Thursday, August 19, 2010

They Want Your Pensions, Too

They must really hate the middle class. While Republicans repeatedly go to the mat for corporate profits, outsized bonuses, and favorable tax schemes for the wealthy, they begrudge middle class public sector employees because most have pensions that are still intact.

Economist Dean Baker has a good read on the manufactured outrage with some conservatives who not only want public pensions to be slashed, they blame the recession on them. Baker has a range of good reasons why this is achingly stupid. I will add here that the public sector has not always faired this well; historically it has lagged appreciably behind the private sector. Even so, Baker notes that when age, education, and job skills are fully accounted for, overall pay in the public sector still lags the private. And there is that other little detail; public employees pay into their pension plans year after year. Apparently they are naïve and selfish to expect those pensions to be there when they retire.

If there is a narrowing in the pay difference, surely it is because corporate America has been allowed to ravage private pensions, while having less direct access to those in the public sector. Strong unions have been but one reason. The real problem is not that public pensions are mostly intact, but rather that so many private retirement plans are not.

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