Tuesday, December 30, 2008

Taxpayers paid $168 bil in State/Local Pension Benefits

in 2007. In 2008, the burden will be much, much higher. Not only will taxpayers have HUGE losses in their own 401ks and IRAs but they will be faced with much higher Government employee pension costs. A DOUBLE WHAMMY!!

The pension plans of Taxpayers are defined contribution plans like IRAs and 401ks. They have NO guaranteed benefits. The retirement benefits go up and down with the value of IRAs and 401ks.

The pension plans of Government employees are very different. They are guaranteed benefit plans. Taxpayers, via our elected representatives, have guaranteed an ever increasing benefit amount and in the case of Tennessee they have written in a generous cost of living adjustment.

State and local government defined-benefit employee retirement systems paid $168 billion to 7.5 million retirees and survivors in fiscal year 2007, the U.S. Census Bureau reported today. This is a $12 billion increase from the previous year when 7.3 million received payments.

There were 2,547 retirement systems in 2007, with memberships of 18.6 million people who could be eligible for regular benefit payments in the future.