Feed on

Pension Purloinment

Fred McChesney illustrates another special privilege granted to the few at the expense of the many. Not only do public employees get paid wages higher than their private counterparts (uncompetitively), not only are many public employees producing things of little value, or things that could be produced more efficiently and effectively by private interests, but their votes are also paid for by offering pretty attractive retirement plans:

Except for one group, that is: retired government employees. Yes, the value of their retirement accounts has fallen, in some cases more than the drop in the accounts of the rest of the country (because of poor investments made by their account managers). But their losses are not irretrievable. After all, they worked for the government—the same government that paid into their retirement accounts by taxing the rest of us. If the government taxed us once, can’t it tax us again to replenish government-employee retirement accounts? Yes, it can, and it’s doing exactly that.

Nevertheless, politicians claim that you and I should be taxed to maintain or restore the retirement benefits of others whose retirement accounts have fallen in value. Think about that. My retirement accounts have certainly fallen in value in the past two years. I bet yours have also. So, if we’re not state or local government employees, where do we go to get back the money we have lost? Nowhere. Who has an “obligation” to replenish those lost accounts? Nobody.

It is one thing to tax private citizens for fire and police protection from which they benefit. It is quite another thing to tax the current generation to pay those who provided those services to the prior generation. When the value of my retirement accounts declined, I did not look to my children to reverse my losses. Nor, probably, would they have done so had I asked them to. But government doesn’t ask. It has the guns; it just takes.

It would be hard to argue with a straight face that public employees deserve such lavish retirement packages as a “compensating differential” for working in the public sector. Given how famously stable and easy it is to work in many jobs in the public sector, you would expect the compensating differential to be negative. This is more larceny, plain and simple.

Leave a Reply