Skip to comments.How many federal and postal workers can retire?
Posted on 05/20/2011 8:01:18 AM PDT by Poundstone
About 550,000 full-time career federal government and U.S. Postal Service could hang it up and move on at anytime because they are eligible to retire, according to government statistics. The eligible workers represent about a quarter of the 2.4 million permanent full-time employees collecting government or postal paychecks.
(Excerpt) Read more at washingtonpost.com ...
From things I hear here in Washington DC, I think a tidal wave of federal employees are already starting to retire, almost all of them motivated by fear a significant reduction in retirement benefits could be coming for those who don’t retire soon.
Glad I retired last year!
From my observation at the local Post Office, many have already. Unfortunately since they still wear the uniform and show up, they still get paid.
The FERS system implemented back in the mid 1980s whacked the devil out of the retirement system leaving a substantial load to be carried by the employees' 401(k) (equivalent) funds.
If you merely implemented the current FERS system on state and local employees you'd probably cut the payouts by 50%, or more than that for systems that allow "spiking". As you know the federales do not benefit from "spiking".
The requirements are simple ~ easily met by honest people.
There are always accountants and such who imagine they can make MORE ON THE OUTSIDE which, combined with their retirement, might make them RICH.
Look, since retirement I've had at least one surgery per year (which is pretty common I understand) with one 9 month period of enforced convalescence.
When you retire you have to imagine getting sick for an extended period. It happens a lot.
Congress helped (more than usual) to create this problem by refusing to let the Postal Service restructure and downsize years ago.
It forced USPS to stay in “business” at artificial levels solely to artificially “fund” the USPS pension plan.
Of course, the backup plan was a federal bailout, which the corrupt congresscritters betted on being able to sell once the problem reached a tipping point.
We shall see.
Most of the postal workers I see aren’t even wearing a uniform any more.
I regularly see people delivering mail from USPS mail trucks wearing whatever they please.
Actually I did look into it once - after the company I was working for folded and screwed me out of back pay and vacation. At the time, even though I am a veteran, the waiting list to be hired was at least two years long.
Always a long waiting list ~ unless the economy is booming. We had a problem back in 1969. That was the old Post Office Department. Wages were too low and we were short about 100,000 employees.
Our family has had five instances of missing or delayed mail in the past few months.
You are right, they’re retired but still standing there in the post office.
What Congress did that hurt the most was done in the enabling legislation passed back under Richard Nixon. That was to restrict USPS' ability to ELIMINATE BUILDINGS.
It's totally bizarre.
In the late 1970s I did a study that demonstrated that USPS could get rid of over 25,000 "buildings", restructure rural route service, and save $800,000,000 per annum (now probably worth $10,000,000,000.
About funding retirement, that was one of the Leftwingtard senators from maine who forced USPS to pay AHEAD on "future retiree" medical insurance. They have to pay $5 billion a year into a fund that is supposed to take care of that in the future.
So, how many companies pay ahead on medical insurance for retirees?
I know the answer ~ and the names, but can you name even one of them?
At the same time USPS is ahead by about $78,000,000,000 in paying for regular retirement costs for future retirees.
No other agency of government has made such advanced payments at those levels.
What that means is USPS' employees are being used by the Obamistas to subsidize the US government.
550,000 full-time career federal government and U.S. Postal Service are eligible to retire.
You can bet the media will report Obama creates 550,000 new jobs.
“I really doubt the federales fear a reduction in retirement benefits. As you know, they get nowhere near what their counterparts (if any) in state and local government get.”
Your statement is largely misinformed about benefits and ignorant about the impact of the coming financial meltdown. Federal retirement compensation matches or possibly exceeds the most lavish state plans. You are focusing on the benefit rate (1% compared to 2.5%) for the most lavish state plans (benefit rates are 3% for law enforcement in some state plans). You are missing some very important components of retirement compensation that compensate for the lower benefit rate. Federal employees contribute less than 1% (0.8% I believe) for the defined benefit plan. The federal government contributes 11.2% but this contribution is different than state contributions because the federal government does not have portfolio to support benefits. the defined benefit plan for federal employees provides an early retirement bonus. From age 57 to 62, federal retirees receive an additional payment to provide essentially early Social Security benefits. Federal pensions are substantially increased by a generous COLA (CPI-W - 1). No state plan has anything close to the same COLA. Federal government retirees also receive generous early retiree medical benefits. Federal retirees must pay the same rate as employees, a very large benefit. Early retiree medical benefits exist in some state and local government plans. In addition to these lavish benefit levels, federal retirees also have a 401K plan in which the employer contributes 5 percent. The combination of the very low employee contribution, early Social Security subsidy, COLA, medical benefits, and 401K plan are on par with the best state/local government plans.
The federal government has no portfolio to support federal retiree benefits. There are large unfunded liabilities (more than $1 trillion) for federal pensions. The federal government will be forced to substantially reduce spending either directly or indirectly in the coming decade. It looks like indirect reduction through a substantial decline of the dollar will occur. Federal pensions will not be spared in the coming financial meltdown. Your federal pension just like other forms of government spending are not secure. It is basically dependent on the full faith of the government which will not be worth much in the coming decades.
“The federal government has no portfolio to support federal retiree benefits. There are large unfunded liabilities (more than $1 trillion) for federal pensions.”
You forget one huge difference between Federal pensions and state/local pensions: unlike states and cities, the federal government can print money to pay its obligations.
You do allude to the danger of inflation, which is proper. But in that case, federal retirees will suffer the effects just like every other American.
“You do allude to the danger of inflation, which is proper. But in that case, federal retirees will suffer the effects just like every other American.”
I agree with your assessment with one caveat. With CPI-W - 1 indexing, federal pensions (and Social Security) will keep pace with inflation at least conceptually. Unfortunately, COLA indexing for many types of federal programs may lead to an inflation spiral. At some point, no one will want dollars so COLAs will not matter. Massive reductions in government spending will be necessary to restore the dollar value. Without massive realignment of government spending (including pensions), individuals will hold other currency or barter.
The USPS is part of the federal government despite the phony claims that it is independent. The federal government including the USPS has large levels of retiree health care. I doubt that any retiree health care payments matter because there is no portfolio to support retiree health care. The USPS is not being used to subsidize other areas of the government. The opposite is true. The USPS has been provided recurring subsidies. The USPS is engaged in a misinformation campaign to dump its unfunded pension liability on other areas of the government.
Then they stay away for a while and get rehired to again.
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