Time and time again we see pay offs and our tax dollars going to waste.
Our families are going hungry, our schools are in disrepair, higher education is unreachable, but we need to put in casinos!
What happen to that words “reform government” which we heard Patrick speak so often during the campaign?
Perhaps a new web site should be designed. It could be called “Patrick’s disappointments” or “grassroots put me in office” but now me and my friends laugh all the way to the bank!
Before the voices from certain die hard supporters call out; it is not Patrick’s fault! We have seen no real changes in State Government either.
You are part of the problem or part of the solution and so far we have seen no solutions just more increases in taxes and more waste of taxes passing us all by.
Power corrupts…absolute power corrupts absolutely.
As long you keep voting these crooks back in office as basically lifetime politicians it will continue to get worse. Enjoy!
considered a career pol. So this isn’t really productive for a comment, to my mind.
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How about coming up with solutions and helping fellow citizens put pressure to get those implemented, eh?
Just sayin.
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Right, and we should do all we can to prevent that from happening.
To really light into this, because it’s crazy, but keep in mind these are pensions promised using rules put in place before Deval got into office…if there’s been reform or will be, it has to kick in over time, necessarily. I doubt you’d see an instant downgrade.
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So I agree on the pressure tactic…just wondering if you’re jumping to blame too quick who’s fault it is, as yet.
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Don’t get me wrong, you are right on the substance – I heard this this morning and meant to blog on it, so thanks for bringing it up.
Let’s take a really good look at the list. Sure, there are some folks taking home pensions in the 100,000’s, but most people aren’t. There are thousands that are in the 20,000’s and 30,000’s after there twenty-plus years and only get their COLA raise each year, and that’s it.
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Most of the folks at the top of the list are the exceptions. The social workers, the nurses, the admin support, etc. are not at the top. Depending how the reforms are done, we are going to hurt the very people that have given their careers to public service in return for lower than average salaries and not huge pensions since their pensions were based off their salaries. Political appointees and upper management make good money, rank and file state workers do not.
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The highest salaries are in the UMass system in the Medical School. The State Police earn hazard pay and are in a different retirement class than most state workers.
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Let’s just be very careful in the debate to not throw the baby out with the bath water. I do not disagree that there may need to be some reforms, but let’s look at what those reforms do to the pensions at the bottom of the ladder and not just the top.
Was Dr. Arthur Pappas, the Red Sox Team Physician (who in full disclosure also operated on my father’s shoulder, who is garnering $270K a year. This is obscene. With all due respect Lynne, if it is legal to retroactively tax people, see the 2002 capital gains tax brouhahah we certainly can readjust top pensions by law. Pensions should be capped at some number that is way south of 100k and current state employees should be put on a defined contribution plan as are federal government employees.
I thought conservatives had some belief in the rule of law and the enforcability of contracts. I’ve been working for UMass for 20 years now, and I’ve been planning for retirement and my daughter’s college on the (possibly naive) assumption that the state will eventually pay me the pension that it promised me under the contract negotiated with my union. (I will get nothing from Social Security because we pay into the pension fund instead of into Social Security, though we still pay into Medicare.) I don’t know if my pension will exceed $100K — it’s unlikely unless there’s a lot more inflation before I retire — but I don’t really want you unilaterally renegotiating my contract after I’ve been paying into the pension plan for 20 years, thanks.
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I think pensions max out at 80% of salary after 40 years service — so if Dr. Pappas was making $400K as a med school professor the pension you quote wouldn’t be unusual at all. High-reputation doctors are expensive, but I like the idea of having them available to train more doctors.
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for the rest of my life because you got a sweet deal? I don’t think so. If this current system stays you run the risk of getting nothing as you’ll see taxpayers continue to move out of state then who will pay your sweet pension deal.
With respect, since you don’t know how much I’ve been paying into the system, what kind of investments the pension fund has been making, and the odds about how long I’m going to live, you know absolutely nothing about whether my pension is subsidized by taxpayers as you claim. There is an overall problem with defined-benefit pension systems in that many people will live to collect them for longer than was anticipated. But we decided in the 1930’s that people’s financial security in old age shouldn’t depend on their investment acumen. I like that system, and GWB’s last attempt to eliminate it was pretty definitively rejected by the public and the Congress. Our system differs from Social Security in that if our salary is high, we pay a percentage of that salary (actually at a higher rate for higher salaries) and get back a pension that depends on our salary.
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I don’t dispute that there are unfair aspects to the pension system — for example, President Bulger has a very high pension based on his very high salary as President of UMass and his long years of service in moderately-paid legislative positions, and his behavior in the President’s job was allegedly dependent on his desire to max out his pension. But I know several retired UMass-Amherst faculty on that list of people with $100K+ pensions — they worked at UMass and paid into the system for 30-40 years and gradually reached the six-figure salaries that are the going rate for highly regarded (and highly marketable) professors.
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The situation of the State Police is somewhat analogous to that of the military, where you get to retire on half-pay after 20 years. Having devoted your youth and middle age to a career you physically can’t continue, you get a cushion on which to develop a second career. It’s a good deal, but I’m not going to say that someone risking their life in the public service doesn’t deserve it.
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There’s probably some truth to that argument about police, but it seems that “retirement” at 45 is a bit much. Just how jacked do you need to be to pull people over on the highway? At 45, I’d be willing to bet that most of those guys could go another 10 years. Oops, did I say “bet”? Sorry, that was immoral…
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I hate that argument with regard to the police, because how far can you push it? As soon as you start making their compensation a measure of what their lives are worth, then there’s just no end to how stratospheric their compensation can become. Their value is dependent on what the market price for those services are. If they don’t like risking their lives, find another job. That’s life. Otherwise, I think voters have the right to say that an State Trooper’s being able to retire at 45 is an expense we can no longer afford.
… that at 10.56%, MA ranked 28th in 2007 in state and local tax burden, between Utah and Mississippi. Apart from NH (@8%, ranked #49), MA is the lowest in New England (VT is #1, ME is #2, RI is #4, CT is #8).
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Maybe I live in a bubble, but my impression was that people are leaving b/c the cost of living is so high in MA, not the tax burden per se. While the high cost of living may be a real problem, it is not due to state workers’ pensions.
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If you’d like to renege on the state workers’ pensions, do you think we’ll be able to hire quality people to be state workers in the future? I’ve found that if you treat workers like crap, you get crappy workers.
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I’m not saying there aren’t problems with the pension system, but this is largely demagoguery.
Thanks
Here.
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Knowing how you operate, I’m sure that you will quickly notice that MA ranks 7th on a basis of fed + state + local tax burden and harp on that.
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At which point I would remind you that the difference in tax load between (state + property taxes) and (federal + state + property taxes) is the difference in federal tax, which will be driven by things like differences in income (as states with a high % of population in high tax brackets will pay a higher % of federal tax). Note that states like NJ, MD, and NH, which
have all have high median incomes, also show a big change when you add federal tax in, while poor states like Arkansas go the other way.
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There’s a lot of historical data on the site referenced above; you’ll see that we stopped being “Taxachusetts” circa 1981, after which our ranking for (state + property) has averaged around 24th.
Even if the numbers are obscene.
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But every employee hired after, say tomorrow, should be on a defined contribution plan rather than a defined benefit plan. At least then the huge nut can be worked down over time.
…I’ll merely point out that ERISA was based on the Interstate Commerce Clause (ICC)( of the federal constitution, and in a series of decisions in the 1990s starting with Seminole vs. FLorida, the US Supreme Court severely limited application of laws baws on the ICC to the state governments. Private companies, yes. State and local governments, no.
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I’d do a lengthy dissertation on why that is constitutionally correct–but for a different reason than in the Seminole case–but I’ll refrain.
I think I have to agree with jaj, though it is really neither here nor there. I suspect that it might be just as difficult under laws that do apply to the Commonwealth to reduce pension benefits retroactively.
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So why is it that new employees are not defined contribution only?
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Start-ups I’m familiar with are 100% defined contribution plans: 401(k)s and the like.
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If the entrepeneurs were relatively old, say 40+, maybe there’d be a tax angle for defined benefit, otherwise, they’re just too complicated compared to the defined benefit plans.
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http://www.aflcio.or…
Dad – I don’t want to sling any nasturtiums, but…
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I believe in a contributory plan, you hwve to put the money in the account on a routine basis, right there in front of God and everybody.
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In a defined benefit plan, as long as the checks keep coming timely, well, never you mind where the money came from.
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Not that the Commonweatlh need worry itself on that score…
I want to remind BMG that most Mass. pensioners are not eligible for Social Security.
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In 1982 (1983?) Social Secutiry looked pretty bleak. Washington looked around for more revenue, and lo and behold, there were all those state and Federal employees. They began collecting on Federal salaries immediately. I worked for the Feds at the time, and you wold have thought the world was ending. Pay into Social Security (SS) AND the Pensions System? At the same TIME? HORRORS! Of course, that is exactly what workers did in the private sector in those pre-401k days. Penalties were instituted that created what is known as the pension offset – that is, if you have a pension in what is caled a non-contributory state (not contributing to Social Security), then if you DO earn any Social Security, it will be offset by the amount of your pension. IF you have a $30,000 SS pension, and a $15,000 Mass. pension, you will collect $15,000 from SS. If you have a $30,000 Mass Pension and a $15,000 SS pension, you will collect zilch from SS. They are entirely unmoved that you maybe have paid in.
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Mass. is one of only a half-dozen states which is still non-contributory. If you worked as a RMV employee in New Jersey, where you pay into both systems, you can stack your Jersy and SS pensions. Not so in Mass.
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The worst of this is that this usually hits widows. Couples who have the husband getting $50,000 and the teacher-wife getting $30,000 collect $80,000 while he is alive. When he dies, his surviorship benefit is $30,000 and so is her pension – so her income drops from $80,000 to $30,000 – right when she is too old to get a better paying job.
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Anybody who is a lifer – at the 80% range – will be entirely reliant on their MA pension due to a tightening of restrictions in the early 90’s. It used to be if you worked 30 years in the Dreaded Private Sector, the offset was dropped and you COULD stack. But people were working summers and part time, making $2,000 or so per year just to evade the offset. So it was changed to ‘meaningful’ earnings, i.e., full time.
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So keep in mind for the majority of those MA pensioners, it is their only income for the balance of their life.
I was recently contacted by a concerned municipal employee who is urging advocacy to repeal the law.
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Additionally, NEA has taken a strong stance [http://www.nea.org/s…]
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This is a Reagan Administration legacy that needs to be shot-down immediately, while looking at the top tier pensions that are clearly unsustainable.
Other than obstinacy?
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I had thought there were only 6 or 8 non-contributory states, but if they say 15, OK.
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What do Congressmen tell their constituents in the OTHER 35 states which DID begin paying in 30 years ago? Hey, too bad you began to play by the rules and pay out all that money, but you have to understand – this is MASSACHUSETTS we’re talking about! Why should THEY have to pay in like you to get full benefits? Don’t you want to give them a break?
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“Shoot down Reagan era legacy” – the arrogance is just amazing.
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We can solve this problem tomorrow – by making this a contributory state. Hey, doesn’t some governor have a pension reform bill?
I have no idea what I did there. I must not post when angry; it’s like Jove hurling thunderbolts….
I guess I pressed the Reagan button!
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You will find that I have advocated for pension reform in MA for some time here [http://www.bluemassg…] along with our thought-filled friends at Pioneer Institute. I also gave Peter Porcupine a (6) on her post upstream with particular appreciation for pointing out the aggregious penalization of women/widows in the law.
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Obstinancy – probably; I worked on this issue on behalf of my aged mother 4-5 years ago and made no progress with our Senators. None, no action to help a low/moderate income elderly woman, none.
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Arrogance – on my part – maybe. But humbly I submit to you that I am quite aware of my station in life including my position as second tier on this blog. You my friend, are privileged to enjoy the top shelf, right corner.
The COMMONWEATH is, to adhere to a policy it knows it hurts its own workers, but thinks it is going to come out better than those other, little states.
That’s a very concise and scary explanation. I worked for 15 years and paid into social security. My employers paid into the system. At 31 I became a state employee. I can retire at 63 with the full 80% pension. What happened to all the money that came out of my check all those earlier years? Did it go the same place as lost socks and pen caps?
Periodically, Mass. public employee unions have bills filed to repeal this. Barney Frank did one, I think Markey, even Moakley. It’s a loser that they probably pass around the delegation to effect ‘action’.
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Because the truth is – it’s a loser. At least 35 states have already complied with the 1983 action. Tweny-five years later, Mass employees aren’t going to convince Congress to vote against the interests of THEIR constituents and repeal it because we were stubborn and greedy enough.
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What these unions DON’T do is educate their own members so they can make their own decisions. They blame it on the evil Feds (less so when Clinton was President) and talk about how they are perennially lobbying Washington to change the unjust law! The NAGE organizers probably get to write off a couple of hotel and restaurant tabs in DC every year, as they ‘work’ for the best interests of their membership.
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Sorry, thom – that money is bye-by, unless we change our contribution system. And before you get huffy, consider this – you could die at 64, and never be entitled to collect anyway. Every pension system is a crap shoot.
Sadly I know as far as I’m concerned the money is bye bye. I try and look at it as paying my Dad’s SSI. He’s 81 so everything he put in, all the interest and then some is long since gone. It’s just the whole shell game thing about SSI that bothers me. I have a friend who owns his own business which means he puts in his half and the employer half. He’s 60 and unmarried. I he were to die every penny just gets tossed back into the pot. Thank you very much for your contribution!
25 years ago, if you were self employed, you paid 10.5% based on the idea that since you were your own boss, you were one and a half people.
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In the 1990’s it was changed so if you are self employed you now pay the full employee and employer share – 7.5% apiece, the full 15%.
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At the end of the day, you will collect based on your ’employee’ 7.5% contribution.
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It is a Ponzi scheme, and has been since FDR decided people could collect without paying in for a lifetime. Difference is, it USED to be considred a supplement, not a living. NOW, people haven’t saved and have no pensions, and have nothing else. And are terribly surprised that they have to take out reverse mortgages to maintain their standard of living.
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Cape Cod is a happy, shiny place since the interest rates on CD’s went into single digits, I’ll tell ya.
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And I’m sorry, but the single worst thing the Democrats did in the last seven years was to refuse to allow younger workers to create individual accounts within Social Security to begin to turn this Leviathan around – just because it was GWB’s idea and the AARP told them not to.
I want to remind BMG that most Mass. pensioners are not eligible for Social Security.
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if what you mean by Massachusetts pensioners are MA state employees, if they have not paid into the SS and Medicare systems. The federal government cannot tax state and local government–federalism, you know. And half of the SS tax (and medicare tax) comes from the employer–in this case it would be state and local government.
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If a MA state worker also has earned enough SS and Medicare credits, they can collect at least something from SS and Medicare.
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Post 1986, they can receive Medicare benefits.
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But, Social Security benefits are reduced by the Mass retirement benefits received, so that if the calculated Mass retirement dollars are higher than calculated SS dollars, then the Mass retirement is all the beneficiary will receive, regardless of quarters paid.
And they DO collect from state workers in 35 states – Federal law, you know.
if you are referring to something different (no citations from you, I notice) this http://www.ssa.gov/p… describes a bit of a different kettle of fish.
The SSA link says exactly what I said. And nothing about fish.
These pension contracts go back what, 20, 25, 30 years? Any sound fiscal management Deval Patrick applies to pensions won’t really show up until 2030 or so.
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It does seem to me that in future negotiations, they could try to implement a bit of a sliding scale… 80% of the first $100,000 of salary, 70% of then next $100,000, whatever. It’s not a huge difference, but it would help keep those outliers a little closer to the median, which would make everybody else feel a lot better somehow.
Pension problems have been around forever. It used to be (maybe still is?) that dead people used to fill the rolls and checks were sent monthly to nursing homes, etc or the politically connected received multiple pensions. Now we have the six figure pensions.
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Just how much can the pension fund support? Is the reason the state is trying to get municipal pensions into the state pension that the state pensions are going belly up? Does anyone audit (a real audit) the state pension system? Will the taxpayers have to bail out the pension system?
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Is this our next BIG SCANDAL?
States have been giving away pension benefits for years without providing funding for the defined benefits. So, yeah, ultimately it’s a taxpayer bailout.
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I’ve seen estimates of the Massachusetts Pension underfunding ranging from 6.5 to 13 billion.
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I don’t know, but am pretty sure the large pensions aren’t the significant cause of the deficit, although they certainly contribute to the problem. Granted, the big pensions are news-worthy. The core problem is that government cow-tow to the unions, give large benefits to the masses, then the government doesn’t currently provide for that future benefit, leaving the problem for future legislators.
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The problem is with the guppies (as in “enough guppies will eat a treasury”). Take, for example, a typical state employee or teacher with 28 years of service and a $50,000 salary. That teacher chooses to retire at age 55. In Massachusetts, the retiree, at 55, receives $21,000 pension for life.
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Whether you believe that pension at 55 is fair, or not, it’s much more generous than the similar employee in the private sector.
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Or Orson Welles in The Third Man, as he looks down on a city from atop a Ferris Wheel:
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All those greedy old people who want to live on $20,000 a year–there’s just no way our country can afford it.
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…Off-topic, how much money did we spend in Iraq today?
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My question isn’t can we afford to pay a 55 year old, $20K per year to retire. Of course the government can afford to pay it. My question is should we pay it.
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Should we pay a larger sum at an earlier age than the private sector allows?
…cap pensions for state and municpal workers at, say US$100K a year (a figure I pulled out of the air) and provide for expanded contributions to the state’s actually very good deferred compensation program. The latter runs like a private sector 401K system, but with much higher contribution levels.
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Withdrawals from the deferred comp program are state taxable (state pensions aren’t) but all private sector pensions are taxable, as are 401k withdrawals (social security is not, but that is limited, too)
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I think the very idea of people retiring at (or above) the 100,000 per year mark is the sign of a healthy pension plan… or do you, de facto, dispute the worth of both State Police and Higher Education employees?
Seriously, there’s no evidence (none-zilch-zip-nada) that they have not earned the money. Just your assumption that, because it’s a lot of money, it’s waste. Where would that assumption come from? Where is the evidence? Why is it waste? Where’s your warrant? Add in some bottom-feeding sensationalism from the Herald and all you got is a two tempests in one teapot.
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I don’t see how spending is an indication of health. Maybe in the case of drunken sailors, but not in the case of underfunded pension plans.
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If you don’t spend you don’t have an economy. Period. End of discussion.
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Absent real indications of fraud, waste and/or abuse the money is deserved and earned. Meaning the workers in the pension fund are good workers and have been rewarded accordingly and would compare favorably to non-public pension plans (where, I understand, there are a wide range of values in retirement funds…)
The problem with the state’s pension system has been brewing for a very long time.
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Patrick has been in office for a very short time.
I thought sweet bennies (including retirement) were there to offset the relatively low wages given to state employees as compared to their private counterparts.
…but the state keeps ‘enhancing’ salaries to attract ‘better’ candidates, so they can be ‘competitive’ with the private sector.
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Or so they tell it.
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You have two choices, Grasshopper. Be a 35 year lifer, retire at 80%, don’t pay Mass income tax, making it truly 85%, and forego Social Security.
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OR work ten years for lifetime benefits and get out and earn money in the Dreaded Private Sector.
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(The latter is becoming more popular with the younger workers, but many lifers are like flies trapped in amber, and have no recourse).
I suppose fly is a step up from maggot which I was in boot camp. 😉 True enough though I’m pretty much stuck. Twenty plus years in with ten to go. Bailing doesn’t make sense at this point.
I gained most of my knowledge telling this same sad story over and over again to weeping little old ladies when they called the State House looking for help, unable to believe it was true.
Although this comment only covers higher education, it’s important to qualify Mary Jean’s outrage with a reminder that the state pension plan involves mandatory contributions from state employees. For the UMass system, employees contribute 9% of the first $30k gross salary, and 11% of amounts over $30k. (see UMass Retirement Plans). In an ideal world, the state invests that money for years to create the pool of money available for retirees. The underfunding of pensions is a very different issue than the justice of state workers paying in for years on the expectation of a secure retirement. Whether it’s a good idea to continue defined benefit plans rather than move to defined contribution plans is another different issue, with merit on both sides.
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Whoop de do that there are a few employees that game the system. Deal with them, but don’t screw the people who have worked for all of us for decades. I would say the Herald should be ashamed of itself for its tortured leaps of logic, but that would probably be pointless.