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Retired US auto works and benefits
03-13-2009, 08:33 AM
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#1
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Recycles dryer sheets
Join Date: Jul 2008
Posts: 150
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Retired US auto works and benefits
There has been much talks about how expensive it is for the auto companies to pay their retired employees for healthcare and pension.
What about US government employees? Don't you think they are getting way too much benefits also?
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03-13-2009, 08:37 AM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
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huusom, go to the search button and put "government pension" into the Google Custom Search bar. That will bring up a half dozen or more threads, some very recent, where this subject has been discussed.
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03-13-2009, 08:38 AM
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#3
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Thinks s/he gets paid by the post
Join Date: Nov 2005
Location: Colorado, USA
Posts: 1,127
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Nope, I don't think so. I would hope that a life's work would get you a comfortable retirement with medical care.
Coach
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03-13-2009, 08:39 AM
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#4
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Under the old CSRS, maybe so, but what's done is done there, and no one else is being hired into that old plan. But under FERS (the federal retirement plan for most new employees) I think it's much more manageable and much more like the traditional "three-legged" retirement stool. There is a pension component but it doesn't promise the moon and the stars.
The real ticking time bombs are some of the state and local retirement plans, and I would expect some serious battles over those in the next few years, especially if most people continue to believe their 401K-based retirement is permanently busted. We've hit this topic pretty hard lately, mostly as people watch their 401Ks going to zero.
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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03-13-2009, 08:42 AM
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#5
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Recycles dryer sheets
Join Date: Jul 2008
Posts: 150
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Quote:
Originally Posted by Coach
Nope, I don't think so. I would hope that a life's work would get you a comfortable retirement with medical care.
Coach
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I agree, there should be a law requiring all companies to offer the same benefits to their employees as states and fed employees.
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03-13-2009, 09:08 AM
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#6
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Recycles dryer sheets
Join Date: Nov 2005
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People who took government jobs 30 or so years ago, took them at usually lower pay than offered in private industry. The pensions offered were an enticement to get people into government, essentially that was the contract at the time. As time went on, the fortunes in private sector ebbed and flowed and now are ebbing for quite some time, thus government jobs in many cases look like plums, with their defined benefit pensions.
Same thing with the auto industry. Except with auto industry, there is no backup, whereas government has the power to tax to pay the contracted pension.
What is offered at any given time is a reflection of need at the time.
5 years from now things may be much different with private industry thriving and government jobs again going wanting whereby the defined benefit pension again would have to be enhanced instead of downsized. Hard to imagine today, but the psychology changes on a dime.
jug
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03-13-2009, 09:40 AM
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#7
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2005
Location: Chicago
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State and local govt's offered generous pensions in lieu of current pay because the politicians figured they'd be long gone when the time to pay arrived. They "took care" of their current work force by promising them future compensation, then inadequately funded pension plans and relied on future generations to come up with the money.
The best solution to control state and local unfunded generousity is to legislate federally that govt pension funds must by 100% funded (with the most conservation methods of calculation possible) at all times. If you're going to promise your team huge future rewards, OK, but set aside the money to pay for those rewards as the rewards are earned.
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03-13-2009, 09:55 AM
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#8
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Recycles dryer sheets
Join Date: Nov 2005
Posts: 331
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Quote:
Originally Posted by youbet
State and local govt's offered generous pensions in lieu of current pay because the politicians figured they'd be long gone when the time to pay arrived. They "took care" of their current work force by promising them future compensation, then inadequately funded pension plans and relied on future generations to come up with the money.
The best solution to control state and local unfunded generousity is to legislate federally that govt pension funds must by 100% funded (with the most conservation methods of calculation possible) at all times. If you're going to promise your team huge future rewards, OK, but set aside the money to pay for those rewards as the rewards are earned.
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Well thats what many local and state pension plans do. They set up a pension fund, they pour money into it, some from the locality, some from contributions of workers, and they manage it using actuarial methods to keep the fund fully loaded over the course of time to pay out obligations.
The NYS pension fund works this way, that is my pension plan, and it does work, in good times and bad. It all depends on who manages it but regardless managing such a fund is a balancing act in which you have to be conservative to an extent, but yet squeeze out adequate funds from investments. From time to time adjustments are made to employee/employer contributions to keep the fund actuarily sound. Contributions fluctuate according to needs and sometimes are not even needed.
Jug
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03-13-2009, 10:42 AM
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#9
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2008
Location: East Nowhere, 43N Latitude, NY
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Quote:
Originally Posted by huusom
I agree, there should be a law requiring all companies to offer the same benefits to their employees as states and fed employees.
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Apples and oranges.
Companies are for-profit, private sector entities whose revenues come from profits, i.e. sales.
Government (state and fed) are not-for-profit, public sector entities whose revenues come from taxes.
If governments at any level ever tried to equalize public salaries to the private sector, i.e. raise taxes, it would be pitchfork and torch time.
Salary parity between the two sectors will never happen.
Therefore, benefit parity cannot be possible.
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03-13-2009, 10:59 AM
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#10
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2005
Location: Northern IL
Posts: 26,895
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Quote:
Originally Posted by youbet
The best solution to control state and local unfunded generousity is to legislate federally that govt pension funds must by 100% funded (with the most conservation methods of calculation possible) at all times. If you're going to promise your team huge future rewards, OK, but set aside the money to pay for those rewards as the rewards are earned.
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Amen to that. I'd take it a step further and say that should be required for private companies - if they "promise" a pension or "promise" health care, it should be backed with real dollars in a separate account - completely transparent.
Take the example of a person early in their career making a decision between two private jobs. One is lower pay, the other offers better long term benefits. But those benefits are a "promise", and he has no real idea how solid the promise is. So yes, I think if a company even hints at some benefit to attract employees, they should be required to back it fully.
I guess this gets back to my general thinking that we need more transparency. Sometimes the govt needs to get involved to assure the transparency is there, but I prefer regulations to increase transparency to regulations that just increase complexity.
-ERD50
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03-13-2009, 11:03 AM
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#11
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Quote:
Originally Posted by ERD50
Take the example of a person early in their career making a decision between two private jobs. One is lower pay, the other offers better long term benefits. But those benefits are a "promise", and he has no real idea how solid the promise is. So yes, I think if a company even hints at some benefit to attract employees, they should be required to back it fully.
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True. Just as some public employees may say they have chosen the "lower pay" (increasingly not as true in many fields) for the benefits and job security, so too have those choosing private sector factored everything in as well. But when private sector workers see their pensions frozen, suddenly that deal they signed up for was changed for the worse.
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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03-13-2009, 11:07 AM
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#12
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Quote:
Originally Posted by freebird5825
If governments at any level ever tried to equalize public salaries to the private sector, i.e. raise taxes, it would be pitchfork and torch time.
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Some would argue this is already the case....... However, like I always say, any public employee that thinks they have a poor situation could always try the private sector.......
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03-13-2009, 11:20 AM
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#13
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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I agree with the existence of the perception of "highly paid" pubic employees. The reality may be yet another thing. It really depends on the govt entity, level (fed/state/county/city/town), the c*reer field, the health of the agency's budget, the size of the tax base. etc. Too many variables to generalize.
Public employees at lower or entry level grades do not earn a lot, from what I have personally seen in the federal sector. Once they have invested the time in grade and/or service, then the salary increases happen, albeit at a snail's pace.
I've been in both private and public sector. Hands down, public sector was better EXCEPT for the salary growth potential. YMMV.
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03-13-2009, 11:49 AM
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#14
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Recycles dryer sheets
Join Date: Jun 2008
Posts: 184
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Retire after 20 years?
Quote:
Originally Posted by Coach
Nope, I don't think so. I would hope that a life's work would get you a comfortable retirement with medical care.
Coach
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Life's work ??
20 years?
Plus, every city, county, state, water district, anything paid for by taxpayers goes along for the ride.
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03-13-2009, 12:03 PM
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#15
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Quote:
Originally Posted by Hal3
Life's work ??
20 years?
Plus, every city, county, state, water district, anything paid for by taxpayers goes along for the ride.
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Our school district is looking to hire 3 new kindergarten teachers, only 1 year experience necessary. Starting pay? $50,000 plus benefits. Not bad for a 24 year old teacher......
Again, demographics play a role.
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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03-13-2009, 01:07 PM
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#16
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Recycles dryer sheets
Join Date: Jun 2008
Posts: 184
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I could do that. I'd have to lose a little bit more of my hearing first ... but.... 50k - plus benefits. Do they have dental?
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03-13-2009, 03:30 PM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Location: Hooverville
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Quote:
Originally Posted by jug
5 years from now things may be much different with private industry thriving and government jobs again going wanting whereby the defined benefit pension again would have to be enhanced instead of downsized. Hard to imagine today, but the psychology changes on a dime.jug
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Do you know of any nation once there was a large tax supported population of governemnt workers which ever rolled that back significantly?
The only one I can think of is the UK under Margaret Thatcher.
Ha
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03-13-2009, 04:15 PM
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#18
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Thinks s/he gets paid by the post
Join Date: Aug 2006
Posts: 2,433
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Quote:
Originally Posted by jug
Well thats what many local and state pension plans do. They set up a pension fund, they pour money into it, some from the locality, some from contributions of workers, and they manage it using actuarial methods to keep the fund fully loaded over the course of time to pay out obligations.
The NYS pension fund works this way, that is my pension plan, and it does work, in good times and bad. It all depends on who manages it but regardless managing such a fund is a balancing act in which you have to be conservative to an extent, but yet squeeze out adequate funds from investments. From time to time adjustments are made to employee/employer contributions to keep the fund actuarily sound. Contributions fluctuate according to needs and sometimes are not even needed.
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Let's not get too carried away here. With 70% of the portfolio in equities and real estate on March 31, 2008 (the end of it's last fiscal year), I seriously doubt that the NYS state pension plan is actuarially funded today. How can it be? Since then the stock market is down over 40%.
New York State and Local Retirement System
See page 63 for asset allocation
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03-13-2009, 04:25 PM
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#19
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Join Date: Nov 2005
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Quote:
Originally Posted by FIRE'd@51
Let's not get too carried away here. With 70% of the portfolio in equities and real estate on March 31, 2008 (the end of it's last fiscal year), I seriously doubt that the NYS state pension plan is actuarially funded today. How can it be? Since then the stock market is down over 40%.
New York State and Local Retirement System
See page 63 for asset allocation
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Keep in mind the present situation is just that, present. We are probably near a bottom in both RE and equities. Things will shake themselves out, if not, then we may as well kiss this country goodbye and head over to a more prosperous land, Mexico, at least they have a thriving drug business, so good they are killing themselves over it.
Jug
ole
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03-16-2009, 12:30 PM
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#20
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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I go back to my original point. The PRIVATE sector lost what, 600,000 jobs last month? How many PUBLIC sector jobs were lost? I think a LOT LESS than 600,000.........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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