Public employee pensions are a good deal

September 07, 2010

I am writing in response to Matt Patterson's commentary, "The public pension curse," which appeared in The Sun on September 5.

Unfortunately, I have grown to expect this type of hysterical rhetoric sprinkled with a few historical facts from the likes of right-leaning "think tanks" such as the Capital Research Center, the Heritage Foundation and the American Enterprise Institute. However, I am compelled to respond — just as the nation celebrates Labor Day — for fear that anyone might actually take this "opinion piece" seriously.

First Mr. Patterson says that it is "quaint" to say that the honor from public service justifies receiving lower wages combined with job security. It is worth noting that public service — which many still see as an honor — often involves grueling mandatory overtime due to lack of sufficient staffing, supervision of the state's most dangerous inmates and former inmates, and long hours protecting vulnerable children and elderly individuals and little in the way of thanks. He goes on to attack the desire of these employees to have a sustainable retirement that they have paid for and earned.

The current public pension system depends on employee and employer contributions that are invested and are then the basis for a formula-based benefit. Because of the pooling of benefits among all employees, and a long term perspective, this type of plan provides greater security to employees and stability to the system.

The media often focuses on the handful of public employees who receive inflated retirement benefits, but the average pension for a retired public employee in the U.S. is about $20,000. These pensions are nothing compared to extreme private sector bonuses and retirement packages for today's corporate executives.

In addition, according to the National Institute on Retirement Security (NIRS), each dollar in contributions to Maryland's state and local pension plans ultimately supports six dollars in total economic activity in the state. This reflects the fact that investment returns provide the bulk of financing for the retirement benefits, which in turn provide income and jobs for others in the state. NIRS estimates that retiree expenditures stemming from state and local pension plan benefits support more than 21,000 jobs in the state. ("Pensionomics: Measuring the Economic Impact of State and Local Pension Plans," National Institute on Retirement Security, February 2009.)

The real travesty is not that public employees have decent pensions; it's that private sector employees do not. Mr. Patterson and his friends are advocating a race the bottom, a race they are determined to see all public employees, including Maryland's correctional officers, foster care employees and state highway safety workers — win.
 


Our state's public employees deserve to receive the pensions they have contributed to and earned, without having to constantly fight for and continually justify them. Happy Labor Day.

Patrick Moran, Annapolis

The writer is director of the American Federation of State, County and Municipal Employees-Maryland.

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