How to Fix Government Pensions

Many government public pensions are way more generous than private pensions. They are designed in a manner that truly rips off the taxpayer. The situation is so bad, that the unfunded pension liabilities are going to bankrupt cities and states. This is not only bad for those cities and states, but bad for the government employees who may collect much less pension than they were expecting. There is a need to correct these problems in a manner that is fair to both the government employees and the taxpayers.

How did this happen in the first place? There is a very serious, obvious conflict of interest between public unions ( a legal labor monopoly that should not exist at all because it has all the adverse impacts of banned business monopolies) and the politicians, who get elected with union support (time, money, and votes), that negotiate wages, pensions, and benefits with the people who got them their jobs.

Here are my recommendations:

Fund all public pension liabilities that exist and new ones that are created. You can't use government bonds to fund them; you must use taxes that are invested by qualified, non-interested commissions subject to rules and review. However, if that funding requires a tax increase greater than inflation or a tax increase two contracts in a row, then publicly state how much in total and by average taxpayer, and hold an election in which voters can accept or reject the contract.

Eliminate the conflict of interest between public unions and politicians. The simplest, most effective way would be to ban public unions. Other less effective solutions may work such as point 1. Arbitration of union contracts by non-politicians who are not interested parties could be another solution.

3. Overtime pay may not be utilized to calculate income in pension determinations. Furthermore, management and professions, just as in private industry, can not be paid overtime, but are expected to work overtime as required to fulfill the duties of their jobs.

4. To avoid the spiking of pensions through either massive overtime or phony promotions in the years just before retirement, annual income for pension calculations will be the highest consecutive 5 year average of the last ten years and again can not use overtime pay. No pension amount can exceed 55% of this five year average annual pay. You get 1.5% credit for each full time year worked, not to exceed 55% in total. Part time years get partial credits in proportion to a 40 hour week.

5. Full pensions cannot begin until age 65 and partial pensions until age 55. For each year of retirement before age 65, the pension amount will be reduced 4% from the full pension amount.

6. Government workers must also contribute to and receive Social Security. Calculated pension amounts will be further reduced by half the projected Social Security benefit.

7. Government workers who are married at the time of retirement may choose to allow their spouses to collect their pension after they die. However, the amount of pension collected will be further reduced based on life expectancy tables of the husband and wife.

8. No cost of living raises will be allowed on government pensions.

9. Should there ever be a default of a government pension so that only partial benefits can be paid, those collecting pensions that were calculated utilizing overtime pay, would have their pensions reduced first to what their pensions would have been without overtime pay. Then all pensions, if still needing to be reduced, will be reduced by the same percentage.

10. In the future, eliminate government pensions and just contribute to 401K plans (no more than 5% a year). 80% of taxpayers have no pensions and should not be on the hook to fund extravagant government pensions.

What I have proposed is essentially the way private pensions work. Federal pensions should not exceed the private pensions of those taxpayers who get them.

School and other Bond Referendums - Information Black Hole

Voters just approved a 312 million dollar bond referendum for schools in my county. No information other than how much it would cost was given on the ballot. How is someone supposed to make an intelligent decision to approve or disapprove? Prior to the elections, there was precious little information in local papers other than how many schools were to be built and what they each would cost. One school is estimated at 145 million dollars plus land costs. You could build a palace for that price! There should be a law forcing government to give pertinent facts on all bond votes such as:

Cost per square foot and cost per classroom. (for roads, cost per mile, etc.)

Cost of the school building and cost of the athletic fields/stadiums separately.

Average cost per household of the bond total.

Costs in total and costs per household of all other outstanding bonds.

Projected repayment costs of principal plus interest as an annual dollar total and percentage of tax revenues.

Is this an interest only bond with a principal balloon payment at the end (probably necessitating a refinancing to pay off the principal)?

It seems that if you just put the word "school" in front of a bond referendum that it is likely to pass without any serious review by voters. That is fiscal insanity!

A State with No Republicans

Very interesting...Note this. A US State with zero Republicans in office -
The State of Illinois. Think about this.
Some interesting data on the 'state' of Illinois... There are more people on welfare in Illinois than there are people working. Chicago pays the highest wages to teachers than anywhere else in the U.S. averaging $110,000/year. Their pensions average 80-90% of their income. Wow, are Illinois and Chicago great or what? Be sure to read till the end. I've never heard it explained better. Perhaps the U.S.should pull out of Chicago? Body count: In the last six months, 292 killed (murdered) in Chicago. 221 killed in Iraq; AND Chicago has one of the strictest gun laws in the entire US.
Here's the Chicago chain of command: President: Barack Obama .
Senator: Dick Durbin . House Representative: Jesse Jackson Jr. .
Governor: Pat Quinn . House leader: Mike Madigan . Atty. Gen.: Lisa Madigan (daughter of Mike) . Mayor: Rohm Emanuel . The leadership in Illinois - all Democrats. . Thank you for the combat zone in Chicago.
Of course, they're all blaming each other. Can't blame Republicans; there aren't any! .
Chicago school system rated one of the worst in the country. Can't blame Republicans; there aren't any!
State pension fund $78 Billion in debt, worst in country. Can't blame Republicans; there aren't any!
Cook County (Chicago) sales tax 10.25% highest in country. Can't blame Republicans; there aren't any!
This is the political culture that Obama comes from in Illinois. And he is going to 'fix' Washington politics for us?
George Ryan is no longer Governor, he is in the prison.
He was replaced by Rob Blajegovitch who is that's right, also in the prison.
And Representative Jesse Jackson Jr. resigned a couple of weeks ago, because he is fighting to not be sent to...that's right, prison.
The Land of Lincoln, where our governors make our license plates.
But you know what?
As long as they keep providing entitlements to the population of Chicago, nothing is going to change, except the state will go broke before the country does.
"Anybody who thinks he can be happy and prosperous by letting the Government take care of him; better take a closer look at the American Indian."
Don't forget Detroit another good example.
Some of you might find these data interesting. ALL SHOULD. There are actually two messages here. The first is very interesting, but the second is absolutely astounding -- and explains a lot!
A recent "Investor's Business Daily" article provided very interesting statistics from a survey by the United Nations International Health Organization.
Percentage of men and women who survived a cancer five years after diagnosis:
U.S. 65%
England 46%
Canada 42%
Percentage of patients diagnosed with diabetes who received treatment within six months:
U.S. 93%
England 15%
Canada 43%
Percentage of seniors needing hip replacement who received it within six months:
U.S. 90%
England 15%
Canada 43%
Percentage referred to a medical specialist who see one within one month:
U.S. 77%
England 40%
Canada 43%
Number of MRI and CT scanners (a prime diagnostic tool) per million:
U.S. 71
England 14
Canada 18
Percentage of seniors (65+), with low income, who say they are in "excellent health:
U.S. 12%
England 2%
Canada 6%
And now for the last health statistic:
National Health Insurance:
U.S. NO
England YES
Canada YES
And check this last set of statistics!!
The percentage of each past president's cabinet who had worked in the private business sector prior to their appointment to the cabinet....
You know what the private business sector is. A real-life business, not a Government job. Here are the percentages.
T.Roosevelt................... 38%
Taft...........................40%
Wilson ....................... 52%
Harding....................... 49%
Coolidge.......................48%
Hoover ........................42%
F. Roosevelt...................50%
Truman.........................50%
Eisenhower.................... 57%
Kennedy........................30%
Johnson........................47%
Nixon..........................53%
Ford...........................42%
Carter.........................32%
Reagan.........................56%
GH Bush........................55%
Clinton .................. ...39%
GW Bush........................55%
Obama.......................... 8%
This helps to explain the incompetence of this administration: only 8% of them have ever worked in private business!
That's right! Only eight percent -- the least, by far, of the last 19 presidents! And these people are trying to tell our big Corporations how to run their business?
How can the president of a major nation and society, the one with the most successful economic system in world history, stand and talk about business when he's never worked for one? Or about jobs when he has never really had one? And when it's the same for 92% of his senior staff and closest advisers?
They've spent most of their time in academia, Government and/or non-profit jobs or as "community organizers." They should have been in an employment line.
Pass this on because we'll NEVER see these facts in the mainstream media.
"One of the penalties of not participating in politics is that you will be governed by your inferiors." - Plato