TRS Issues and Answers

The Public Sector Pension Problem (aka) the Teachers Pension Problem is quite fixable and the solution would be fair to those in the plan. If one computes the contribution level by the teachers (9.2% plus a 9.2% match) and uses a conservative investment strategy the payout would be around $44K per year moving forward. This is substantially less then the 85% of final pay they are expecting which also includes a 40% Inflater for the years prior to retirement plus excessive COLAs and other health benefits. But a solution of paying out $50K maximum annually with a COLA tied to the Social Security COLAs for all over 35 years of age is quite doable at this point. All others and new employees should be moved into the same plans as taxpayers —Social Security, Medicare and self-defined 401k with a 3% match. If the unions want to offer a Pension Plan that is their decision and responsibility not the taxpayers. What the problem is in addressing this fraud on the taxpayers are the Politicians who are major beneficiaries of this on many levels. What is needed is for all Public Sector Labor Agreements to be approved at the ballot box since there is no way anyone should be allowed to raise their own salary and benefits unless they own the enterprise. Here we have a classic case of the foxes controlling the hen house. The other solution that is less painful on the taxpayers is for the state to default and wipe all these obligations. Examining the operations it is a great possibility as there is absolutely no intelligence or operational experience in any of this massively bloated and corrupt operations. Like all criminals the ending is sealed by their unabated greed.