Analyst paints a sobering pictures of state pension woes
Richard C. Dreyfuss, a business consultant and actuary who worked for the Hershey Co. for 21 years, knows a few things about pensions.
Unfortunately, when it comes to Pennsylvania, most of what he knows are bad things.
Dreyfuss delivered his thoughts on Pennsylvania’s pensions at a Pennsylvania Economy League luncheon recently.
He painted a picture of underfunding, overestimating of investment returns and a ticking time bomb of liability in the billions. If Pennsylvania’s pension system was turned off tomorrow, Dreyfuss said it would face $88 billion in liability.
His sobering facts weren’t unlike those that have come from people pushing for reform of the public employees retirement system in Pennsylvania. But coming from a person removed somewhat from the politics of the state, they carry more weight.
Anyone objectively viewing the facts knows that the state pension system must be reformed, not just for the good of Pennsylvania’s taxpayers but also for the public employees of the future who will be seeking – and are deserving – of some benefits.
Dreyfuss believes pension reform must be based on current funding levels and both predictable and affordable costs for the future. That equation won’t get easier with time.
Pension reform that respects longtime existing employees but makes major fundamental changes for relatively new public employees and those to come is the only way to tame this monster. No amount of politicized massaging of the facts can change that.