People who go to work for the government with the expectation that it will provide them with retirement security are kidding themselves.
Getting local politicians *and* local unions to think more than a year or two is all but impossible. Do you realize that practically no local jurisdictions even have a Liabilities Budget?
It’s just part of that visionary and long-range thinking on the part of governments.
2 words:
Defined Contribution plan
Okay, it’s 3 words. Sue me. So long as you use Senator Obama as prosecutor, and I use Governor Palin as defense attorney.
In moments of quiet fancy I imagine that one day the Government will pass a law that basically says “In whatever manner the governments acts the same as any private actor, the regulations which govern private actors shall go govern the government.”
But flights of fancy pass, and we’re back to governments running their pension plans far out of whack from GAAP requirements.
I guess government pensions at the local, state, and federal level are going to be one of the big financial scandals of the next decade. There’s no way government collectively can promise what they have and deliver during the retirement of the babyboomer generation.
I’m a professor at a state-owned university in TN. When I started, I was given a choice of a pension plan that would pay me an amount essentially based upon my average salary, or one in which I would be given 10% of my gross salary each month to invest where I choose (TIAA-CREF). Hmmm, they promise to pay me when I’m retired, or they give me money now to invest. Which should I choose? Needless to say, I didn’t (and don’t) remotely trust the state to do what it promises. Granted I’m taking my chances with TIAA-CREF, but I think my odds are better that way.
Yeah, and many people think that a federal job is a job for life, not knowing that a lot of agencies sub-contract work out. Oops, lost your contract? Sucks to be you. My pension plan/401k is through a private company, not the federales.
“Orville wrote:
Yeah, and many people think that a federal job is a job for life, not knowing that a lot of agencies sub-contract work out.”
Huh? Sure, federal agencies contract work out, but anyone starting a new job knows whether they are taking a civil service job or a contractor job. And they know that if it’s the former (non-term, anyway) they have as good a guarantee as there is that it is a job for life. I’ve never met anyone who went to work for a contractor and then was surprised that they got laid off.