State pension inflation protections start to get cut

[GoRed]

I'll jump in medias res to address some points made in this thread, using my perspective as a state employee.

1.) The median for salaries for IT personnel in the state of Texas are 50k-60k. Rarely do we get employers with 6 figures or even close to it. Those are very high level, and would be CIO's or Chief architects in private companies. Remember that Texas is a large state with well over a hundred thousand employees, servicing a population of ~25 million. At Dell, for example, where I used to work, just about all middle to senior software developers made close to or above six figures.

The site I linked to does not distinguish between levels or employees. So a programmer could easily be just a desk clerk, or the Security Lead for the entire department.

I can't speak for Psychiatrist or the finance guys salaries, which is admittedly jaw-dropping, but I assume there must be a market for them out there.

2.) Not sure how moving all new employees to 401k plans would work. The retirement system here in Texas, and I'm sure in other states, depends on current employees contributions to stay afloat. Private companies can write it off, but the state would have to sell the wirte off to the tax payers. Tax payers, I think, would simply prefer that they up government employee contributions (as they just did this past January) in any crises.

3.) Double dipping is a big problem where I work, imo. Not only is a person essentially drawing double salary for doing the same work as another, but due to some arcane federal regulation double-dippers are not allowed to contribute to the pension fund. Its a nice gig and every retiree here seemed to be angling for it. The result is that there is less money going to the pension fund because those jobs are tied up by the retiree and less jobs are available for younger, more energetic personnel.

However, the legislature seems to have wised up and is now forcing the department that hires a double-dipper to pay the contribution out of the departments budget. So a double-dipper better be worth it to the department to be rehired, instead of just being buddies with the hiring manager.

 

[ziggy29]

However, the legislature seems to have wised up and is now forcing the department that hires a double-dipper to pay the contribution out of the departments budget. So a double-dipper better be worth it to the department to be rehired, instead of just being buddies with the hiring manager.

Frankly, I'd like to see the practice of double-dipping in the public sector either eliminated or tightly restricted, particularly when the retiree is eligible for a pension and health insurance in "retirement". I say this not *only* from the angle of being a concerned taxpayer, but in this era of 15%+ "real" unemployment if you can afford to retire and start collecting retirement benefits, you can afford to let someone else who *needs* the job have it.

 

[FinanceDude]

Tuition increases in state universities are largely due to
1) demand for more expensive subjects
2) reduction in state support
3) desire to study at a research university

they have studied the instructional costs of subjects taught in 1968 that are taught today. There is not much change relative to the cost of living

So, this article is a fake?

College tuition is far outpacing the cost of living - Aug. 20, 2008

 

[ronocnikral]

Frankly, I'd like to see the practice of double-dipping in the public sector either eliminated or tightly restricted, particularly when the retiree is eligible for a pension and health insurance in "retirement". I say this not *only* from the angle of being a concerned taxpayer, but in this era of 15%+ "real" unemployment if you can afford to retire and start collecting retirement benefits, you can afford to let someone else who *needs* the job have it.

I agree. my BIL's FIL is a police chief in Utah. he retired on a friday, didn't even clean out his desk, and showed up monday collecting his pension and a salary. and here i thought working in the public sector wasn't about the money, it was about the service...

 

[Emeritus]

So, this article is a fake?

College tuition is far outpacing the cost of living - Aug. 20, 2008

"Dwindling support for higher education from cash-strapped federal and state governments doesn't help the situation."
is one of the major factor I mentioned for state universities
otherwise the article is largely about private universities

 

[FinanceDude]

"Dwindling support for higher education from cash-strapped federal and state governments doesn't help the situation."
is one of the major factor I mentioned for state universities
otherwise the article is largely about private universities

"Doesn't help" is not positioned as a major factor......... I get it, the taxpayers abandoned public universities, so like all your analogies, it's the taxpayer's fault they don't support education.....not like I haven't heard that one before.........

 

[Texas Proud]

We have a 1.8 multiplier at 30 years service if you started before 1979. Much less for new hires.

That sounds a lot more reasonable compared to others I hear about... does it have a COLA when you start getting benefits If so, then maybe it is on the edge or just over.

The other is that no matter what percent... having it based on the last 3 years (or even the highest paycheck I saw for the police chief)... then there is an ability to game the system...

I would much rather see a cash balance account... you put in your money... the state matches... it is invested in treasuries (safe)... and at the end you have a pile of money to buy an annuity.... simple... no unknown liability, no gaming the system.. no let me start getting my pension and then get hired back (well, you could, but it really doesn't matter as you start your pension early you get less...)

 

[ziggy29]

"Dwindling support for higher education from cash-strapped federal and state governments doesn't help the situation."
is one of the major factor I mentioned for state universities
otherwise the article is largely about private universities

This graph shows college costs up 439% since 1982, while the CPI is up 108%. Now I think the CPI is largely farcical and hides much of the real inflation most people feel, but still -- if college costs matched the CPI, we should be paying $2.08 in tuition today for every dollar spent in 1982, not $5.39. There's no way that public funding has dropped *that* much or even close to it. You'd have to believe that real public financial support has dropped by about 60% to account for that.

I see two main factors in the difference: one is the huge increase in labor and retirement costs. The other is an increase in demand as everyone buys what is increasingly the Big Lie about the need to go to college. People are willing to eat dog food in order to make sure their kids get into college today, despite the fact that we are developing a glut of college graduates who are finding that a degree no longer means a good, high-paying job as a given -- and that it increasingly means unemployment and $100,000 in student loans. Education past the K-12 level has become an "arms race."

 

[Emeritus]

3.) Double dipping is a big problem where I work, imo. Not only is a person essentially drawing double salary for doing the same work as another, but due to some arcane federal regulation double-dippers are not allowed to contribute to the pension fund.r.

Our State plan put q strict limit on double dippers. They can pay you up to a total of your pension and salary equal to your high 3 but no more (there are special rules for certain teachers)

So as an Emeritus faculty member I work "part time" teaching the courses they need.
But they cant hire me for a "full time" job without me giving up the pension and going back into the system. And the system is statewide so moving to another school has no effect.

 

[Texas Proud]

I'll jump in medias res to address some points made in this thread, using my perspective as a state employee.

1.) The median for salaries for IT personnel in the state of Texas are 50k-60k. Rarely do we get employers with 6 figures or even close to it. Those are very high level, and would be CIO's or Chief architects in private companies. Remember that Texas is a large state with well over a hundred thousand employees, servicing a population of ~25 million. At Dell, for example, where I used to work, just about all middle to senior software developers made close to or above six figures.

The site I linked to does not distinguish between levels or employees. So a programmer could easily be just a desk clerk, or the Security Lead for the entire department.

I can't speak for Psychiatrist or the finance guys salaries, which is admittedly jaw-dropping, but I assume there must be a market for them out there.

2.) Not sure how moving all new employees to 401k plans would work. The retirement system here in Texas, and I'm sure in other states, depends on current employees contributions to stay afloat. Private companies can write it off, but the state would have to sell the wirte off to the tax payers. Tax payers, I think, would simply prefer that they up government employee contributions (as they just did this past January) in any crises.

3.) Double dipping is a big problem where I work, imo. Not only is a person essentially drawing double salary for doing the same work as another, but due to some arcane federal regulation double-dippers are not allowed to contribute to the pension fund. Its a nice gig and every retiree here seemed to be angling for it. The result is that there is less money going to the pension fund because those jobs are tied up by the retiree and less jobs are available for younger, more energetic personnel.

However, the legislature seems to have wised up and is now forcing the department that hires a double-dipper to pay the contribution out of the departments budget. So a double-dipper better be worth it to the department to be rehired, instead of just being buddies with the hiring manager.

A few things that are not quite right....

The retirement system is NOT like the SS system where we 'need' the payment of current employees to pay off retirement benefits.... it is considered 'funded'... so they COULD stop all benefits going forward and there would not be a major problem... I do not know how underfunded it is right now... but I remember it being 10 billion a few years ago...


It does not matter that the employee does not pay into the system when they start to double dip.... because their benefits are not going to go up... they are now working at a salary that does not include retirement benefits... which goes to show that some people WILL work without these benefits...

 

[Emeritus]

This graph shows college costs up 439% since 1982, while the CPI is up 108%. Now I think the CPI is largely farcical and hides much of the real inflation most people feel, but still -- if college costs matched the CPI, we should be paying $2.08 in tuition today for every dollar spent in 1982, not $5.39. There's no way that public funding has dropped *that* much or even close to it. You'd have to believe that real public financial support has dropped by about 60% to account for that.

I see two main factors in the difference: one is the huge increase in labor and retirement costs. The other is an increase in demand as everyone buys what is increasingly the Big Lie about the need to go to college. People are willing to eat dog food in order to make sure their kids get into college today, despite the fact that we are developing a glut of college graduates who are finding that a degree no longer means a good, high-paying job as a given -- and that it increasingly means unemployment and $100,000 in student loans. Education past the K-12 level has become an "arms race."

Real public funding of universities has dropped enormously.
for one source

• From fiscal years 2002 to 2007, the Texas state budget was cut in terms of real dollar, per-student funding for universities by 19.92%; for community colleges the per-student cut was 35.29%.

Texas Where We Stand: Education
And that was just for those 5 years. I can only speak for my department but in 1990 State funding was 80 percent of our budget and last year it was 25% I also wrote that people increasingly want to study at a research university. Research universities compete on a wordwide basis for academic talent.

Everyone keeps complaining about government employees. Those complaints are meaningless in the context of faculty at major universities Universities are a highly competitive internationally focused academic business. We dominate the world. We set high standards and demand a great deal from our workforce. If you think you can run a world class university on the cheap there are lots of places to try.

 

[Emeritus]

That sounds a lot more reasonable compared to others I hear about... does it have a COLA when you start getting benefits If so, then maybe it is on the edge or just over.

The other is that no matter what percent... having it based on the last 3 years (or even the highest paycheck I saw for the police chief)... then there is an ability to game the system...

I would much rather see a cash balance account... you put in your money... the state matches... it is invested in treasuries (safe)... and at the end you have a pile of money to buy an annuity.... simple... no unknown liability, no gaming the system.. no let me start getting my pension and then get hired back (well, you could, but it really doesn't matter as you start your pension early you get less...)

Based on base salary, no overtime, high three
Faculty have the choice of a 403b system operated by TIAA-CREF that provides exactly the benefit you describe.

 

[Emeritus]

"Doesn't help" is not positioned as a major factor......... I get it, the taxpayers abandoned public universities, so like all your analogies, it's the taxpayer's fault they don't support education.....not like I haven't heard that one before.........

Not a question of fault, its a question of public policy. If the return on a degree is high the cost should be paid by the student.

 

[ziggy29]

Not a question of fault, its a question of public policy. If the return on a degree is high the cost should be paid by the student.

So are we saying that philosophy degrees should be almost entirely taxpayer-subsidized while degrees in science, engineering, business and pre-professional studies should have no subsidy at all (and perhaps charged more than cost in order to subsidize history majors)?

[Edit to add: If some majors are charged more because of the need to pay higher salaries to compete with private industry in that field, that's one thing and I can see that. But I don't think taxpayer subsidies should vary.]

 

[FinanceDude]

Not a question of fault, its a question of public policy. If the return on a degree is high the cost should be paid by the student.

The system is set up that way already..........

So, the pre-med undegrad student should pay more than the philosophy undergrad for their tuition? Good luck with that one!

 

[FinanceDude]

So are we saying that philosophy degrees should be almost entirely taxpayer-subsidized while degrees in science, engineering, business and pre-professional studies should have no subsidy at all (and perhaps charged more than cost in order to subsidize history majors)?

[Edit to add: If some majors are charged more because of the need to pay higher salaries to compete with private industry in that field, that's one thing and I can see that. But I don't think taxpayer subsidies should vary.]

I think some professors have too many years in academia to know how the real world works..........it is a common malady.........

 

[donheff]

I have known many government employees over the years.
Not one has been overworked or put under near the stress that employees such as my self have been submitted working in an industry that is monitored 100% of the time by numerous federal employees on site who can artibtrarily shut down the lines and make life miserable for no justifiable reason.

Gotta call this one out. Not one overworked or overstressed? You must have a very limited exposure. I liked many aspects of the jobs I held in over 30 years fed and 5 years city but there was substantial stress in every job. High levels of stress induced me to make a 180 from HR to IT in the mid 90s. Ten years later I pulled the plug on my IT career which I liked enough to have continued into my 60s were it not for high levels of stress. You had federal inspectors looking over your shoulder, we had auditors second guessing our every move. Virtually all of my peers experienced high stress and we were in standard bureaucratic environments. What do you say about law enforcement - another group of government employees? No stress there?

 

[Emeritus]

Since the state cannot declare bankruptcy, the federal government can put the state into receivership.

No it can't. There is no such power.

 

[Emeritus]

I have known many government employees over the years.
Not one has been overworked or put under near the stress that employees such as my self have been submitted working in an industry that is monitored 100% of the time by numerous federal employees on site who can artibtrarily shut down the lines and make life miserable for no justifiable reason.

wow , you never met a member of the military? Or a fire fighter? Police officer? Air traffic controller? VA physician or nurse? Prison guard? Urban social worker? Mental hospital caretaker? My father was a cloud chaser, who rode DC-3s through nuclear fallout clouds to collect radioactive samples. FSOs have died at their embassy for their country. Are you saying that their stress free lives don't compare with the life altering worry of having a production line shut down? Or just that you never met one?

 

[NeverBored]

Tuition increases in state universities are largely due to
1) demand for more expensive subjects
2) reduction in state support
3) desire to study at a research university

they have studied the instructional costs of subjects taught in 1968 that are taught today. There is not much change relative to the cost of living

I'm on staff at a large public university - in the last 10 years, my responsibilities have moved from 100% student support & advising to 20% student support & advising / 80% dealing with mandatory federal and state data reporting. Just in our one college (of eight within the university) we have also added an Assessment office with one faculty (who does not teach) and one staff member. Several faculty have been moved from teaching to assessment responsibilities to comply with state and federal assessment requirements. Several years ago, the state imposed a mandatory comprehensive assessment with no financial support. The choice was to eliminate the programs, pass all fees to the students, or cut everywhere else to come up with the resources. We're doing a combination dance, but it's hurt everything. The constant demand for increased data (which is mostly useless) has bloated the payroll - but feds and state legislature keep upping the requirements.

So you need to add "increased data and assessment requirements" to that list.

 

[Emeritus]

So are we saying that philosophy degrees should be almost entirely taxpayer-subsidized while degrees in science, engineering, business and pre-professional studies should have no subsidy at all (and perhaps charged more than cost in order to subsidize history majors)?

[Edit to add: If some majors are charged more because of the need to pay higher salaries to compete with private industry in that field, that's one thing and I can see that. But I don't think taxpayer subsidies should vary.]

I was describing the public policy claim. First of all "return on a degree" is not the same as salary. and High private return in this context is relative, not absolute. Education is a mix of what economists call public and private goods. It has public and private returns. It is understood than when you talk of salary related to education you are describing the private return and ignoring the public return. As an example the cost of educating a cadet at West point is enormous. The return in that case is almost all public, i.e. we need West point graduates for the society. So we pay the full cost and then some. When we talk of fairness in students paying tuition we are describing the "private return". If the private return is high and the public return is low it is easy to justify the student paying full cost tuition. The absolute cost of tuition is related to the cost of the education.

Engineers have high salaries and the education is expensive. For more than a hundred years we have believed that the public return is high relative to the private return. That is why we subsidize the education of engineers, Nurses, Teachers and many other professions, despite the costs.

In some professions like law, the private returns are very high but the public also needs some of the professionals. In such cases it is rational to have the students pay the money and then repay their educational costs as they do public service.

Many researchers believe that the return on classic "liberal arts" like philosophy and history is split about half and half between public and private. The absolute return is not high, but the education is fairly cheap.

Music and other arts are another story. The education is expensive and the total return is not high by the measure we use. But those measures may be flawed. Its hard to quantify the value of culture, so we guess.

 

[Emeritus]

I think some professors have too many years in academia to know how the real world works..........it is a common malady.........

When we are describing the cost and return and competition etc in higher education, academia is the real world.

 

[FinanceDude]

When we are describing the cost and return and competition etc in higher education, academia is the real world.

You need to get out more............

 

[Emeritus]

You need to get out more............

Oh I do. But to a farmer the farm is the real world. to a banker a bank is the real world, to an actor the theater is the real world. Like the blind men and the elephant we all have a part of the "real world" in our hands.