Mt. Vernon Register-News

Opinion

February 15, 2013

Private and public pensions - no comparison

—  

I have a very good friend that I worked with for 30 years. He is bright, articulate and most of all totally honest. This guy had a very important job at General Tire at the director level.

We lost touch like a lot of retirees do when locating to different parts of the country. I recently received an email from him and in a couple of paragraphs he succinctly put the problem I have been writing about for a couple of years into language and perspective that anyone can understand.

His situation, although no fault of his own, is the epitome of what is at the heart of our countries financial problems and is pushing Illinois toward bankruptcy.

I hope you read this very carefully and think about the difference that has caused a huge chasm between public and private retirement ages and pensions. Did you ever ponder or even think about the difference between just paying? I am talking about taxpayers paying for 15 years of retirement for someone retiring at 65 years old, someone who worked for a private company that receives a pension from defined contributions and paid — along with their company — into the Social Security system.

The 65-year-old will get increases based on the CPI on Social Security. This applies to less than half of his retirement in a lot of instances. Compare this with 25 years of retirement for the public employee retiring at 55 years with a guaranteed 3 percent increase each year in retirement. The difference will amaze you. My friend and colleague has done a good job explaining this problem with his personal example. He does not mention the windfall from unused sick days at retirement because the only thing received in his case would have been vacation not taken and certainly no juicing — increasing of salary by 10 to 20 percent in the last year for the purpose of increasing retirement pay.

Text Only
Opinion
  • Take a lesson from Texas I like to eat at blue-collar diners and cafes, particularly when I’m on vacation.It’s a chance to step beyond the homogenized national chains and experience a bit of local flavor.And being a reporter, I like to chat up local folks to find out a bit a

    July 23, 2014

  • The future reality of terrorist drones A very small airplane rose over the Gaza Strip last week. It entered Israeli airspace and sped toward the coastal city of Ashdod. Then a Patriot missile blew it up.The plane, a rudimentary drone launched by the terrorist group Hamas, posed little thr

    July 23, 2014

  • We are headed to a jobless future In an op-ed in The Wall Street Journal, former Treasury Secretary Lawrence Summers revived a debate I’d had with futurist Ray Kurzweil in 2012 about the jobless future.He echoed the words of Peter Diamandis, who says that we are moving from a history

    July 23, 2014

  • Pensions need to be addressed I will have to admit that I am slightly overwhelmed today with the receipt of articles and suggestions for a column. One of my Fitness Mafia colleagues constantly tells me the columns are too long and trying to address different subjects just dilutes

    July 22, 2014

  • VA still failing our vets Jymm’s preferred attire is a skin-tight Minnie Mouse T-shirt with bright pink windbreaker pants. Even when not sporting his choice outfit, he dons short shorts and shirts with holes in them, because that’s what he finds most comfortable. His Santa Mo

    July 22, 2014

  • Feed your home piggy bank with a 15-year mortgage This summer, we finally decided to take the plunge we’d been contemplating for a while: converting our 30-year mortgage to one with a 15-year payoff. It’s a big step. Our payments will go up somewhat (the PITI — principal, interest, tax, and insuranc

    July 19, 2014

  • Under the dumb There is a TV series about an entire town trapped under a giant, mysterious crystal-clear dome that appears out of the blue one day. The dome is impenetrable; no one can get in, no one can get out. Who made the dome? Aliens? God? A super-secret branc

    July 19, 2014

  • Widening the loopholes This week, two more U.S. companies moved to reestablish themselves overseas, allowing them to pursue lower corporate tax rates. They will join dozens of others who have chased lower tax bills abroad while maintaining operations in the United States,

    July 19, 2014

  • Patriotism not questioned Editor:I am responding to Mayor Mary Jane Chesley’s Reader’s View article in the Thursday, June 19, 2014, Register-News “Patriotism is strong.”The mayor has missed the point of my Reader’s View/opinion article in the local newspapers regarding Flag D

    July 19, 2014

  • Who's telling a story now? For this administration, failure is always the result of a “communications” problem. Otherwise, failure might be taken as evidence of misguided ideology and incompetent execution, right? It’s a weird excuse for the president who fancies himself to be

    July 18, 2014

Twitter Updates
Facebook
Stocks