4 ms·

I always see the words pensions in civic deficit news. I'm early 30s and pensions are a concept that nobody my age or younger will ever benefit from yet is foot

I always see the words pensions in civic deficit news. I'm early 30s and pensions are a concept that nobody my age or younger will ever benefit from yet is footing the bill for.

dragonwriter 2y ago
You’ve already benefited from them, by getting government services at a lower up front cost by acquiring labor with the promise of them on the backend. (And, barring those promises not being fulfilled, plenty of people your age and younger have already been working in jobs that qualify them for pensions when they reach a certain age, or have a relative with such a pension with survivorship benefits, and will benefit from them as beneficiaries.)
- toomuchtodo 2y ago
  Most of today is the result of stealing from the future, and that strategy is running out of steam.
  - ok_dad 2y ago
    Now financial instruments like pensions are stealing? In what way? Those workers worked for that pension. It’s funny how the top wealth owners have vacuumed up more and more wealth and you’re mad at the regular Joe working a 9-5.
    - toomuchtodo 2y ago
      Let me expound so I can be exceptionally clear. I fall firmly in the "billionaires should not exist" bucket. They are a bug in the economic system. Bernie Sanders is my North Star from a policy and nation state social system perspective (its also more financially efficient, but I digress). I do not blame workers for our current fiscal crisis predicament. Pensions are not stealing from the future. When done properly, invested prudently, and managed to a fiduciary standard, they are an effective mechanism to invest those worker capital earned at that time into productive investments to provide returns in the future when those workers approach retirement. Through the 401k attempt, we have shown this policy to be a failure. The human cannot be relied on to financially prepare for retirement, this must be done with systems and at scale. When I say "stealing from the future," I mean where pensions were promised and now they're being marketed as "too expensive" when what would've gone into pensions over the last 40 years was vacuumed up by the very wealthy through management compensation and shareholder returns. I mean sovereign debt that has been issued, to be paid back by future workers who in no way consented to having to work to pay that debt back. I mean infrastructure and climate expenses that will rapidly approach $1T/year in costs, because we did not have the will to pay for these things today. Capitalism stole from the future, and it will never be enough. Someone is going to be left holding the bag, and everyone is going to be unhappy the future is not as bright as the past was. (i am once again asking you to think in systems) McKinsey: Dependency and depopulation? Confronting the consequences of a new demographic reality - https://www.mckinsey.com/mgi/our-research/dependency-and-depopulation-confronting-the-consequences-of-a-new-demographic-reality https://www.mckinsey.com/mgi/our-research/dependency-and-dep... - January 15th, 2025 US Treasury Fiscal Data: What is the national debt? - https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ https://fiscaldata.treasury.gov/americas-finance-guide/natio... ($36.22T as of this comment) Climate change could erase $1.4 trillion in real estate value - https://www.axios.com/2025/02/03/climate-change-insurance-costs-real-estate https://www.axios.com/2025/02/03/climate-change-insurance-co... - February 3rd, 2025 Climate crisis costs the world 12% in GDP for every 1°C temperature rise - https://www.weforum.org/stories/2024/06/nature-climate-news-global-warming-hurricanes/ https://www.weforum.org/stories/2024/06/nature-climate-news-... - September 10th, 2024 HN Search: climate change cost - https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=climate+change+cost&sort=byPopularity&type=story https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu... The cost to fix America’s crumbling infrastructure? Nearly $2.6 trillion, engineers say - https://www.cnn.com/2021/03/30/politics/infrastructure-us-investment-cost-engineers/index.html https://www.cnn.com/2021/03/30/politics/infrastructure-us-in... - March 30th, 2021 https://news.ycombinator.com/item?id=42052544 https://news.ycombinator.com/item?id=42052544 (401k failure citations)
      - trgn 2y ago
        > Through the 401k attempt, we have shown this policy to be a failure. 401ks are a terrible on their own. It has thrown everybody for the wolves and tied people's financial wellbeing to the vagaries of the market. But there's still a flipside. Pensions should not be used to provide a level of income to maintain a lifestyle (cue anecdotes of boomers packing up and leaving for florida). Pensions should be to provide a baseline level of financial support for the essentials, perhaps a little above, say like social security but a little more. But they are not that, generally speaking. Retiring at 58 with 80% of wages - or whatever absurdities sometimes occurred - _is_ theft from the young.
        toomuchtodo 2y ago
        It should be like a layer cake. Social Security on the bottom, this keeps you from destitution. It is insurance, not an investment. Pensions are the next layer on the cake. This provides additional income from investments made during your working career, with employer contributions mandated, and with it very difficult to touch this before retirement. Australia's Superannuation system [1] is my mental model for this. You have to have strong governance around reasonable returns and payments to prevent from the absurdities you mention. It is not tied to a single employer. The final cake layer should be personal savings and investments made by someone. This derisks everyone's risk of the usual human failing (lack of financial sophistication, adverse events, etc), while enabling those who want to invest above and beyond a mechanism to do so. Right now, it's Mad Max with some Social Security scraps [2]. [1] https://en.wikipedia.org/wiki/Superannuation_in_Australia https://en.wikipedia.org/wiki/Superannuation_in_Australia [2] https://www.gao.gov/financial-security-older-americans https://www.gao.gov/financial-security-older-americans
        trgn 2y ago
        agreed 100% > Mad Max with some Social Security scraps haha! sadly
    - trgn 2y ago
      pensions are defined benefits. if they truly worked for that pension, it'd be defined contribution.
      - ok_dad 2y ago
        I guess I didn’t work for my health insurance since it’s a benefit then? What kind of nonsense are you talking about, “they didn’t work for their pension”? Clearly I’m misunderstanding what you’re saying because that would be stupid as fuck to say pensioners didn’t work for a pension because of some technical definition? I don’t get it.
        trgn 2y ago
        I meant that pension payouts are a legal claim, and somewhar untethered from what the actual amounts an individual puts into it. You're guaranteed a benefit, until death. in practice thwt benefit is met by new younger contributors, higher taxes,... You sense a pension is like insurance (a benefit, paid out because of legal contract) , and this burden by mathematical nexessity is carried unequally. Other people feel like it should be more like a return on prior investment, a burden carried individually. I think both are complementary fwiw because both by themselves have drawbacks, different moral hazards
    - sct202 2y ago
      My city, Chicago, is one of the ones mentioned in TFA. We had about 15 years of pension holidays, where contributions were not paid and the the catch up payments were scheduled far into the future. It is now the future and the people who had their taxes artificially lowered have long ago retired to Florida. The workers are owed a pension but it's being paid by current workers not those who got the tax breaks.
      - FuriouslyAdrift 2y ago
        Chicago is a very poor example... the city is terribly run and horribly corrupt and has been or decades. There are reasons the rest of Illinois has tried to secede from them. https://www.forbes.com/sites/edwardsiedle/2021/09/03/chicago-police-pension-forensic-audit-ends-with-disturbing-findings/ https://www.forbes.com/sites/edwardsiedle/2021/09/03/chicago...
        seryoiupfurds 2y ago
        Sounds more like that makes it a particularly good example.
        tptacek 2y ago
        Most of the revenue that funds programs in counties outside of Cook comes from the Chicagoland MSA, so I guess they can be our guests; we can use the money.
  - JumpCrisscross 2y ago
    > Most of today is the result of stealing from the future, and that strategy is running out of steam If you "calculate the net present value (NPV) of benefits received minus taxes paid for US generations born 1850 to 2090," you find "all generations 1950 to 2050 are net gainers, while many current elderly are losers" [1]. ("There are two peaks in net benefits. The first peak was centered on the cohort born in 1908 which experienced the large windfall gains from the start-up of social security but missed much of the windfall losses from the expansion of public education funding. On net, the 1908 cohort received net transfers amounting to 5.7% of lifetime earnings. The second peak in net benefit is centered on the cohorts born in 1993-94 which experienced the positive benefits of the educational expansion funded by previous generations and which are projected to avoid the looming net costs of paying the social security and Medicare implicit debt. On net, these cohorts are forecast to receive net benefits amounting to 5.6% of lifetime earnings. There are three sets of cohorts which experienced net losses through the transfer systems. Those born before 1880 experienced net losses due to the expansion of the public education system. Those born between 1930 and 1947 also experienced net losses. While these cohorts did receive large windfall gains associated with the start-up periods for Social Security and Medicare, these were more than offset by windfall losses from the expansion of the public education system. Cohorts born after 2060 are expected to incur increasingly large net losses via the public transfer systems as Social Security and Medicare overwhelm the gains through education.") [1] https://pmc.ncbi.nlm.nih.gov/articles/PMC2840408/ https://pmc.ncbi.nlm.nih.gov/articles/PMC2840408/
    - toomuchtodo 2y ago
      I would like to see an update, as this paper is ~15 years old. I also don't see it accounting for real estate costs outpacing wages, requiring younger cohorts to devote arguably unreasonable amounts of their current cashflows to housing. My statement does not scope solely to public transfer systems, but the economic system as a whole. Today wants returns, while issuing as much future obligation as possible (in various ways, debt instruments, higher future taxes, etc) for someone in the future to pay.
      - JumpCrisscross 2y ago
- lenerdenator 2y ago
  They're beneficial to younger generations, provided that there's enough value generated by the younger generations to cover the cost of the pension. The problem is, this new wave of retirees - the Baby Boomers - did not have enough children. Their children's generation - the Millennials - can thus charge more for their labor. The Millennials also aren't having enough children. This means that the people generating the value are taking more of the value for themselves to live on (though not relative to inflation, but that's a different conversation), and there's fewer of them contributing to pensions through various government revenue schemes. Also, anecdotally, my parents have far more expensive plans for their retirement than my grandparents ever did.
- qwe----3 2y ago
  The person that worked for 25 years starting at 18 for a full pension benefited me? Nah, I think they benefited far far more.
- deleted 2y ago
  [deleted]
ok_dad 2y ago
Are you mad at the pensioners, who worked for decades on the agreement they’d get a pension, or are you mad at the oligarchs and businesses who lobbied to make pensions a thing of the past so that you’re not protected as well? You should be mad at the Capitalists not the workers.
- lenerdenator 2y ago
  It's worth noting that a lot of shares in publicly traded companies are held by retirement and pension funds. Money paid to a shareholder is money not paid to the person doing the labor and vice-versa. That's not to say that pension funds are the sole reason that wages haven't kept up with costs over the last 50-ish years, but it doesn't help, particularly when management/the oligarchs are compensated mainly using the same shares that those retirement and pension funds use to generate revenues for the people they cover.
- unyttigfjelltol 2y ago
  Patrick Boyle did a segment recently on pensions that I cannot locate. He pointed out that the private industry in the US that granted generous pensions in the mid-20th century all went bankrupt, and that is why there are not private-sector US pensions anymore. It coincided with globalization, but is more a symptom of the countercyclical nature of pension expenses. They cost most when a business can bear the costs least. This is one of many ways that folks aged 70+ had it much better than folks in the workforce now, and represents generational inequality that you should not minimize or attribute to "capitalists." You may, if you like, attribute it to "generosity" by individuals indifferent to "math."
  - no_wizard 2y ago
    > They cost most when a business can bear the costs least. Shouldn't a reasonable business have been investing forward to avoid this problem? IE, you don't use todays dollars, you use yesterdays dollars. Its seems the flaw is that they lacked sufficient savvy to invest the pensions in a way where it would be able to build upon itself.

I always see the words pensions in civic deficit news. I'm early 30s and pensions are a concept that nobody my age or younger will ever benefit from yet is footing the bill for.

dragonwriter 2y ago

You’ve already benefited from them, by getting government services at a lower up front cost by acquiring labor with the promise of them on the backend. (And, barring those promises not being fulfilled, plenty of people your age and younger have already been working in jobs that qualify them for pensions when they reach a certain age, or have a relative with such a pension with survivorship benefits, and will benefit from them as beneficiaries.)

toomuchtodo 2y ago
Most of today is the result of stealing from the future, and that strategy is running out of steam.
- ok_dad 2y ago
  Now financial instruments like pensions are stealing? In what way? Those workers worked for that pension. It’s funny how the top wealth owners have vacuumed up more and more wealth and you’re mad at the regular Joe working a 9-5.
  - toomuchtodo 2y ago
    Let me expound so I can be exceptionally clear. I fall firmly in the "billionaires should not exist" bucket. They are a bug in the economic system. Bernie Sanders is my North Star from a policy and nation state social system perspective (its also more financially efficient, but I digress). I do not blame workers for our current fiscal crisis predicament. Pensions are not stealing from the future. When done properly, invested prudently, and managed to a fiduciary standard, they are an effective mechanism to invest those worker capital earned at that time into productive investments to provide returns in the future when those workers approach retirement. Through the 401k attempt, we have shown this policy to be a failure. The human cannot be relied on to financially prepare for retirement, this must be done with systems and at scale. When I say "stealing from the future," I mean where pensions were promised and now they're being marketed as "too expensive" when what would've gone into pensions over the last 40 years was vacuumed up by the very wealthy through management compensation and shareholder returns. I mean sovereign debt that has been issued, to be paid back by future workers who in no way consented to having to work to pay that debt back. I mean infrastructure and climate expenses that will rapidly approach $1T/year in costs, because we did not have the will to pay for these things today. Capitalism stole from the future, and it will never be enough. Someone is going to be left holding the bag, and everyone is going to be unhappy the future is not as bright as the past was. (i am once again asking you to think in systems) McKinsey: Dependency and depopulation? Confronting the consequences of a new demographic reality - https://www.mckinsey.com/mgi/our-research/dependency-and-depopulation-confronting-the-consequences-of-a-new-demographic-reality https://www.mckinsey.com/mgi/our-research/dependency-and-dep... - January 15th, 2025 US Treasury Fiscal Data: What is the national debt? - https://fiscaldata.treasury.gov/americas-finance-guide/national-debt/ https://fiscaldata.treasury.gov/americas-finance-guide/natio... ($36.22T as of this comment) Climate change could erase $1.4 trillion in real estate value - https://www.axios.com/2025/02/03/climate-change-insurance-costs-real-estate https://www.axios.com/2025/02/03/climate-change-insurance-co... - February 3rd, 2025 Climate crisis costs the world 12% in GDP for every 1°C temperature rise - https://www.weforum.org/stories/2024/06/nature-climate-news-global-warming-hurricanes/ https://www.weforum.org/stories/2024/06/nature-climate-news-... - September 10th, 2024 HN Search: climate change cost - https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=climate+change+cost&sort=byPopularity&type=story https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu... The cost to fix America’s crumbling infrastructure? Nearly $2.6 trillion, engineers say - https://www.cnn.com/2021/03/30/politics/infrastructure-us-investment-cost-engineers/index.html https://www.cnn.com/2021/03/30/politics/infrastructure-us-in... - March 30th, 2021 https://news.ycombinator.com/item?id=42052544 https://news.ycombinator.com/item?id=42052544 (401k failure citations)
    - trgn 2y ago
      > Through the 401k attempt, we have shown this policy to be a failure. 401ks are a terrible on their own. It has thrown everybody for the wolves and tied people's financial wellbeing to the vagaries of the market. But there's still a flipside. Pensions should not be used to provide a level of income to maintain a lifestyle (cue anecdotes of boomers packing up and leaving for florida). Pensions should be to provide a baseline level of financial support for the essentials, perhaps a little above, say like social security but a little more. But they are not that, generally speaking. Retiring at 58 with 80% of wages - or whatever absurdities sometimes occurred - _is_ theft from the young.
      - toomuchtodo 2y ago
        It should be like a layer cake. Social Security on the bottom, this keeps you from destitution. It is insurance, not an investment. Pensions are the next layer on the cake. This provides additional income from investments made during your working career, with employer contributions mandated, and with it very difficult to touch this before retirement. Australia's Superannuation system [1] is my mental model for this. You have to have strong governance around reasonable returns and payments to prevent from the absurdities you mention. It is not tied to a single employer. The final cake layer should be personal savings and investments made by someone. This derisks everyone's risk of the usual human failing (lack of financial sophistication, adverse events, etc), while enabling those who want to invest above and beyond a mechanism to do so. Right now, it's Mad Max with some Social Security scraps [2]. [1] https://en.wikipedia.org/wiki/Superannuation_in_Australia https://en.wikipedia.org/wiki/Superannuation_in_Australia [2] https://www.gao.gov/financial-security-older-americans https://www.gao.gov/financial-security-older-americans
        trgn 2y ago
        agreed 100% > Mad Max with some Social Security scraps haha! sadly
  - trgn 2y ago
    pensions are defined benefits. if they truly worked for that pension, it'd be defined contribution.
    - ok_dad 2y ago
      I guess I didn’t work for my health insurance since it’s a benefit then? What kind of nonsense are you talking about, “they didn’t work for their pension”? Clearly I’m misunderstanding what you’re saying because that would be stupid as fuck to say pensioners didn’t work for a pension because of some technical definition? I don’t get it.
      - trgn 2y ago
        I meant that pension payouts are a legal claim, and somewhar untethered from what the actual amounts an individual puts into it. You're guaranteed a benefit, until death. in practice thwt benefit is met by new younger contributors, higher taxes,... You sense a pension is like insurance (a benefit, paid out because of legal contract) , and this burden by mathematical nexessity is carried unequally. Other people feel like it should be more like a return on prior investment, a burden carried individually. I think both are complementary fwiw because both by themselves have drawbacks, different moral hazards
  - sct202 2y ago
    My city, Chicago, is one of the ones mentioned in TFA. We had about 15 years of pension holidays, where contributions were not paid and the the catch up payments were scheduled far into the future. It is now the future and the people who had their taxes artificially lowered have long ago retired to Florida. The workers are owed a pension but it's being paid by current workers not those who got the tax breaks.
    - FuriouslyAdrift 2y ago
      Chicago is a very poor example... the city is terribly run and horribly corrupt and has been or decades. There are reasons the rest of Illinois has tried to secede from them. https://www.forbes.com/sites/edwardsiedle/2021/09/03/chicago-police-pension-forensic-audit-ends-with-disturbing-findings/ https://www.forbes.com/sites/edwardsiedle/2021/09/03/chicago...
      - seryoiupfurds 2y ago
        Sounds more like that makes it a particularly good example.
      - tptacek 2y ago
        Most of the revenue that funds programs in counties outside of Cook comes from the Chicagoland MSA, so I guess they can be our guests; we can use the money.
- JumpCrisscross 2y ago
  > Most of today is the result of stealing from the future, and that strategy is running out of steam If you "calculate the net present value (NPV) of benefits received minus taxes paid for US generations born 1850 to 2090," you find "all generations 1950 to 2050 are net gainers, while many current elderly are losers" [1]. ("There are two peaks in net benefits. The first peak was centered on the cohort born in 1908 which experienced the large windfall gains from the start-up of social security but missed much of the windfall losses from the expansion of public education funding. On net, the 1908 cohort received net transfers amounting to 5.7% of lifetime earnings. The second peak in net benefit is centered on the cohorts born in 1993-94 which experienced the positive benefits of the educational expansion funded by previous generations and which are projected to avoid the looming net costs of paying the social security and Medicare implicit debt. On net, these cohorts are forecast to receive net benefits amounting to 5.6% of lifetime earnings. There are three sets of cohorts which experienced net losses through the transfer systems. Those born before 1880 experienced net losses due to the expansion of the public education system. Those born between 1930 and 1947 also experienced net losses. While these cohorts did receive large windfall gains associated with the start-up periods for Social Security and Medicare, these were more than offset by windfall losses from the expansion of the public education system. Cohorts born after 2060 are expected to incur increasingly large net losses via the public transfer systems as Social Security and Medicare overwhelm the gains through education.") [1] https://pmc.ncbi.nlm.nih.gov/articles/PMC2840408/ https://pmc.ncbi.nlm.nih.gov/articles/PMC2840408/
  - toomuchtodo 2y ago
    I would like to see an update, as this paper is ~15 years old. I also don't see it accounting for real estate costs outpacing wages, requiring younger cohorts to devote arguably unreasonable amounts of their current cashflows to housing. My statement does not scope solely to public transfer systems, but the economic system as a whole. Today wants returns, while issuing as much future obligation as possible (in various ways, debt instruments, higher future taxes, etc) for someone in the future to pay.
    - JumpCrisscross 2y ago
lenerdenator 2y ago
They're beneficial to younger generations, provided that there's enough value generated by the younger generations to cover the cost of the pension. The problem is, this new wave of retirees - the Baby Boomers - did not have enough children. Their children's generation - the Millennials - can thus charge more for their labor. The Millennials also aren't having enough children. This means that the people generating the value are taking more of the value for themselves to live on (though not relative to inflation, but that's a different conversation), and there's fewer of them contributing to pensions through various government revenue schemes. Also, anecdotally, my parents have far more expensive plans for their retirement than my grandparents ever did.
qwe----3 2y ago
The person that worked for 25 years starting at 18 for a full pension benefited me? Nah, I think they benefited far far more.
deleted 2y ago
[deleted]

ok_dad 2y ago

Are you mad at the pensioners, who worked for decades on the agreement they’d get a pension, or are you mad at the oligarchs and businesses who lobbied to make pensions a thing of the past so that you’re not protected as well? You should be mad at the Capitalists not the workers.

lenerdenator 2y ago
It's worth noting that a lot of shares in publicly traded companies are held by retirement and pension funds. Money paid to a shareholder is money not paid to the person doing the labor and vice-versa. That's not to say that pension funds are the sole reason that wages haven't kept up with costs over the last 50-ish years, but it doesn't help, particularly when management/the oligarchs are compensated mainly using the same shares that those retirement and pension funds use to generate revenues for the people they cover.
unyttigfjelltol 2y ago
Patrick Boyle did a segment recently on pensions that I cannot locate. He pointed out that the private industry in the US that granted generous pensions in the mid-20th century all went bankrupt, and that is why there are not private-sector US pensions anymore. It coincided with globalization, but is more a symptom of the countercyclical nature of pension expenses. They cost most when a business can bear the costs least. This is one of many ways that folks aged 70+ had it much better than folks in the workforce now, and represents generational inequality that you should not minimize or attribute to "capitalists." You may, if you like, attribute it to "generosity" by individuals indifferent to "math."
- no_wizard 2y ago
  > They cost most when a business can bear the costs least. Shouldn't a reasonable business have been investing forward to avoid this problem? IE, you don't use todays dollars, you use yesterdays dollars. Its seems the flaw is that they lacked sufficient savvy to invest the pensions in a way where it would be able to build upon itself.