7 ms·

If you feel upset or angry about what public employees receive, realize that the problem isn't that they get too much but that you get too little.

by Dowwie 10y ago

deleted 10y ago
[deleted]
imgabe 10y ago
The problem is that what they get is unsustainable. The public is on the hook for paying those pensions for decades. Which means there will be an ever-increasing pool of public retirees that that taxpayers will have to fund.
- crdoconnor 10y ago
  Raise taxes on the assets of the wealthy, crack down on tax havens and it "magically" becomes sustainable again.
  - ohwello 10y ago
    Please show me the math on how you are going to give everyone a pension greater than the GDP per capita by changing tax law.
  - m0llusk 10y ago
    No, it doesn't. California pensions for example are such that even if the state dropped all other obligations and paid only pensions even with massive tax increases pensions could not be fully paid. This mess will unwind in the short term. Yet another argument for some kind of basic income alternative.
- clort 10y ago
  only if the population is increasing.. and if the population is increasing, then the burden to the taxpayers is spread ever wider. the problem starts when the tax income shrinks
  - varjag 10y ago
    No, only if public sector and life expectancy are increasing. And they can be increasing just as well in a shrinking demographic.
- jandrese 10y ago
  This is what should be scary. If this "crisis" is just because we know the numbers now, and there's a hidden crisis in the public sector where people don't even realize how screwed they will be a decade into their retirement? 401k plans are way more opaque than pensions.
  - toomuchtodo 10y ago
    401ks were a way for shareholders to reap outsized returns from corporations while saddling workers with their own retirement costs. Everyone here complains people haven't saved enough, yet wages have been stagnant for decades.
civilian 10y ago
No way man. The civil servants who are honest with themselves recognize that they didn't provide enough value to the city while working to justify their pensions. This is a situation where the group of people who make the rules are the people who will benefit from the rules, and someone else foots the bill.
- jandrese 10y ago
  Your position is that all civil servants are overpaid for the work they do? That's a rather bold claim.
  - deleted 10y ago
    [deleted]
  - thereisnospork 10y ago
    Considering their pay (inclusive of benefits) is literally bankrupting the state it would seem rather obviously true that they are collectively overpaid.
    - ubernostrum 10y ago
      OK, so raise the wages during the time they're working, in order to be competitive with other industries, and provide a 401(k) with matching contributions like the private sector does. Except that will cause a tax increase now rather than a tax increase twenty years from now, and is political suicide. Underpay during working years and promise an outsized pension to make up for it (since that passes the buck of having to fund it to some other sucker who's in office much later on) is a common pattern in the public sector. If you want to end it, you can simply pay competitive wages up-front (and no, pointing to a handful of outliers does not indicate that the average public-sector salary is competitive with private sector).
    - jandrese 10y ago
      Or it means the state has made too many promises without allocating sufficient funds to cover them. Government would be so much cheaper if they didn't pay the workers and instead just made them straight up slaves! Also, they need to find workers that don't need food or energy, since those cost money.
ohwello 10y ago
These pensions are higher than the GDP per capita. If everyone got pensions that big, where would the money come from?
apsec112 10y ago
If the supply of housing, healthcare, and education is fixed, as it is in NYC, SF, LA, and other such places, paying everyone more money doesn't make anyone better off. Everyone will just bid up the prices of these goods, until the average person can once again barely afford them on their new salary. Elizabeth Warren wrote about this in The Two-Income Trap: a family with two incomes today actually has less disposable cash than a single-income family from 1975, because the extra money all gets eaten by bidding wars.
- alasdair_ 10y ago
  The median size of a home was roughly half the size it is now.
  - apsec112 10y ago
    The book covers that. The average size of new homes has increased by 40 percent, but that's just new homes, a minority of the housing stock. "In fact, the size and amenities of the average middle-class family home have increased only modestly. The median owner-occupied home grew from 5.7 rooms in 1975 to 6.1 rooms in the late 1990s—an increase of less than half of a room in more than two decades. What was this half a room used for? Was it an “exercise room,” a “media room,” or any of the other exotic uses of space that critics have so widely mocked? Nope. The data show that most often that extra room was a second bathroom or a third bedroom. The wealthy may be living in spacious new digs, but middle-class families are not. The proportion of families living in older homes has increased by nearly 50 percent over the past generation, leaving a growing number of homeowners grappling with deteriorating roofs, peeling paint, and old wiring. Today, nearly six out of ten families own a home that is more than 25 years old, and nearly a quarter own a home that is more than 50 years old."
    - blackguardx 10y ago
      What is wrong with living in an old house? Old wiring, depending on when it was put in, isn't necessarily bad. Knob and tube wiring (a really old style) can probably never start an electrical fire (assuming the outlets are periodically replaced) because the conductors are separated by 18 inches or more. A roof needs to be replaced every 20 years or so. Paint, more often. If the house you own has peeling paint or a leaking roof, look in the mirror and blame that person. Don't blame the age of the house.
CountSessine 10y ago
I shouldn't get upset or angry that they get paid well above the market value of their labour? And that as taxpayers and future taxpayers, my children and I are on the hook to pay for this?
- sidlls 10y ago
  His point is that you should get upset that the "market value" is too low (e.g. due to information or other asymmetries that give advantages to the holders of capital which aren't generally available to labor).
  - CountSessine 10y ago
    That's an interesting perspective. Can you elaborate? How do you think that public sector unions are disadvantaged by not having enough information? Do you think that rewarding them with an enormous supplementary pension fixes the market for their labour?
    - sidlls 10y ago
      I don't think public sector unions are disadvantaged. That group of disadvantaged folks would be private sector workers. I believe the argument would be that, to a certain extent, their pensions and other benefits do "fix the market" for their labor. I'm not sure I agree with the argument. My view would be that if the unions were as effective as they could be the workers' salaries would be higher and the pension benefits a bit lower.
edblarney 10y ago
"realize that the problem isn't that they get too much but that you get too little." In relative terms it's effectively the same thing. -> Public sector employees are generally paid too much for the value that they produce. It's a function of power: their unions are the most powerful organizations on the planet. They will pay themselves whatever they want.
- edblarney 10y ago
  Here's the sunshine list for Ontario: http://www.fin.gov.on.ca/en/publications/salarydisclosure/pssd/orgs.php?organization=hospitals&year=2013 http://www.fin.gov.on.ca/en/publications/salarydisclosure/ps... Police Officers in places like Cornwall, Ontario, pretty far out there, where the average home price is probably just above $100K ... often earn well over $100K. Nurses, Teachers, a plethora of questionable Directors (the Director for 'Clergy Services' the hospital earns a lot. How many staff? And how big is that responsibility?) all earning well north of $100K, esp. in rural areas where cost of living is low. Private sector salaries will be lower to reflect lower cost of living, but public sector wages are not. Average wage in Canada is just above $40K. See the groupings by trade: http://www.livingin-canada.com/work-salaries-wages-canada.html http://www.livingin-canada.com/work-salaries-wages-canada.ht... Note that 'public sector' employees are near the top. The group earning more is 'utilities' - which in Canada are 'Crown Corporations' (or de-facto), meaning essentially public sector. Where I live in Quebec, the 'best career path' for most people is 'Government', as it turns out, we have almost the lowest wages in North America, just ahead of the other Canadian Maritime provinces. One of the most overlooked factors in government work is the 'riskless' nature of it. In finance, we learn that 'consistent payments' have quite a lot of value, which is why companies that pay very consistent dividends are worth more. That you have 'a zero chance of layoff, and a very low chance of being fired' is actually a benefit, and it's economically measurable. It's a premium and it's worth a lot.
mikebelanger 10y ago
That's why I think the only kind of pensions that should exist are public pensions -- something all citizens get access to. Work-specific ones, especially in the public sector are prone to these sorts of issues. Yes, there's still issues with government mandated ones, but I'd argue they get way more attention given that they affect so many more people at the same time.

If you feel upset or angry about what public employees receive, realize that the problem isn't that they get too much but that you get too little.

by Dowwie 10y ago

If you feel upset or angry about what public employees receive, realize that the problem isn't that they get too much but that you get too little.

deleted 10y ago

[deleted]

imgabe 10y ago

The problem is that what they get is unsustainable. The public is on the hook for paying those pensions for decades. Which means there will be an ever-increasing pool of public retirees that that taxpayers will have to fund.

crdoconnor 10y ago
Raise taxes on the assets of the wealthy, crack down on tax havens and it "magically" becomes sustainable again.
- ohwello 10y ago
  Please show me the math on how you are going to give everyone a pension greater than the GDP per capita by changing tax law.
- m0llusk 10y ago
  No, it doesn't. California pensions for example are such that even if the state dropped all other obligations and paid only pensions even with massive tax increases pensions could not be fully paid. This mess will unwind in the short term. Yet another argument for some kind of basic income alternative.
clort 10y ago
only if the population is increasing.. and if the population is increasing, then the burden to the taxpayers is spread ever wider. the problem starts when the tax income shrinks
- varjag 10y ago
  No, only if public sector and life expectancy are increasing. And they can be increasing just as well in a shrinking demographic.
jandrese 10y ago
This is what should be scary. If this "crisis" is just because we know the numbers now, and there's a hidden crisis in the public sector where people don't even realize how screwed they will be a decade into their retirement? 401k plans are way more opaque than pensions.
- toomuchtodo 10y ago
  401ks were a way for shareholders to reap outsized returns from corporations while saddling workers with their own retirement costs. Everyone here complains people haven't saved enough, yet wages have been stagnant for decades.

civilian 10y ago

No way man. The civil servants who are honest with themselves recognize that they didn't provide enough value to the city while working to justify their pensions. This is a situation where the group of people who make the rules are the people who will benefit from the rules, and someone else foots the bill.

jandrese 10y ago
Your position is that all civil servants are overpaid for the work they do? That's a rather bold claim.
- deleted 10y ago
  [deleted]
- thereisnospork 10y ago
  Considering their pay (inclusive of benefits) is literally bankrupting the state it would seem rather obviously true that they are collectively overpaid.
  - ubernostrum 10y ago
    OK, so raise the wages during the time they're working, in order to be competitive with other industries, and provide a 401(k) with matching contributions like the private sector does. Except that will cause a tax increase now rather than a tax increase twenty years from now, and is political suicide. Underpay during working years and promise an outsized pension to make up for it (since that passes the buck of having to fund it to some other sucker who's in office much later on) is a common pattern in the public sector. If you want to end it, you can simply pay competitive wages up-front (and no, pointing to a handful of outliers does not indicate that the average public-sector salary is competitive with private sector).
  - jandrese 10y ago
    Or it means the state has made too many promises without allocating sufficient funds to cover them. Government would be so much cheaper if they didn't pay the workers and instead just made them straight up slaves! Also, they need to find workers that don't need food or energy, since those cost money.

ohwello 10y ago

These pensions are higher than the GDP per capita. If everyone got pensions that big, where would the money come from?

apsec112 10y ago

If the supply of housing, healthcare, and education is fixed, as it is in NYC, SF, LA, and other such places, paying everyone more money doesn't make anyone better off. Everyone will just bid up the prices of these goods, until the average person can once again barely afford them on their new salary. Elizabeth Warren wrote about this in The Two-Income Trap: a family with two incomes today actually has less disposable cash than a single-income family from 1975, because the extra money all gets eaten by bidding wars.

alasdair_ 10y ago
The median size of a home was roughly half the size it is now.
- apsec112 10y ago
  The book covers that. The average size of new homes has increased by 40 percent, but that's just new homes, a minority of the housing stock. "In fact, the size and amenities of the average middle-class family home have increased only modestly. The median owner-occupied home grew from 5.7 rooms in 1975 to 6.1 rooms in the late 1990s—an increase of less than half of a room in more than two decades. What was this half a room used for? Was it an “exercise room,” a “media room,” or any of the other exotic uses of space that critics have so widely mocked? Nope. The data show that most often that extra room was a second bathroom or a third bedroom. The wealthy may be living in spacious new digs, but middle-class families are not. The proportion of families living in older homes has increased by nearly 50 percent over the past generation, leaving a growing number of homeowners grappling with deteriorating roofs, peeling paint, and old wiring. Today, nearly six out of ten families own a home that is more than 25 years old, and nearly a quarter own a home that is more than 50 years old."
  - blackguardx 10y ago
    What is wrong with living in an old house? Old wiring, depending on when it was put in, isn't necessarily bad. Knob and tube wiring (a really old style) can probably never start an electrical fire (assuming the outlets are periodically replaced) because the conductors are separated by 18 inches or more. A roof needs to be replaced every 20 years or so. Paint, more often. If the house you own has peeling paint or a leaking roof, look in the mirror and blame that person. Don't blame the age of the house.

CountSessine 10y ago

I shouldn't get upset or angry that they get paid well above the market value of their labour? And that as taxpayers and future taxpayers, my children and I are on the hook to pay for this?

sidlls 10y ago
His point is that you should get upset that the "market value" is too low (e.g. due to information or other asymmetries that give advantages to the holders of capital which aren't generally available to labor).
- CountSessine 10y ago
  That's an interesting perspective. Can you elaborate? How do you think that public sector unions are disadvantaged by not having enough information? Do you think that rewarding them with an enormous supplementary pension fixes the market for their labour?
  - sidlls 10y ago
    I don't think public sector unions are disadvantaged. That group of disadvantaged folks would be private sector workers. I believe the argument would be that, to a certain extent, their pensions and other benefits do "fix the market" for their labor. I'm not sure I agree with the argument. My view would be that if the unions were as effective as they could be the workers' salaries would be higher and the pension benefits a bit lower.

edblarney 10y ago

"realize that the problem isn't that they get too much but that you get too little." In relative terms it's effectively the same thing. -> Public sector employees are generally paid too much for the value that they produce. It's a function of power: their unions are the most powerful organizations on the planet. They will pay themselves whatever they want.

edblarney 10y ago
Here's the sunshine list for Ontario: http://www.fin.gov.on.ca/en/publications/salarydisclosure/pssd/orgs.php?organization=hospitals&year=2013 http://www.fin.gov.on.ca/en/publications/salarydisclosure/ps... Police Officers in places like Cornwall, Ontario, pretty far out there, where the average home price is probably just above $100K ... often earn well over $100K. Nurses, Teachers, a plethora of questionable Directors (the Director for 'Clergy Services' the hospital earns a lot. How many staff? And how big is that responsibility?) all earning well north of $100K, esp. in rural areas where cost of living is low. Private sector salaries will be lower to reflect lower cost of living, but public sector wages are not. Average wage in Canada is just above $40K. See the groupings by trade: http://www.livingin-canada.com/work-salaries-wages-canada.html http://www.livingin-canada.com/work-salaries-wages-canada.ht... Note that 'public sector' employees are near the top. The group earning more is 'utilities' - which in Canada are 'Crown Corporations' (or de-facto), meaning essentially public sector. Where I live in Quebec, the 'best career path' for most people is 'Government', as it turns out, we have almost the lowest wages in North America, just ahead of the other Canadian Maritime provinces. One of the most overlooked factors in government work is the 'riskless' nature of it. In finance, we learn that 'consistent payments' have quite a lot of value, which is why companies that pay very consistent dividends are worth more. That you have 'a zero chance of layoff, and a very low chance of being fired' is actually a benefit, and it's economically measurable. It's a premium and it's worth a lot.

mikebelanger 10y ago

That's why I think the only kind of pensions that should exist are public pensions -- something all citizens get access to. Work-specific ones, especially in the public sector are prone to these sorts of issues. Yes, there's still issues with government mandated ones, but I'd argue they get way more attention given that they affect so many more people at the same time.