Tuesday, March 8, 2011

Public Pension Idiocy

There is lots of huff and puff about how unfunded public pension obligations will bankrupt us all. Funny how we always have the money for banks, war, and tax cuts for the wealthy, but funding retirement for civil servants? Well, they don't deserve it anyway.

It's all horseshit. Paul Krugman has addressed the "truth about pensions." He references an excellent pdf from Dean Baker:

Dean Baker has a deeply enlightening analysis of state pension shortfalls (pdf), containing a lot of stuff I didn’t know. The basic moral is that the official story these days — of years and years of huge giveaways to unions, resulting in gigantic, unpayable debts — is just wrong: to a very large extent, the pension shortfall has emerged just since 2007, thanks to the financial crisis, and even then it’s not nearly as big relative to future state incomes as widely imagined. Here’s a key figure:


It puts an entirely different light on the situation. Whaddya know, we’re being sold a bill of goods.
Dean Baker's work has also caught the attention of Mike Elk, who also cites the work of Keith Brainard, research director of the National Association of State Retirement Administrators (NASRA). Specifically, Brainard has debunked the meme, shamelessly promoted by teabaggers and other assorted Republicans, that we gotta gut those public unions 'cause America just can't afford a middle class.

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