Friday, May 15, 2015

Public Pensions...and Ultrarunning

Here in Pennsylvania, we have a public employees pension "problem."  Translation: the state says it doesn't have enough money to continue to pay its retirees.

Seems that state employee retirees and public school employees, who share a common retirement system, were long the targets of the just-ousted Tom Corbett administration, who pushed hard for "pension reform."  Basically they underfunded the pension fund for years and now they say, with a totally straight face, mind you: "There's just not enough money.  So we gotta cut benefits.  Oops, and sorry!"

Nevermind that employees worked their whole careers with the expectation that a certain promised annuity awaited.  "Nope, sorry, folks, we promised too much and now we gotta scale things waaaay back."

I am eagerly waiting to see how our new governor, Tom Wolf (D) will deal with this funding situation (I do have high hopes).

The situation here has parallels in the great state of Illinois.  Let me quote extensively from a great blog post at First Draft:

At issue was a December 2013 state law signed by then-Democratic Gov. Pat Quinn that stopped automatic, compounded yearly cost-of-living increases for retirees, extended retirement ages for current state workers and limited the amount of salary used to calculate pension benefits.
Employee unions sued, arguing that the state constitution holds that pension benefits amount to a contractual agreement and once they’re bestowed, they cannot be “diminished or impaired.” A circuit court judge in Springfield agreed with that assessment in November. State government appealed that decision to the Illinois Supreme Court, arguing that economic necessity forced curbing retirement benefits.
On Friday the justices rejected that argument, saying the law clearly violated what’s known as the pension protection clause in the 1970 Illinois Constitution.
“Our economy is and has always been subject to fluctuations, sometimes very extreme fluctuations,” Republican Justice Lloyd Karmeier wrote on behalf of all seven justices. “The law was clear that the promised benefits would therefore have to be paid and that the responsibility for providing the state’s share of the necessary funding fell squarely on the legislature’s shoulders.
“The General Assembly may find itself in crisis, but it is a crisis which other public pension systems managed to avoid and … it is a crisis for which the General Assembly itself is largely responsible,” Karmeier wrote.

That was the background.  The post then goes on to comment:

RIGHT?! You can’t just decide that okay, here’s a contract we want to void, so … fuck it. That’s the whole POINT of a contract, is to prevent that. Legislators want to get pissy because unions had the foresight to realize people would try to screw them over, and insisted on contracts to protect against that? SORRY NOT SORRY. Way to prove the SEIU’s point, shitbirds.
And don’t throw fiscal responsibility in my face. I don’t know what is fiscally responsible about breaking contracts. If the state’s word isn’t good, that should give everybody pause. The state promises things to entities public and private all the goddamn time, including subsidies to corporations to relocate and create jobs. Everyone has to trust that their agreements will be honored, even when things get rough for some of Springfield’s cocktail party attendees.

Amen! says Gary.

The whole situation can be thought of as a 100 mile race.  At great length and after great personal effort, you, the Ultrarunner, approach the finish line...only to find a sanctimonious race official telling you that, sorry, we measured wrong and the race is actually longer than you were told.  And there will be no more aid stations because we didn't budget for them.  Oh, and there will be no T-shirt or finisher's belt buckle, again because we can't afford it.

The race budget is broke.  You'll surely understand.

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