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Editorial Thinking

The city of Pensacola has its own retirement system that is really a collective 401k with employer/employee matching contributions. As the Pensacola News Journal reported: Pension costs pinching City of Pensacola. Big surprise, the investments aren’t doing very well.

So today the PNJ runs an editorial: City’s pension system is no longer supportable

… It needs to be changed and brought into line with the kind of retirement plans private businesses provide.

And in the private sector, the defined benefits plan that issues a monthly check to retirees is all but dead — because businesses can’t afford it.

Neither can government.

Today, defined contribution plans — like 401(k)s — have become the norm. They don’t impose long-term future liabilities on businesses (or taxpayers), are portable when employees change jobs, and cost less to administer.

Today, taxpayers struggling to provide for their own retirements in an increasingly scary economy can’t afford to continue what have become “Cadillac” retirement systems for some government employees.

The private sector is the problem. If the private sector hadn’t so totally screwed up that we were facing a new Depression, the retirement fund would be in good shape. No one looking at their current 401k would seriously recommend it as a retirement plan. Businesses didn’t change because they couldn’t afford the old system, they changed so they could loot it.

If it weren’t for the good benefits, you would be hard pressed to find people willing to take most government jobs. You accept below market rates of pay for the security and benefits government jobs offer. Without those enticements, governments are going to be forced to compete for competent people, and those people won’t stay around. There are lots of formally major corporations that have failed because they stopped showing loyalty to their workforce and productivity suffered. When the only purpose of a corporation is to provide management perquisites, they won’t last. We are in this mess because the private sector made a lot of bad decisions. Emulating the private sector is not a plan for success.

[As an aside – how’s Gannett doing? Forget about using “Cadillac” as an example of luxury. Have you looked at GM lately?]

6 comments

1 catnapping { 03.09.09 at 6:21 pm }

my late hubby and i never ever signed up for 401Ks…we didn’t trust ’em. we actually predicted this shit.

people nowadays are indoctrinated to distrust co-oping, and communal living…pooling resources, sharing. it’s really too bad.

it’s cheaper in the long run, and everybody wins.

geez, i wish we could just undo the last 70 years. maybe even before then…but people didn’t fear communism as much, yet…before the 50s.

people still worked in collectives. i can remember sharing tools with neighbors…sharing food…sharing the work.

taxes..they keep saying the government…the government gets the money. well…aren’t WE the government? isn’t this supposed to be a government of, by, and for the people?

so if we all pool our resources…isn’t that US using the money…as a group? why is it so bad to pay in…and then make sure everyone eats…stays warm, gets medical attention, gets a good education…even into old age?

it bums me out, and frustrates me to no end that so many will only think of their immediate family…the nuclear unit. they actually lose in the end. no one can do everything. we only survived as a species because we worked as clan…we pooled resources, and shared the good and bad.

i hate “the private sector.” i hate capitalism. in the end, it only makes a few people very rich, and screws everyone else.

2 Bryan { 03.09.09 at 8:20 pm }

Actually real capitalism would have killed off the real offenders in this mess, and corporations wouldn’t exist. Corporations are a violation of the basic principle of capitalism – total risk. Loss isn’t limited to the investment in capitalism, it includes everything you own. Ask any small business owner about risk, because they know.

The people who complain about taxes want a “free lunch”. They don’t want to pay for the infrastructure and services that government provides, they just want to use them.

As you say, we are the government. We want the services, so we have to pay for them. You aren’t paying for someone else’s kids to go to school when you pay school taxes, you are paying for the free education that was available to you.

If you don’t want police, eliminate them before you cut the taxes. That’s the way it should be – first cut the spending, then cut the taxes.

People seem to believe that nothing ever wears out, and the infrastructure appeared by magic. Try paying $20+ for a dozen eggs because everything has to be moved by air as there are no roads. See what taxes buy, and then decide whether you want to pay them or do without.

There are problems that are just too big for a family unit to handle, and the only way to solve them is by people working together.

Because of hurricanes I have a lot of experience in living without modern conveniences, and it sucks. My grandfather used to strenuously object when people started talking about the “good old days”. He used to say that they should try having a tooth ache in the “good old days” or diarrhea in the winter on a farm without indoor plumbing.

3 catnapping { 03.10.09 at 1:34 pm }

when i was still a little girl, there was at least one child in every class who wore leg braces…they were survivors of polio.

the salk vaccine came out when i was still little, and then sabin (oral)…

but still, there were children who weren’t vaccinated in time. military families probably got it first…we were probably guinea pigs, actually. luckily the vaccines worked, and didn’t kill us.

i also remember people my dad’s age with scars behind their ears…from mastoiditis. ear infections, untreated with antibiotics….because they just weren’t that available. these folks had to have parts of the bone removed…and they were often deaf in the ear originally infected.

i do see how technology helps, but i’m part luddite…and really believe that technology has hurt us more than it has helped. humans in america have forgotten how to behave. we have pretty one purpose here…to consume/purchase.

in hunting/gathering societies…men worked about 20 hours a week…women about 25 to 30. Now…folks work 50 to 60 hours a week. And their children…omg. Kids need at LEAST 10 hours of sleep a night…they’re getting 6.

Adults are only getting 7. (A century ago, they averaged 9.)

It seems all we do is work enough to pay bills…for some this just to eat and be safe in shelters…but even for the “middle class” this means covering mortgages, and mulitple cars, boats, etc…crap they don’t need. but believed the marketing…capitalism only works if people are buying stuff. new stuff. if they share…or if they just don’t buy new stuff…capitalism fails.

but when i speak of doing the last 70 years over, i’m speaking mostly of the propaganda that convinced americans that communism** was a bad thing and that social darwinism was a legitimate social construct.

**china and the ussr were totalitarian…besides…communism is an economic system, not a political one.

catnapping´s last blog post..Mo

4 Bryan { 03.10.09 at 3:15 pm }

I have a lot of older family members who, like FDR, wore braces all their life. They were normal.

There is no need to adopt a particular economic system to do the right thing. Most of the really necessary things that we need to fix our system aren’t really socialist, they would fall under the heading of “mutual insurance”. just like Mutual of Omaha.

The problem is how we pay for things, not what things to pay for. Private business isn’t interested in insuring everyone, so “the people” need to insure themselves. Rather than requiring people to respond to the “hue and cry” for public safety, the people hire a group to do it for them.

There are minimum standards required to call yourself a society, and the US keeps avoiding the reality that we need to meet those standards for the good of everyone.

5 Kryten42 { 03.11.09 at 3:52 am }

I think that the nothing will change until a very fundamental problem changes. Too many people are either lazy, selfish, antisocial or insanely paranoid (and simply insane). Until that’s fixed, not much is going to change because nobody in these categories cares about such things as ‘the common good’. The primary word in their vocabulary is “ME!”.

6 Bryan { 03.11.09 at 3:29 pm }

People just don’t understand the connections. They don’t seem to understand what they get for their taxes, any more than corporations understand that their employees are also consumers.

Ayn Rand has a lot to answer for, including bad writing.