The state pension is in shambles for not paying pension obligations for decades, wealthy retirees are flocking to zero income state tax states like florida, and now companies are starting an exodus for more favorable corporate tax environments. What happens to the state, the retirees who rely on the pension, and how do you fix this issue?
Cut OPEB and retirement benefits, or sell more bonds and let investors take the haircut down the line, or both.
i think the best way is to extend the retirement age gradually. like for example. if its at 62 this year, it’ll be 63 in 2 years. then 64 in 2 yrs. etc etc. until the flows balance out. that way people have time to adjust, save, prepare, or continue working.
this is a lame topic. STL please zap this crap.
I want to hear more stories about DDDs from ACE.
I’m in agreement with Turd. STL it’s a wrap
How do you cut what was promised to you? I.e teachers who don’t receive social security and took on a lesser salary in return for this promised pension? This is a solid topic - meant to be shared with Ace’s savagery.
What Nery said. Extend the retirement age, new entrants to the plan get less benefits, etc.
to be fair. people are living longer. this was def unanticipated.
You can definitely cut pension benefit, see Rhode Island precedent. Granted it is extremely difficult and ultra unpopular politically, but it can be done via amendments to the state’s constitution.
The problem is its all formulaic. An extended retirement age results in an increased -substantial - pay. New entrants are already cut off but that doesnt solve decades of not paying into the fund.
why do you need to raise anyone’s comp? are you implying that people factor in pension benefits for their comp? i doubt most people think that way, they just think of a pension as a icing on the cake.
you live longer, hence you work longer. is my way of thinking.
I think it takes making people realize its bigger than them. Same way you trick people to be soldiers for a war or make any other sacrifices. Planet money recently covered the Indian situation where they eliminated the cash. Most interviewed seemed upset with the implementation but liked the policy, because they felt their sacrifices were going to improve the Indian society.
Why do teachers not receive SS? Teachers in my state receive both SS and pension, of which they also contribute to both.
Nery - retirement comp. i.e, if you retire at age 65 your benefits are avg(salary 64,63,62) x .45, if you retire at 70: avg(salary 69 68 67) x .7
Reduce the multiplier, or cap it?
Nbd. Is London completely in the shitter? Is Chicago? No.
No, but both face increasingly less attractive outlooks .
Brexit will clearly hurt London in the long-term unless the government negotiates some solid trade deals and/or has some other offsetting factor. London benefits in that there really isn’t an alternative global capital city quite like it on the European continent. Ease of doing business, infrastructure, class A office space, that it is the capital of the UK, etc… are all just better in London. Paris, Frankfurt, Lux are still well behind in those departments, but are more than eager to grab share. Notably, Paris actually has a larger office market (by square meters) than London, it just doesn’t have as much of the class A shiny space. That all said, I actually think London will be fine, just not quite as robust as some were underwriting a few years ago.
I would definitely say Chicago is in worse shape. It has to compete much more with the likes of NYC, Boston, SF, the Southeast, etc… The free flow of capital and people across states makes it difficult for Chicago to establish a proper barrier vs. London. It’s also not a first point of entry for many international businesses. Many have to be in London, NYC, etc… but there really isn’t a requirement for Chicago. The state’s budget is in shambles and taxes/regulation are high with no sign of coming down. The weather is also pretty awful except for a couple months and there isn’t much to do/see once you leave Chicago (London has Europe close by; NYC has a few more attractions vs Chicago and the rest of the Northeastern cities to draw from). Chicago’s best bet would be to slash taxes, substantially lower the costs of doing business, drop the ultra pro-union stance, invest in proper infrastructure, stop the gimmicky tax credit schemes, build a bubble to improve the weather, etc… Never going to happen except maybe for the last item because it requires spending other people’s money.
To the OP. Connecticut is beyond shooting themselves in the foot with this crap; West Palm is quite happy to take accomodate. Seriously, who the heck wants to live in Stamford (i.e. “Manford”) anyway?
i assure you this is nothing to shrug off. i normally wouldnt care but i have a parent who is relying partially on a pension that - in all reality - doesnt exist. As for the sentiment about IL, they were just downgraded by rating agencies. The agencies are notoriously slow, and political, so this downgrade should show how urgent the matters are.
Aye, Chicago is in a real pit financially. That’s what you get with ultra Liberals running the show.
Funny we just had a conversation about Connecticut this morning and I was reminded of this thread. Another big factor they were looking at is the exodus of corporate companies that equate to permanent corporate tax revenue destruction. Not to mention the ensuing drop in income taxes as people relocate and property values on the tax base.
Aetna confirmed Wednesday it will move its corporate headquarters out of Hartford, Connecticut, due to “the fiscal problems and leadership of our state.”
The insurance giant is Hartford’s fourth largest taxpayer and has been an icon of Connecticut’s capital city for 164 years. It is expected to move its corporate headquarters and top executives to either Boston or New York City, reports the Hartford Courant.