things get very bad over time. Hoping that cities can manage their pension funds over many decades is probably foolhardy. Predicting the future and the temptation to overspend or be overly optimistic just works against the long term plan of funding retirement income.

bulk
bulk  
11/26/2013 2:23:16 AM
User Rank Urban Legend
Re: Extra taxes
@Venks, 

Taxes themself are not enough for most of these cases. The bottom line is that the belt needs to be tightened at the same time that some taxes have to go up. 

Venks
Venks  
11/25/2013 9:10:29 PM
User Rank Urban Legend
Extra taxes
Thanks for the article, Mary. I think, I liked the the approach favoured by Chicago Mayor. We will have to look at many more such things from where money could be generated. For example. extra taxes on goods which are very expensive (read as ultra luxury items), cigarettes, alcohol etc. Policies have to be framed keeping in mind that common people/poor does not suffer whilst rich would feel the heat.

Mary Jander
Mary Jander  
11/25/2013 1:06:14 PM
User Rank Staff
Re: cities and their unions
Good points, hfreeman17. It's one thing to have policies that a city can deliver on, but if those policies aren't deliverable, nothing but trouble ensues. If public/private partnerships can alleviate outsized promises and the bitterness that follows (not to mention the alarming indebtedness), that model is worth pursuing.

hfreeman17
hfreeman17  
11/25/2013 12:07:18 PM
User Rank Urban Legend
cities and their unions
Such a huge issue. Thanks for writing about it, Mary.  Recently, we all read that Mayor Bloomberg balanced next year's budget for Mayor-elect de Blasio, but of course it doesn't address pay raises, and Bloomberg is leaving a lot of contracts on the negotiating table.

Further, the pay policies are often out of whack. A friend who worked a union job recently told me he'd get time and a half for evening work and double pay for working holidays.  Not that a city/etc. doesn't need to incentivize people to work past their 9-5, but this institutional policy and worker posture can break an operating budget quickly.  That and quaint, Tammany-hall-era notions like preferential hirings based on seniority the way we parents saw in the school bus strike earlier this year.  That alone cost us $600 out of pocket, unreimburseable.

Too many cities are still beholden to 19th century workplace relationships, where negotiations for current and deferred pay break both the budget and also promises down the road.

I think a lot of services should be privatized.  Or, like many parks and public spaces here in NYC, should be a private non-profit/public partnership (Central Park Conservancy; Bryant Park Corporation, etc.).

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