One of the key purposes of this blog is to bring attention to the growing pension problem and to try educate those who make policy (politicians) or report on pensions (media). It is a complicated issue that has concepts and a language that is difficult for many to understand. In interviews with other pension experts one of the interesting aspects of pensions is that most employees who have defined benefit pension plans have no idea of the value of the plans.
Clarity is required to have a well educated public discussion on pensions.
To try an bring about clarity the CNPA association for newspapers in California focused on the issue at a recent conference. The coverage of the conference was reported on in Publishers preview pension problems The article pointed out:
• Public employee unions want to deny the problem but the truth is dawning on them and their members.
• Many politicians underestimate the problem either because they don't understand it or don't want to tell the voters they have to cut services and raise taxes to correct a problem they didn't see coming when they gave away the store.
• Some politicans do get it. They are bargaining hard with unions and pushing reforms. They are having luck reducing the pensions of employees who will be hired in the future.
At the pension portion of the conference one presenter was Dan Borenstein. Dan is a veteran in the pension battles reporting for the Contra Costa Times. He has brought to light many pension problems in the state of California.
There continues to be a litany of problems for public sector pensions. Not only in the US but here in Canada as well. In Canada we need reporters who will become pension crusaders. Until that happens the issue will remain under the sight lines of most Canadians and politicians who hate the issue will continue to sweep it under the carpet until there is a rising crescendo of taxpayer voices that demand to be heard. In the meantime the problem will float merrily along with more and more lip service being paid to it, without any real action being taken.
In the meantime we hope that more article like this one will be seen in the Canadian media. There was no recession for gov't pensions. The article points out that:
Only government-employee union officials at this point are denying the reality of California's pension crisis, as public pension debts estimated as high as a half-trillion dollars are crushing state and local governments and threatening to increase the burden on already hard-pressed California taxpayers. Meanwhile, the disparity keeps growing between government employees, who retire with guaranteed cost-of-living-adjusted benefits that too often top $100,000 a year, and private-sector employees who must rely on 401(k)-style plans supplemented by the increasingly shaky Social Security system.
As you are aware the issue is as big a problem in Canada. A 401K is the US version of our RRSP. Lets hope the media gets on board with a thorough discussion of pensions and begin to address the issue more. Oh well, maybe when the election is done. We remember Kim Campbell stated, an election campaign was no time to discuss serious issues!
BIll Tufts
Fair Pensions For All
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