Kentucky passed Repub version of pension reform: The state will now keep 15% of any investment gains

[Zorba]

It's not an answer and the math proves it out. The 15% is a drop in the bucket towards "past mistakes". Its impact is close to immeasurable.

We had a thread here railing on about Trump running up the national debt by a shit-ton. The usual suspects were all in a rage. The Omnibus spending bill passes and Democrat causes are the big winners but it runs up the debt by a shit-ton more. All I heard was crickets. There wasn't even a thread about the Omnibus bill.

Outrage when it suits them, silence when it suits them. But that doesn't matter. We're insolvent from sea to shining sea and borrowing like there is no tomorrow.

There is a tomorrow and it's barreling towards us.

When was the last time liberals ran the state of Kentucky? Seems it was conservatives that created is mess.

 

[IronWing]

This is what happens when you promise people future money and can't deliver on those guarantees. Politicians have been kicking this can for years and now they are trying to screw over new teachers coming in.

I wonder how long before public pensions are completely gone in this country because they are obviously not sustainable.

Pensions are perfectly sustainable if politicians keep their hands out of the cookie jar and quit handing out tax cuts to their donors.

 

[Lanyap]

Too bad the lawmakers didn't cut 15% from their pension.

 

[Sunburn74]

They aren't keeping 15% of what you invest. They are essentially making a 15% capital gains tax on pension accounts.

Still sounds like theft to me.
Its no different from a state saying "we want 1/2 of all the interest you're getting from the bank on your savings account or CD".

 

[MomentsofSanity]

Still sounds like theft to me.
Its no different from a state saying "we want 1/2 of all the interest you're getting from the bank on your savings account or CD".

Oh I’m not saying it’s minor or inconsequential. Just clarifying that the thread title itself is not correct

This eliminates much of the benefit of the pension account to the contributor. Between the taxation as income and the essentially capital gain tax both on what I assume is the back end it’s a big impact.

 

[Jhhnn]

Oh I’m not saying it’s minor or inconsequential. Just clarifying that the thread title itself is not correct

This eliminates much of the benefit of the pension account to the contributor. Between the taxation as income and the essentially capital gain tax both on what I assume is the back end it’s a big impact.

I wouldn't assume back end. They'll probably want their cut annually, thus holding down the effective rate of return for participants.

 

[Darwin333]

Pensions are definitely dieing but when the answer to that is "fuck over new teachers" people are going to be pretty upset. The optics of keeping 15% of their growth to pay for the past mistakes of the Kentucky government looks pretty bad.

In a lot of states they aren't just dying they are mathematically impossible to fund going forward. That is what happens when you have public unions negotiating with the public, when you negotiate with yourself you get to agree to all kinds of things. Things like guaranteeing workers pension payouts based on 15%+ returns every single year forever or unions agreeing to allow politicians to "borrow" from pension funds.

A LOT of these public pension funds are going to flat run out of money and because of the sheer sums of money at play it will be impossible for them to raise with any kind of new taxes or other income. Which means "old" pensioners are going to start getting zero and ones that haven't started collecting yet will never see a dime. If fucking over new teachers allows them to keep the charade up for another decade, or even less, then that is what they will do. It is far better politically than fucking over all of the old ones and at the same time letting the new ones know as an absolute fact their pension is a pipe dream.

 

[UNCjigga]

So let me get this straight--Republicans advocate for eliminating capital gains taxes on millionaire/billionaire "jerb creators" but want a 15% cap gains tax on lower/middle income public sector workers.

Sounds about right.

 

[Sunburn74]

In a lot of states they aren't just dying they are mathematically impossible to fund going forward. That is what happens when you have public unions negotiating with the public, when you negotiate with yourself you get to agree to all kinds of things. Things like guaranteeing workers pension payouts based on 15%+ returns every single year forever or unions agreeing to allow politicians to "borrow" from pension funds.

A LOT of these public pension funds are going to flat run out of money and because of the sheer sums of money at play it will be impossible for them to raise with any kind of new taxes or other income. Which means "old" pensioners are going to start getting zero and ones that haven't started collecting yet will never see a dime. If fucking over new teachers allows them to keep the charade up for another decade, or even less, then that is what they will do. It is far better politically than fucking over all of the old ones and at the same time letting the new ones know as an absolute fact their pension is a pipe dream.

Hmm... I don't think I would put the issue on unions in any sense.
The problem isn't that america doesn't have enough wealth to fund social services across the board (ie CHIP, teacher salaries and schools, medicare, medicaid, etc etc) but rather that most of america's wealth is concentrated in the hands of a few and those few
1) get most of the taxation benefits
2) have most of the ability to skirt US tax laws
3) have undue influence on tax law
4) generally (and quite reasonably so) do not want to pay more taxes

US wealth is in no way the primary issue. Rather the issue is collecting said wealth and using it ethically and efficiently.

In addition there is the general issue of marked misalignment between government goals and actual laws passed. SO many laws are totally counterproductive to what the government is actually trying to do.

I would say tax law and in conservative states really boils down to a fundamental misunderstanding and unappreciation on the concept of return on investment. Pay a penny today, save a dollar tomorrow. No understanding on this concept.

 

[Jhhnn]

generally (and quite reasonably so) do not want to pay more taxes

There's nothing reasonable about insane greed at the top. More money won't improve their lifestyles or send their kids to better colleges. It's all abstraction on the balance sheet, about winning the game, about more power.

 

[ch33zw1z]

So let me get this straight--Republicans advocate for eliminating capital gains taxes on millionaire/billionaire "jerb creators" but want a 15% cap gains tax on lower/middle income public sector workers.

Sounds about right.

Why do you hate America?

 

[senseamp]

The answer is don't be a teacher in Kentucky.

 

[MomentsofSanity]

The answer is don't be a teacher in Kentucky.

Or in Oklahoma apparently.

https://www.cnn.com/2018/03/31/us/oklahoma-teachers-profiles/index.html

but let's get em armed quick!

 

[senseamp]

Or in Oklahoma apparently.

https://www.cnn.com/2018/03/31/us/oklahoma-teachers-profiles/index.html

but let's get em armed quick!

These people are so stupid. Yeah, neighboring state pays 80% more, but I would rather work 4 jobs here

 

[ch33zw1z]

Obviously just snowflakes complaining.

 

[Darwin333]

Hmm... I don't think I would put the issue on unions in any sense.
The problem isn't that america doesn't have enough wealth to fund social services across the board (ie CHIP, teacher salaries and schools, medicare, medicaid, etc etc) but rather that most of america's wealth is concentrated in the hands of a few and those few
1) get most of the taxation benefits
2) have most of the ability to skirt US tax laws
3) have undue influence on tax law
4) generally (and quite reasonably so) do not want to pay more taxes

US wealth is in no way the primary issue. Rather the issue is collecting said wealth and using it ethically and efficiently.

In addition there is the general issue of marked misalignment between government goals and actual laws passed. SO many laws are totally counterproductive to what the government is actually trying to do.

I would say tax law and in conservative states really boils down to a fundamental misunderstanding and unappreciation on the concept of return on investment. Pay a penny today, save a dollar tomorrow. No understanding on this concept.

Those are completely seperate issues.

But I disagree with your first statement, the unions carry a ton of fault. They knowingly negotiate contracts for pensions that are completely unsustainable because it makes them look great and they know damn well they won't be around when it all blows up. You can't knowingly negotiate a contract that you know is mathematically impossible to be fulfilled in the future and claim to have no responsibility. Now they are going to look for taxpayers to bail them out and they will for a while but in some states it is simply impossible for the taxpayers to bail out the pension funds for long, eventually people owed pensions will get virtually nothing. In other states the states have used pension funds which again is a problem that arises when you are essentially negotiating with yourself, no decent negotiator would have allowed that in the contract.

 

[darkswordsman17]

Those are completely seperate issues.

But I disagree with your first statement, the unions carry a ton of fault. They knowingly negotiate contracts for pensions that are completely unsustainable because it makes them look great and they know damn well they won't be around when it all blows up. You can't knowingly negotiate a contract that you know is mathematically impossible to be fulfilled in the future and claim to have no responsibility. Now they are going to look for taxpayers to bail them out and they will for a while but in some states it is simply impossible for the taxpayers to bail out the pension funds for long, eventually people owed pensions will get virtually nothing. In other states the states have used pension funds which again is a problem that arises when you are essentially negotiating with yourself, no decent negotiator would have allowed that in the contract.

No they're not.

I'm not saying there aren't issues with pension payments, but acting like wealthy looking to bolster their own benefits doesn't come at the expense of others is absurd. The reason strong unions capable of doing the things you're talking about happened is because of excessive greed by the wealthiest. Over time, corruption happened, but let's not pretend like there wasn't alarming greed elsewhere that likely played a role in some of that as well.

There's other factors too (unions are hardly the first to use ridiculously optimistic gains to bolster their position; at times it seemed like our government and even economists seemed to have a belief that we could sustain healthy gains perpetually, and then it created a feedback loop).

 

[Darwin333]

No they're not.

I'm not saying there aren't issues with pension payments, but acting like wealthy looking to bolster their own benefits doesn't come at the expense of others is absurd. The reason strong unions capable of doing the things you're talking about happened is because of excessive greed by the wealthiest. Over time, corruption happened, but let's not pretend like there wasn't alarming greed elsewhere that likely played a role in some of that as well.

There's other factors too (unions are hardly the first to use ridiculously optimistic gains to bolster their position; at times it seemed like our government and even economists seemed to have a belief that we could sustain healthy gains perpetually, and then it created a feedback loop).

Exactly whose greed got a freaking teachers union to agree to a pension plan that relied on 15%+ yearly gains in order to remain solvent was to blame? Even if the union negotiator sucked at math, and this would be an insanely huge suck, he could have enlisted the help of a 3rd grade math teacher to tell him there was no way in hell the plan he was signing would be sustainable long term. You are telling me the people that reaped the benefits of these lavish, yet unsustainable, pension benefits for decades weren't greedy? The union bosses that negotiated the deals, got themselves power, and very likely profited off it themselves weren't greedy?

Please sir, who are these other greedy players that are more at fault than people who were negotiating these billions in pension funds with 15%+ year over year gains forever was impossible and that the fund would eventually fail?

 

[Zorba]

No they're not.

I'm not saying there aren't issues with pension payments, but acting like wealthy looking to bolster their own benefits doesn't come at the expense of others is absurd. The reason strong unions capable of doing the things you're talking about happened is because of excessive greed by the wealthiest. Over time, corruption happened, but let's not pretend like there wasn't alarming greed elsewhere that likely played a role in some of that as well.

There's other factors too (unions are hardly the first to use ridiculously optimistic gains to bolster their position; at times it seemed like our government and even economists seemed to have a belief that we could sustain healthy gains perpetually, and then it created a feedback loop).

A huge part of the problem is states have negotiated huge future benefits to help justify crappy current pay and benefits. Unions have accepted that, even though it is obviously not sustainable.

 

[Zorba]

These people are so stupid. Yeah, neighboring state pays 80% more, but I would rather work 4 jobs here

You are such a jackass, but I do agree with you. I read an article the other day that said Oklahoma lost 25% of their teachers last year, either to moving out of state or leaving the field. (A different article said OKC school district had lost 25% so I am not sure if that is actually for the whole state or just OKC Public)

I have a friend that moved down from Kansas. His wife is a teacher and took a $20k/yr pay cut when she moved here. Since 2005, the state has cut $200M in funding to school in real dollars. For that matter the state has cut our revenue by 25% in the last decade, yay tea-partiers!

 

[bbhaag]

https://www.sfgate.com/news/politics/article/Kentucky-lawmakers-resurrect-pension-bill-12791651.php

WtfBBQ?!?!
this is the genius idea from Repubs to fix the worst funded pension in the US?
to steal from future workers?
and it does nothing to address the state's current massive debt because those workers aren't going to retire for decades.

wtfbbq indeed

The great state of Illinois might have something to say about that. The Democraps up here seem to think that raising taxes to heights that have never been seen before is the answer. Taxing the citizens of Illinois out the ass will definitely solve the pension problem here in Illinois. Mike Madigan and the billionaire Pritzker told me so.

 

[1prophet]

There's nothing reasonable about insane greed at the top. More money won't improve their lifestyles or send their kids to better colleges. It's all abstraction on the balance sheet, about winning the game, about more power.

Obviously the rich with all their elite education aren't taught or raised by their parents like in the past since today's mantra is it's all about me and profit only matters


https://en.wikipedia.org/wiki/The_Gospel_of_Wealth

Carnegie based his philosophy on the observation that the heirs of large fortunes frequently squandered them in riotous living rather than nurturing and growing them. Even bequeathing one's fortune to charity was no guarantee that it would be used wisely, due to the fact that there was no guarantee that a charitable organization not under one's direction would use the money in accordance with one's wishes. Carnegie disapproved of charitable giving that maintained the poor in their impoverished state, and urged a movement toward the creation of a new mode of giving that would create opportunities for the beneficiaries of the gift to better themselves. As a result, the gift would not be simply consumed, but would be productive of even greater wealth throughout the house.

In The Gospel of Wealth, Carnegie examines the modes of distributing accumulated wealth and capital to the communities from which they originate. He preached that ostentatious living and amassing private treasures were wrong. He praised the high British taxes on the estates of dead millionaires, remarking that "By taxing estates heavily at death the State marks its condemnation of the selfish millionaire's unworthy life. It is desirable that nations should go much further in this direction."[2]

Carnegie made it clear that the duty of the rich was to live modest lifestyles,[7] and that any surplus of money they had was best suited for re-circulation back into society where it could be used to support the greater good. He shunned aristocratic chains of inheritance and argued that dependents should be supported by their work with major moderation, with the bulk of excess wealth to be spent on enriching the community. In cases where excess wealth was held until death, he advocated its apprehension by the state on a progressive scale: "Indeed, it is difficult to set bounds to the share of a rich man's estates which should go at his death to the public through the agency of the State, and by all means such taxes should be granted, beginning at nothing upon moderate sums to dependents, and increasing rapidly as the amounts swell, until of the millionaire's hoard, at least the other half comes to the privy coffer of the State."[2] He claimed that, in bettering society and people here on Earth, one would be rewarded at the gates of Paradise.

 

[ch33zw1z]

The great state of Illinois might have something to say about that. The Democraps up here seem to think that raising taxes to heights that have never been seen before is the answer. Taxing the citizens of Illinois out the ass will definitely solve the pension problem here in Illinois. Mike Madigan and the billionaire Pritzker told me so.

So, in essence, you're ok with kentucky instilling what's essentially a 15% capital gains tax on the average public employee

Wonder what you think about the bug beautiful tax cuts for the wealthy.

 

[JEDI]

The great state of Illinois might have something to say about that. The Democraps up here seem to think that raising taxes to heights that have never been seen before is the answer. Taxing the citizens of Illinois out the ass will definitely solve the pension problem here in Illinois. Mike Madigan and the billionaire Pritzker told me so.

it worked for California and got them out of their budget mess created by Repubs.
10% tax rate for millionaires

 

[JEDI]

well, KY governor signed the controversial pension reform bill into law.

https://www.whas11.com/article/news/local/bevin-signs-pension-reform-bill-into-law/417-537078159

- end the use of accrued sick days for factoring in retirement dates for current employees,
- continue cost of living adjustments for current retirees
- place new-hires into a hybrid cash retirement account

I actually agree with ending the use of accrued sick days in factoring retirement dates