Archived posting to the Leica Users Group, 2011/03/13
[Author Prev] [Author Next] [Thread Prev] [Thread Next] [Author Index] [Topic Index] [Home] [Search]yes, exactly--the worker is sacrificing immediate reward for longterm reward On Mar 13, 2011, at 12:34 AM, Jayanand Govindaraj wrote: > Ric, > The lower current salary could also be because of lifetime job security. > This is usually the trade off for public sector employees the world over, > even in Asia, where retirement benefits are minimal. > Cheers > Jayanand > > On Sun, Mar 13, 2011 at 4:09 AM, Ric Carter <ricc at embarqmail.com> wrote: > >> But, let's not forget. Pensions were one of the things management used as >> a >> bargaining tool to keep wages down. Employees were persuaded to work for >> less today on the promise of being cared for after retirement. >> >> State employees still make less money than private industry when comparing >> comparable education. >> >> ric >> >> >> >> On Mar 12, 2011, at 5:29 PM, Lawrence Zeitlin wrote: >> >>> Rei is certainly right. Pensions are the biggest burden on state and >> local >>> taxes. I've seen how this operates from both sides. I was a union member >> at >>> my university for 32 years as my union negotiated for ever higher pension >>> and medical benefits for retired faculty. The union espoused a defined >>> benefit plan where the pension after retirement would be based on the >>> average of the last three year's salary. It was an unfunded pension, >>> payments to be made from endowment and current income. Fortunately the >>> legislators in my state permitted faculty to drop out of the plan in >> favor >>> of a defined contribution pension where the university would contribute >> 15% >>> of annual salary plus whatever I cared to add into a TIAA/CREF retirement >>> fund. I chose to invest largely in equities, a lucky decision. The Dow >> was >>> at 600 when I started. Now it hovers around 12,000. >>> >>> On the flip side, I was a member of my local school board for 10 years. I >>> saw our expenditures for student education rise markedly during and >> mostly >>> after my tenure. When I started, our budget was about $17,000,000 for an >>> enrollment of 3,500 students, an annual cost of less than $5000 per >> student. >>> Currently the budget is over $50,000,000 for only 2,500 students, an >> annual >>> cost of $20,000 per student. While education costs have indeed risen >>> (computers, mandated busing, special education) the bulk of the increase >> is >>> due to overly generous retirement and full medical care benefits paid to >>> former teachers. Since school districts are prohibited from investing and >>> can hold only a small amount in reserve, the full budget is paid by >>> taxpayers every year. One teacher told me that she makes more as a >> retiree >>> than she ever did while working. You can imagine my joy at hearing that >>> since I haven't had a kid in public school for over 20 years. >>> >>> All I can definitively say is that state and local governments are on the >>> slippery slope to bankruptcy because of the benefits negotiated in those >>> golden '90s when it was assumed that the money would keep flowing in. >> From >>> my personal experience I suggest that educational and municipal >> institutions >>> get off the defined benefit retirement bandwagon and adopt a defined >>> contribution system. Let the hard working teachers and government >> employees >>> take their chances on the economy like the rest of us. >>> >>> Larry Z >>> >>> _______________________________________________ >>> Leica Users Group. >>> See http://leica-users.org/mailman/listinfo/lug for more information >> >> >> _______________________________________________ >> Leica Users Group. >> See http://leica-users.org/mailman/listinfo/lug for more information >> > > _______________________________________________ > Leica Users Group. > See http://leica-users.org/mailman/listinfo/lug for more information