Teamsters Face Pension Meltdown
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  • Jim Luebke

    We need to have a new approach in this country to “Free money” — cash payouts that are not supported by useful work done at market prices, e.g. pensions and entitlements.

    Instead, payouts of this sort of largesse need to be tailored directly to the ability of the money-giving sources to pay. (This will happen one way or another, as money that doesn’t exist can’t be paid.) Defined-contribution plans and entitlements whose total payouts match the volume of their tax base (and never a cent more!) are the future of the Blue model. They’re the only sustainable path.

    Anything else leads to crisis and collapse, as we’re seeing now.

  • Anthony

    “These problems will sound familiar to anyone who has been following the travails of public pension plans in states like Illinois and California.” Yes, and basic fiscal arithmetic suggests that the pension challenges ahead will require more than ad hoc responses to changing economic/political structure undergirding pension finances.

  • Richard Treitel

    Umm, if the same contributions had been invested in the same markets, the only difference would be that the pensioners would *know* they were worse off instead of being surprised.

    As Megan McArdle pointed out recently, there is no way in the world to assure yourself of an income thirty years in the future. I would add that there is also no sure way to know what you’ll want to buy thirty years hence, nor what it will cost.

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