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Making it worse

February 24, 2013

State Sen. Eugene Yaw in a recent story on public employee pensions says he supports forcing new teachers into a defined contribution, 401(k)-style plan. I commend Se....

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(51)

andy33

Feb-24-13 2:54 AM

Just give a big thank you to your union...teachers make great paychecks....why haven't you saved your money....you didn't see the well was running dry!!!!

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USABorn

Feb-24-13 3:53 AM

No Andy..........as long as the public employees are getting theirs, the taxpayers doesn't count! BUT the day of reckoning WILL come if change isn't made. And the 401K route with a maximum of 10% matching would suffice. Let public employees plan for their retirement just like everyone else has to!

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mikekerstetter

Feb-24-13 5:04 AM

USABorn-"Let public employees plan for their retirement just like everyone else has to!"

They did, and they do. They pay 6.5% of their pay and upwards (depending on which government agency they are employed by and which pension system [SERS or PSERS] they are placed in) in to the pension fund.

You say that you think a 10% matching fund system would work, but the governments didn't pay in their matching 6.5% or 7.5% matching funds into the current system, so why do you think that your plan would be any different?

It's a fact that, for most public employees, they are paid less than their private industry counterparts, even when the costs of benefits and pensions are figured in.

The public employees have planned for their retirement by believing that after they worked for the government and putting in their share of money from their paycheck the Government would do what it promised through legislation and pay them a pension at the end of their career.

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mikekerstetter

Feb-24-13 5:14 AM

andy33-"Just give a big thank you to your union...teachers make great paychecks....why haven't you saved your money....you didn't see the well was running dry"

Andy, I guess you believe, like most of the liberals, if you say it enough it becomes the truth.

Pensions are not a negotiated item in PA. Unions are not involved in negotiations for pensions. Pensions are set by law. That is, if you haven't figured it out, the PA House, PA Senate and the Governor all approved Legislation creating and subsequently modifying both pension systems in PA.

That law REQUIRES public employees to pay a share of their paychecks into the retirement system and sets how the pension will work in exchange for that mandatory payroll deduction. The employees were forced to pay in their share, the Government was not.

I find your disdain for public employees puzzling. They did nothing but choose to work for the Government. Your anger towards them is misplaced. The Government caused the problem.

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mikekerstetter

Feb-24-13 5:22 AM

The writer is partially correct about changing to a 401k system for new employees.

If the government pays in their that they promise to put in, it will eliminate the possibility of having underfunded pensions for new employees when it's time for them to retire.

It won't fix the current employees underfunding problem caused by the Government not putting their share into the fund.

And according to all previous PA court challenges on the subject, the Government has an obligation to honor the existing pensions for current employees and can't change them mid way through their career.

So what Corbett is proposing does nothing to fix the current problem.

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LaughIn

Feb-24-13 5:57 AM

NOT EVERY UNION IS THE SAME. THE PSERS ISSUE IS THE STATES FAULT BUT THE LOCAL TAXPAYERS WILL MAKE UP FOR THE FAILED GAMBLING THROUGH THERE SCHOOL TAXES.

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CHayes

Feb-24-13 6:13 AM

"State Sen. Eugene Yaw in a recent story on public employee pensions says he supports forcing new teachers into a defined contribution, 401(k)-style plan"

I wonder if Sen Yaw supports forcing himself into a defined contribution 401(k) style plan? I mean, he is a public employee.

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Don521

Feb-24-13 6:23 AM

andy33 you should become a teacher. You must be working for minimum wage or near that. Been to the dentist or doctor lately? Hired a lawyer lately? Teachers pay real estate taxes also and have all the bills and desires that you do. I would not recommend any young person go in to teaching just because of the public's attitude. Start a cyber school, collect the $ 9000 per student, buy a $400 computer for each kid, hire someone to oversee it and enjoy life.

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mikekerstetter

Feb-24-13 6:43 AM

LaughIn-"THE PSERS ISSUE IS THE STATES FAULT BUT THE LOCAL TAXPAYERS WILL MAKE UP FOR THE FAILED GAMBLING THROUGH THERE SCHOOL TAXES."

The local School Boards have also failed to pay in their share of the pension money.

Yes, we the taxpayers are going to have to pay to fix the problem our Governments created. But the reality is that it is money we should have paid a long time ago.

It's like a balloon payment on your mortgage. You pay a low payment for a long time in the hopes that when the balloon amount is due you are in a position to make it.

The Government gambled that the stock market would continue indefinitely in paying their share. They lost, and now we are all suffering because of it.

One thing is for sure, the employees had no part in this mess. They did only what they were forced to do by law.

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LaughIn

Feb-24-13 6:56 AM

THE STATE GAMBLED AND LOST, GET OUT YOUR CHECK BOOK BECAUSE THE LOCALS WILL PAY AND THAT MEANS mike karstetter

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enigma

Feb-24-13 8:09 AM

Carol, The pension plan is not a Ponzi scheme (that would be Social Security). Putting new teachers in a 401K progran will not keep you from getting your pension. If you don't get your pension it will be because the county has gone broke from paying you too much for what you do and paying others for doing nothing. Your pension is in the stock market and when it collapses, so will your retirement. How bad are our schools when a college graduate knows so little about how a pension plan works?

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Premier

Feb-24-13 8:30 AM

This all started when wall street was doing great in the 90's. The Ridge administration then increased the pension by 25% by relying on an unrealistic 7.5% return. Then came 9/11.

This would not be as bad as it is today if Fast Eddy wasn't out exploding our budget every year and handing out money like it was candy instead of paying into the fund.

Right now the taxpayers of PA pay 1.1 billion each year and by 2016 it will be 4.1 billion. Get ready for the biggest tax hike we've ever seen.

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andy33

Feb-24-13 9:12 AM

Mr. Mike...if you weren't so defensive concerning ANY criticism of unions, you would see the problem. Funding these big public service unions will break the bank. Simple.

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ToTEXASfromPA

Feb-24-13 9:15 AM

Maybe Act 13 funds ought to be moved to fund the underfunded pension fund obligations and then transition teachers' contributions to 401k defined contribution accounts that they can manage them.

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andy33

Feb-24-13 9:18 AM

When YOUR taxes go through the roof [Mike] , let's see what song you'll sing then. It's time for a restructure of state government, funding for vital programs and all things related to 'who does what for who'....States need to take responsibility for their own educational systems and the funding of them...getting OUT of bed with the feds!

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CMReeder

Feb-24-13 9:18 AM

Good letter spoiled by the responses from Andy, USABorn, enigma.

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andy33

Feb-24-13 9:20 AM

Premier...you are correct in placing the blame...BUT...we don't need another blame game...just solutions!

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andy33

Feb-24-13 9:23 AM

Chuck...are you on the gov't hand out list ?...they are the only ones against cleaning up the mess

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Premier

Feb-24-13 9:24 AM

I wasn't accually placing blame Andy but trying to point out how we got to where we are today.

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CMReeder

Feb-24-13 10:14 AM

"Chuck...are you on the gov't hand out list ?...they are the only ones against cleaning up the mess "

You are full of crap! I am not employed by the government. Pensions were negotiated in good faith by the teachers now that the state can't deliver you advocate bad faith to teachers. You are rat who willingly will jump ship.

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mikekerstetter

Feb-24-13 11:09 AM

andy33-"Mr. Mike...if you weren't so defensive concerning ANY criticism of unions, you would see the problem. Funding these big public service unions will break the bank. Simple."

Andy, if you weren't so full of hate for public employees and their unions you would recognize the fact that the Public Employee nor their Unions have anything to do with the pension underfunding.

I've explained it to you over and over again. You willfully ignore the facts because they're contrary to what you want to believe.

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mikekerstetter

Feb-24-13 11:17 AM

LaughIn-"THE STATE GAMBLED AND LOST, GET OUT YOUR CHECK BOOK BECAUSE THE LOCALS WILL PAY AND THAT MEANS mike karstetter"

Yes, every tax payer will now have to pay because the Government failed to pay their share. It's a common theme, isn't it?

I'm not sure, but it seems that you think that the State Government pays into the PSERS system. While they may for their employees who are in that system, it is the local School Districts who are responsible for the Governments Share of the pension funds and who also didn't pay their share over that decade long period.

It's not that the local School Districts will have to pay what the State didn't put in, the local School Districts have to pay what they themselves didn't put in.

And again, yes, all tax payers are on the hook to repay everything that wasn't put in previously to make the systems solvent.

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mikekerstetter

Feb-24-13 11:23 AM

andy33-"When YOUR taxes go through the roof [Mike] , let's see what song you'll sing then. It's time for a restructure of state government, funding for vital programs and all things related to 'who does what for who'....States need to take responsibility for their own educational systems and the funding of them...getting OUT of bed with the feds!"

Andy, I totally agree that funding for local School Districts should come from local taxes. I think School Boards are more prudent with their spending when they are the ones justifying raising taxes.

But the problem with that is that when you cut out Federal and State funding your local taxes will necessarily 'go through the roof' to make up for that lost revenue unless you cut out a whole lot of programs.

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mikekerstetter

Feb-24-13 12:02 PM

enigma-"Carol, The pension plan is not a Ponzi scheme (that would be Social Security). Putting new teachers in a 401K progran will not keep you from getting your pension. If you don't get your pension it will be because the county has gone broke from paying you too much for what you do and paying others for doing nothing. Your pension is in the stock market and when it collapses, so will your retirement. How bad are our schools when a college graduate knows so little about how a pension plan works?"

True, it will not effect her from getting her pension. But the fact is that money being put into the system now is being used to pay current retirees.

Going to a 401k program for new employees will fix the problem in the long term, but it will do nothing to fix the situation for the short term with existing employees and retirees.

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andy33

Feb-24-13 12:14 PM

Mike...to be clear....I do think States should fund schools in their OWN state...also local tax support...only then will salaries and bennies come in line with reality and comparable with those paying the BILL!!!! This seems to be the only way to solve this issue.....do you have anything better to offer?

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