Quote:
Originally Posted by mosholu
I do not think it is as easy as that for the following reason: Isn't the main problem with the pension systems for the states is that they have been underfunded. Are you suggesting that the pension plans would lose any amounts that have not been funded yet. If so, I think that would be difficult from a political and legal stand point. It would be a hard argument to make that people should take dramatic cuts to their benefits accrued because prior governments ignored their pension obligations. As far as turning them into 401(k) plans I think it results in just another large subsidy to the financial sector. Maybe they can be self directed but to be honest I really do not know how much flexibility there is.
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In the private sector, if the pension plan is underfunded or not fully funded and the company goes under, you loose your pension. (Enron and Polaroid just to name a few). Believe me, I wish it was affordable for everyone to have a pension but in the end, a pension is a "major perk" and it does not seem to be sustainable from a government level. If the yearly salaries were not so high, I could see it being more affordable but you can’t have it both ways. Some public employees are making a hell of a lot of many especially compared to 20 years ago and they still expect a pension which is rated off of that high salary. It just isn't sustainable in this world. The government isn't selling something to make a large profit like a private company and it just isn’t sustainable.