Perennial failed candidate Mike Protack had an op-ed in yesterday’s News Journal about state employee pensions. His basic idea is from the Paul Ryan school of screw the young people:
There is a way, though, to protect pension rights already earned and provide future stability for employees and taxpayers. There needs to be a partial hard freeze on pension benefits.
Current retirees will see no change, and current workers will keep their accrued benefits but will transition to a 401(k) plan for the rest of their state employment, and new workers will be in a straight 401(k) plan. Workers who move into a 401(k) plan will still receive a pension when they retire, but only the benefits they accrued up to the date of the pension freeze.
An important part of the transition to the 401(k) plans is to pay each state employee 7 percent of their normal pay on each scheduled pay period to invest at their free will. This plan will align public-sector workers with the private sector while also protecting previously earned pension benefits while reducing budget pressures.
For those who say this sort of plan is unfair and can’t happen, they are wrong. As an airline employee my pension was valued at well over $1.5 million dollars. It was not modified or frozen — it was terminated. I was a union employee with a negotiated benefit. It might have seemed to be solid but it was not. Over 13,000 employees were affected, and at the time of termination the pension was over 86 percent funded.
This is not crazy. A lot of corporations are going away from traditional pensions to all 401Ks. Pensions are much more desirable because they aren’t subject to the whims of the stock market. Hopefully public employees should get some benefit from their employment since they are constantly bashed by Republicans.