You’ve probably read about the poorly funded state pension plans for public employees. Don’t believe it!! There is a tightly wound conspiracy afoot that abuses public employees and their pension rights. Here’s how it works. Actuaries pressure each plan to achieve fully funded status–meaning that ALL current and future benefits are CURRENTLY funded. This is totally unnecessary…do you pay your electric bill 30 years in advance? Next, the Governor of each state appoints his toadies to manage the plan. Usually, they are incompetent and incapable of adding any technical support to the process. And to guarantee any possibility of intelligent result the Governor appoints his/her friends to invest the plan’s assets. This always leads to investment underperformance via bad choices, self-dealing and sometimes theft. The trending pattern is a loss of benefits, elimination of Cost of Living increases and reduction (or elimination) of retiree medical plan coverage. We invite you to ask any friend/family member who participates in one of these state pension plans about recent changes. Keep in mind that this could all be fixed if someone had a loud enough voice to focus on this sad dilemma in the media. But that is unlikely because politicians probably get some form of “kickback” benefit by supporting the status quo. We tried to get this to the attention of 60 Minutes but were unsuccessful. Any ideas?
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