Wednesday, May 9, 2012

Public pensions: "Day of reckoning has arrived"

Pension Reform? It's simple math and at least one Democratic politician "gets it"--kudos to Chicago Mayor Rahm Emanuel, for taking on the political risk to try to fix a broken system (which I have previously posted about here):

Rahm Emanuel to state lawmakers on pension costs: 'Day of reckoning has arrived' - "Emanuel called for a pause on cost-of-living increases for 10 years to allow pension systems "to catch its breath." He wants city employees to increase their contributions 1 percent each year for five years and to allow employees to be offered a choice of retirement plans.   "The day of reckoning has arrived," Emanuel said, saying taxpayers, retirees and employees want politicians to be honest and "level with them" about the problems.   A rare step for a Chicago mayor, Emanuel personally pitched his ideas for cutting costs to a House pension panel. It's an approach that his immediate predecessor, Richard M. Daley, had not taken, though he made a variety of appearances over the years. Emanuel said the cost-of-living pause is necessary because retirees are getting increases while current employees are unable to get similar increases. For example, a retiree making a $60,000 pension in 1995 is now receiving $100,000. After 10 years of a pause, Emanuel said the plan would go to a simplified cost-of-living adjustment rather than annual compounded increases. . . . "


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