Thread: Protesting in Wisconsin....Just the beginning?

Originally Posted by niftyshaving

I wish I had access to the contracts.
A classic difference is that pay is less but retirement
is at 20 years and the pension rate is 80+% of wages
combined with a rich health plan.

So a private sector dude makes 4% more but has to work
for 45 years and then retires with his 401K or just social
security and must depend on Medicade....

Right, so the comparison has to be made w.r.t the total. Of course, there are more factors, so here's a study I found that gives a lot more details. (Different numbers from the same study are quoted by either side as justification that the public employees are more compensated, or less compensated than their private counterparts, so it's best to look up the meaning of the quoted numbers at the source)

http://epi.3cdn.net/9e237c56096a8e4904_rkm6b9hn1.pdf

Originally Posted by niftyshaving

Then there is the issue of double dip.

I don't understand how this is an issue (other than 'these people are making a lot of money'), whether the pensions for those two separate jobs are paid to one person, or two people it is the same amount that is being paid. I suppose that there is a saving in health benefits are if they go to the same person instead of two different people, since one person can't charge twice for the same medical bill.


I didn't know that the public employees get to retire after 20 years on the job, I thought that's only for law enforcement/military type and if they pick that option the retirement pay is 50%, not 80%.

Originally Posted by gugi

Right, so the comparison has to be made w.r.t the total. Of course, there are more factors, so here's a study I found that gives a lot more details. (Different numbers from the same study are quoted by either side as justification that the public employees are more compensated, or less compensated than their private counterparts, so it's best to look up the meaning of the quoted numbers at the source)

http://epi.3cdn.net/9e237c56096a8e4904_rkm6b9hn1.pdf


I don't understand how this is an issue (other than 'these people are making a lot of money'), whether the pensions for those two separate jobs are paid to one person, or two people it is the same amount that is being paid. I suppose that there is a saving in health benefits are if they go to the same person instead of two different people, since one person can't charge twice for the same medical bill.


I didn't know that the public employees get to retire after 20 years on the job, I thought that's only for law enforcement/military type and if they pick that option the retirement pay is 50%, not 80%.

The retirement age and retirement qualification/vesting age is all
over the map. I just know that a couple high school pals of mine
retired twice. Once at 20 years and later when they hit 60 and
qualified for early retirement.

The link above is a good one -- it does not list the future value
of vested retirement. It does list the single year earning tables
and does show that on a given work year it public service folk
are not overpaid. However I could not see an accrual for retirement
and health insurance in the link.

I know of a computer company in Wisconsin that pays very well
but has zero retirement. Employees are on their own with
a 401K and Social Security.

So retirement pay of 50%+insurance for 20 years is a
a BIG tag along payment. Page 8 says...
"Retirement benefits also account for a substantially greater share
of public employee compensation costs: 8% compared
with 4.6% in private sector organizations with more than
100 employees." But does not state that this larger retirement
benefit is "deferred". It also does not say that it is "nearly double"
the private sector.

One thing that is hammering local governments is this "deferred"
payment. Private companies today shake your hand and
say good by at retirement. State and local employers shake your hand
and then sign 'em up for the plan.

I suspect the above pdf was well researched to make the
point of one side. I suspect there are more facts to consider.

The least of which is that our elected officials have been running
a Ponzi scheme by not funding their retirement plans.

And little of this matters if the insanity in the mid east
erupts into a big oil fueled fireball and we continue
to outlaw coal and more....
Invest in insulation if you have not already.

Right, the issue with the retirement is not very clear. From that paper it appears that there is 8% (or whatever number for the corresponding education bracket) in benefits and that would go into a pension account from which the future pensions would be paid.

That would be what makes sense. If that is true, the problems seem to be (1) poor management of those pension funds, so they actually do not make enough to cover the promised benefits; (2) the government just issues an IOU instead of actually contributing that portion (we know this was/is the case in NJ where it was highly publicized); (3) the government just takes money off that pension fund to pay for other things (seems to be a favorite thing in NY).

All these are chronic problems happening for decades and the problem is with all the politicians during these decades, which tend to keep being reelected. So, if the voters leave things go bad for that long, at some point they ought to suffer the consequences of being that stupid. And when the state goes bankrupt the government employees who hold all these IOUs get to forfeit their benefits as well, or at least large portion of them. I mean they certainly weren't too smart either if they relied on a contract with a government that doesn't appear to have the means to honor it. The same as if you contribute to a private pension fund that just goes bankrupt (or invested yourself in stocks that plummeted), the money is not there, so you're screwed.

That's the scenario I already described in my earlier posts.

In the private sector one instance of the same thing was the so called 'housing bubble', a couple of financial institutions went bankrupt, and many others would've gone too, but under the threat of destroying the whole economy they got bailed out.

At the end of the day those with money/power, on average, always do far better than those without, and that's exactly what the free market is all about, both in economics and politics.

Whether the majority of people without much money/power (who hold the final say via voting) can influence a more pragmatic middle ground solution is yet to be seen. Looking at the news, or even at political threads on SRP, it doesn't seem promising right now.

I don't pretend to understand even half of the details regarding this whole thing, but I know a lot of people who work for the state (I live in Maine). I haven't seen any of them getting rich off their jobs. They are certainly not starving, but I just don't understand the notion that state workers are these people trying to milk us for all we're worth.

I know many are not suggesting this, but we're going through something similar in Maine, and it just doesn't make sense. Our new governor is saying that state workers are bleeding us, and then gives his 23 year old daughter a 43k job in an entry level position.

I wonder what a lot of the talking heads opinions of the AFTRA union is?

Originally Posted by MaritimeFanatic

I don't pretend to understand even half of the details regarding this whole thing, but I know a lot of people who work for the state (I live in Maine). I haven't seen any of them getting rich off their jobs. They are certainly not starving, but I just don't understand the notion that state workers are these people trying to milk us for all we're worth.

I know many are not suggesting this, but we're going through something similar in Maine, and it just doesn't make sense. Our new governor is saying that state workers are bleeding us, and then gives his 23 year old daughter a 43k job in an entry level position.

+1
The trouble with all of this is the people that should understand
all of this do not. Because they do not they failed to understand
their cash and cash flow positions over time and entered into contracts
that may prove impossible to honor.

This places a lot of "agencies" in the position of finding a bad guy
to lump the blame on. Some are so "blind" to reality they will
hire their daughter when the state should have furlough and
reduced hours.

Consider that the board of education can enter into contracts but
does not have control over their funds beyond the current fiscal
year. Yet they enter into contracts that include pension plans
that reach decades into the future. True some of these contracts
are known to the legislature and governor but not understood.

Governors and Mayors will have to make hard decisions but in some cases
their hands are tied because the law requires various activities.
Most of these required program expenses have no link to or limits
on the income side of the balance sheet.

The legislators need to address this -- too bad so many
are on vacation in neighboring states. Perhaps, just perhaps
they are working remotely and will show up with quality
legislation and sane solutions.

No one will like them but if they buck up and tighten up focusing
on an honest balanced budget program removing or limiting
many entitlement programs and more things will not fully fall
apart.

And it is not just collective bargaining (union) contracts that
need "Force majeure" actions to revisit the terms.

Originally Posted by gugi

I don't understand how this is an issue (other than 'these people are making a lot of money'), whether the pensions for those two separate jobs are paid to one person, or two people it is the same amount that is being paid. I suppose that there is a saving in health benefits are if they go to the same person instead of two different people, since one person can't charge twice for the same medical bill.

The issue is not when you work one job and retire, then take up a second job and retire. That is totally legal.

The issue is that one person would hold 2 jobs at the same time. Each job would be "full time" but the employee would only work a portion of a week on each job. Now, you have one person, possibly working one job 80-90% (if you are lucky) of the time and giving lip service to a second job. He is earning a pension on both but only doing the work of one.

Originally Posted by MackofallTrades

The issue is not when you work one job and retire, then take up a second job and retire. That is totally legal.

The issue is that one person would hold 2 jobs at the same time. Each job would be "full time" but the employee would only work a portion of a week on each job. Now, you have one person, possibly working one job 80-90% (if you are lucky) of the time and giving lip service to a second job. He is earning a pension on both but only doing the work of one.

Does this actually happen beyond small number of cases that add up to no financial impact? It seems rather odd if somebody can do two full time jobs simultaneously. And in any case it looks to me something that would be done by a middle or high level executive rather than a teacher. Numbers would be nice.

It is not teachers and blue collar workers that are the culprits here. It is always a politically appointed position given to someone who is already a state employee (usually members of the legislative branch).

As far as numbers, it can't be that many at one time. The problem is that it has occurred over many years. Over time, even a small chink in the armor can be catastrophic.

Right, but those officials are elected, or appointed by elected officials, and tasked with making decisions on behalf of the taxpayers. So, when they screw up the taxpayers are still on the hook for those bad decisions.

What the current political majority in Wisconsin is saying is that it's too bad the guys before us messed it up, now we're going to fix it by just giving a round of tax breaks and just alter the contracts on the low level government employees.
(Anybody still remember the big outcry a couple of months ago over the unfairness of taking an extra 1-2cents on every dollar over $250,000/year? Way better to take 3-10cents on the dollar from all these government employees making $30,000-$80,000/year.)

What I see is just lot of politics and very little interest in addressing the problem in a meaningful way.