Look Out Below... 'In Budget Crisis, States Take Aim at Pension Costs' - NYT

[WillyT]

Payback Time
In Budget Crisis, States Take Aim at Pension Costs'
By MARY WILLIAMS WALSH
Published: June 19, 2010

<snip>

Many states are acknowledging this year that they have promised pensions they cannot afford and are cutting once-sacrosanct benefits, to appease taxpayers and attack budget deficits.

Illinois raised its retirement age to 67, the highest of any state, and capped public pensions at $106,800 a year. Arizona, New York, Missouri and Mississippi will make people work more years to earn pensions. Virginia is requiring employees to pay into the state pension fund for the first time. New Jersey will not give anyone pension credit unless they work at least 32 hours a week.

“We can’t afford to deny reality or delay action any longer,” said Gov. Pat Quinn of Illinois, adding that his state’s pension cuts, enacted in March, will save some $300 million in the first year alone.

But there is a catch: Nearly all of the cuts so far apply only to workers not yet hired. Though heralded as breakthrough reforms by state officials, the cuts phase in so slowly they are unlikely to save the weakest funds and keep them from running out of money. Some new rules may even hasten the demise of the funds they were meant to protect.

Lawmakers wanted to avoid legal battles or fights with unions, whose members can be influential voters. So they are allowing most public workers across the country to keep building up their pensions at the same rate as ever. The tens of thousands of workers now on Illinois’s payrolls, for instance, will still get to retire at 60 — and some will as young as 55.

One striking exception is Colorado, which has imposed cuts on its current workers, not just future hires, and even on people who have already retired. The retirees have sued to block the reduction.

Other states with shrinking funds and deep fiscal distress may be pushed in this direction and tempted to follow Colorado’s example in the coming years. Though most state officials believe they are legally bound to shield current workers from pension cuts, a Colorado victory could embolden them to be more aggressive.

<snip>

More: http://www.nytimes.com/2010/06/20/business/20pension.html

:wtf:

:mad:

:nuke:

[msongs]

1. meanwhile, Obama and congress have endless $$$ for wars, war profiteers, and the welfare military nt

[WillyT]

2. Of Course... Us Small People Can Always Eat Cake

Thanks Marie... watch your head!!!

:mad:

[fasttense]

3. Billionaires pay 15% income tax, GE paid no federal taxes, none, nada, zip.

But those old people who expect to get decent pensions like they were told? They pay 35% tax AND get their pensions swiped. When did America become the land of the thieving government cronies?

[WillyT]

4. The Way It Usedb To Be...

:shrug:

[Greyhound]

7. The final nail was driven in 1968. n/t

[ljm2002]

5. and yet we were told...

...that "contracts are sacrosanct" when it was the banksters' bonuses that were in question...

[WestSeattle2]

6. People who walk away from their mortgages are told the same

thing, by the same people. Meanwhile, banks are walking away from their commercial property contracts with nary a second thought - whatever is best for the bottom line.

[WillyT]

8. Same Theme... Obvious Kick !!!

:evilgrin:

[Karmadillo]

9. Reality kick for the serfs.

nt