Here we go again with short-term gains with long-term consequences. It seems that public employees in twenty-one States can give their boss (meaning us taxpayers) pennys on the dollar now and reap much larger benefits later. Here are some words from the above article:
The practice, called buying “air time,” lets state, municipal and school employees pay to add up to five years to their work history so they are eligible to retire and collect a lifetime pension. Workers already eligible for retirement can buy extra years to boost a pension by up to 25%…
The New Hampshire Legislature barred air time in 2007 after finding it was costing the retirement system $25 million to $40 million. “It allowed a lot of people to game the system,” says state Rep. Kenneth Hawkins. “That’s part of the reason we’re $3.7 billion underfunded.”
Most recognize that pension funds, both public and private, are at a tipping point especially during the last decade of a very stagnant economy. At least New Hampshire has barred this practice. If it doesn’t happen in the private sector why does it continue in the public sector? Of course the answer to that is the politicians who control these things won’t be around when the time-buying rooster comes to roost. The money is helpful in balancing budgets now but will be deadly down the road when all these increased benefits have to be paid off.
You can’t blame the public employees who take advantage of this scheme. They see a good thing and use it. I probably would too if it had been offered to me. I’m sure it brings in a lot more money than sticking it into the current stock market. We need to get some public officials who will treat our money with the same respect that they treat theirs. It seems that too many of these yahoos just treat it as if we taxpayers were and unlimited piggy bank meant to be raided.
But what do I know….