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-   -   Feds to bail out state pension funds? (http://glocktalk.com/forums/showthread.php?t=1445576)

Mr981 09-30-2012 21:02

Feds to bail out state pension funds?
 
At least the Gov. of IL would like to see that:
http://www.foxnews.com/politics/2012...state-pension/

These Democrats are amazing; they are absolutely shameless about trying to tap into the federal piggy bank to bail out thier own mismanagement.

aircarver 09-30-2012 21:34

With what ? ....:steamed:

.

jpa 10-01-2012 07:57

So if Nevada's pension is completely funded and solvent (it is), can we get a bonus check just because? Otherwise I don't see this as being fair to the states that actually manage their money responsibly instead of writing an IOU to the pension and a check to some BS program.

m2hmghb 10-01-2012 09:16

In NJ the emloyees of the public sector met their contributions, but the state and local governments usually didn't. I find it ironic how the state blames the employees for not putting enough in when they constantly steal from it or just plain ignore it.

JohnBT 10-01-2012 10:06

"So if Nevada's pension is completely funded and solvent (it is)"

It must have happened last month, because Nevada has been underfunded for years.

www.pewstates.org/research/state-fact-sheets/nevada-widening-gap-update-85899399277

TheExplorer 10-01-2012 10:24

You aint seen nothing yet. Wait till all the baby boomers, who are at the top of their pay range, retire. Full salary and medical benefits are really going to hurt the system.

Flying-Dutchman 10-01-2012 10:29

Quote:

Originally Posted by aircarver (Post 19472790)
With what ? ....:steamed:

.

Easy, just press a couple of buttons. The Fed does not even need a printing press anymore.

They will get their pensions. It may pay their cell phone bill.

mgs 10-01-2012 12:56

That would be typical......another payoff with taxpayer cash!

Mr981 10-01-2012 16:19

I'd like to have this subject come up in the Debate on Wednesday
 
Romney should ask him if he would support this for IL or any other state straight up , yes or no--no equivocation.

Wolfgang 10-01-2012 16:26

VA "VRS" is so funded the Guvernator pulled money out to balance the state budget....he now claims a balanced budget, but underfunded retirement system.

Maybe a bailout with "printed dollars" will bail it out.

turretg 10-01-2012 16:34

Incremental Marxism.

RonS 10-01-2012 16:40

It will be like the GM bail out, blue states will get money, red states won't.

http://dailycaller.com/2012/09/12/an...ensions-fight/

wjv 10-01-2012 16:41

Quote:

Originally Posted by aircarver (Post 19472790)
With what ? ....:steamed:

.

This really neat stuff that they create from thin air. It's called "Back to the Future Money - IV". . .

jpa 10-03-2012 22:42

Quote:

Originally Posted by JohnBT (Post 19473997)
"So if Nevada's pension is completely funded and solvent (it is)"

It must have happened last month, because Nevada has been underfunded for years.

www.pewstates.org/research/state-fact-sheets/nevada-widening-gap-update-85899399277

They keep using the full cost of all liabilities in determining the percentage of funding. If the state promises 75% of my salary 30 years from now, they're not going to take 75% of my current salary and put it in a bank account. They take 11.5% of my salary from me and match it to put 23% of my salary in investments. Assuming a 7% rate of return on that money for the next 30 years, one year's worth of contributions will be equal to 1.5x the total salary or 2 years worth of benefits. Adding in compounding returns over 30 years and continued contributions at the same rate will yield 31 years worth of payments at 75% of my salary after retirement.

How is that not solvent again?

certifiedfunds 10-03-2012 22:48

Quote:

Originally Posted by Wolfgang (Post 19475151)
VA "VRS" is so funded the Guvernator pulled money out to balance the state budget....he now claims a balanced budget, but underfunded retirement system.

Maybe a bailout with "printed dollars" will bail it out.

It's all taxpayer money. Doesn't really matter what bucket it comes from. Why should the pension remain fully funded with tax dollars when the rest of the budget is bleeding?

ugly8604 10-04-2012 00:07

I love how people who have no idea what they're talking about keep screaming, "unfunded liability." Guess what folks,if suddenly at this very moment every person in the nation who was eligible to retire did so, we may be in a bind. Pensions are pay as you go, it's not the end of the world if they aren't fully funded at the moment.

Dennis in MA 10-04-2012 07:19

Doubtful that they'd ever bail it out. If they haven't thrown a lifeline to CA yet, they won't throw any lifelines. There is PLENTY a state can do to avoid problems. RI, amongst others, has made radical changes to it's pension system to stay afloat.

There are certain things Uncle won't do. Bail out a state is one of them.

devildog2067 10-04-2012 07:42

Quote:

Originally Posted by jpa (Post 19483591)
How is that not solvent again?

This part:
Quote:

Assuming a 7% rate of return on that money for the next 30 years

certifiedfunds 10-04-2012 07:45

:rofl:

7%

:rofl:

risk free

:rofl::rofl:

Dennis in MA 10-04-2012 08:10

Pension funds don't invest in risk-free investments. They have a "prudent man" diversified portfolio. 7% long-term (30 years) is NOT unreasonable.

devildog2067 10-04-2012 08:30

Quote:

Originally Posted by Dennis in MA (Post 19484324)
Pension funds don't invest in risk-free investments. They have a "prudent man" diversified portfolio. 7% long-term (30 years) is NOT unreasonable.

7% for 30 years is not unreasonable--to fund benefits which are not inflation adjusted and are based on this year's salary.

But every pension system I've seen bases your pension on the last few years' salary--i.e., the highest possible ones--and gives increases in benefits for inflation.

7% is not unreasonable--but 7% above inflation is.

jpa 10-04-2012 21:19

Quote:

Originally Posted by devildog2067 (Post 19484230)
This part:

Even if the fund has a few underperforming years, the higher yield years will make up for them. The stock market has highs and lows. The 7% return will fund a 75% retirement with no adjustments for 31 years. Inflation adjustments start after 3 years of retirement. The pension amount is based on the top 3 consecutive years of salary and the contributions the employee and employer both make are always a percentage of the employee's salary (11.5% each).

I don't know anyone who has retired for 31 years. As a matter of fact average life expectancy for a cop after retirement is about 5 years. So should his family get a refund of the rest of his contributions? It averages out and it's not without risk, but the pension has been very prudent about balancing their portfolio.

Let me guess, all your money is socked away in gold ingots under your bed?

sourdough44 10-04-2012 21:25

The USPS missed a 5 Bil $$ payment the other week. Do we need another reminder we are out of money? We can't continue to borrow 40 cents on every dollar spent. I realize few want to really cut anything, Europe here we come.

jpa 10-05-2012 02:25

Quote:

Originally Posted by sourdough44 (Post 19486653)
The USPS missed a 5 Bil $$ payment the other week. Do we need another reminder we are out of money? We can't continue to borrow 40 cents on every dollar spent. I realize few want to really cut anything, Europe here we come.

The USPS is learning a hard lesson about not using funding for long-term liabilities to pay for operating costs. That's the same problem a lot of states are getting themselves into. Without the power of compounding returns on their investments, the bill that's going to come due is only going to get bigger and bigger. They need to suck it up, fund pensions fully and move forward. The politicians who used the pension contributions to pay for pet projects, new programs and random other bureaucratic nonsense need to go to jail.

certifiedfunds 10-05-2012 06:42

Quote:

Originally Posted by jpa (Post 19487007)
The politicians who used the pension contributions to pay for pet projects, new programs and random other bureaucratic nonsense need to go to jail.

What do we do with the politicians who negotiated unrealistic pension obligations in the first place?


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