Average taxpayers pay for pension promises
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#1 May 17, 2008
During the 1990's when the economy and investments were booming,(gosh, remember those days?) school systems were given a pass on their contributions to the retirement system in a effort to keep taxes as lower. That was a well intended move and the economic conditions seemed to support it. During that time, there was no pass for workers contributing to the system from their pay checks, as there shouldn't have been. The point is this, if regular payments are made to the system by all parties, the system has a better chance of remaining solvent and will require no sudden tax payer bail out. Of course when school systems go for ten years at a time with no or minimal contributions to their portion of the retirement system and then have to go back to paying their share, the school district budgets strain; especially since they are being asked to ante up at the same time that the economy is heading down for everybody and revenue is scarce. This year's retirement system surplus was gained in a large part due to returns from investment in Exxon oil stock's strong performance in light of their obscene profits. When that profiteering is finally dealt with, Exxon oil will not be the cash cow it was for the retirement system this year. Making changes with long term implications to the system based on short term investment returns seems ill-advised. Let the system build a surplus over several years. Keep contributions steady, and then see what changes might be warranted.
#2 May 17, 2008
Taxpayers must demand that all cities, towns,counties and school districts give a real estimate of unfunded liability immediately.
Meanwhile, many workers have to save for their own pensions while paying for those who get to retire after 25 and sometimes fewer years.
#3 May 17, 2008
More knee-jerk reaction about oil companies.
Exxon is just big - lots of sales revenue means lots of profit, but their profit margin is quite average for American industry. Not unusual investment returns either. This is why the "profiteering" will never be "dealth with"; every time uninformed consumers force Congress to investigate, Congress finds that the oil companies are not price gouging and in fact are quite retrained considering the inelastic demand for the product. Many other products we buy every day have higher profit margins.
I agree with the rest of your post. Let them accumulate a surplus before considering cutting contributions.
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