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This used not to be a problem when pension benefits were shifted to the public sector (which doesn't have a solvency problem by definition). Nonetheless, neoli

This used not to be a problem when pension benefits were shifted to the public sector (which doesn't have a solvency problem by definition). Nonetheless, neoliberal dogma says that the market does a better job of investing than the government will. Coincidentally privatized pension contributions provide ample opportunity for profiteering. It's more that we let this happen to us through inaction rather than we asked for it, though.

SilasX 11y ago
>This used not to be a problem when pension benefits were shifted to the public sector (which doesn't have a solvency problem by definition). There is no definition of public sector that makes bankruptcy impossible. Pre-funding is about honesty of the obligations. If you say you're going to pay the workers $X at time t, apportion the money now. Put your full faith and credit behind it now. Make it so you can only renege by reneging on bonds in general. It's mind-boggling how ostensibly pro-worker advocates are okay with the mentality of, "don't worry, we'll find your pension money later, if Congress appropriates enough down the road".
- crdoconnor 11y ago
  >There is no definition of public sector that makes bankruptcy impossible. The US treasury can't and won't ever run out of dollars. Whenever there is a bank that needs bailing out or a war suddenly the government remembers this. It's only when funding pension obligations or healthcare it suddenly 'forgets' and assumes that taxes pay for things. There is still an inflation risk but bankruptcy does indeed become impossible. >Pre-funding is about honesty of the obligations. If you say you're going to pay the workers $X at time t, apportion the money now. Put your full faith and credit behind it now. Make it so you can only renege by reneging on bonds in general. There has to be wiggle room somewhere if it's a private sector obligation. Pension are invested and future payouts are based upon certain assumptions about those investments holding. A lot of perfectly reasonable assumptions pre-2008 suddenly went out of the window afterwards. So it is not entirely about honesty of the obligations. >It's mind-boggling how ostensibly pro-worker advocates are okay with the mentality of, "don't worry, we'll find your pension money later, if Congress appropriates enough down the road". I've never heard any ostensibly pro worker advocate say this.
  - SilasX 11y ago
    >The US treasury can't and won't ever run out of dollars. Again, the point is that dynamic is unrelated to the definition of the public sector. I understand the on-the-ground reality; I was objecting to your characterizing of it as "by definition". >There has to be wiggle room somewhere if it's a private sector obligation. Pension are invested and future payouts are based upon certain assumptions about those investments holding. A lot of perfectly reasonable assumptions pre-2008 suddenly went out of the window afterwards. Right, but there's a big difference between "our reasonable RoR estimates were a little off and we unexpectedly needed to add a little more this year" vs "we never funded it to begin with and expected to earn the income to fund this later". Funding it now makes the promise honest; "we'll find the money later" isn't, and it's wrong for GM or the USPS to do this. For the US government, the promises need to go right into the federal debt, which the 75-year prefund obligation would accomplish. >I've never heard any ostensibly pro worker advocate say this. You did, when you advocated the USPS handle its pensions that way, not having to prefund them (modulo time/RoR discount).

SilasX 11y ago

>This used not to be a problem when pension benefits were shifted to the public sector (which doesn't have a solvency problem by definition). There is no definition of public sector that makes bankruptcy impossible. Pre-funding is about honesty of the obligations. If you say you're going to pay the workers $X at time t, apportion the money now. Put your full faith and credit behind it now. Make it so you can only renege by reneging on bonds in general. It's mind-boggling how ostensibly pro-worker advocates are okay with the mentality of, "don't worry, we'll find your pension money later, if Congress appropriates enough down the road".

crdoconnor 11y ago
>There is no definition of public sector that makes bankruptcy impossible. The US treasury can't and won't ever run out of dollars. Whenever there is a bank that needs bailing out or a war suddenly the government remembers this. It's only when funding pension obligations or healthcare it suddenly 'forgets' and assumes that taxes pay for things. There is still an inflation risk but bankruptcy does indeed become impossible. >Pre-funding is about honesty of the obligations. If you say you're going to pay the workers $X at time t, apportion the money now. Put your full faith and credit behind it now. Make it so you can only renege by reneging on bonds in general. There has to be wiggle room somewhere if it's a private sector obligation. Pension are invested and future payouts are based upon certain assumptions about those investments holding. A lot of perfectly reasonable assumptions pre-2008 suddenly went out of the window afterwards. So it is not entirely about honesty of the obligations. >It's mind-boggling how ostensibly pro-worker advocates are okay with the mentality of, "don't worry, we'll find your pension money later, if Congress appropriates enough down the road". I've never heard any ostensibly pro worker advocate say this.
- SilasX 11y ago
  >The US treasury can't and won't ever run out of dollars. Again, the point is that dynamic is unrelated to the definition of the public sector. I understand the on-the-ground reality; I was objecting to your characterizing of it as "by definition". >There has to be wiggle room somewhere if it's a private sector obligation. Pension are invested and future payouts are based upon certain assumptions about those investments holding. A lot of perfectly reasonable assumptions pre-2008 suddenly went out of the window afterwards. Right, but there's a big difference between "our reasonable RoR estimates were a little off and we unexpectedly needed to add a little more this year" vs "we never funded it to begin with and expected to earn the income to fund this later". Funding it now makes the promise honest; "we'll find the money later" isn't, and it's wrong for GM or the USPS to do this. For the US government, the promises need to go right into the federal debt, which the 75-year prefund obligation would accomplish. >I've never heard any ostensibly pro worker advocate say this. You did, when you advocated the USPS handle its pensions that way, not having to prefund them (modulo time/RoR discount).