The public pension plans that are underfunded are in that shape because politicians, Christie Whitman when she was governor of New Jersey being a prime example, cut money going into the plans and used them to finance tax cuts. The workers fought like hell to prevent that, but failed.
Hmmmm, how interesting. Unionized workers negotiate for a solid and sound compensation package and along come vote-seeking (dare we say rent-seeking) anti-tax politicians who end up costing the taxpayers more, not less, because they violated well established, centuries old economic practices.
The Chicago Tribune has been detailing how the public employee union leaders in Illinois have been fighting like hell to protect their employee pensions:
Most city workers spend decades in public service to build up modest pensions. But for former labor leader Dennis Gannon, the keys to securing a public pension were one day on the city payroll and some help from the Daley administration.
And his city pension is more than modest. It’s the highest of any retired union leader: $158,000. That’s roughly five times greater than what the typical retired city worker receives.
Not bad for one day. But for somebody fighting like hell to ensure that public employee plans are adequately funded, it’s surely a bargain.
Via Death and Taxes.