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"More than 4,100 legislators in 33 states are positioned to benefit from special retirement laws that they and their predecessors have enacted to boost their pensions by up to $100,000 a year, a USA Today investigation found. Even as legislators cut basic state services and slash benefits for police, teachers and other workers, they have preserved pension laws that grant themselves perks unavailable to voters they serve or workers they direct.Because each state's legislature that has indulged itself with these policies does so in different, evermore creative ways, comparative analysis is difficult. However, state-by-state examination yields shocking results:State lawmakers in Missouri meet for roughly five months a year and are paid slightly more on average than a state worker, but records show a typical lawmaker's pension averages 30 percent more than a state worker's. New York has barred legislators elected after 1994 from receiving legislative pension payments while in office, but this leaves 15 lawmakers who took office before 1995 collecting a legislative pension in addition to their salary (earnings average $154,000 each year). Though the Texas legislator salary ($7,200) hasn't risen since 1975, pensions are tied to the salary made by Texas trial judges, which has nearly tripled since 1981, allowing one state legislator to receive pension payments equivalent to 17 times his salary. Though the specific policies and schemes in each state are different, the results are strikingly similar: state legislators across the country compensate themselves with exceptional generosity in belt-tightening, budget-cutting times of economic woe. These lavish systems mean that at least 570 lawmakers in 19 states have qualified for pensions that will pay them as much as (and in many cases, more than) their base legislative salaries. While many of these legislators are concentrated in only a few states, the national repercussions are substantial, as that figure represents nearly 10 percent of the 5,900 lawmakers in the 40 states with legislative pensions.Source: Thomas Frank, "How State Lawmakers Pump Up Pensions in Ways You Can't," USA Today, September 24, 2011."
Get rid of the pension opportunities. Let's get back to people who serve for a limited time then go back to their "real" jobs. You don't need to build up a pension as a official if it's not your career!
Quote from: LadyVirginia link=topic=3124.msg34683#msg 34683 date=1317237206Get rid of the pension opportunities. Let's get back to people who serve for a limited time then go back to their "real" jobs. You don't need to build up a pension as a official if it's not your career!Is it just me or is all Liberals wanting to suck this Country dry until it goes belly up and then Federally take over? Yes, I mean Dictatorially!
"State and local public sector employee pensions are widely known to be underfunded, but pension financial reports do not reveal the true extent of funding shortfalls. Pension accounting methods assume that plan investments can earn high returns without taking any account of the market risk involved. This gives a false sense of the financial strength of public sector pensions and understates risks to taxpayers. Since accrued pension benefits are legally and constitutionally protected, any pension funding shortfalls must be met by taxpayers. This benefit guarantee amounts to an effective put option on plan investments, the cost of which is not disclosed under current actuarial accounting, says Andrew Biggs, a resident scholar at the American Enterprise Institute. In a new paper, Biggs uses an options pricing method to calculate the market value of taxpayer guarantees underlying public sector pensions.The average funding ratio declines from 83 percent under actuarial accounting to 45 percent under this options pricing approach. The typical state has unfunded public pension liabilities three times larger than its explicit government debt. Public pension shortfalls equal an average of 27 percent of state gross domestic product, posing a significant fiscal challenge in coming years. Accurate measures of public pension liabilities are important for policymakers, taxpayers, investors considering the economic environment in which to start or locate a business, and bond purchasers considering the risk premia appropriate to municipal government bonds that are in practice subordinate to public pension liabilities, says Biggs.Source: Andrew G. Biggs, "An Options Pricing Method for Calculating the Market Price of Public Sector Pension Liabilities," Public Budgeting & Finance Journal, Fall 2011."
