By Chris Adams
A tale of two cities, indeed.
Public sector pensions have been assigned blame for the collapse of the finances of many cities and states, with critics saying extravagant payouts reward teachers, firefighters, police officers and state workers for work done decades ago.
The story, however, isn’t quite so simple – in part because it’s not just one story.
“It’s like politics – it’s all local,” said Steve Kreisberg, director of research and collective bargaining services for the American Federation of State, County and Municipal Employees. “There’s not a pension problem, writ large, but there are pension problems in some localities.”
In a panel discussion with National Press Foundation fellows exploring the status of public and private pensions, Kreisberg and five other representatives of public pensions sought to put the nation’s pension problems in context.
“My goal, if I was reporting on this, would be to inquire, ‘How did we get here?’ ” Kreisberg said. “Why do we have a pension problem in City X but City Y doesn’t?”
Or State X and State Y. Kreisberg compared Wisconsin and Illinois, neighboring Midwestern states. One of them – Wisconsin – has a well-funded public pension system. The problems in Illinois are legendary.
Overall, Kreisberg said, about a third of public pension plans are well-funded, a third are underfunded and in trouble, and a third fall somewhere in the middle.
Panelists talked about how some state governors or legislators opted to skip state pension funding payments, choosing instead to use the money for current needs. On-the-ground union or pension coalition organizers in Kansas and Kentucky described statehouse battles when their governors tried to significantly alter their public pension plans, while a union official in California described efforts taken this decade to strengthen the state’s public pension plan.
And representatives of the teachers and firefighters unions gave the intellectual underpinning for why traditional, defined benefit pension programs are so important to their workers – as a recruiting tool and as a public safety measure. In addition, many are not eligible for Social Security that most Americans receive.
Tim Hill, pension resource adviser for the International Association of Fire Fighters, detailed the physical demands of being firefighter. People don’t begrudge athletes who retire early, when the physical demands become too great. Why should firefighters be any different?
“Nobody wants a 64-and-a-half year-old firefighter going through the window to save their baby,” he said.