It will go up here at BizzyBlog Thursday morning (link won’t work until then) after the blackout expires.
It’s hard to know what’s more ridiculously entertaining when choosing between Jesse A. Myerson’s “Five Economic Reforms Millennials Should Be Fighting For,” the illogical screed in Rolling Stone which would lead to the enslavement of those about whom he claims to be concerned, or Myerson’s tweets as the opprobrium has poured in.
Since Noel Sheppard at NewsBusters has handled Myerson’s original work, I’ll have fun with the tweets. And it will be a pleasure to turn around Saul Alinsky’s Fifth Rule for Radicals (“Ridicule is man’s most potent weapon”).
AP Headline Claims Social Security Inflation Increase Will Be ‘Among Lowest in Years,’ When 2010 and 2011 Had No Increase at All
There was no annual adjustment to Social Security benefits for inflation during 2010 or 2011. That’s because the 2009 increase of 5.8 percent (announced in November 2008, and considered the “2009″ increase at this table) was artifically lifted by the $4 per gallon gas prices seen in the summer of 2008, the period used in the annual inflation adjustment calculation. After gas prices came down, overall prices levels were slightly lower during the next two years.
With that background, it’s hard to imagine how a headline writer at the Associated Press, aka the Adminstration’s Press, could transform what writer Stephen Ohlemacher accurately described as an “historically small increase” to “among the lowest in years” — unless it’s to create a false impression among those who only read headlines that the government is being unduly stingy in disbursing benefits. Excerpts from Ohlemacher’s report follow the jump (bolds are mine):
So now it’s a crisis.
The Buckeye Institute (HT to an email from Chris Littleton) has the details:
Cincinnati’s current public employee retirement plan, the Cincinnati Retirement System (CRS), is a traditional “defined benefit” (DB) pension plan that is far less fiscally sound than commonly understood. By some accounting standards, CRS is optimistically underfunded by $862 million. But a more accurate measure, the “fair market valuation” preferred by most economists, reveals unfunded liabilities of over $2.5 billion and a funding ratio of only 35%. As a result of this shortfall, pension costs for the City are extremely high. Total pension costs for 2014 are projected to equal 58% of total employee payroll, with the City bearing a cost equal to almost 49% of payroll. By comparison, the median total state or local government pension contribution is equal to 13% of employee payroll.
That $2.5 billion is roughly $8,400 for each of Cincinnati’s 296,000 residents.
Chris’s email points out to a related November ballot issue:
A Yes vote on Issue 4 this November, the charter amendment to fix Cincinnati’s pension problem, is extremely popular with voters and absolutely vital to Cincinnati’s future. Win-win from every direction!
This is going to require more research, because attempts at finding information about the issue on the web were futile.
Except that the evil employers are municipal governments, as an Investor’s Business Daily editorial noted yesterday:
Detroit Shows How ObamaCare Will Bankrupt the Country
Cost-Shifting: Looks like Detroit might get a federal bailout after all, by offloading its retiree health costs onto federal taxpayers via ObamaCare. It’s a window into why Obama-Care costs will quickly spiral out of control.
On Sunday, the New York Times noted that Detroit hopes to push its younger retirees who aren’t yet eligible for Medicare into the ObamaCare exchanges, where many will be eligible for subsidized insurance. Federal tax payers will pick up the tab, rather than those in Detroit. (IBD’s Jed Graham first wrote about this last month.)
One of the first to suggest this clever cost-shifting idea was Chicago Mayor Rahm Emanuel, who was in the Obama administration while it was putting ObamaCare together. In May, he revealed plans to save about $108 million a year by tossing 30,000 retirees into the ObamaCare exchanges.
If Detroit and Chicago get away with this, you can bet other cities will try, too. The U.S.’ 61 largest cities have more than $118 billion in unfunded retiree health care liabilities, the Pew Charitable Trusts estimates.
And the National League of Cities is practically drooling over the opportunity to shift as much as possible onto ObamaCare.
Imagine that. The public-sector unions will probably roll over on this. Union bosses tend to be all about representing current workers. When push comes to shove, they’ll throw retirees, who often do not have a vote on union contracts, under the bus and let the nation’s taxpayers pick up the tab (e.g., [although they're private sector -- well, sort of in GM's case]: GM and Chrysler bailouts).
Its defined-benefit plans are unsustainable.
This column went up with minor edits at Watchdog.org earlier this afternoon.
In a story which should have stayed on its home page for several days but instead was gone within hours, the Cincinnati Enquirer reported on Saturday that the City of Cincinnati must pay at least $85 million into its $2 billion pension and retiree health care system next year.
Cincinnati is alone among Ohio’s major cities in that its employees do not participate in any of the state’s five statewide retirement systems.
In the past year alone, the Enquirer’s Cliff Peale notes, the Cincinnati Retirement System’s unfunded liability has ballooned by 22 percent to a whopping $870 million, or just under $3,000 for each man, woman and child living within the city’s limits.
Not that it’s much consolation, but the city is far from alone.
Has no one heard of web conferencing?
This post went up a short time ago at Watchdog.org.
Two of the most tone-deaf organizations in America have to be the National Conference on Public Employee Retirement Systems, followed closely by Ohio’s School Employees Retirement System.
NCPERS markets itself as “the largest trade association for public sector pension funds, representing more than 550 funds throughout the United States and Canada.” SERS is a “public pension fund that provides pensions and access to health care coverage” for non-teaching personnel at public schools throughout the Buckeye State.
NCPERS thinks that holding an expensive members’ conference at a posh Hawaiian resort is a great idea. SERS believes, defiantly so, that sending two of its board members to the conference is an appropriate use of participants’ funds.
Politico’s Tau Pretends Big Labor ‘Targets’ Obama, When It Just Doesn’t Like One White House Proposal
I guess Byron Tau thought he had to make it look like Big Labor is really, really mad at President Barack Obama and the White House so he could make Obama look like he’s a moderate on economic and fiscal issues. Thus his Sunday morning post’s headline: “Labor targets Obama over proposed benefit cuts.”
Of course, they aren’t “cuts” at all, though they are being portrayed as such. All Obama has done, according to information which appears to have been conveniently leaked (perhaps in hopes of killing the idea) to the New York Times ahead of his very late President’s Budget, is “propose a new inflation formula that would have the effect of reducing cost-of-living payments for Social Security benefits, though with financial protections for low-income and very old beneficiaries, administration officials said.” Despite the weakly descriptive language at the Times, monthly Social Security and other checks would continue to increase under the proposal each year inflation occurs — just not by as much.
Politico’s ‘Quiet Liberal Plans for Entitlements’ Are Predominantly Tax Increases, Redistributions of Wealth
The front-page title at the Politico for David Nather’s lengthy write-up on Democrats’ alleged ideas for doing something about runaway entitlement programs is “The quiet liberal plan for entitlements; There are some ideas for reining in spending that have been blessed by the left.” That gives readers the impression that the left might actually have something specific and potentially palatable in mind.
No such luck. The actual title at Nather’s write-up, however, pluralizes “plan” — “The quiet liberal plans for entitlements.” Its itemization of the supposedly brilliant ideas for reform liberals have in mind are dominated by tax increases and income redistribution measures which fail to structurally reform anything.
For four years (and really going back further when you consider former President George W. Bush’s halting attempt to reform Social Security in the middle of last decade), Barack Obama and his party have paid lip service at best to the idea of entitlement reform while refusing to provide any specifics about what they would do to fix Social Security and Medicare, both of which are unsustainable in their current forms. Obama rejected his own Simpson Bowles commission’s recommendations. Democrats have treated serious proposals coming from Republicans as grannycide.
Yet the Politico’s Carrie Budoff Brown, who must be gaining strength in her arms and shoulders from all of her water-carrying for Obama and his party, wants us to believe that Obama has a “deeply conflicted relationship with entitlement reform.” And in case you missed it (I certainly did), Obama has tried “harder than any other Democratic president to tackle the issue” (no Democratic Party president has “tried hard” to tackle the issue). Several paragraphs from her Tuesday dispatch follow the jump (bolds are mine):
This column went up at FrontpageMag.com in slightly revised form early this morning.
On Wednesday, Julie Pace and Martin Crutsinger, two of the usual suspects at the Associated Press, began paving the way for what they clearly hope will be a worry-free Senate confirmation of current Obama administration Chief of Staff Jack Lew to become the nation’s next Treasury Secretary.
Towards that end, the AP pair larded on the compliments and historical revisionism with reckless abandon:
- “one of Washington’s most knowledgeable budget experts to manage prickly fiscal negotiations with Congress and steer the still-shaky national economy.”
- “Lew, 57, would bring to Treasury a mastery of federal budget mechanics …”
- “Lew helped negotiate a balanced budget agreement with Congress, something that has eluded Washington ever since.”
- “Lew, a pragmatic liberal … is well-liked in Washington by both Democrats and Republicans …”
Along the way, Pace and Crutsinger couldn’t make up their minds about the current condition of the economy. After the “still-shaky” characterization just noted in their first paragraph, they later evaluated it as “now stabilized, if still sluggish.” Those two conditions can’t exist at the same time, given that “shaky” is an antonym of “stable.” Although it would have required more verbiage, the AP pair should have characterized the current economy, as a result of the derelict stewardship of Obama, the soon-departing Tim Geithner, and Fed Chairman Ben Bernanke as “the worst since Franklin Delano Roosevelt needlessly extended the Great Depression by over eight years during the 1930s.” Because it is.
The AP also decided to have a little fun with Lew’s signature, which will appear on the nation’s currency if he is confirmed, commenting in a separate item that his sign-off, a ”J” followed by “seven loopy scribbles,” is “illegible.”
What’s really loopy is AP’s collection of contentions about Lew.
Its actuaries have been blowing the calculations, and there is no “buffer.”
This column went up at FrontPageMag.com with minor revisions early Tuesday morning.
At first, one doesn’t know whether to laugh or cry at research findings reported by two Ivy League profs in a co-authored column in the Sunday New York Times titled “Social Security: It’s Worse Than You Think.”
Actually, white-hot anger is more appropriate, given that what Gary King, a professor of government and director of the Institute for Quantitative Social Science at Harvard, and Samir S. Soneji, a demographer and assistant professor at the Dartmouth Institute for Health Policy and Clinical Practice, really told us, namely that the New Deal-era retirement system, thanks to its use of ossified actuarial calculations, is more insolvent than almost all of us knew.
The pair’s core finding, as presented in the Times: “[T]he Social Security Administration underestimates how long Americans will live and how much the trust funds will need to pay out — to the tune of $800 billion by 2031.”
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