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Old 06-07-2016, 07:00 PM
 
2,648 posts, read 6,084,360 times
Reputation: 3409

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Quote:
Originally Posted by vulfpeck View Post
Yes, they pay a little and taxpayers cover the rest. Pension is $2.7 billion short of funding, but even worse is the health insurance shortfall.

"...the state has promised to provide every state employee with free health insurance after they retire, for life. But thereís one hitch: Not one penny has been set aside to pay those bills. How big a problem is that? Itís an unfunded liability of $26 billion thatís going to land on taxpayersí doorsteps when the bills come due."

Read more here: North Carolina

Let that sink in for a minute... Taxpayers are on the hook for nearly $30 billion dollars to pay people that no longer even work for them. For the rest of their natural life. Many of which can retire at 45, more than 20 years sooner than those same taxpayers will even be able to consider retirement.
Nice scare tactics using numbers with little context. Yes, the retirement pension plan is unfunded by a couple billion dollars, but the total actuarial liability is 93% funded. Actuarily speaking, that's no cause for alarm at all. It's an estimate based on life expectancy, and to be within 7% is quite good.

Regarding the $26 billion "unfunded" health care liability--it's unfunded because it's a pay-as-you-go system! There is no underlying "funding" of this benefit, so the total actuarial payout estimate is always an "unfunded" amount. There are many factors that go into this, such as life expectancy, illness rates, medical costs, etc, and the liability stretches out over many years. The issue is not so much what the liability is, but rather how do we make state employment attractive to potential employees? The retirement health benefit is one way to do that. If it wasn't available, we'd have to offer higher salaries or other benefits to attract quality candidates. So to consider whether the retirement health benefit is good or not, we should compare its cost to the cost of paying higher salaries. That comparison brings the $26 billion figure into a bit more focus.
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Old 06-07-2016, 07:13 PM
 
901 posts, read 848,988 times
Reputation: 887
Quote:
Originally Posted by vulfpeck View Post
I'm sure Republicans would support replacing current retirement benefits with 401k matching. Defined-contribution plans are much more fiscally responsible than defined-benefit plans.
I disagree. It isn't fiscally responsible to stand by and watch people not save enough for retirement. The retirement gap ultimately gets covered by the taxpayers.
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Old 06-07-2016, 07:24 PM
 
1,351 posts, read 751,238 times
Reputation: 916
Quote:
Originally Posted by arbyunc View Post
Regarding the $26 billion "unfunded" health care liability--it's unfunded because it's a pay-as-you-go system! There is no underlying "funding" of this benefit, so the total actuarial payout estimate is always an "unfunded" amount. ...If it wasn't available, we'd have to offer higher salaries or other benefits to attract quality candidates.
It's always easier to pass the bill on to our kids and grandkids. That doesn't make it right.

Benefits should be defined contribution plans. We have no idea how circumstances will change as these payouts continue indefinitely, which makes defined benefit plans irresponsible. If you can pay your debts today, why compound the impact by waiting? The bill isn't being footed by some secret, benevolent entity, it's on the backs of hard working taxpayers.

Give teachers reasonable raises, a matching 401(k) and get rid of pensions and lifetime healthcare. Create real competition between schools, charters and private options and release them all from overbearing bureaucratic interference so they can teach and hire how they choose, based on their own individual neighborhoods, needs and demographics. Then hold them accountable for their student growth, not overall test scores, and if they aren't measurably helping their students, shutter and replace them.

Last edited by vulfpeck; 06-07-2016 at 07:45 PM..
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Old 06-07-2016, 08:02 PM
 
Location: North of South, South of North
8,706 posts, read 8,814,219 times
Reputation: 5073
Quote:
Originally Posted by TheEmissary View Post
With your statement in mind, I guess you're all for ending social security. Why pay for people who can't work. I guess when the cost of your benefits exceed what you've paid into the system, (typically after about a year and a half of SS payments) you'll happily send those checks back! Oh, and taking your philosophy one step further, I guess we can stop paying Medicare for all of those old, sick people whose costs continue to rise and for many of us, making the payments is simply becoming too expensive! Grind "grandma" into premium dogfood for the one percenters! Yeah, that's the GOP and tea-bagger thinking!

Soylent green:


https://www.youtube.com/watch?v=9IKVj4l5GU4
Your guess would be wrong.

Being that I am not part of the Demove at party, the GOP or a Tea Party member, I can think logically on individual issues. I do not lump them all together under one ideology. That would be ignorant to do.

Now I WOULD be for people being able to make the choice they want for themselves, when it comes to SS. Personally, I would choose to stay in the SS program.....but I understand others may prefer to handle their retirement in a different way. I am okay with that, but I would not be okay with taking it away from people who want it.
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Old 06-07-2016, 08:07 PM
 
Location: North of South, South of North
8,706 posts, read 8,814,219 times
Reputation: 5073
Quote:
Originally Posted by TheEmissary View Post
You should start saving about 40% of your salary every year for the next 40 or so to pay for your old age ...in the style that millennials would like to become accustomed! And don't forget those HOA payments! You'll be in the same boat as those newly-minted teachers!
IMO, many millennials have unrealistic expectations. Many of them expect to have too much too soon. Certainly not like my generation and especially generations prior.
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Old 06-07-2016, 08:11 PM
 
Location: North of South, South of North
8,706 posts, read 8,814,219 times
Reputation: 5073
Quote:
Originally Posted by vulfpeck View Post
I don't follow your math, but my 401k will do just fine. Too bad the state doesn't match teacher's contributions.
That is the way it should be done, IMO. Pay out as employees contribute. Then the money is accounted for in real time and there are no longer unfunded liabilities after the fact.

Regarding pay, I most certainly do think most teachers should be paid more. That is not isolated to NC. However, I think it needs to be partly adjusted to include incentive rewards....not 100% cash up front.
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Old 06-07-2016, 08:13 PM
Status: "North of Palm Trees, South of High Taxes" (set 6 days ago)
 
Location: Noth Caccalacca
5,595 posts, read 6,691,901 times
Reputation: 4900
Quote:
Originally Posted by vulfpeck View Post
It's always easier to pass the bill on to our kids and grandkids. That doesn't make it right.

Benefits should be defined contribution plans. We have no idea how circumstances will change as these payouts continue indefinitely, which makes defined benefit plans irresponsible. If you can pay your debts today, why compound the impact by waiting? The bill isn't being footed by some secret, benevolent entity, it's on the backs of hard working taxpayers.

Give teachers reasonable raises, a matching 401(k) and get rid of pensions and lifetime healthcare. Create real competition between schools, charters and private options and release them all from overbearing bureaucratic interference so they can teach and hire how they choose, based on their own individual neighborhoods, needs and demographics. Then hold them accountable for their student growth, not overall test scores, and if they aren't measurably helping their students, shutter and replace them.
Define a reasonable raise! I know teachers in Westchester county NY that think that their $110K+ salaries with a COLA and a 2.7% raise is downright chintzy! As to your other points, well, they're easier said than done. The devil is in the details! Your statement reminds me of GOP politicians that criticized Obamacare and said they'd have an alternate "sensible healthcare plan " ...which never materialized.
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Old 06-07-2016, 08:13 PM
 
Location: North of South, South of North
8,706 posts, read 8,814,219 times
Reputation: 5073
Quote:
Originally Posted by Tominftl View Post
Another reason to NOT vote for another Republican....
IMO, no one should vote for a republican or for a democrat. They should vote for the individual and the skills that person brings to the table. Political party should be a non factor. Voter political ideology IS the reason things are as divided and messed up in so many ways.
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Old 06-07-2016, 08:17 PM
 
Location: North of South, South of North
8,706 posts, read 8,814,219 times
Reputation: 5073
Quote:
Originally Posted by TheEmissary View Post
Why is the pension $2.7 billion short? Well maybe if the lame-brain legislature hadn't decided to give tax cuts with most of the money going to the richest North Carolinians, they might have had the funds to pay for what they had promised state employees years before.

In years past, when the marginal tax rates were much higher, especially on high income people, we didn't have all of the fiscal problems we have now. If those GOPers and teabaggers look fondly back on the 50's and early 60's as a golden era, let's duplicate the finances of those times. How about a 90% marginal tax rate on capital gains. The CEO made 25 times the salary of his lowest paid employee. Employees had strikes in those days as well!

Just the other day someone pointed out that one of the big NC hospital corporations CEO made $9,000,000 or so, last year. If we apply that old 50's ratio, the orderly in one of this guy's hospitals should be pulling in $360,000. I'm sure he'll appreciate the increase! He'll actually be able to afford a Cadillac health plan as well as a Cadillac! Those old marginal income tax rates and 90% capital gains taxes on that CEO's salary and investments ought to cover a few pension payments of some old lady secretaries who worked for the state. See. vulpeck - everything old is new again!
I believe capital gains should be taxed as regular income, however that number would not be 90%....LOL!

Do you honestly feel that a 90% marginal tax rate on capital gains is reasonable today?
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Old 06-07-2016, 08:24 PM
 
1,351 posts, read 751,238 times
Reputation: 916
Quote:
Originally Posted by TheEmissary View Post
Define a reasonable raise! I know teachers in Westchester county NY that think that their $110K+ salaries with a COLA and a 2.7% raise is downright chintzy! As to your other points, well, they're easier said than done.
The current proposal that moves us to the top teacher pay in the Southeast is reasonable, but if we were able to reform all state employee benefits to a more sustainable model, I would imagine salaries that put us within the top ten nationwide would be reasonable. It frontloads a lot of the cost, but also saves a lot in the long run.

Quote:
Originally Posted by TheEmissary View Post
The devil is in the details! Your statement reminds me of GOP politicians that criticized Obamacare and said they'd have an alternate "sensible healthcare plan " ...which never materialized.
I was pretty specific. Everything I said could be achieved in relatively short order if the political will was there and special interest groups didn't get in the way.
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