Skip to comments.The City and State Pension Crisis Has Only Just Begun
Posted on 01/30/2014 7:26:51 AM PST by SeekAndFind
America has recently experienced a wave of municipal bankruptcies significantly fueled by underfunded pension and retiree health obligations to retired city workers, including policemen, firemen and teachers.
The bankruptcies of Detroit and some California towns, the massive pension shortfall in Illinois only partially addressed by recent legislation, and the tense situation in Chicago with the mayor asking municipal workers for give-backs are just the beginning of difficulties that will appear across the country. Asset returns have come up short of what has been assumed.
Generous unfunded retirement benefits with early retirement dates and expensive cost-of-living adjustments were doled out to government workers years ago by politicians who are no longer around to be held responsible for their dereliction of prudence and duty to taxpayers who now are expected to pay for these shortfalls. By the best estimate, the total pension underfunding for state and local government is $4 trillion.
Two problems have become increasingly apparent and immediate: the legacy obligations promised to retirees and workers just about to retire, and the funding and nature of retirement benefits being accrued now and in the future by younger and future state and local government workers.
The first problem is larger in size and concern because those retirees and long-service workers are legitimately worried that their retirement benefits promised by fiscally challenged sponsors and backed by severely underfunded plans are now highly uncertain and unsustainable and subject to arbitrary and chaotic cuts in the bankruptcy and political processes operating today. Moreover, many of these retirees, again owing to poor past choices by their representatives and employers, are not even covered by Social Security, and therefore extremely exposed to risks in retirement.
(Excerpt) Read more at realclearmarkets.com ...
How would you like to earn a pension while getting your hair cut, playing golf or going to a cocktail party? Sounds sweet? Well, run for public office. Those are some of the presumably vital public activities that Albany County legislators had the gall to list in their time sheets in order to amass enough hours to qualify for pension credits.
Standing out in a pretty shameful crowd was the NY Legislatures chairman, Shawn Morse, who went so far as to earn two pensions simultaneously, Times Union reporter Brendan Lyons found in a review of time sheets. Mr. Morse booked hours in his part-time county post while he was on duty as a full-time Cohoes firefighter. Thats not allowed by the state pension system, even if he was doing county business during his downtime in a firehouse.
But dont just single out one lawmaker or one county legislature. This is a problem all across New York at every level of government: politicians feathering their personal nests at taxpayer expense.
The issue isnt just the rank cheating that goes on as lawmakers stretch the meaning of work in order to qualify for pension credits. The issue is also whether such part-time elected posts should even been treated like government jobs at all.
Elected officials in New York state can qualify for state pensions if they work at their office full time, which in local governments across the state is defined as 30 hours the minimum allowed under resolutions passed annually by you guessed it the very town and county legislative bodies that benefit from this definition of full-time employment.
The state requires officials to provide, once every eight years, a three-month sample of their time to prove they meet that threshold. And lo and behold, many do some by plugging in activities that really have no government purpose, and whose main purpose is to keep the politician elected fundraising, speaking to community groups, or just showing up, which, for better or worse, could easily be the entire job description of some lawmakers.
But what New Yorks long-suffering taxpayers need perhaps even more is a re-examination of who qualifies for a state pension and who doesnt. Perhaps theyre appropriate for full-time mayors and supervisors and highway superintendents, most of whom likely put in a full week, week in and week out. But what justification is there at all for public pensions for part-time legislators village, town, city, county, and, yes, state. Perhaps state legislators most of all.
Its state lawmakers, remember, who make the big decisions on the states costly retirement system. How can we expect them to take what needs to be a compassionate but hard look at the system and make sensible decisions about it, when lawmakers themselves stand to gain or lose by those very decisions?
We elect people to local, county and state legislative bodies to represent and govern, not to become part of the bureaucracy. Ending pensions for these representatives would be a step toward focusing them more on the publics interest and less on their own.
(AP) Scores of retired New York City police officers, firefighters and prison guards were charged Tuesday with faking psychiatric problems to get federal disability benefitswith some falsely claiming their conditions arose after the Sept. 11 attacks, prosecutors said.
Four ringleaders coached the former workers on how to falsely describe symptoms of depression and other mental health problems that allowed them to get payouts high as $500,000, said Manhattan District Attorney Cyrus R. Vance Jr. The ringleaders made tens of thousands in dollars in secret kickbacks, Vance said. Among the retirees arrested were 72 city police officers, eight firefighters, five corrections officers and one Nassau County Police Department officer.(Excerpt) Read more at hosted.ap.org ...
It is astoundingly easy to steal/launder govt money.....especially if the govt PTB cunningly suck up to state pols to get millions in line-item budget allocations--that are siphoned off into secret offshore accounts.
REFERENCE Who could forget the dumb accountants, mayor and council who ignored the $53 million stolen by the Dixon, Ill Comptroller? The dumb Mayor never figured out the Comptroller deposited govt funds into secret bank accounts? Probably b/c he was getting a cut of the millions?
Trying to explain how that much money could disappear unnoticed, the stupid Mayor said the muni struggled financially because "the state" was far behind on income tax disbursements.....(now there's a red flag is there ever was one).
NOTE The Comptroller lived a lavish millionaire's lifestyle on an $80,000 govt salary---which onlookers attributed to her success in the horse breeding industry (cackle).
HOW INSIDERS STEAL Here's another astoundingly brazen larceny -- $5.7M was electronically emptied out of the coffers of Columbia Univ into an employee's bank account.
Now, several employees are on trial----accused of funneling the stolen millions into the Bank account of alleged mastermind George Castro, 49, in collusion w/ two workers in the university's accounts payable dept.
Accounts payable insiders allegedly altered a routing code and other info connected to payments slated to go from the university's medical center to an affiliate hospital. The money never reached its destination. "Within six weeks, over $5M meant for NY Presbyterian Hospital found it's way into the employee's Bank account," prosecutors said.
When nabbed, one university employee was carrying bags of money -- $200,000 in cash -- into his new $80,000 Audi as cops busted him outside his Bronx residence...he and his co-defendants had at that point thrown hundreds of thousands of stolen dollars into failed day trading investments.
One Columbia accounting dept insider pled guilty to grand larceny, hoping to avoid jail by testifying against the four defendants and his accounts payable co-conspirator.
Democratic voters hardest hit... I love it!
If the problem is today's economics, where would Governments get the money today for up front lump some payments.?- Tom
LATINO'S "JUST HERE FOR A BETTER LIFE" SCAM Seems this tax-sucking latino worked for Cali's San Bernardino County Dept of Corrections. He said he worked 9 mos and got 3 mos time off to be with his children---one of whom was college age.
JJ asked him how he supported himself those 3 mos----he said he collected UI.
Seems the Cali Dept of Corrections perpetuates the acam---they calculately "laid him off" and rehired him 3 mos later.
He had been doing that for nine years. falsifying govt docvuments to get UI tax dollars---AKA government fraud.
Now get this----when he was "laid off" to be with his children, he was actually traveling to be with his girlfriend---she was suing him for a $4000 loan---which was why they were in JJ's court.
Hank Morris, the chief political consultant to then-NY state comptroller Alan Hevesi, who administers the $100 billion state pension fund, was charged criminally in March 2009 with selling access to pension fund assets in exchange for kickbacks from money managers such as Liberty Oak that wanted the lucrative pension investment business.
Memphis-based Consulting Services Group, which created the Liberty Oak fund-of-funds for the state, is identified in both the Morris indictment and the SEC complaint as having paid him fees.
CSG hasnt been criminally charged or sued by the SEC.
Liberty Oak received $200 million on July 1, 2006, the same day EnTrust received $15 million from Liberty Oak, according to Whalen. EnTrust got another $5 million through Liberty Oak on June 1, 2007, he said. John Nester, a spokesman for the SEC, declined to comment on whether EnTrust is under investigation.
Then AG Andrew Cuoomo (now governor) prosecuted the case---but recused himself b/c he used one of the financial entities.
Liberty Oak was established in June 2006 for a portfolio of hedge fund investments for the New York state Common Retirement Fund. CSG, as general partner of the fund, managed the hedge fund investments for the state.
Morris brazenly established an offshore account to funnel crooked monies.
NOTE Morris and Hevesi both went to jail----were recently released (to enjoy the billions they stashed away offshore).
They should all sue the Democrat party. The lawyers know you always sue the outfit that has big money. The Democrat party will never go broke. The Democrats promised and then couldn’t deliver. Sue them. The Democrat party is already funded by taxpayers. It would just be transferring the money to where it should have gone in the first place.
If only we raised taxes a little bit on the richest 1% none of this would be happenening. And Bush’s illegal wars. And tax cuts for the rich. And hemerhoids. And red tide....