A systematic fraud is and has been carried on in the world of public employee pensions for years. These pension plans which now total more than $6 trillion in assets are mired in a conspiracy that threatens to destroy the retirement plans of millions of public sector retiree and employees. Despite what you’ve heard many of these plans are well-funded. But plan actuaries–who calculate plan costs–always want more funding no matter how much is already in the trust. Poor management–usually appointed by the state’s Governor–typically pressures participating employees and employers to increase their contributions. Incompetent and/or larcenous investment managers are again chosen politically and their underperformance is legendary. In many cases–like those your editor is very familiar with–investment advisors are actually paid bonuses even if they produce less than half of their target returns. In many states lobby groups and self-organizing retirees have banded together to fight all this BS. But, so far, their impact has been limited. There is little question that the management of these plans is inept and guilty of law/regulation violations but the victims have no real opposing voice. In Ohio, for example, the Ohio Public Employee Retirement System (OPERS) is headed toward the unnecessary elimination of the medical plan for retirees. Nearly 97% of ALL Ohio public employees are ineligible for Medicare. So–if this medical coverage is eliminated–all of these people will be thrown into the insurance market at an advanced age. Imagine the costs they will encounter. And this entire threat is TOTALLY UNNECESSARY. If you know someone who works for a public employer (public school teacher, police officer, county administrator) ask them to check their retirement plan activities out BEFORE making any plans to retire. It may save them real stress if they know what loss of active employment might mean in the access to medical plan coverage or cost of living benefit increases in the future. Until a sense of honesty, fairness and intelligence replaces political bias, incompetence and mass fraud ALL affected individuals will experience a disastrous pension situation that can only worsen.
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