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Poll: Should Rhode Island Eliminate Pension Hikes?

State leaders are talking about eliminating the cost-of-living increases for retired workers ... Do you agree?

Rhode Island Gov. Lincoln Chafee and General Treasurer Gina Raimondo are pushing plans to reform Rhode Island's pension system, including elimination of cost-of-living-adjustments (COLAs) for all retirees.

These COLAs, which increase to match the rate of inflation, have inflated pensions for many retirees beyond their highest working salaries. The Providence Journal reported recently that, according to Raimondo, more than half of the state's retired teachers, and nearly half of the retired state workers, receive more state income today than they did while working.

Is it fair to pull out the rug on these COLAs now, after people worked their many years under fair contracts? Or do the state's finances trump the rights of those workers? What are your thoughts?

William F Horan October 28, 2011 at 02:32 PM
Your public sector pensions finical structure - What you and your employer paid in does not provide the resources for a COLA indexing. The taxpayer lacks affordability / ability to pay for these COLA indexing Pensions & companion benefits pkgs golden handshakes. Perhaps another solution is to increase your pension contribution significantly if you want a COLA or better yet close down the public employees pensions and roll the available funds over into a private plan that you take responsibilities for managing. The taxpayer and all taxable entities are already over leveraged e.g. you can not get blood out of a rock. What is to good to be true is not true. OBTW the companion retirement benefits is an equally critical situation that mist be adjusted to market realities as well. We should now understand why FDR was strongly opposed to public sector employees having collective bargaining rights. The underpinnings of the Republic would be eroded as the elected and appointed officials would be compromised by a self serving civilian army of the left (sounds like today's problems)! Clearly we mist resolve this situation by a transition plan to a redesigned / baseline retirement and benefits system for public sector employes.
Glenna Andrade October 28, 2011 at 02:35 PM
Artificially inflated means that greedy mortgage companies gave out loans to people who could not pay. The brokers were convincing homebuyers that their home would keep going up in value. Some homeowners sought multiple loans as their house value was pushed up (partly by speculators in the flip market). The loans were packaged and sold overseas to financial institutions who were left holding the bag and to Real Estate Trusts here. It was a nice pyramid scheme although not on purpose. I always worked on the premised that a home loan payment should not exceed 1/3 of the takehome pay. But some people who got into a house on poor credit, just stayed for the free rent during foreclosure. The more specific issue of pension reform is what Average Joe wrote about. What good will anything be if the state goes bankrupt. You will get nothing---instead of a reduced pension.
Average Joe October 28, 2011 at 02:37 PM
Dennis, Former Governor Carceiri talked about the unfunded liability for years, but was ignored because he was a Republican in a Democratically controlled state. You just heard about this major problem recently? Did you just move here from another state? Planet? I don't want to hear from anyone that we weren't warned about this.
Paul Silver October 28, 2011 at 02:52 PM
I understand what you mean by artificially inflated, but I dont see markets getting artificially inflated or deflated... it is simply the nature of unregulated markets that they go up and down in this fashion... The loans you speak of were not only sold overseas, but to domestic investors as well... not just trusts... But buyers needed little convincing regarding prices going up... some just timed it wrong... but it is the nature of markets that these things happen... perhaps we need to revise our understanding of just how markets work... Greed on the part of the investment banks and mortgage lenders was certainly a fact, but that too is one of the fundamental assumptions about markets: that greed will result in a benefit to society and to the investor... this is the basis, philosophically, of capitalism and market based economies in general... I still cant say that anything was "artificially" inflated... inflated yes, but not artificially...
Jim L October 28, 2011 at 03:00 PM
cola's the cola for anyone on ss has been 0% for 3 yearsnow we are getting a 3% bump so with alot or you who got 3% X 3 years= 9% while the elderly and retired got nothing. And you just whine, and this way of the fact that if #2 the FTR is not voted in then you can exspect tax increases to just suck up that little 3% bump you just got. VOTE YES TWICE ON NOV.8TH
Dennis October 28, 2011 at 03:06 PM
@Average Joe... that was my point!!! Something should have been done years ago!! Someone screwed it up... shouldn't be too hard to find out who!! My guess is start at the top!!! It always runs downhill, and lands smack in the face of the little guy! Nope, didn't just fall off the turnip truck, been here forever, but like I said, I'm not a state worker, nor part of the pension system, so it wasn't something I thought about until recently. That doesn't mean I don't get to voice my opinion! Member of Planet Earth, State of Rhode Island....
Paul Silver October 28, 2011 at 03:30 PM
Pension plans use statistical methods to determine what funding is needed to start them off and survive based on pay out plans... The contributions from the pensioners and employers should be made commensurate with the payout requirements... these pensions have solid math behind them... it is when the employers use the funds other than as designed, fail to repay the borrowed funds, or pay out those golden parachutes without having had them planned or paid in, that troubles start... I am not in favor of privatizing public pensions, at all, as most people do not have the skill sets required to invest properly, and in any event the banks have not proven to be reliable... I see no reason to pump up their fees for them in this way... better, would be to adjust payouts based on pay in, with pay in being adjusted to account for longer lives, realistically, cost of living increases, and 'member" contributions into the future... But for me this talk of armies of the left smacks of a lack of reality...
Norman M. Fucile October 28, 2011 at 03:40 PM
Social Security has NO built in COLA increase, and in fact has had no COLA increase for the last two years.
vicki norris-karten October 28, 2011 at 03:40 PM
If the COLA is eliminated, RI will have the distinction of being the ONLY state in the country altering the public pensions of those already retired. Why does that not surprise me? Why are our neighbors in MA not threatening public employees with these changes? I would have gladly invested nearly 10% of my weekly salary on my own, however, I did not have that option and had to rely on "the promise" made to me and so many others.
Average Joe October 28, 2011 at 03:42 PM
Paul, I think your comment "I am not in favor of privatizing public pensions, at all, as most people do not have the skill sets required to invest properly,.." is laughable. So are you saying that public employees are not intelligent enough to invest in their retirement? The majority of private sector employees with a 401K do it everyday. Oh, and the State has done a wonderful job for public employees up to this point.
Paul Silver October 28, 2011 at 04:22 PM
Average Joe... do you claim to be an expert on investing? You may think that it is not a high level skill to invest profitably, but then, if it were so easy, there would not be such huge income disparities in our country... I do see many people managing their own investments, and losing their shirts... so for me, I do not find it laughable at all... sad really... but then, I suppose you are an expert and I just dont get it...
Average Joe October 28, 2011 at 04:33 PM
I don't know this as fact, but I would bet that if you took a poll, the majority of ALL workers would like to have some control of their retirement funds. Public workers with pensions have zero control, and now look at the mess they are in. Most of the people I know have not lost their shirts, but it looks like the employees working for the State of RI have lost theirs.
Paul Silver October 28, 2011 at 05:03 PM
AJ, are you sure about that? Most retirement plans, both public and private, allow some discretion in the products invested in... I do not know for sure what discretion RI public Employees have, but I cant assume they have none... anyone know for sure?
vicki norris-karten October 28, 2011 at 05:28 PM
As a teacher I had no say as to how my money was invested or spent.
Mike Callahan October 28, 2011 at 06:55 PM
I find it amusing that a Member of the Legislature on the Committee handling pension reform was indicted today for first degree sexual assault. Add to that Rep. Gordon, Rep. Watson, and Rep. Medina .. . . .quite a team working for us ...
Paul Silver October 28, 2011 at 07:35 PM
And add Chris Masselli, State Senator from Johnston, who is serving time for mortgage fraud...
Paul Silver October 28, 2011 at 07:37 PM
Okay Vicki, so state workers have no say in the programs used for investing the Pension Fund... I do feel that this should be changed, just as other State's pensions and private sector pensions are managed, with some program options for the pension member...
sandra bernadette October 28, 2011 at 09:47 PM
The ones responsible for not funding should be punished. They "redirected" or im my book robbed peter to pay paul with someone elses money and never informed the public what was being done with the funds..It should be punishable under the law for all who were complacent in this and said nothing...Thats illegal and the effort to find out who what and where it all went south should be exposed.
Lawrence Holmes October 28, 2011 at 11:17 PM
Oh you are the guy i read about from the planning board and the police
clarence October 29, 2011 at 01:08 AM
As a senior citizen collecting on SS I am tired of hearing the excuse that you contributed to your pension. You stated that you contributed 10% of your salary for 30 years . Lets assume you contributed $12,000 a year for 30 years for a total of $120,000. Yor retire at $100,000 It has been reported that school teachers can retire with 100 to 120% of their final salary. As a pension of $100,000 per year with COLA'S. for the rest of your life(Guaranteed). Now these numbers may not be applyed to your case but basely thats the way it works. As a school teacher you must think majority of the people are dumb and do not understand this. Many private people onSS last their COLA'S under Obama and pay higger drugs costs I paid $15000 last year for my medical while some school teachers get free healthcare and drugs. I have put money in my 401 and lost 65% . I meet teachers in Florida bragging about their pension plans and free drugs. They live in Florida and pay no RI taxs. You realy got a deal, a lot better then they people in the private sector.You are the reason why we are in debt and causing the high taxs. What bothers me majority of the people that are elected belong to the union and getting paid by them. You claim you did not create the problem, your not bumb you know you were getting a deal at the expense of the average tax payer
clarence October 29, 2011 at 01:11 AM
Sorry Iit should have been $360'000
clarence October 29, 2011 at 01:17 AM
Not true other state are elimating COLA'S
vicki norris-karten October 29, 2011 at 01:50 AM
Clarence, your numbers regarding teachers and their earnings are laughable. I also lost my health care when I retired. I have to pay for a plan as any other private citizen that does not have a plan through their employer. I will never collect social security either. Please do not talk of which you do not know.
J. Lane McMahon October 30, 2011 at 01:13 AM
Then I would suggest you take it up with your union bargining committee. They are the one who negotiated your pension plan. You voted for it.....
Chmn October 31, 2011 at 05:54 PM
Looking at the polls results, it appears that the unions got the word out to vote in the poll "en masse". Can't fool me!
Paul Silver October 31, 2011 at 06:43 PM
one need not be in a Union to support Cost Of Living Increases for pensioners... I am not now and have never been in a Union nor worked for the State but support cost of living increases as a matter of equity and fairness...
John Garagliano October 31, 2011 at 06:48 PM
LOL - I agree Chmn. Still trying to remember when I, as a working person, has had a 3% raise. Nothing in life should be automatic except, oh well, never mind....,
clarence October 31, 2011 at 07:45 PM
I guess you would agree giving the judge a $30,000 COLA.? It's wrong and should not be allowed .I am on SS and have not gotten a cost of living increase. The COLA's are driving up the cost to the tax payer. In some cases school teachers are reciivng 100% of their salary in their pension. Check the Providence papers. (58% of them.) Do you know some teachers were making over $50,000. Come on wake up. They know the got a deal. The got a free candy store called the state ,while some retired people are on food stamps and don't have money for their heating bills. Do you call that FAIR. They are called the RICH people in this state
Paul Silver October 31, 2011 at 07:59 PM
For a judge to get a $30,000 COLA he would have to be earning $1 million per year... are you aware of any judges making that much? As for SS, cost of living increases have been in place for most years it has existed, except the last 3 yrs... you must have only been receiving payments for that long or less... Teachers are among the most valuable assets our society has... worth more in my view than doctors, lawyers, accountants, etc. and almost all other jobs... $50K per year after 20 yrs or so of work is not bad, but not enough for such an important job... so as far as that is concerned, I have to say that we are getting away cheap and paying far less than the importance of the job justifies... As for 1005 of the salary? I am assuming these teachers you mention have been retired quite some time... to make that data meaningful, we would need to know what that salary is, and when they retired, and so how many years of COLAs have been included... and of course, we should then compare the COLA to actual inflation over that same period... anything less is meaningless...
Old Chief October 29, 2012 at 02:10 PM
So you believe that your contract to public employees should be broken because you are jealous of their pensions. When you fail to pay your obligations for whatever reason, you are termed a "deadbeat", and that's exactly what Roadies are. Tell you what Clarence, why don't you propose this. You give up your Social Security COLA by sending it to the state retirement system for as long as your state's retirees have to give up theirs. While your at it, propose that ALL citizens of RI pay any increase in their wages and capital gains from 2012 on into the state retirement system to solve the problem. That way everyone feels the pain equally but the problem will be solved in much less time. Otherwise, you and the others like you are simply deadbeats.

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