Earlier this year, the Pew Center released a study estimating that there is a one trillion dollar gap between what states had promised workers in retiree pensions and benefits, and the money they currently had to pay for it all.
In an attempt to remedy the gap, lawmakers in Colorado, Minnesota and South Dakota have voted to reduce annual cost-of-living increases on pensions. Not surprisingly, retirees in each state have filed lawsuits.
Stephen Fehr has been following the pension disputes for stateline.org. He explains what the states and pensioners have to lose, and how the outcomes of these cases could affect people across the country. And Gary Justus shares his side of the story. A retired teacher, he is spearheading the lawsuit against the state of Colorado to re-instate annual pension raises.
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The show is a co-production of WNYC Radio and Public Radio International, in collaboration with New York Times Radio and WGBH Boston.
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Comments [3]
I recently askednthe democratic candidate for Governor of Colorado, hickenlooper, his take on the contract breach we current retirees have endured. He had the double audacity to say;:
the taxpayers would go crazy if they had to honor those existing contracts. He went on to site all the for-profit corporations that have gone under and not been able to pay pensioners.
1. The taxpayers contracted for our services and owe for those services......how else does a school
district attract,pay,and retain then teachers that educated children .
2. Public servants work for lower salaries than similarly educated people in the private sector....The State cannot go bankrupt because profits are too low. The taxpayers are obliged to pay for those who fulfilled their careers and became fully vested in the retirement system. We cannot go back and adjust our contributions, restart our careers, or shop for a better job AFTER putting in 30years!
3.Colorado has recently been in the top 4 states of the nation for attracting business.....this will change if and when corporations learn thatncontracts with our state can be voided at will, unilaterally by state legislators. If a contract is NOT binding, who would do ANY business in this state.
I recall that the state of CO was going to try to get Social Security back by repealing the windfall status. What has happened to that? My peers in other states have a fine retirement compared to me as they have Social Security. It will be quite a hardship for us to survive without cost of living raises. I agree that bad investment decisions were made especially in Denver Public Schools, who has now joined with PERA.
I follow this story religiously. When I started for the State of Colo. I was promised so much in retirement. Although alot of this is due to the economy, I think alot of this is due to innappropriate decisions by the Board who controls the funds they invest in.
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