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(Philly.com)   It turns out that gutting pension funds for fun and profit may have some negative consequences down the road   (philly.com) divider line 161
    More: Followup, Mount Kilimanjaro, retirement crisis, actuarial tables, Organization for Economic Cooperation  
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3940 clicks; posted to Politics » on 29 Dec 2013 at 2:10 PM (51 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



161 Comments   (+0 »)
   
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2013-12-29 01:01:22 PM  
As a Gen Xer I don't have a problem with retirement benefits being adjusted to align with life expectancy or means tested.  What I do have a problem with is the BS reasoning that they have to be slashed because of deficits--deficits created by people who had no intention of paying for the causes of those shortfalls to begin with.
 
2013-12-29 01:27:09 PM  
This has very little to do with gutting of retirement benefits. It's almost entirely demographics. Populations are aging because people live longer and people are having fewer kids. This inevitably will lead to the ratio of people retired to people working growing.

I found this comment terrifying:

"In China, the 65-and-older population will rise from 11 percent of the working-age population in 2010 to 42 percent in 2050. In the United States, this old-age dependency ratio will rise from 20 percent to 35 percent."
 
2013-12-29 01:37:57 PM  
Well, the obvious answer is for the US government to promote the virtues of excessive tobacco and alcohol consumption for the over 50 citizens.
 
2013-12-29 01:50:05 PM  
Article: more people are getting older and there aren't enough younger folks able to pay into the pension funds or even take care of the older people
Subby: fark the 1%
 
2013-12-29 01:50:49 PM  
"Now, they face a demographics disaster as retirees live longer and falling birth rates mean there will be fewer workers to support them. "

I REALLY dont see a problem here. The retirees will need to not retire and fill those jobs. Or immigrants. Not really rocket science


doyner: As a Gen Xer I don't have a problem with retirement benefits being adjusted to align with life expectancy or means tested.  What I do have a problem with is the BS reasoning that they have to be slashed because of deficits--deficits created by people who had no intention of paying for the causes of those shortfalls to begin with.


So let's look at what happened.
80's high deficits
90's shrinking deficits
00's high deficits

It is ALMOST like half of the people, and half (or more) of those soon to be retirees voted to create the problem that will now affect them. GOOD.
Time for THEM to pay for the bullshiat problems that they created.

So we will have more and more old people in the food/service industry? meh
I really have no problem with these people getting screwed.

Hopefully the youngers will figure something out. Rather than just getting screwed by the people who kept voting for more and more debt.
 
2013-12-29 01:52:03 PM  

namatad: I really have no problem with these people getting screwed.


Me either, but there are millions of folks getting screwed that didn't cause the problem.
 
2013-12-29 01:54:31 PM  

b2theory: This has very little to do with gutting of retirement benefits. It's almost entirely demographics. Populations are aging because people live longer and people are having fewer kids. This inevitably will lead to the ratio of people retired to people working growing.


So what you are saying is that the current system was basically a ponzi scheme, requiring more and more people to enter the system inorder to keep it afloat. Good thing that we created a retirement lockbox !!!
Which is filled with IOUs?? DOH!!!!

Strange how there is no or little traction to change Soc Sec to be means tested. 
But more, screw the younguns by raising the retirement age.
 
2013-12-29 01:58:48 PM  

namatad: b2theory: This has very little to do with gutting of retirement benefits. It's almost entirely demographics. Populations are aging because people live longer and people are having fewer kids. This inevitably will lead to the ratio of people retired to people working growing.

So what you are saying is that the current system was basically a ponzi scheme, requiring more and more people to enter the system inorder to keep it afloat. Good thing that we created a retirement lockbox !!!
Which is filled with IOUs?? DOH!!!!

Strange how there is no or little traction to change Soc Sec to be means tested. 
But more, screw the younguns by raising the retirement age.


And no traction to raise the cap on SS contributions.
 
2013-12-29 02:15:39 PM  
Now 41 years old I expect to work until I am unable to think or move well enough to continue.
Then I expect to be thrown out of where I live and be homeless and starving until I die of exposure.
This is the direction the country is going in and I expect it will continue so my end of life expectations are aligned with that.
 
2013-12-29 02:20:13 PM  
Remember - rich people greed is good. Poor people wanting to live a comfortable retirement is bad and will end western civilization as we know it.
 
2013-12-29 02:20:42 PM  
Seize The Money!
 
2013-12-29 02:24:40 PM  
 
2013-12-29 02:24:54 PM  

namatad: b2theory: This has very little to do with gutting of retirement benefits. It's almost entirely demographics. Populations are aging because people live longer and people are having fewer kids. This inevitably will lead to the ratio of people retired to people working growing.

So what you are saying is that the current system was basically a ponzi scheme, requiring more and more people to enter the system inorder to keep it afloat. Good thing that we created a retirement lockbox !!!
Which is filled with IOUs?? DOH!!!!

Strange how there is no or little traction to change Soc Sec to be means tested. 
But more, screw the younguns by raising the retirement age.


I wouldn't have thought it possible to condense so much nonsense into so few words.
 
2013-12-29 02:25:05 PM  

simplicimus: namatad: b2theory: This has very little to do with gutting of retirement benefits. It's almost entirely demographics. Populations are aging because people live longer and people are having fewer kids. This inevitably will lead to the ratio of people retired to people working growing.

So what you are saying is that the current system was basically a ponzi scheme, requiring more and more people to enter the system inorder to keep it afloat. Good thing that we created a retirement lockbox !!!
Which is filled with IOUs?? DOH!!!!

Strange how there is no or little traction to change Soc Sec to be means tested.
But more, screw the younguns by raising the retirement age.

And no traction to raise the cap on SS contributions.


and nop realization that maybe actual pensions were a good thing.

My wife: "How are our parents retiring?  401k and SS?"
Me: "Well my father and your father have pensions."
Wife: "What's a Pension?"
 
2013-12-29 02:27:48 PM  
Remember, kids: breaking a contract with a corporation means you should be punished to the full extent of the law. Breaking a contract with workers? All good, especially if you get to campaign on "fiscal responsibility!"
 
2013-12-29 02:39:15 PM  
It's Baby Boomers. They will be kept warm by their greed and kept feed by their ego.
 
2013-12-29 02:46:22 PM  
The present situation is a result of overpromising and underfunding of benefits. You can see the phenomenon at work today in the number of Farkers who think it's something approaching a crime that the US Postal Service is required to fully fund its retiree pension and health plans.
 
2013-12-29 02:46:23 PM  

doyner: namatad: I really have no problem with these people getting screwed.

Me either, but there are millions of folks getting screwed that didn't cause the problem.


I go back and forth on that one.
The people who voted for the other side, the people who didnt vote, the people who didnt protest while this was happening, the people who silently benefited but said nothing, the people who are blind to the world around them, refusing to read the real news, etc etc etc.

The people who pushed and voted for trickle down and deficits dont matter and supply side candidates?
They deserve a special place in hell. Anyone who voted for bush, TWICE, I hope they all have to become greeters. fark them.


But in the end, we get the society that we deserve, in aggregate.
Those that knew better, are also people who have probably been saving.

Dont get me started on all the moops with upside down mortgages and home equity loans.
fark EM

I lived like a proper adult. Didn't extend insanely. Didnt buy more than I could afford at inflated prices. Paid off all my debt. 

WHY THE FARK should I shed a single tear for those that did the opposite??

/and no, I am not referring to the poor and working poor, but all the tools in the middle.
/the poor were already going to only have soc sec to rely on when they retired. their lot in life hasnt gotten "worse".
 
2013-12-29 02:46:24 PM  
FTA:  "Companies have eliminated traditional pension plans that cost employees nothing and guaranteed them a monthly check in retirement."


Pensions are funded through wages that are pooled and invested rather than paid directly to you as part of your salary.  Pensions are not freebies or gifts, they are compensation for labor just like your health benefits, mandatory social security contributions, and any other "perk"  you received for the time you spent working at the company.

You gotta hand it to the corporate propagandists out there, if you read that article it comes off as everyone's fault but theirs.  Especially those greedy, lazy, old people.
 
2013-12-29 02:47:29 PM  

b2theory: This has very little to do with gutting of retirement benefits. It's almost entirely demographics. Populations are aging because people live longer and people are having fewer kids. This inevitably will lead to the ratio of people retired to people working growing.

I found this comment terrifying:

"In China, the 65-and-older population will rise from 11 percent of the working-age population in 2010 to 42 percent in 2050. In the United States, this old-age dependency ratio will rise from 20 percent to 35 percent."


I'll take the optimist route here and say there gonna be a bunch of jobs that open up...

/If they decide to retire that is...
 
2013-12-29 02:49:55 PM  

keytronic: FTA:  "Companies have eliminated traditional pension plans that cost employees nothing and guaranteed them a monthly check in retirement."


Pensions are funded through wages that are pooled and invested rather than paid directly to you as part of your salary.  Pensions are not freebies or gifts, they are compensation for labor just like your health benefits, mandatory social security contributions, and any other "perk"  you received for the time you spent working at the company.

You gotta hand it to the corporate propagandists out there, if you read that article it comes off as everyone's fault but theirs.  Especially those greedy, lazy, old people.


It's amazing.  The media looks like it's written by PR firms for multinationals lately.

My favorite article over the Christmas break was "Why it's the Consumer's fault that UPS didn't deliver your presents"

That was the title.
 
2013-12-29 02:51:19 PM  
Dems make promises
Retirees bank on their words
They work until death.

What this is about is state politicians who couldnt manage their way out of a piss soaked paper bag who promised unions generous benefits in exchange for votes. Governments are no different from companies except that there is nothing to stop people who are utterly incompetent from getting votes. Bankrupt govts are bankrupt and don't keep promises.
 
2013-12-29 02:51:43 PM  

GBmanNC: b2theory: This has very little to do with gutting of retirement benefits. It's almost entirely demographics. Populations are aging because people live longer and people are having fewer kids. This inevitably will lead to the ratio of people retired to people working growing.

I found this comment terrifying:

"In China, the 65-and-older population will rise from 11 percent of the working-age population in 2010 to 42 percent in 2050. In the United States, this old-age dependency ratio will rise from 20 percent to 35 percent."

I'll take the optimist route here and say there gonna be a bunch of jobs that open up...

/If they decide to retire that is...


They can't retire. That's what the article is about.
 
2013-12-29 02:51:44 PM  

jjorsett: The present situation is a result of overpromising and underfunding of benefits. You can see the phenomenon at work today in the number of Farkers who think it's something approaching a crime that the US Postal Service is required to fully fund its retiree pension and health plans.


Are you willing to double the price of mailing stuff through USPS? Then huzzah! Otherwise you're just deliberately bankrupting the agency.
 
2013-12-29 02:53:19 PM  

namatad: So what you are saying is that the current system was basically a ponzi scheme, requiring more and more people to enter the system inorder to keep it afloat.


More like the current system was designed for a steady birthrate and we have a decreasing one.  It's only a ponzi scheme if there was never any realistic possibility of enough new participants coming in to keep the old ones funded.
 
2013-12-29 02:56:36 PM  

jjorsett: The present situation is a result of overpromising and underfunding of benefits. You can see the phenomenon at work today in the number of Farkers who think it's something approaching a crime that the US Postal Service is required to fully fund its retiree pension and health plans.


Disingenuous post is disingenuous.
 
2013-12-29 02:59:36 PM  

rev. dave: Now 41 years old I expect to work until I am unable to think or move well enough to continue.
Then I expect to be thrown out of where I live and be homeless and starving until I die of exposure.
This is the direction the country is going in and I expect it will continue so my end of life expectations are aligned with that.


Don't fret, you won't have to work THAT long.  If you are employed for any sizeable corporation they'll toss you when you hit 50. Then you can live a longer more miserable life on the streets than you thought.
 
2013-12-29 03:01:28 PM  

cman: Article: more people are getting older and there aren't enough younger folks able to pay into the pension funds or even take care of the older people
Subby: fark the 1%



The decades of plundering of wages and wealth of middle class and poor Americans by our political and economic oligarchic class have resulted in Americans who are not only no longer getting the pension and retirement benefits they used to be able to count on, but also have crippled our ability to save for retirement. On today's wages most people struggle to make ends meet in the here and now, so how are they going to save for retirement without pretty much living in abject poverty their entire lives until they retire? I know a lot of people comfort themselves by pretending to be superior and blaming the victims ("They should eat their bootstraps while saving 50% of their shiatty income - and besides it's their own fault for not being born into wealth or somehow magically reversing decades of wage deflation across the board.") - but the reality is that nonsensical trickle-down economics have led to this situation.

So yeah, how about instead of just "fark the 0.2%", how about we just rebalance the needs of the 99.8% against those of the 0.2% and get America back to a place where ordinary Americans are being paid more so they can save for retirement and to start new businesses without being trapped in a cycle of debt and poverty. We aren't going to be able to have a robust and healthy economy when we're taking the backdoor route to turning most of the country in to indentured servants. Once upon a time America's economy was the strongest in the world because we made more of our citizens wealthier across the board than pretty anyone else had ever done. Then we let the GOP prosperity gospel shiatheads hatefark the middle class and poor for campaign funds and personal wealth.

Our economy runs on consumption. When you impoverish the consumers you weaken the economy. Why do you think our "recovery" from the last financial crisis - caused by those same greedy 0.2%'ers who have reaped all economic benefits for the last 40+ years - is so shiatty? Why do you think the labor market is still struggling? Why do you think more people are in poverty now?

Paying the 99.8% more - instead of letting the 0.2% have a field day reaping everyone's benefits and wealth almost without end - is GOOD for the economy. The opposite is economic poison.
 
2013-12-29 03:08:39 PM  

jjorsett: The present situation is a result of overpromising and underfunding of benefits. You can see the phenomenon at work today in the number of Farkers who think it's something approaching a crime that the US Postal Service is required to fully fund its retiree pension and health plans.



You're leaving something BIG out there. What you're referring to is the GOP's purposeful effort to sabotage US Postal. They pushed through legislation when they still had the power to do so which required US Postal to fund 75 years of pensions in the span of 5 years. If you don't understand the problem that might create then either you're:
1. not being an honest participant in discussion or
2. are wholly unaware of this despite it being pointed out to you many times or
3. simply do not have the intellectual capacity to participate meaningfully in the discussion

And no, the present situation is not due to "overpromising and underfunding of benefits". If that were the case then ordinary non-union and non-public sector employees wouldn't be the ones having this problem.... and we are.
 
2013-12-29 03:09:04 PM  

EnderWiggnz: My wife: "How are our parents retiring? 401k and SS?"
Me: "Well my father and your father have pensions."
Wife: "What's a Pension?"


The position I started five months ago not only has a great 401(k) plan, but an honest-to-sh*t PENSION. From a private company, not any government. Says so in my contract and on my direct deposit slip. No other company I've ever worked for had this mythical beast except for the US Navy, and when I told my friends about it more often than not I got the "quizzical dog" look, head tilted slightly to one side as they tried to resolve that word in their minds.

Yes there are still companies that have pensions. We have a stable out back for our unicorns too.
 
2013-12-29 03:09:07 PM  

mongbiohazard: Paying the 99.8% more - instead of letting the 0.2% have a field day reaping everyone's benefits and wealth almost without end - is GOOD for the economy. The opposite is economic poiso


I agree with your analysis, but I think the top 20% can pay more with extra taxes on the top 2%, to boot.

Also, we're only discussing the income tax. I think other taxes need adjusting to make them less regressive.
 
vpb [TotalFark]
2013-12-29 03:09:20 PM  
mongbiohazard:
Paying the 99.8% more - instead of letting the 0.2% have a field day reaping everyone's benefits and wealth almost without end - is GOOD for the economy. The opposite is economic poison.

Too obvious and sensible for Fark.
 
2013-12-29 03:14:02 PM  

rewind2846: EnderWiggnz: My wife: "How are our parents retiring? 401k and SS?"
Me: "Well my father and your father have pensions."
Wife: "What's a Pension?"

The position I started five months ago not only has a great 401(k) plan, but an honest-to-sh*t PENSION. From a private company, not any government. Says so in my contract and on my direct deposit slip. No other company I've ever worked for had this mythical beast except for the US Navy, and when I told my friends about it more often than not I got the "quizzical dog" look, head tilted slightly to one side as they tried to resolve that word in their minds.

Yes there are still companies that have pensions. We have a stable out back for our unicorns too.


I came across /one/ in the past 15 years that had a pension.  Yeh, they exist, but not in any reasonable amount.

Right now, I'm hoping for a Univiersity Job with it's free tuition for me and dependents.  That's some crazy, crazy coin, and actual  job stability that just doesn't exist in private enterprise.
 
2013-12-29 03:14:37 PM  

simplicimus: Well, the obvious answer is for the US government to promote the virtues of excessive tobacco and alcohol consumption for the over 50 citizens.


Pretty much sums up my retirement plan.  In fact, I plan to start doing smack if I make it to 63.   Here is the horrible scenario we are facing.   People usually rolled into retirement owning their own home.  A vast number of people were sucked into the housing drama and saw all their home equity stripped from the largest asset most Americans ever buy - their home.  So if you are lucky enough to still be in your home, there is a high likelihood that you will not own it outright before you retire or die whichever comes first.  Pension plans were scuttled in the past 30 years for 401K plans.  These 401k plans were painfully small even before the crash.  Now they are laughably short for a large majority of retirement aged individuals.  Social Security and Medicare which are really there to keep you out of destitution, are on the chopping block.  We are not like some countries in Asia or the country of India.  We are now built culturally around the extended family where the kids take care of their parents and so on and so on.  So this is going to be socially traumatic.
 
2013-12-29 03:15:03 PM  

doyner: jjorsett: The present situation is a result of overpromising and underfunding of benefits. You can see the phenomenon at work today in the number of Farkers who think it's something approaching a crime that the US Postal Service is required to fully fund its retiree pension and health plans.

Disingenuous post is disingenuous.


He's a liar. Not "disingenuous." A LIAR.

Don't use the wrong word. "Disingenuous" gives it a veneer of respectability.

Call it lying when it's lying.
 
2013-12-29 03:20:13 PM  
Well I guess this is the result of entitlement and living beyond our means. Really the only people to blame is yourself. Yourself for not saving enough, yourself for voting for the same politicians who put the government finances in the red, yourself for living outside your means. America was a great country once and has not been for almost 30 yrs living in the past does not pay for the future.
 
2013-12-29 03:24:48 PM  

pmdgrwr: Well I guess this is the result of entitlement and living beyond our means. Really the only people to blame is yourself. Yourself for not saving enough, yourself for voting for the same politicians who put the government finances in the red, yourself for living outside your means. America was a great country once and has not been for almost 30 yrs living in the past does not pay for the future.


Your essay is due in five minutes.
 
2013-12-29 03:27:37 PM  

Your Hind Brain: pmdgrwr: Well I guess this is the result of entitlement and living beyond our means. Really the only people to blame is yourself. Yourself for not saving enough, yourself for voting for the same politicians who put the government finances in the red, yourself for living outside your means. America was a great country once and has not been for almost 30 yrs living in the past does not pay for the future.

Your essay is due in five minutes.


Um like my dog um like ate the first draft and like um my computer crashed and um I deserve an extension.
 
2013-12-29 03:35:03 PM  
 
2013-12-29 03:39:06 PM  

pmdgrwr: Your Hind Brain: pmdgrwr: Well I guess this is the result of entitlement and living beyond our means. Really the only people to blame is yourself. Yourself for not saving enough, yourself for voting for the same politicians who put the government finances in the red, yourself for living outside your means. America was a great country once and has not been for almost 30 yrs living in the past does not pay for the future.

Your essay is due in five minutes.

Um like my dog um like ate the first draft and like um my computer crashed and um I deserve an extension.


Really? Okay, off to the camp with you.
 
2013-12-29 03:46:28 PM  
Yep, promising unicorns and showing up with Shetland Pony is going to have some pretty large repercussions.

A dose of hard reality is defiantly going to wake a few folks up.
 
2013-12-29 03:48:05 PM  

HeadLever: Yep, promising unicorns and showing up with Shetland Pony is going to have some pretty large repercussions.

A dose of hard reality is defiantly going to wake a few folks up.


Yep. Here we go.
 
2013-12-29 03:50:13 PM  

HeadLever: Yep, promising unicorns and showing up with Shetland Pony is going to have some pretty large repercussions.

A dose of hard reality is defiantly going to wake a few folks up.


The "hard reality" is often that employers and employees engaged in good-faith negotiations to reach contractual agreements, and then the employers didn't hold up their end of the bargain.
 
2013-12-29 03:54:48 PM  

Notabunny: The "hard reality" is often that employers and employees engaged in good-faith negotiations to reach contractual agreements, and then the employers didn't hold up their end of the bargain.


Or couldn't hold up their end of the bargain.  If you haven't noticed, unfunded pension obligations has been a leading cause of bankruptcies here in the last few years (both public and private).  Many times, these promises were made during the good times where the financial assumptions were made based upon rosy projections with no contingency to allow for what would happen if these projections did not come to fruition.
 
2013-12-29 03:58:44 PM  

pmdgrwr: Well I guess this is the result of entitlement and living beyond our means. Really the only people to blame is yourself. Yourself for not saving enough, yourself for voting for the same politicians who put the government finances in the red, yourself for living outside your means. America was a great country once and has not been for almost 30 yrs living in the past does not pay for the future.


People with pensions did plan for their retirement. Do you not understand what a pension is? It is part of a workers compensation no different in that respect from an agreed upon salary.
 
2013-12-29 04:02:07 PM  
Just for some perspective, the US unfunded liability for SS, Prescription Drugs and Medicare is close to about $130 Trillion.  That amounts to a bit over $1.1 million per taxpayer.

While increased taxes (especially on the rich) are going to need to be a part of the solution, it will not solve the issue by itself.  There will need to be more done.
 
2013-12-29 04:05:28 PM  

Thrag: pmdgrwr: Well I guess this is the result of entitlement and living beyond our means. Really the only people to blame is yourself. Yourself for not saving enough, yourself for voting for the same politicians who put the government finances in the red, yourself for living outside your means. America was a great country once and has not been for almost 30 yrs living in the past does not pay for the future.

People with pensions did plan for their retirement. Do you not understand what a pension is? It is part of a workers compensation no different in that respect from an agreed upon salary.


They planned, poorly.
 
2013-12-29 04:07:56 PM  

HeadLever: Notabunny: The "hard reality" is often that employers and employees engaged in good-faith negotiations to reach contractual agreements, and then the employers didn't hold up their end of the bargain.

Or couldn't hold up their end of the bargain.  If you haven't noticed, unfunded pension obligations has been a leading cause of bankruptcies here in the last few years (both public and private).  Many times, these promises were made during the good times where the financial assumptions were made based upon rosy projections with no contingency to allow for what would happen if these projections did not come to fruition.


Did the company move overseas or get outsourced? Did the goods they produce no longer be wanted? Perhaps their products became obsolete when other companies had better solutions? Very understandable. Did the CEO and shareholders of a very financially stable corporation decide that they needed more personal revenue. Yeah, that is an issue when job contracts are agreed and signed.
 
2013-12-29 04:08:24 PM  

HeadLever: Just for some perspective, the US unfunded liability for SS, Prescription Drugs and Medicare is close to about $130 Trillion.  That amounts to a bit over $1.1 million per taxpayer.

While increased taxes (especially on the rich) are going to need to be a part of the solution, it will not solve the issue by itself.  There will need to be more done.


Not to worry. We're having everyone stop taking vitamins, and limiting surgeries, feeding kids coffee, oh and drink more too. We'll get that population down soon.

We can't have death panels so the process has slowed down a bit but it plods onward.
 
2013-12-29 04:10:48 PM  

Notabunny: The "hard reality" is often that employers and employees engaged in good-faith negotiations to reach contractual agreements, and then the employers didn't hold up their end of the bargain.


Also, don't forget that these 'bargins' are mostly contractual issues where reneging on these  obligations can only be done after a court order or by subsequent negotiations that supersede the original contact.
 
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