Home

Empire Center for
  Public Policy


Categories

Manhattan Institute
  for Policy Research

Fiscal Watch Memos

Payroll Watch Archive


   

Enter your e-mail address to receive notifications when there are new posts

 

 

 

February 16, 2012


Pension Casino Royale

E.J. McMahon

OK—I admit it. Those protestors outside our pension reform event in Albany today did get one thing right.  I do think people need to “gamble” some of their retirement savings on Wall Street.

Memo to picketers: you do realize, don’t you, that this guy already is gambling retirement money on Wall Street?  In fact, he’s now got more than $150 billion riding on Number 7.5 (as in, percent assumed annualized return).  If you’ve live in New York City, this guy has got more than $100 billion of your money riding on Number 8 (ditto).

You didn’t think the money was in Al Gore’s locked box, did you?

(Thanks to Rus Sykes for holding the sign up for the camera.)

Filed under: Public Pensions, Uncategorized

5 Comments »

  1. If the public employee unions are angry with you, I know you are doing a great job!

    Comment by Gene Palmer — February 16, 2012 @ 2:08 pm

  2. Of course, the guy who is now gambling with the retirement funds is a professional investor as opposed making all state employees investors of their own financial future. Its OK, I am sure the NYS safety net will catch them when they fail at not that high a cost to the tax payer for increased welfare benefit costs.

    I think its great that each new tier requires workers to work longer at higher salaries, delaying any traditional breakage the state enjoys when higher paid workers retire and get replaced by lower paid new workers. Paying folks higher salaries for longer should just about off set any savings the new tier manages to ring from the system. The only difference will be that retirement contribution costs will be lower while salary costs will be higher. Plus it robs local governments of the opportunity to save money by offering retirement incentives to save money when it finds it necessary.

    Who does the cost benefit analysis of these wacky policy proposals? Totally political and zero substance.

    Comment by Garondah — February 16, 2012 @ 3:05 pm

  3. I retired 15 years ago with little in the way of a pension plan, but an accumulation in a profit share 401 plan. For about 5 years I envied the folks on a fixed pension but a slow and steady inflation rate eventually made my arrangement far superior. I would think a compromise of 50% fixed and 50% 401 type plan could be worked out.

    Comment by George Baum — February 16, 2012 @ 4:25 pm

  4. I don’t think that this tier is a good idea at all.

    It will create more problems than solutions and Tier VII in 5 years will appear.

    Ask any SUNY employee who retired from the ORP — I think they will give you an idea why it isn’t in the best interest of the anyone to go this route.

    Keep the current structure, do reform. Have all active employees no matter what tier contribute 3% towards ERS.

    If there were any paper handouts or a powerpoint presentation, can you post them?

    Comment by Kate — February 16, 2012 @ 4:31 pm

  5. The answer has to be a defined contributions plan. Guaranteeing these type of returns (while also doing 100% of the funding) is unreal and no longer works. The sooner the change to defined contributions (with employee participation)the quicker we will stop digging the Hole.

    Comment by roger scheiber — February 17, 2012 @ 10:09 pm

RSS feed for comments on this post. TrackBack URL

Leave a comment

 

 
 

Empire Center for Public Policy
P.O. Box 7113 - Albany, New York 12224
phone: 518-434-3100