Conservatives have had their sights on public-sector workers for a while and for good reason. Public-sector workers represent two favorite targets: organized labor and government. I am a public-sector employee and union member, so I can’t help but take these attacks and struggles personally. I am also a veteran of the welfare “reform” battles of the 1990s, and the debates over public-sector workers are strikingly similar.
Like welfare moms, public-sector workers have been painted as greedy [fill-in-the-blank barnyard animals], feeding from the public trough and targeted as the primary source of what’s wrong with government today.
Like 1990s welfare-reform debates, this one is dominated by more fiction than fact. For example, previous and recent research consistently shows public-sector workers actually earn less than private-sector workers with comparable skills and experience. While many, but not all, public-sector workers who work long enough for the public sector have a defined-benefit pension, the unfunded portions of those pensions are often due to bad state policy, not union negotiations.
In some states, like my own, Massachusetts, current workers are paying most of their pension costs through their own contributions into interest-bearing pension funds. Because state and local governments with defined pensions do not contribute to social security, there are currently cost savings. The upshot is that the cost of pensions may not be as high as some are arguing.
It is true that health-insurance costs for current retirees are expensive and worrisome. But this is because of the rising costs in private health insurance. Making workers pay more for their health-care benefits will erode the compensation base of public-sector workers, but it won’t get at the real problem of escalating health-care costs.
During the welfare debates, one of the arguments used to justify punitive legislative changes was spun around the fact that welfare moms who did get low-wage employment could also get child-care assistance—while other moms could not. Sound familiar? Public-sector workers do have employer-sponsored benefits many private-sector workers no longer get. But benefits haven’t improved in the public sector over the last 20 years; indeed most public-sector workers are paying more for the same benefits.
Over the same period, many private-sector workers have been stripped of their employer-provided benefits even as profits have soared. Instead of asking why corporate America is stripping middle-class workers of decent health-care coverage and retirement plans, the demand is to strip public-sector workers of theirs.
The new Cadillac-driving welfare queens are the handful of errant politicians who game the pension system and a few highly paid administrators getting handsome pensions. Sure they exist, but are hardly representative. The typical public-sector worker is a woman, most often working as a teacher, secretary or social worker. Women comprise 60% of all state and local workers (compared to their 47% representation in the private work force). And those three occupations make up 40% of the state and local work force.
Shaking down public-sector unions may make some feel better about solving government fiscal problems, but the end result will be more lousy jobs for educated and skilled workers. It will also not stem the red ink that is causing states to disinvest in much-needed human and physical infrastructure with budget cuts. But eroding wages and benefits combined with public-sector bashing will send a very loud market signal to the best and brightest currently thinking about becoming teachers, librarians, or social workers to do something else.
Wisconsin Governor Scott Walter is leading the attack on public-sector workers today. In the 1990s it was another Wisconsin governor, Tommy Thompson, who was a leader in demanding and implementing punitive changes to his state’s welfare system. His plan became a model for the rest of the states and federal welfare legislation in 1996. Then there were horror stories and welfare bashing, but not much in the way of discussing the real issue of decent paying jobs that poor and low-income mothers on and off welfare needed to support their families. The main result of welfare reform was the growth in working-poor moms.
There is one important difference. Public-sector workers, unlike welfare moms, have unions and a cadre of supporters behind them.
By: Randy Albelda, CommonDreams.org, May 12, 2011
May 12, 2011
Posted by raemd95 |
Class Warfare, Collective Bargaining, Conservatives, Deficits, Economy, GOP, Gov Scott Walker, Government, Health Care, Jobs, Lawmakers, Middle Class, Politics, Public, Public Employees, Republicans, Social Security, State Legislatures, States, Teachers, Union Busting, Unions, Wisconsin, Women | Defined Benefits, Employers, Organized Labor, Pension Costs, Pensions, Politicians, Private Sector, Secretaries, Social Workers, Teachers, Wages, Welfare, Welfare Reform |
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Wisconsin’s budget may be in a hole, but the state’s pension system is among the healthiest in the nation.
In fact, the Badger State was one of just two states to fully fund its public employee pension in 2009, according to a report released Tuesday by the Pew Center on the States. New York was the other.
Although nationally there was at least a $1.26 trillion gap in 2009 between what states have promised in public employee retirement benefits and what they have set aside, Wisconsin stands out as a leader in managing its liabilities for both pension and health benefits over the long term, the Pew report concluded. The shortfall is 26 percent greater than it was in 2008.
Pew researchers attribute the gap to unwise decisions by retirement benefits fund officials and the Great Recession that whacked pension fund investments. In all, 31 states were below the recommended 80 percent funding level for their pension plans in 2009, compared with 22 states that fell short of that threshold the previous year.
“Over the last decade, it was all too common for state leaders to skip or shortchange their annual retirement contributions and increase retiree benefits without checking the price tag or figuring out how to pay the larger, long-term bill,” said Susan Urahn, managing director for the Pew Center on the States. “Now, policymakers in many states are taking a long overdue look at how they have managed, or failed to manage, the considerable costs for public employees’ retirement benefits. Even in states like New York and Wisconsin, where pension systems are well-funded, governors have sought policy changes aimed at reducing their pension liabilities.”
The report was released at a time when Wisconsin sits at the epicenter of state budget battles across the country as governors are focusing on public employee benefits to cut costs and balance budgets. Wisconsin Gov. Scott Walker ignited a firestorm with his “budget repair” proposal that strips public employees of many of their collective bargaining rights and requires them to contribute more of their income toward their retirement benefits. Several states followed with similar proposals, fueling a debate over the role of pension systems in the financial crisis in the states.
At a Capitol Hill forum Tuesday sponsored by the American Action Forum, a conservative think tank, the consensus among panelists was pensions are not to blame for states’ fiscal woes. One panelist, Eli Lehrer, vice president of the Heartland Institute, said given the health of Wisconsin’s pension fund, Walker would be wise to focus his budget balancing effort elsewhere.
“The pension system in Wisconsin is fully funded,” Lehrer said. “As a budget focus, I think he’s better off expending his political capital somewhere else.”
Andrew Biggs, a pension expert at the American Enterprise Institute, said just because Wisconsin’s pension fund is solvent doesn’t mean it should be off-limits.
“It could be well-funded and still be a drain on the budget,” Biggs said.
Pew researcher Stephen Fehr said retirement benefit costs for all states continue to rise, and while states like New York and Wisconsin should be commended for maintaining their funding obligations amid hard times, they face financial strains.
“They don’t have a pension crisis, but on the other hand they do have some pressures as all states do when it comes to figuring out how do we pay our bills,” Fehr said.
New York and Wisconsin have fulfilled their pension fund obligations regardless of the economic times, Fehr said.
By: Larry Bivins, Greenbaypressgazette.com, April 27, 2011
April 28, 2011
Posted by raemd95 |
Collective Bargaining, Gov Scott Walker, Governors, Politics, Public Employees, States, Wisconsin | American Action Forum, Health Benefits, New York, Pension Funds, Pensions, Retirement Benefits, State Budgets |
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If there’s a better government program than Social Security, I’d like to know what it is. It has gone a long way toward eliminating poverty among the elderly. Great numbers of them used to live and die in ghastly, Dickensian conditions of extreme want. Without Social Security today, nearly half of all Americans aged 65 or older would be poor. With it, fewer than 10 percent live in poverty.
The Center on Budget and Policy Priorities tells us that close to 90 percent of people 65 and older get at least some of their family income from Social Security. For more than half of the elderly, it provides the majority of their income. For many, it is the only income they have.
When you see surveillance videos of some creep mugging an elderly person in an elevator or apartment lobby, the universal reaction is outrage. But when the fat cats and the ideologues want to hack away at the lifeline of Social Security, they are treated somehow as respectable, even enlightened members of the society.
We need a reality check. Attacking Social Security is both cruel and unnecessary. It needs to stop.
The demagogues would have the public believe that Social Security is unsustainable, that it is some kind of giant contributor to the federal budget deficits. Nothing could be further from the truth. As the Economic Policy Institute has explained, Social Security “is emphatically not the cause of the federal government’s long-term deficits, since it is prohibited from borrowing and must pay all benefits out of dedicated tax revenues and savings in its trust funds.”
Franklin Roosevelt couldn’t have been clearer about the crucial role of the payroll taxes used to finance Social Security. They gave the beneficiaries a “legal, moral and political right” to collect their benefits, he said. “With those taxes in there, no damn politician can ever scrap my Social Security program.”
There has always been feverish opposition on the right to Social Security. What is happening now, in a period of deficit hysteria, is that this crucial retirement program is being dishonestly lumped together with Medicare as an entitlement program that is driving federal deficits. Medicare costs are a serious problem, but that’s because of the nightmarish expansion of health care costs in general.
Beyond Medicare, the major drivers of the deficits are not talked about so much by the fat cats and demagogues because they were either responsible for them, or are reaping gargantuan benefits from them, or both. The country is drowning in a sea of debt because of the obscene Bush tax cuts for the rich, the wars in Afghanistan and Iraq that have never been paid for and the Great Recession.
Mugging the nation’s grandparents by depriving them of some of their modest, hard-earned Social Security retirement benefits is hardly an answer to the nation’s ills. And, believe me, those benefits are modest. The average benefit is just $14,000 a year, which is less than the minimum wage would pay. With employer-provided pensions going the way of the typewriter and pay telephones, the income from Social Security is becoming more precious by the day.
“If we didn’t have Social Security, we’d have to invent it right now,” said Roger Hickey, co-director of the Campaign for America’s Future. “It’s perfectly suited to the terrible times we’re going through. Hardly anyone has pensions anymore. People’s private savings have taken a huge hit, and home prices have been hit hard. So the private savings that so many seniors and soon-to-be seniors have counted on have just been wiped out.
“Social Security is still there, and it’s still paying out retirement benefits indexed to wages. It’s the one part of the retirement stool that is working.”
The deficit hawks and the right-wingers can scream all they want, but there is no Social Security crisis. There is a foreseeable problem with the program’s long-term financing, but it can be fixed with changes that do no harm to its elderly beneficiaries. One obvious step would be to raise the cap on payroll taxes so that wealthy earners shoulder a fairer share of the burden.
The alarmist rhetoric should cease. Americans have enough economic problems to worry about without being petrified that their Social Security benefits will be curtailed. A Gallup poll taken recently found that 90 percent of Americans ages 44 to 75 believed that the country was facing a retirement crisis. Nearly two-thirds were more fearful of depleting their assets than they were of dying. The fears about retirement are well placed — most Americans do not have enough to retire on. But there should be no reason to believe that Social Security is in jeopardy.
The folks who want to raise the retirement age and hack away at benefits for ordinary working Americans are inevitably those who have not the least worry about their own retirement. The haves so often get a perverse kick out of bullying the have-nots.
By: Bob Herbert, Op-Ed Columnist, The New York Times, January 24, 2011
January 26, 2011
Posted by raemd95 |
Social Security | Benefits, Deficits, Economic Policy Institute, Medicare, Pensions, Poverty, Retirement, Right Wing, Seniors, Taxes |
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