Posted on 09/22/2007 4:36:10 PM PDT by Son House
Bureaucrats' Union Bosses
Percentage of Unionized Government Employees Click on a state to view the full state profile.
Government employees are more than four times likelier to be unionized than their private-sector counterparts, according to the Bureau of Labor Statistics. Taxpayer-funded jobs are the only sector of the economy where unions have consistently grown for several years. And taxpayers are left with the check, rung up by government employee union officials and the politicians all too eager to appease them.
* Some basic facts: The median public employee netted $39,416 in 2005, compared with $32,500 for the typical private-sector employee.
* The New York Times reported on August 8, 2006 that state and local governments may owe roughly $375 billion (on top of current budgeting) in order to pay out pensions. "Barclays Global Investments has calculated that if America's state pension plans were required to use the same methods as corporations," the Times reports, taxpayer liability would double.
* Between federal, state, and local government pension obligations, USA TODAY reported on May 24, 2006, every household in America owes public employees more than $27,500.
(Excerpt) Read more at unionfacts.com ...
My State, Minnesota:
Government Employee Unions Each year, public sector unions cost Minnesota residents millions of dollars by driving state budgets well beyond responsible spending.
Government Employees 269,273 Percent Unionized 52.6 % Average Government Employee Salary $ 44,823
Minnesota residents could pay 24.03% less in state income taxes if they weren't paying for inflated government employee union wages.
Minnesota Democrats are called DFL, Democrat Farm Labor Party, so where it says other, it really means Democrats;
State-level Political Donations
Public sector unions give thousands of dollars to local legislators, often in an effort to guarantee exorbitant benefits from the state.
Total Contributions Democrat $ 7,200 Other $ 198,460 Other $ 750 Republican $ 18,975 Source: Institute on Money in State Politics
Federal-level Political Donations Each election unions spend millions of their members' money supporting politicians, many of whom the union members don't even like. The following Minnesota candidates received money from labor unions.
Total Contributions Democrat $ 590,443 Other $ 306,950 Republican $ 49,500 Source: Federal Election Commission
Please find your state and post the obvious wrongs. Also feel free to surf the whole site, it's great research.
http://www.unionfacts.com/
Are you selling unionization to people?
How about fringe benefits? Do unionized people get better fringe than non-unionized people?
The amount of deferred compensation is hidden from taxpayers because of the common practice in compensation surveys to only count the employer's cost in retirement compensation. In Colorado, the compensation survey makes the outrageous claim that retirement compensation in the private sector is higher than retirement compensation in the public sector. Here is a link to a summary of the study that I wrote if you want more details.
Yes, Unionized Government Employees cost tax payers more money.
No.
No, someone has to pay for the benefits, and as you can tell from the recent GM Union talks, it’s going to be the folks who do the productive work.
Thank you!
Do you perhaps believe that products acquire value only as a consequence of the input of labor?
Now, a couple of questions ~ do the Colorado employees pay into a retirement fund each year?
If so, how much is it?
I went back over all of my "payroll contributions" to the CSRS and FERS systems shortly after I retired, matched them up with T-Bill interest rates, and discovered that my taxable deductions from salary over those years ended up MORE THAN PAYING for my own retirement.
Has any computation been made regarding ALL the Colorado state and municipal employees to see how much of their own contributions is used to finance their retirements.
Bet it's about the same as the federal systems.
In Colorado, state and local government employees pay into the PERA plan as well as the employer. I counted all contributions from both employee and employer contributions and compounded the contributions using the PERA guaranteed rates (higher than standard TBill rates). The difference between the account balance using the contributions and interest and the private sector value of the pension was on the average about $523,000.
I am skeptical about your situation unless you retired in your late 60s or 70s or had very poor raises. Even lower paid workers had large amounts of deferred compensation in my study. I am not sure how you could make a similar calculation. Do you have access to mortality tables? Do you know the private sector interest rate available to fund a single premium lifetime annuity on your retirement date? I doubt that you calculated the value of your pension correctly. You probably greatly underestimate the value of your pension if you think that contributions compounded at TBill rates could buy a single premium lifetime annuity to fund your pension.
You are right that every state does not have the same deal as Colorado. Many states do have comparable or even better deals (for example, California).
I am trying to get more data but it is difficult. I did the study because I did not see any similar studies. Everyone was talking about the funding side, not the compensation side. I just want truth in compensation claims.
The payroll contribution made by the employees was sufficient to fund an annuity capable of generating my current payments.
BTW, I had 38 years federal service ~ at 40 years your benefits don't increase!
About 5 years ago USPS (Postal Service) discovered that they'd been making too high a contribution to the retirement funds (invested in federal securities) ~ ultimately they CUT their contribution ~ employees kept making their contribution. The USPS also didn't enhance existing retirements.
Other federal agencies didn't have as large a problem since direct agency contributions had not previously been "collected".
Little secret, used to be that each federal agency didn't have to consider retirement in current accounts. They do now, and have been doing so more and more every year as CSRS employees retire and FERS employees surge toward 100% of employment.
Anyway, the Colorado plan looks rich ~ how'd their salaries compare to federal employee salaries?
Massachusetts unions contributed $1.2 Million to democrats compared to $15,000 to republicans.....I knew it was ridiculous but MAN.
I am surprised that the Massachusetts unions found one Republican to contribute too. I would not have been surprised if the number was ZERO.
In Colorado, some retirees in my study were upside down on their account balance. However, a retiree can alternatively base benefits on their account balance annuitized at 8.5%. With this provision, everyone in my study had lump sum deferred compensation because no private company will annuitize at anything close to 8.5% (how about 5.5% for annuitizing your lump sum payment?)
I doubt that the Colorado plan is much different than the federal retirement plan. The standard benefit rate in Colorado is 2.5% after 30 service years with a rule of 80. My study only examined career employees, not employees who left with a small number of service years.
Yes, they really bank on their politicians always being in favor, Minnesota Republican Senators get a couple hundred thousand less than some Democrats in the House, you’d think a Senator would be worth more:
Coleman, Norm (R) $ 9,500
Daly, Teresa Ann (D) $ 147,500
Mccollum, Betty (D) $ 147,950
Oberstar, James L (D) $ 242,950
Sabo, Martin Olav (D) $ 96,850
Wetterling, Patty (D) $ 202,543
That makes things highly complex.
However, they were not also subject to Social Security unless they converted to the FERS plan, or were hired from 1987 on.
That makes it incredibly complex.
I wrote an elaborate computer program to determine whether or not it was worth converting from CSRS to FERS. Turned out that if you were roughly between the age of 37 and 47, you made out like a bandit because the legislation had been written by guys in that age range ~ and they took care of themselves (while screwing Congressmen a bit believe it or not).
Several times over my 38 years the Congress, with the connivance of the President at the time, sought to balance the federal budget on the backs of the employees and temporarily raised the employee contributions ~ usually 1/2 or 1/4 percent.
BTW, the federal system (for the defined benefit portion) uses "High Three", and you get COLA increases in future years.
The FERS portion gets a COLA 1% less than the rate of inflation. They don't want the retired federal workers getting rich off the taxpayers ya' know.
It does not make the deferred compensation calculation any more complex. It may make the switching decision more complex but it does not make the deferred compensation calculation any more complex.
It is easy to account for retirement contributions (both employee and employer) as current compensation. The total amount of salary and benefits is your current compensation. If you contributed 8% to your retirement, you can lower your salary by 8% and increase the amount of current retirement compensation by 8%.
What is difficult to calculate is deferred compensation disguised as a pension. The amount that you and your employer contribute compounded at a risk free rate is no where near sufficient. In Colorado, the pension agency thinks they can make 8.5% returns (most likely fantasy given the Dim takeover of the government). Regardless of the pension agency’s assumption, you cannot earn that return risk free. Since your benefit is risk free, deferred compensation is the proper way to view the excess of the pension benefit value compared to the account balance at a risk free rate of return.
I can assure you that the budget was never balanced on the backs of the federal employees or retirees. You are joking when you say that an additional 1/4% or 1/2% increase in your contribution rate is balancing the budget on your back. This additional increase was just a small decrease in your golden parachute.
Federal employees retiring in recent times have received golden parachutes. The fact that you deny it (an probably most other federal employees and retirees) means that I need to get more data to publish the facts.
The 7% "contribution" was TAXED as current income so in reality it was much more than 7% (since it was taxed at the highest applicable marginal rate).
The Extra 1/2 or 1/4 percent temporary increases turn out to have had a very good return since that money was technically invested in US securities sold at a high rate of interest.
Social security taxes are included as federal taxable income so you got the same deal as the rest of us. For government workers in Colorado, their contribution is tax deferred. For federal retirees under the new retirement system, I believe their contribution is tax deferred also.
My points about compensation are full disclosure and market driven wages. The deferred compensation hidden in defined benefit pensions is not disclosed. With full disclosure, you would need to add another 30 to 50% current compensation for long term employees (20 years or more). It is not necessary to pay this ridiculous amount of hidden deferred compensation to have a competent government work force. Government employees should get the same deal as private sector employees: a 401K and social security. If a government agency cannot hire and retain employees, current compensation should be increased for just those employees and areas of employment.
If a defined benefit plan is offered to government employees, the retirement age should be raised to 67, consistent with social security. There is an initiative in California that will try to raise the retirement age of state employees. California pensions and retiree health care threaten to bankrupt the state. A similar situation could ensue in a number of other states including Colorado.
The “tax deferral” would apply only to the federal equivalent of the 401(k) plans, and the employee contributions to those plans.
That's no different than private sector. On the other hand, CSRS employees never earn eligibility for Social Security without additonal, non-government employment, and they are subjected to a heavy penalty for "double dipping" ~ a tax private sector folks don't face.
The contribution is very small, less than 1% in FERS. Most of the contribution is employer paid, about 11.2%. Focusing on the contribution (employer or employee) is a distraction from the issue of hidden deferred compensation. The deferred compensation is the excess beyond employee and employer contributions with interest. My study provides strong evidence about the amount of deferred compensation. I am confident that federal employees have golden parachutes also.
The deal to include federal employees in social security was fraudalent. Federal employees were given an additional 401K funded by the employer as a condition to enter social security. You could view it another way. Federal employees were given social security benefits in exchange for an additional employer financed 401K. What a deal! Can private sector employees get the same deal?
There is no tax that federal employees face that is not faced in the private sector. Double dipping just means that you are getting two pensions. Anyone who earns a defined benefit pension with exemption from social security faces the same double dipping rules. Unfortunately, only government employees and clergy can double dip. I wish that I could double dip because it would mean that I did not pay much social security tax during my working years.
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