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#51
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Jay Honeck wrote: Of course, "retirement pay" comes out of a different bucket of cash in the state's budget then "teacher's salary", so ON PAPER they LOOK like they "saved the taxpayers some money"... Typically, retirement pay doesn't come out of current taxes at all. The employer sets a certain amount of money aside every year as a retirement account. Typically, this money is invested in stock and bond accounts and will grow at the rate of between 5% and 15% a year. Some government and education system pensions are keyed to the market even after retirement - my mother's pension payments go up and down with the stock market, and she has not tired of complaining about it for the last three years. In any case, salaries and benefits for those still working are paid for out of tax revenue. This includes payments into the retirement account from which their pensions will eventually come. Pension payments for retired people are not - they are paid out of withdrawals from the pension funds. In part, they are pre-paid by taxes that were paid during their period of employment, but the majority comes from interest on the account. George Patterson Great discoveries are not announced with "Eureka!". What's usually said is "Hummmmm... That's interesting...." |
#52
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G.R. Patterson III wrote:
Jay Honeck wrote: Of course, "retirement pay" comes out of a different bucket of cash in the state's budget then "teacher's salary", so ON PAPER they LOOK like they "saved the taxpayers some money"... Typically, retirement pay doesn't come out of current taxes at all. The employer sets a certain amount of money aside every year as a retirement account. Typically, this money is invested in stock and bond accounts and will grow at the rate of between 5% and 15% a year. Some government and education system pensions are keyed to the market even after retirement - my mother's pension payments go up and down with the stock market, and she has not tired of complaining about it for the last three years. Where does this "certain amount of money" to be set aside every year come from if note from current tax revenues? In any case, salaries and benefits for those still working are paid for out of tax revenue. This includes payments into the retirement account from which their pensions will eventually come. Pension payments for retired people are not - they are paid out of withdrawals from the pension funds. In part, they are pre-paid by taxes that were paid during their period of employment, but the majority comes from interest on the account. Not necessarily. Just look at all of the corporations that are now having to pour hundreds of millions into their pension funds to keep them solvent. Matt |
#53
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Tom Sixkiller wrote:
"Matthew S. Whiting" wrote in message ... Tom Sixkiller wrote: "Matthew S. Whiting" wrote in message ... Richard Hertz wrote: Yeah, but they only have to work 180 days out of the year and work only 7 hour days and then get retirement plans that are killing the tax payers. And how much teaching experience do you have? I'm guessing none by your response. Why not answer his question, Matthew? Answer this one, too: Why is it that over 3/4ths of teachers come from the bottom quartile of their graduating classes? Because he didn't ask a question. He made a statement. The only question in the above is the one I asked. Matt Gee, Tom, this "reply" is even more interesting than your last one! :-) Matt |
#54
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Tom Sixkiller wrote: Government retirement DOES come out of current revenue. At the Federal level. Teachers are typically State or local employees, and these pensions are frequently funded by investment in the markets. Although not a teacher, my mother was an employee of the University of Tennessee. Her pension comes from the proceeds of stock/bond accounts, and the amount of the monthly payments varies with the performance of the market. The financial crisis in California has impacted Tennessee State pensions because a large portion of the funds are invested in California State bonds. It seems you are using "revenue" and "tax revenue" interchangeably between private and civil service pension funds. Can you clarify? I was speaking exclusively of personal experience with pensions in the education system. In the systems with which I am familiar, tax revenues fund the salaries and pension plans of current employees. If the system were to close tomorrow, retired employees would still receive their pensions - the payments do not come from taxes being levied today. George Patterson Great discoveries are not announced with "Eureka!". What's usually said is "Hummmmm... That's interesting...." |
#55
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"Matthew S. Whiting" wrote: Where does this "certain amount of money" to be set aside every year come from if note from current tax revenues? That comes out of tax revenues. When the employee is working. Retirement pay does not come out of current tax revenues in the education systems with which I am familiar. Not necessarily. Just look at all of the corporations that are now having to pour hundreds of millions into their pension funds to keep them solvent. We were discussing education system pensions. The corporate solvency issue is primarily caused by the fact that the Federal government changed the requirements to increase the amount of money that must be retained for each employee in a standard retirement package plan. Some companies simply reacted by abandoning these plans for new employees and providing strong incentives (as in "change or get fired") to current employees to transfer over to what is called a "cash balance payout" plan. The increased limit requirements were instituted in reaction to the Enron scam. George Patterson Great discoveries are not announced with "Eureka!". What's usually said is "Hummmmm... That's interesting...." |
#56
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G.R. Patterson III wrote:
"Matthew S. Whiting" wrote: Where does this "certain amount of money" to be set aside every year come from if note from current tax revenues? That comes out of tax revenues. When the employee is working. Retirement pay does not come out of current tax revenues in the education systems with which I am familiar. It doesn't come out directly, but it still comes from tax revenues. And if you have more retirees, you have to more heavily fund the pension fund and that means setting aside more each year into the fund, which comes from tax revenues. To say that tax revenue doesn't pay the pensioners is ridiculous. Not necessarily. Just look at all of the corporations that are now having to pour hundreds of millions into their pension funds to keep them solvent. We were discussing education system pensions. The corporate solvency issue is primarily caused by the fact that the Federal government changed the requirements to increase the amount of money that must be retained for each employee in a standard retirement package plan. Some companies simply reacted by abandoning these plans for new employees and providing strong incentives (as in "change or get fired") to current employees to transfer over to what is called a "cash balance payout" plan. The increased limit requirements were instituted in reaction to the Enron scam. I think the larger part was that investment returns dropped well below the assumptions needed to keep the funds solvent. That has had a huge impact, at least at my company as was the reason given by top management for putting in much more money this year and last. That may also be the reason that Capt. Haynes is not in a good position financially to help fund his daughters medical care. Matt |
#57
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#58
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Henry Kisor wrote:
One of the reasons -- maybe the primary reasons -- states like teachers in their 50s to retire is that they can be replaced by fresh new teachers just out of college at starting salaries much less than those the veterans were getting. It actually saves the states money. Jay Honeck responded: Hmmm. Not sure I see the math here. While the state may save, say, half of the older teacher's salary (let's say my sister was making $45,000 -- so they'll cut it by half in retirement, to $22.5K) they then have to pay a new teacher what, $25K to start, plus benefits? Thus, we've lost a few grand in the mix. Of course, "retirement pay" comes out of a different bucket of cash in the state's budget then "teacher's salary", so ON PAPER they LOOK like they "saved the taxpayers some money"... More typical gubmint accounting, is my hunch. I suspect that they make up a substantial portion of that perceived "lost few grand" in the medical benefits payments. It's my impression that older worker's (as a class) medical outlays greatly exceed those of younger workers, and the retiree medical plan generally is funded more by the retiree than the state, unlike the active employee medical plan. Russell Kent |
#59
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Russell Kent wrote:
Henry Kisor wrote: One of the reasons -- maybe the primary reasons -- states like teachers in their 50s to retire is that they can be replaced by fresh new teachers just out of college at starting salaries much less than those the veterans were getting. It actually saves the states money. Jay Honeck responded: Hmmm. Not sure I see the math here. While the state may save, say, half of the older teacher's salary (let's say my sister was making $45,000 -- so they'll cut it by half in retirement, to $22.5K) they then have to pay a new teacher what, $25K to start, plus benefits? Thus, we've lost a few grand in the mix. Of course, "retirement pay" comes out of a different bucket of cash in the state's budget then "teacher's salary", so ON PAPER they LOOK like they "saved the taxpayers some money"... More typical gubmint accounting, is my hunch. It ain't just gubmint accounting. Why do you think so many corporations give early retirement incentives whenever they want to downsize? Same principle, pensions come out of a different bucket (usually a bucket already accounted for by pension contributions made years ago by the employer so "free" on the balance sheet, at least until the pension plan becomes underfunded by corporate raiding and/or accounting manipulations). I'll try to refrain from commenting on the kind of attitude that makes one think this move, which is very widespread in private industry, is some kind of "gubmint accounting." |
#60
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I'll try to refrain from commenting on the kind of attitude that makes
one think this move, which is very widespread in private industry, is some kind of "gubmint accounting." Well, maybe this kind of "voodoo economics" is widespread in big business, too -- but big mega-firms continue to represent a smaller and smaller percentage of American jobs. I can assure you that this kind numbers game is NOT prevalent in the small to mid-sized businesses I'm used to dealing with. As far as my "attitude" indicating anything, I guess it's because I've spent my lifetime paying, and paying, and paying taxes, yet all I see is the economic waste and fraud that means we "need to raise taxes" again. Thus, I equate bad business practices with Big Gubmint LONG before I equate it with Big Business. Why? Well, other than this past year (when I actually received a check from my Federal Gubmint,thanks to GW), I've never received one damned nickel for my troubles. Yet my Federal, State and Local taxes have continued to spiral upward each and every year. Given that kind of performance, it's pretty hard to NOT be cynical about our government. Meanwhile, Big Business can screw the accounting pooch all they want, as far as I'm concerned. At least they actually provide me with goods and services I want and need, and if I don't like 'em, I can take my business elsewhere. -- Jay Honeck Iowa City, IA Pathfinder N56993 www.AlexisParkInn.com "Your Aviation Destination" |
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