Author Topic: Blue-collar pensions also failing  (Read 2567 times)

MillCreek

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Blue-collar pensions also failing
« on: July 20, 2017, 10:08:03 AM »
http://www.cbsnews.com/news/slashed-pensions-another-blow-for-heartland-workers/

It is not just the governmental pension plans that are struggling. 



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Quote from: Angel Eyes on August 09, 2018, 01:56:15 AM
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just Warren

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Re: Blue-collar pensions also failing
« Reply #1 on: July 20, 2017, 02:43:39 PM »
I'm getting the idea that pensions are just a bad idea.

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HankB

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Re: Blue-collar pensions also failing
« Reply #2 on: July 20, 2017, 05:59:53 PM »
When I read about stuff like this, I start thinking that it's time to pick up torches and pitchforks to have a little talk with the pension managers, union bosses, and politicians who agreed to, set up, and managed these pensions without funding them properly, knowing full well the promises made couldn't be kept . . . and maybe oil up le Guillotine.
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Ben

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Re: Blue-collar pensions also failing
« Reply #3 on: July 20, 2017, 06:04:42 PM »
This is just another reason why I want 401K and IRA limits massively increased. Let me invest for my own damn retirement. I'll (and everyone else can) be responsible for saving for retirement, or blowing the money and camping under a bridge at 65. Personal responsibility.

Eliminating pensions would also allow larger employers that currently have both pensions and 401Ks to match more money into the 401Ks. It would be way cheaper for them in the long run.
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Scout26

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Re: Blue-collar pensions also failing
« Reply #4 on: July 20, 2017, 08:20:46 PM »
I remember back in the late 1990's when I worked for Airborne Express and all the drivers were Teamsters.  They always gloated about what their pensions would be....


Then came the (near) insolvency (after a bunch of fraud and theft), and pensions were cut anywhere from 30-50% (or more in some cases).   In fact, I'd have to go check, but I think they've been cut several times as the pension does not have the money to pay both current and future retirees.  IIRC, it would go broke in 3-5 years.  

Article is three years old, but I don't think much has improved.

http://www.chicagobusiness.com/article/20141206/ISSUE01/312069985/employers-woes-push-union-pension-plans-to-collapse
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sumpnz

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Re: Blue-collar pensions also failing
« Reply #5 on: July 20, 2017, 11:38:05 PM »
I get a pension where I work.  It tops out at basically 35% of your best 5 years average pay.  Not many private sector companies left with even that for a pension.  Supposedly pretty healthily funded too, if the ERISA statements each year can be believed.

The pension was a factor in my decision to decline a job offer a few years ago.  Not the main factor, by a long shot, but it was a factor.  I've calculated that to replace the income from that pension I'd need to save an extra $6-7k per year in a 401k/IRA. 

dogmush

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Re: Blue-collar pensions also failing
« Reply #6 on: July 21, 2017, 12:56:25 AM »
This is just another reason why I want 401K and IRA limits massively increased. Let me invest for my own damn retirement. I'll (and everyone else can) be responsible for saving for retirement, or blowing the money and camping under a bridge at 65. Personal responsibility.

That only work if a society is willing to let old folks camp under a bridge.  We've shown pretty clearly that we are not willing to do that.

MechAg94

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Re: Blue-collar pensions also failing
« Reply #7 on: July 21, 2017, 01:19:12 AM »
I bet the union bosses and the people running these pensions are doing okay. 
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Firethorn

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Re: Blue-collar pensions also failing
« Reply #8 on: July 21, 2017, 07:42:40 AM »
That only work if a society is willing to let old folks camp under a bridge.  We've shown pretty clearly that we are not willing to do that.

Indeed.  Thus why I mentioned it over in the social security thread.  I don't believe that we can get rid of it as long as there are reporters out there able to show grandpa sleeping under a bridge or elderly widows eating cat food.  It doesn't look good for us as a country.

Now, give the pension systems a shave?  That we can do.  Raise the retirement age a bit. Lower payouts a bit.  Meanwhile, throw embezzlers into prison, fix the rules like we did with the USPS so that they gotta fully fund pension funds, and otherwise make them predictable.

$12k a year, plus medical, should be enough to keep old people in good enough living conditions.

dogmush

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Re: Blue-collar pensions also failing
« Reply #9 on: July 21, 2017, 08:44:22 AM »

$12k a year, plus medical, should be enough to keep old people in good enough living conditions.

you're high.

ETA: As in smoking crack, not that that number is too high.  realized my comment could be misunderstood

HankB

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Re: Blue-collar pensions also failing
« Reply #10 on: July 21, 2017, 09:22:54 AM »
I get a pension where I work.  It tops out at basically 35% of your best 5 years average pay.  Not many private sector companies left with even that for a pension.  Supposedly pretty healthily funded too, if the ERISA statements each year can be believed.
Same here - my pension plan is very similar to what you describe. Not as lucrative as some .gov pensions, but my benefit is still considerably better than Social Security.  The ERISA statements all look good.

Around 15 years ago my employer tried to get current employees to voluntarily switch to a "new & improved Portfolio II" pension plan, but after spending a couple of hours using Excel and making various projections, every result - and I mean EVERY result - revealed a lower employee benefit. Everyone I know found the same thing - lower benefits with the new plan - and nobody I know made the switch.

The pension was a factor in my decision to decline a job offer a few years ago.  Not the main factor, by a long shot, but it was a factor.

For several years, new employees got the PII pension. New employees for the company now get no pension.

And the HR people lament the decline in new worker retention levels - they don't quite grasp that lower long term benefits mean lower incentives to stay with the company. So when people get job offers as you did, the pension is no longer a consideraton.

Duh.
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MillCreek

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Re: Blue-collar pensions also failing
« Reply #11 on: July 21, 2017, 09:31:26 AM »
Working in law/insurance/healthcare, I never received a pension.  My retirement has always been on me, in the form of a 401(k) or 403(b) and IRAs.  My wife has a combination of a 403(b) and a pension from the school system.  My dad had a pension from Boeing, and my sister has been working long enough at Boeing (twenty years) to still be in the cohort that received a pension.  I think new Boeing hires for the past several years do not.
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Quote from: Angel Eyes on August 09, 2018, 01:56:15 AM
You are one lousy risk manager.

MikeB

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Re: Blue-collar pensions also failing
« Reply #12 on: July 21, 2017, 09:59:18 AM »
We wouldn’t have nearly as many old folks potentially sleeping under bridges if we had no property taxes. Many older people will have paid off homes by retirement, but may not be able to pay property taxes on Social Security/Retirement Savings/what have you. Granted should probably have planned for it, but the way property taxes are often raised who can really say. Then of course to bring it full circle those property taxes are often used to fund inflated pensions plans for the various teachers unions.

Ben

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Re: Blue-collar pensions also failing
« Reply #13 on: July 21, 2017, 10:04:34 AM »
We wouldn’t have nearly as many old folks potentially sleeping under bridges if we had no property taxes. Many older people will have paid off homes by retirement, but may not be able to pay property taxes on Social Security/Retirement Savings/what have you. Granted should probably have planned for it, but the way property taxes are often raised who can really say. Then of course to bring it full circle those property taxes are often used to fund inflated pensions plans for the various teachers unions.

Rather than increase SS or other tax increases, I'd be happy seeing some type of drastically reduced property tax rates for people say, over 65 or 70. I think some places may do that already. Others already do "homestead" discounts, farm discounts, etc.

Of course I'm not for that if it's balanced out by increasing property taxes for those under 65. Which likely means it's a dead idea.
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MikeB

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Re: Blue-collar pensions also failing
« Reply #14 on: July 21, 2017, 10:14:04 AM »
Rather than increase SS or other tax increases, I'd be happy seeing some type of drastically reduced property tax rates for people say, over 65 or 70. I think some places may do that already. Others already do "homestead" discounts, farm discounts, etc.

Of course I'm not for that if it's balanced out by increasing property taxes for those under 65. Which likely means it's a dead idea.

I’d rather stop paying outrageous salaries, pensions and healthcare for teachers and administrators. Of course this may not be the same everywhere. Where I’m at average salaries are about $70k and they contribute little to nothing to pension and healthcare.

Really though I was just pointing out that government policies are often the drivers of people sleeping under bridges.

HankB

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Re: Blue-collar pensions also failing
« Reply #15 on: July 21, 2017, 05:58:51 PM »
I’d rather stop paying outrageous salaries, pensions and healthcare for teachers and administrators. Of course this may not be the same everywhere. Where I’m at average salaries are about $70k and they contribute little to nothing to pension and healthcare.

Really though I was just pointing out that government policies are often the drivers of people sleeping under bridges.
Not just teachers and admins. I remember seeing a story that in NYC, school custodians get 7/12 the cost of a baseline SUV every 3 years as a bonus. Seems that with NYC in the snow belt, there's a chance of a blizzard 7 months of the year, so custodians need transportation to get them to the school. And an SUV typically will last 3 years (Style, rust, I don't know why such a short time) so every 3 years, the taxpayers help the janitors get a new vehicle.



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Firethorn

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Re: Blue-collar pensions also failing
« Reply #16 on: July 22, 2017, 09:10:59 AM »
you're high.

ETA: As in smoking crack, not that that number is too high.  realized my comment could be misunderstood

This isn't actually an argument against it, you know? 

Given that the goal is keeping old people out from under bridges and not eating cat food(which was a fairly common story when I was a kid), we shouldn't be worrying so much about keeping people in a style that they have become accustomed to, like the social security system is somewhat designed to do.

Somebody who's worked 40 years paying into the system deserves something.

Ben - I'm in a homestead area.  Drastically reduced property taxes on your primary home.  A discount if you're a qualified member of the volunteer fire department.  Another discount if you're disabled or over 65.

MikeB - $70k with 'little to nothing' to pension and healthcare isn't outrageous, I don't think.  Not for a job requiring at least a bachelor's degree. $70k combined with full provisioning of healthcare and pension is, depending on the job, of course.

Janitor, depending on the nastiness they have to deal with, might be equally well paid.

The SUV thing?  Given that it's 7/12th and 3 years, that's actually closer to every 6 years, and yes, NY does use LOTS of salt on the roads such that unless you take extraordinary measures the frame will be eaten by then.

And a 'baseline SUV' isn't actually that expensive.  $24k, looking it up.  So it boosts custodian pay $4.7k/year, in exchange for them presumably being available to make sure the school isn't collapsing from snow, cleaning out the parking lots and walkways, etc...

Probably something that their union negotiated.  Possibly something to boost their pay when the politics wouldn't sustain them having their pay boosted directly. 



Scout26

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Re: Blue-collar pensions also failing
« Reply #17 on: July 22, 2017, 02:25:55 PM »
You are talking out of both sides of your mouth.

Reducing your property taxes:

Ben - I'm in a homestead area.  Drastically reduced property taxes on your primary home.  A discount if you're a qualified member of the volunteer fire department.  Another discount if you're disabled or over 65.



Janitor, depending on the nastiness they have to deal with, might be equally well paid.

The SUV thing?  Given that it's 7/12th and 3 years, that's actually closer to every 6 years, and yes, NY does use LOTS of salt on the roads such that unless you take extraordinary measures the frame will be eaten by then.

And a 'baseline SUV' isn't actually that expensive.  $24k, looking it up.  So it boosts custodian pay $4.7k/year, in exchange for them presumably being available to make sure the school isn't collapsing from snow, cleaning out the parking lots and walkways, etc...

Probably something that their union negotiated.  Possibly something to boost their pay when the politics wouldn't sustain them having their pay boosted directly. 

That $4.7k per year has to come from somewhere... Property taxes maybe ??

Years back Illinois did a several year "Property Tax Freeze"  which was all well and good.  What didn't freeze was the assessed value of your home.  So what happened was the rates didn't change (about 6.3% of assessed value, which is 33% of the "Fair Cash Value" they set), but the Fair Cash Value of your home kept rapidly climbing.  The rate of property tax increases didn't slow down at all.

Anyway, if that was here, I'd be paying for an SUV and a half each year.

And now Madigan wants to change the school funding formula so that basically even that pays property taxes in Illinois has all the school money put into a big pile and then the State doles it out so that Chicago's failing public schools and teachers pensions get bailed out by the rest of the state.

 :mad: :mad: :mad: :mad: :mad: :mad: :mad: :mad: :mad: :mad:
 [ar15] [ar15] [ar15] [ar15] [ar15] [ar15] [ar15] [ar15] [ar15] [ar15] [ar15] [ar15] [ar15]

Anyway, the point is.  The money to pay for all this has to come from somewhere.  There is no magic money tree, nor Obama's "Stash" to go raid.  It's increasingly falling on the taxpayers and at least here in Illinois, people are getting fed up and leaving..
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MikeB

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Re: Blue-collar pensions also failing
« Reply #18 on: July 22, 2017, 05:31:48 PM »
MikeB - $70k with 'little to nothing' to pension and healthcare isn't outrageous, I don't think.  Not for a job requiring at least a bachelor's degree. $70k combined with full provisioning of healthcare and pension is, depending on the job, of course.




I'm not sure you are understanding. Most employees in the private sector have to at least partially fund their healthcare and 401k(forget pension) out of their pay beyond the compensation that is paid by the employer. These teachers contribute nothing to their own healthcare and pensions. Their healthcare resembles the so called cadilac plans. They shouldn't even get a pension, should have to use a 401k like the parents of the children they are teaching. And $70k + for them on top of free healthcare and pension(retire after 20 years) with only working 9 months out of the year is outrageous.

As for the bachelors degree - bullshit frankly. Most teachers don't teach anything that really requires a degree, they typically have a curriculum handed to them and teach to it. Just consider how successful home schooling is for an awful lot of people without any special education degrees. I went through one of these school districts, more than half the teachers were worthless. Maybe a quarter were good, not great. Then there were actually some who really deserved the pay. Granted that was a little over 25 years ago, but I'm often told little has changed.

Firethorn

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Re: Blue-collar pensions also failing
« Reply #19 on: July 22, 2017, 09:25:57 PM »
You are talking out of both sides of your mouth.

That I live in a homestead area is simply a matter of fact, not an endorsement. 

Quote
That $4.7k per year has to come from somewhere... Property taxes maybe ??

And not paying that money results in what?  People work based on the whole compensation package.  I was simply saying that it probably was put in place because they couldn't give the custodians an actual raise at the time due to a pay freeze, but they could pay them extra to justify them coming in during inclement weather. 

Quote
Years back Illinois did a several year "Property Tax Freeze"  which was all well and good.  What didn't freeze was the assessed value of your home.  So what happened was the rates didn't change (about 6.3% of assessed value, which is 33% of the "Fair Cash Value" they set), but the Fair Cash Value of your home kept rapidly climbing.  The rate of property tax increases didn't slow down at all.

That is perhaps better than the California system.  You can't try to shove almost all of the real estate taxes on the newbies.  For one, it prevents people from moving because their grandfathered property tax rates are too good.

The controls need to be on the spending side, I think. 

Quote from: MikeB
I'm not sure you are understanding. Most employees in the private sector have to at least partially fund their healthcare and 401k(forget pension) out of their pay beyond the compensation that is paid by the employer. These teachers contribute nothing to their own healthcare and pensions. Their healthcare resembles the so called cadilac plans. They shouldn't even get a pension, should have to use a 401k like the parents of the children they are teaching. And $70k + for them on top of free healthcare and pension(retire after 20 years) with only working 9 months out of the year is outrageous.

And I think you didn't read my message.  You know, where I said that $70K + premium bennies is crazy?

Quote
As for the bachelors degree - bullshit frankly. Most teachers don't teach anything that really requires a degree, they typically have a curriculum handed to them and teach to it. Just consider how successful home schooling is for an awful lot of people without any special education degrees. I went through one of these school districts, more than half the teachers were worthless. Maybe a quarter were good, not great. Then there were actually some who really deserved the pay. Granted that was a little over 25 years ago, but I'm often told little has changed.

One can say that, but as long as they're requiring that piece of paper, they have to pay for it.  Besides, haven't you heard?  They're moving up to preferring/requiring master's degrees for teaching in public school.

And home schooling works, when it works, because parents can have a lot more time with their kids, have smaller class sizes than teachers, can afford to customize the courses to suit their kid's needs better.