Is a $100,000 pension outrageous?
There are lots of stories coming out recently about how public workers, typically police or firefighters, are retiring with “outrageous” pensions of $100,000. Here’s one from the Atlantic. From the article:
That doesn’t frustrate Maviglio, who insists that “people who put their lives on the line every day deserve a secure retirement.” But do they “deserve” more than twice the US median income? Do they “deserve” the sum the average California teacher makes, plus $32,000? Do they “deserve” pensions far higher than the highway workers whose jobs are much more dangerous? These aren’t idle questions, given the public safety worker retirements we can expect in the near future.
Okay, let’s go there. If the median income in the country is 38,000, then $100,000 is a lot. But the median income in the communities where these retired firefighters live is sometimes much higher. For example, in Orange County, where the pension system is getting lots of flak, the median incomes can be seen here. In only one community out of is it below $50,000, and in 8 it’s above $100,000. So if you look at it that way then it doesn’t seem so outrageous.
And maybe we should be paying our teachers and our highway workers more, for that matter.
Point #1: California is a rich state, and it costs a lot of money to live there.
Now let’s move on to articles like this, which frame the issue in a very specific way. The title:
Police and Firefighter Pensions Threaten Government Solvency
How about all the other things that have contributed? Why are we blaming these guys, who have worked all their lives to protect their community? Why aren’t we blaming the mafia behind the muni bond deals, or sometimes even the local politicians as well?
Point #2: This is all a political blame game, trying to manipulate you from thinking about who are the actual crooks behind the scenes here.
My momma always said double down, and this is the ultimate double-down opportunity. Instead of looking for where the money went, or why it was handled so badly, we are going to blame the guys on taking the boring public servant job, and doing it for their adult lives, and trying to retire. Basically, we are blaming them for being right, for making the better choice between public and private.
Point #3: They made the right choice and we can’t swallow it because we thought our whole lives they were suckers for working in public service instead of in finance.
And what about that? Why do we compare $100,000 pensions to median incomes but not to golden parachute retirement packages of failing CEOs? Where’s the real outrage? Here’s another list of some seriously outrageous golden parachutes.
Maybe it’s because we feel like private pay is not our business, as taxpayers. It’s a different arena, and we have no right to judge. Let me remind you then that we taxpayers paid for bonuses at too-big-to-fail banks:
Point #4: These pensions don’t look very big when you compare them to what happens in the private sector.
And yes, I’m talking about the extreme cases, but so does everyone else when they talk about “outrageous pensions”, so it’s extreme-case apples to extreme-case apples.