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Definition of working out would be the pension costs are still a reasonable and manageable cost as compared to e.g. payroll or the budget. City bankruptcies do
by cool_dude85 3y ago
Definition of working out would be the pension costs are still a reasonable and manageable cost as compared to e.g. payroll or the budget.
City bankruptcies do occur, I'd argue that blaming pensions is just a scapegoat, but hey, that's me. I haven't looked into Detroit's books, much less Chester PA, Detroit city limits population right now is sub-1920 levels and around 1/3 of where it was in 1950. Such a change would put enormous stress on the finances of any large city, pension or no.
- lotsofpulp 3y agoA properly funded pension should be a non factor in a city’s finances. The fact that leaders in previous decades punted costs (unnecessarily) into the future when the city’s economic productivity ended up not being able to afford is the problem, and what we are discussing on how to avoid (by simply not offering deferred compensation).
- dboreham 3y agoThe problem is a bit deeper in that these workers were paid less while employed on the basis that they'd have a sweet pension. So the government employer double dipped on faking their finances.
- lotsofpulp 3y agoHence the only solution being to make all deferred compensation schemes for taxpayer funded entities illegal. A secondary benefit will be more transparent prices in the labor market that allow quicker responses to changes in supply and demand.