Who is responsible for the pension crisis?

[IronWing]

As I pointed out earlier, I contributed 4% & the company contributed 8% all the years I worked for them. I doubt my situation was unique.

Yes, but would it make any difference if the company simply contributed 12% and offered you a lowered stated salary? Or you contributed 12% and the company gave you a higher stated salary? The company has a price it is willing to pay for your services. How that is divvied up among salary and assorted benefits is really immaterial to the company's cost of doing business wrt your labor, other than the administrative costs of offering various forms of benefits.

Edit: The point being that some folks here claim that various groups of employees don't contribute to their pensions when, in fact, they do. They trade their labor for pension benefits. Instead of paying the employees and then pulling the money back in the form of "employee" pension contributions, some employers just fund the pension plan directly.

 

[IGBT]

teamsters pension fund (private) is in trouble..they say due to nafta. Nafta greatly reduced union membership thus pension contributions. And in other news..http://www.cipamericas.org/archives/11244

After 20 years of NAFTA economics, Detroit’s urban landscape of 80,000 abandoned properties, according to the count of Dollars and Sense magazine, is strikingly similar to the 50,000 or so abandoned homes reported by the local press in a hub of auto industry offshoring- Ciudad Juarez.


As all three NAFTA countries undergo workforce aging trends, the implications of a multinational retirement crisis in the coming years will be profound for the economic and social health of the region. Recent reports, including the one issued last month by the Organization for Economic Co-operation and Development (OECD), carry somber warnings for the futures of millions as they approach their golden years.

 

[Jhhnn]

teamsters pension fund (private) is in trouble..they say due to nafta. Nafta greatly reduced union membership thus pension contributions. And in other news..http://www.cipamericas.org/archives/11244

After 20 years of NAFTA economics, Detroit’s urban landscape of 80,000 abandoned properties, according to the count of Dollars and Sense magazine, is strikingly similar to the 50,000 or so abandoned homes reported by the local press in a hub of auto industry offshoring- Ciudad Juarez.


As all three NAFTA countries undergo workforce aging trends, the implications of a multinational retirement crisis in the coming years will be profound for the economic and social health of the region. Recent reports, including the one issued last month by the Organization for Economic Co-operation and Development (OECD), carry somber warnings for the futures of millions as they approach their golden years.

Well, yeh, but the Job Creators! are doing better than ever, so it'll all trickle down, right?

But only if we cut their taxes, of course, to unleash the power of Capitalism!

 

[Darwin333]

Exponents don't apply at all with a constant or growing workforce. Few people retire from any job at 55 due to financial considerations, particularly healthcare, unless they take another job. Average retirement age is now up to 62. Average life expectancy for a 62 year old today is 82 or so, meaning only half will be alive to collect their pension at 82.

It's a law, not a suggestion. The point I tried to make in my previous post was, if the workforce is ever expanding (as you mentioned) then so is the amount of people that you are paying not to work. An ever expanding workforce means an ever expanding amount of people that you are paying not to work and one side is growing faster than the other. You simply can not swim around that mathematical fact regardless of how much either of us wishes it was so.


Laws of math and physics always apply unless you can prove otherwise and spin the entirety of science on its head.

 

[fskimospy]

It's a law, not a suggestion. The point I tried to make in my previous post was, if the workforce is ever expanding (as you mentioned) then so is the amount of people that you are paying not to work. An ever expanding workforce means an ever expanding amount of people that you are paying not to work and one side is growing faster than the other. You simply can not swim around that mathematical fact regardless of how much either of us wishes it was so.

Laws of math and physics always apply unless you can prove otherwise and spin the entirety of science on its head.

That would only be true if we had a constant per capita productivity rate, which we don't.

Also, fertility rates have varied considerably over time which means that sometimes you have a work force expanding faster than retirees and sometimes you don't.

So it's really not some inescapable mathematical axiom or anything. At the moment we are dealing with unfavorable demographics (they called it a baby boom for a reason!) but there's no reason it always has to be so. Also, productivity continues to increase.

 

[bpatters69]

"PEOPLE, that's who is responsible."

Yes.

Politicians for making promises they could not keep.

People who were either ill-inoformed or too naive to understand that what was promised to them by the politicians was not sustainable.

People who have not planned for their future and rely on the government to provide them income during retirement.

I am in my late 40's and I am not planning on getting $1 from SS. I do have a pension and I feel fortunate to have it as my company does not provide pensions to employees anymore. I contribute as much as I can to my 401k and I have been contributing to it since my late 20's.

Will the market crash and wipe me out? Maybe. Hopefully it will rebound and I will have a chance to retire without too much fuss.

Rely on yourself and no one else. That has always been my mantra.

I do not think it is fair to hit today's youth with the bill for older generations' indiscretions. Our youth will have enough trouble paying back the rediculous college loans that they have incurred in pursuit of a degree.

 

[Jhhnn]

It's a law, not a suggestion. The point I tried to make in my previous post was, if the workforce is ever expanding (as you mentioned) then so is the amount of people that you are paying not to work. An ever expanding workforce means an ever expanding amount of people that you are paying not to work and one side is growing faster than the other. You simply can not swim around that mathematical fact regardless of how much either of us wishes it was so.


Laws of math and physics always apply unless you can prove otherwise and spin the entirety of science on its head.

I think you're the one trying to stand the math on its head. Your "exponential" problem was "exponential" until it wasn't, because it never was that.

If the number of retired people is growing faster than the workforce, that's because of "Job Creator!" factors beyond their control other than by political means. Boomers & GenX'ers have attempted to compensate for the demographic bulge by creating a nearly $3B SS trust fund even as Repubs have cut taxes for & borrowed more money from the financial elite, obviously intending to break the system with a starve the beast fiscal strategy. They've also endeavored to make offshoring & automation even more profitable for that tiny segment of the population while stagnating wages for the rest.

If this doesn't end well, it's because they've successfully propagandized enough of the population to prevent the kind of cohesiveness & direction we need to counter the top down class warfare strategy of the last 35 years or so.

 

[Jhhnn]

"PEOPLE, that's who is responsible."

Yes.

Politicians for making promises they could not keep.

People who were either ill-inoformed or too naive to understand that what was promised to them by the politicians was not sustainable.

People who have not planned for their future and rely on the government to provide them income during retirement.

I am in my late 40's and I am not planning on getting $1 from SS. I do have a pension and I feel fortunate to have it as my company does not provide pensions to employees anymore. I contribute as much as I can to my 401k and I have been contributing to it since my late 20's.

Will the market crash and wipe me out? Maybe. Hopefully it will rebound and I will have a chance to retire without too much fuss.

Rely on yourself and no one else. That has always been my mantra.

I do not think it is fair to hit today's youth with the bill for older generations' indiscretions. Our youth will have enough trouble paying back the rediculous college loans that they have incurred in pursuit of a degree.

If SS fails it'll be because the right wing has succeeded in collapsing the govt, so you'll have bigger problems than mere financials.

They market? You fail to understand the advantages of great wealth. Market crashes only increase the advantages of it while providing profit opportunities for the most ruthless among them. If a $B fortune is only worth a few $100M when the dust settles, their comparative advantage is even greater than before. Their lifestyles are unaffected. The best time to be rich is when everybody else is broke, busted & begging. That's when you can really put the bone to 'em, consolidate gains made when the market was up.

For people who depend on market returns to survive, to live middle class lifestyles, the picture is entirely different. When principal is greatly diminished, so are returns, but overhead doesn't go down at all, thus accelerating principal depletion greatly.

The true key to successful retirement for middle class people isn't so much income as low overhead, no debt, outright ownership of a place to live & economical vehicles. Given the nature of so-called opportunity in this country, few will ever achieve it.