In Roger Lowenstein’s (2010) article The Next Crisis: Public Pension Fund, it states that public employers have given less than the amount they are supposed to give towards pension funds (Lowenstein, 2010). Public employers have done this by borrowing against retirement plans so they can avoid budget cuts and rises in taxes (Lowenstein, 2010). States such as New York are suggesting municipalities borrow from state pensions in which they already owe money (Lowenstein, 2010). The problem is that many municipalities are already indebted to the State (Walsh & Zezima, 2010). This relates to Dorner’s concept of only looking at the problems we are facing now and not looking at how the situation will unfold (Dorner, 1996). Right now it is a satisfiable solution for the present pension issue, but for the long term the government needs to find some form of reform for the long term issues. Even states such as New York have gambled with state money hoping to get a payoff in the investment (Lowenstein, 2010). For example New York State invested money into hedge funds, private equity, real estate and timber (Lowenstein, 2010). In 2008, the investments lost values by 29 percent and Thomas DiNapoli New York State comptroller lost 40 billion during that year (Lowenstein, 2010). Some of the funds returned in prosperous market periods but they still lost a lot of funds (Lowenstein, 2010).
Additionally, in Mary Williams and Katie Zezima (2010) article Small City, Big Debt Problems, we can see problems in accounting and management which is pushing the pension crisis further. In Central Falls, Rhode Island the city has landed in bankruptcy because of the pension problem (Walsh & Zezima, 2010). They are spending more than they can replenish according to...
... middle of paper ...
...ing law suits for cutting cost-of-living adjustments for existing workers’ pensions (Lowenstein, 2010). States must fight against unions to cause changes for pensions (Lowenstein, 2010). Places such as Rhode Island need changes in the management of funding. One main issue is that the government is shoving out more benefits than it can pay for. This means that the government needs to find more revenue, change the management of resources, or cut pensions. If I was a candidate for a governor I would legalize marijuana in every state to fund pensions. It is not that I’m pro marijuana, but it is in the best interest of saving the states from becoming bankrupt. There are probably other cash grabs that involves lesser risks. While generating income there also need to be reforms in management and accounting policies, where we no longer offer benefits that we cannot supply.
Patrick, C 2004, The Guardian: Australia may hold key to pensions, 12 October 2004, retrieved 21 July 2006
San Diego has an unfunded pension liability of $2.1 billion. There was the choice of either cutting public goods and services or raises taxes in order to pay for them. There are three events that played a significant role in the pension crisis. The first of these being Proposition 98.
Despite amid controversy of plausible attempts in extorting the people, the social security program was implemented to avoid reoccurring, widespread economic depressions. Contrarily, constituents speculated so-called precautionary against challenging financial deficit evaded the primary objective of bailing out the nation out of debt was simply propaganda leading to redistributing the nation’s wealth to the fountainhe...
In America’s early days before the kickoff of industry, there was little need for retirement savings for a few key reasons. First of all, people were dying at a much earlier age; most people didn’t live past 38, whereas in 1900, 60 years of age was common for about 40 percent of the population and 15 percent experienced 80 years of life. Another reason for the irrelevance of social security in the 19th century and earlier was that people were usually living rurally on farms with extended families to take care of them. Furthermore, the Civil War also didn’t allow the government much economic room to consider providing a service such as social security. However, after the Civil War, pensions were a form of social security for civil war veterans that carried into their retirement. Unfortunately these pensions provided support for only a very small portion of the population; not even one percent of Americans received these pensions. Despite a much lower need for social security in the 18th ...
To illustrate these tendencies, several macro-level trends and events in Illinois’ recent history warrant brief discussion. First, Thomas Walstrum, a business economist from the Federal Reserve Bank of Chicago, published a striking analysis in 2016 concerning Illinois’ fiscal situation that succinctly illustrated how the state’s current fiscal trajectory essentially began in the late 1980s. In his article, “The Illinois Budget Crisis in Context: A History of Poor Fiscal Performance,” he posits that the state could have been categorized as a low-expenditure, low-revenue state prior to the 1990s (Walstrum). Starting in the mid-1990s, however, his analysis shows that the state began consistently spending more than it took in in revenues, significantly outpacing the national average (see figs. 1-3). From the years 1994 to 2010, Illinois’s spending averaged 115.9% of its revenues compared with 105.7% for the typical U.S. state (see fig. 4). The main source of this increased spending was pension-related and since revenues continued to remain low, the state began accruing debt to cover these liabilities (Walstrum). This imbalance between revenues and expenditures indicates that Illinois’ budget has not really been balanced since this period in the 90s. In his analysis, Walstrum also treats the yearly change in pension liabilities as an expenditure, treating future payments as if they were being made right now. In doing so, he demonstrates that Illinois was actually a much higher expenditure state than commonly believed since it was merely deferring those expenditures in the form of pension fund payments well into the future
Today’s economy is struggling and it is in dire need of relief. As of 2013, the United State’s debt was $17 trillion, and if marijuana were to be legalized than it would help raise more money. It could be taxed and distributed for consumption sold like alcohol and tobacco. Taxes on cigarettes amounted to more than $43.3 Billion in 2012 (RJReynolds). The legalization of marijuana could possibly one day make that money helping to reduce this nation's debt. But, as the United States continues to prohibit the use of marijuana, it will make the taxpayers pay more money each year on the illegal usage of the drug. The marijuana prohibition costs both state and federal governments more than $20 billion a year (CATO Institute). One drug policy could change how much it wastes on the prohibition but the government has done so. A study by the CATO institute showed that...
A major reform, Assembly Bill 340, passed by Jerry Brown in 2012 ended in large-scale reforms. The new reform requires all new public employees to pay for at least 50 percent of their pensions. This takes the financial burden off of the taxpayer. Additionally, AB 340 increases the retirement age for new public workers and caps the salary amount that can go toward pensions.
...ision was to cut the Pension funds because I believe government employees should cooperate today before the economy falls to the point where they have to actually without pay. In addition, a surplus allows using the extra funds and saving them. Nobody knows the exact day when a natural disaster will occur, which will increase the national debt because the government will have to borrow more money to cover the expenses of a disaster relief.
The push for Congress to pass legislation protecting the rights of employees and their retirement was inevitable. Retirement plans are extremely important for all working individuals. Having funds to keep or exceed ones current standard of living and to enjoy one’s life beyond expectations after retire...
health care. The Governor of California wants the taxpayers to believe state employees are the
One of the most apparent issues in California lies in the deficits that are caused by no other explanation than the irresponsible spending. California is all about taxes, and they will raise taxes as much as they can and to whomever they can. According to Chuck DeVore in “Texas vs. California,” Governor Brown is an advocate for higher taxes, resulting in the cost of $6.9 billion per year, tax-hike plans are being devised by the state’s government-employee unions—those of which have no problem blowing tens of millions of dollars during the elections in order to ensure their hold on power. From these facts it is justifiabl...
Proponents of privatization say that workers should have the freedom to control their own retirement investments and that private accounts will give retirees higher returns than the current system can offer, leading to a restoration of the system's solvency ("Privatizing Social Security - ProCon.org”). In reality, however, Social Security was made in order for people to earn the right to participate by working and contributing. The program was never meant to be an investment program. With broader policy goals than private retirement plans, its intent is to provide guaranteed income to seniors, disabled citizens, survivors, and their families. Privatization would severely undermine this system. In addition, many individuals lack the knowledge to make wise investment decisions. Consequently, privatization will do nothing to address the program's approaching loss of money or solve its insolvency. Therefore, Social Security should be neither partially or fully
Education is the key to success. Many people may not agree but I’ve always believed in this slogan. It expands one's awareness and opens the door to new and better job opportunities, evolving a person successfully in life. Obtaining an Associate Degree in Nursing was the first step towards the success. It took hard work, enthusiasm, determination and devotion to become a Registered Nurse. I’m proud to say that I graduated with honors (cum laude) from Pacific Union College (PUC). Accepting an award in front of the crowd was the proudest moment for my family and I. I have looked into different programs to obtain my Bachelors of Science degree in Nursing but nothing came close to Pacific Union College. Nursing staffs devotion, encouragement and appreciation for students is what made me come back to Pacific Union College to advance into my studies.
Allers, Kimberly Seals. "How Fit Are Your Finances?" Ebony 68.9 (2013): 93-97. Academic Search Complete. Web. 15 Nov. 2013. Bauer, Gabrielle, and John Southerst. "A promising retirement: your life, your way." Maclean's 18 Feb. 2013: 37+. Opposing Viewpoints in Context. Web. 15 Nov. 2013.