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By pre-funding, you mean funding. They are required to pay today for the liabilities they incur today (the promises of future healthcare). Today's liabilities

by LanceH 5y ago

By pre-funding, you mean funding. They are required to pay today for the liabilities they incur today (the promises of future healthcare). Today's liabilities (the promises) have a very real cost. Ignoring that cost elsewhere is it's own hazard. Adopting pay-as-you-go might work for governments which can loot people later or just unilaterally change the rules. Or it might work for a company while things are good, but is catastrophic when it goes bad. Actually funding things is the proper way to do it.

dhosek 5y ago
It's the level of prefunding that's excessive. They need to fund retirement benefits for employees who have not yet been hired. https://www.uspsoig.gov/blog/be-careful-what-you-assume https://www.uspsoig.gov/blog/be-careful-what-you-assume
- coredog64 5y ago
  > As things stand now, retiree healthcare, pensions, and workers’ compensation are unfunded by about $86.6 billion. USPS pensions etc. were extremely underfunded for a long time. The size, scope, and quasi-governmental nature of USPS meant that ignoring the problem was more likely to involve a bailout than responsible operations. IMO, the only unreasonable pension expectation levied on USPS is that for veterans: They’re required to pay some amount of veteran retirement benefits for some reason that I haven’t been able to make sense of.
- LanceH 5y ago
  Again, putting aside money to meet the obligations you will incur for having an employee today is funding. It is not prefunding by any stretch. I haven't seen any mention of setting aside money for people who don't work there yet, including in your link. Asking to be treated like the government so that you can hire someone now, with promises of future payments, then pull in those payments based upon the revenue produced by future employees is analogous to a ponzi scheme. The federal government gets away with pay-as-you-go because they can set taxes, devalue money, change payment plans, etc... How much the government should be investing in providing a quality mail system is a different discussion entirely. But this discussion is basically "should pensions be funded or not". Calling it prefunding is a rhetorical device only, and doesn't stand up to actuarial scrutiny.

by LanceH 5y ago

dhosek 5y ago

It's the level of prefunding that's excessive. They need to fund retirement benefits for employees who have not yet been hired. https://www.uspsoig.gov/blog/be-careful-what-you-assume https://www.uspsoig.gov/blog/be-careful-what-you-assume

coredog64 5y ago
> As things stand now, retiree healthcare, pensions, and workers’ compensation are unfunded by about $86.6 billion. USPS pensions etc. were extremely underfunded for a long time. The size, scope, and quasi-governmental nature of USPS meant that ignoring the problem was more likely to involve a bailout than responsible operations. IMO, the only unreasonable pension expectation levied on USPS is that for veterans: They’re required to pay some amount of veteran retirement benefits for some reason that I haven’t been able to make sense of.
LanceH 5y ago
Again, putting aside money to meet the obligations you will incur for having an employee today is funding. It is not prefunding by any stretch. I haven't seen any mention of setting aside money for people who don't work there yet, including in your link. Asking to be treated like the government so that you can hire someone now, with promises of future payments, then pull in those payments based upon the revenue produced by future employees is analogous to a ponzi scheme. The federal government gets away with pay-as-you-go because they can set taxes, devalue money, change payment plans, etc... How much the government should be investing in providing a quality mail system is a different discussion entirely. But this discussion is basically "should pensions be funded or not". Calling it prefunding is a rhetorical device only, and doesn't stand up to actuarial scrutiny.