, ,

The Reactionary Right hates defined benefit pensions for public employees.  As best as I can tell, they make two arguments: they are a huge unfunded liability and they are more generous than pensions in the private sector.

Show Me Institute, Rex Sinquefield funded “think tank” to provide “research” to defund the private sector and privatize everything, just issued a new report “Missouri Transition Costs And Public Pension Reform”.

This report is written by a grifter at the American Enterprise Institute. (More on that at the end of this posting.)  

If you open up the report on the link above, you find it is a very strange report on Missouri public pensions.  If you do a search, there is no analysis of any public pensions in Missouri.

In the actual text, the report mentions only Missouri four times: one identifying the executive director of MOSERS and three times in a paragraph I will cite after the fold.


The executive director of MOSERS provides a quote on a defined contribution system that the report attempts to refute.  

This paragraph is in that refutation with the three other mentions of Missouri.

One might argue if public pensions were reduced, the lower incomes of retired public employees would cause them to rely on public assistance, thereby transferring costs to the government.  These payments would not be, of course, liabilities, but more important is that these payments are unlikely to be significant in any case.  Full-career public employees in most states retire with benefits far exceeding any level at which public assistance would be payable.  In Missouri,for instance, an average full-career state employee retiring today would receive almost $24,000 annually in pension benefits, based on the Missouri State Employee Retirement System’s annual report, plus another $13,000 or so in Social Security benefits.  Based upon U.S Census data, such a public employee would have a retirement income greater than about 83 percent of new retirees in Missouri. (p. 18 of the PDF file)


Missouri public workers’ pension along with Social Security provide them with a retirement income ($36,000/year) which is greater than 83% of new retirees in Missouri, so it is no big deal to cut their pensions.  

(I wonder what the average education of those workers are and their income in relation to the population as a whole.)

I always thought that one of the characteristics of being middle class is to be able to retire in some comfort.  I wonder how comfortable anyone is with $36,000/year.  As someone approaching retirement, I could get by on that, but with increasing health care costs, it will not be comfortable.

In a better world, we would be appalled that a retirement income of $36,000/year is greater than 83% of all new retirees in Missouri and we should be thinking about how to raise their retirement income and NOT reducing the pensions of others so everyone who works for a living is equally poor.

Remember this is the “research” from one of the richest Missourians that will be cited by the reactionary right to end defined benefits for state workers.

The author of this report worked in W.’s administration, Andrew Biggs is a real piece of work.  Because this report has next to nothing about Missouri’s public pensions, it reads like something that he has done for other states.  On his website, I couldn’t find one.

However, he does have this report on Federal worker pensions titled “We’re No. 1 – in public employee pay.”. It has a lot of charts comparing Federal workers at various pay grades to governmental workers in countries of “Organization for Economic Cooperation and Development, the “rich man’s club” whose membership includes most of the world’s developed, high-income countries.”

The argument he makes is that US federal workers are paid more than in these other “rich man’s club.”. Here is the membership of this “rich Man’s club.”

Australia, Austria, Belgium, Canada, Chile, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Turkey, United Kingdom, United States

[Biggs says he compares US worker pay to 18 countries, but never mentions those countries.]

Given how expensive health care is the US, it would be good to know how much health care costs those workers in other countries in relation to what it costs in the US.  Likewise, in those other countries, public universities don’t have the tuition costs in the US.  

The intellectual dishonesty of Biggs is breath taking.

Let’s keep in mind what these “reports” are arguing: These workers are better off than others; therefore, we can (and should) cut their wages and benefits. In other words, because a lot of people are already poor, let’s make that number even bigger.

How much one gets paid to comfort the very, very comfortable by proposing ways to make people poorer.

Does this argument work the other way? American CEOs are paid significantly more than CEOs anywhere else in the world.  Shouldn’t we enact policies to correct this huge inequality, too?