4 ms·

>> Retirement benefits should be funded as they are accrued. That is not the problem. No, that really is the problem. Prefunding pension liabilities is somethi

>> Retirement benefits should be funded as they are accrued. That is not the problem. No, that really is the problem. Prefunding pension liabilities is something that literally no company or federal agency ever does, for obvious reasons.

lotsofpulp 6y ago
I don’t know what this “prefunding” word means, but the USPS was only required to save for accrued benefits. Which every non governmental entity is required to do in the US due to ERISA and PPA 2006. https://www.cnbc.com/2011/10/24/the-truth-about-the-post-offices-financial-mess.html https://www.cnbc.com/2011/10/24/the-truth-about-the-post-off... > Although accounting rules require the postal service to calculate future liabilities, including those for projected future employees, the law only requires pre-funding of obligations to actual current and past employees
- jellicle 6y ago
  The point is that on the day that the USPS hires a 20-year-old employee they immediately need to set aside money for this worker's healthcare at age 90, which is an astronomical sum (as projections of future healthcare costs are inevitably astronomical). And no, no private entity in the US is required to prefund retiree health benefits.
  - Borealid 6y ago
    Let's say USPS has promised to pay for a 20-year-old employee's health care for the next 70 years. Let's say the total price of that health care is going to be $10M over the 70-year course. What should they do that neither involves setting sufficient money aside today nor a significant chance of failing to fulfill their obligation? Keep in mind that USPS' core business can't turn much of a profit due to Congressionally-defined price caps, so it is a very poor place to "invest" money.
  - lotsofpulp 6y ago
    Which goes to show how ridiculous it is to offer retiree healthcare benefits. If the cost is so high as to be described as astronomical, then why is the government offering it?
- deleted 6y ago
  [deleted]

lotsofpulp 6y ago

I don’t know what this “prefunding” word means, but the USPS was only required to save for accrued benefits. Which every non governmental entity is required to do in the US due to ERISA and PPA 2006. https://www.cnbc.com/2011/10/24/the-truth-about-the-post-offices-financial-mess.html https://www.cnbc.com/2011/10/24/the-truth-about-the-post-off... > Although accounting rules require the postal service to calculate future liabilities, including those for projected future employees, the law only requires pre-funding of obligations to actual current and past employees

jellicle 6y ago
The point is that on the day that the USPS hires a 20-year-old employee they immediately need to set aside money for this worker's healthcare at age 90, which is an astronomical sum (as projections of future healthcare costs are inevitably astronomical). And no, no private entity in the US is required to prefund retiree health benefits.
- Borealid 6y ago
  Let's say USPS has promised to pay for a 20-year-old employee's health care for the next 70 years. Let's say the total price of that health care is going to be $10M over the 70-year course. What should they do that neither involves setting sufficient money aside today nor a significant chance of failing to fulfill their obligation? Keep in mind that USPS' core business can't turn much of a profit due to Congressionally-defined price caps, so it is a very poor place to "invest" money.
- lotsofpulp 6y ago
  Which goes to show how ridiculous it is to offer retiree healthcare benefits. If the cost is so high as to be described as astronomical, then why is the government offering it?
deleted 6y ago
[deleted]