We wanted to share an Op-Ed piece that appeared in the Stamford Advocate. It was written by our brother Xavier Gordon from AFSCME Local 269. This is about state employee pensions and stands as a counter-balance to the typical narrative that demonizes public sector pensions...thank you for writing this Xavier!
As a Connecticut state employee and taxpayer, I feel that public service workers are among Connecticut’s greatest assets — and among the most unfairly vilified.
From teachers to sanitation workers to first responders, we care for our children, plow our roads, help the jobless and the poor, build our bridges, and keep our neighborhoods clean and safe. More often than not, public sector workers are bringing home less money than we could by doing similar work in the private sector, but not without good reason.
Yet too often state employees are condemned for having the security that comes with a defined benefit retirement plan. It’s time to change the narrative that wealthy and corporate special interests are spinning about pensions.
From the start of our employment, we pay a percentage of our wages into our pension with every paycheck. Our employer also contributes to the plan, and this money is then professionally invested. As long as we have been working and paying into this system for the minimum number of years required by our employer, we will receive a modest but guaranteed benefit for life once we retire.
This is money that we as public service workers have earned and have agreed to not receive until retirement, with the hope of providing security and stability for ourselves and our families at the end of our lives.
State and local pensions are a great investment for Connecticut taxpayers. According to the National Institute on Retirement Security, in 2016 alone pensions generated $7.1 billion in economic activity. Each dollar invested by taxpayers into public pensions supports $3.54 in economic activity, while each dollar paid out in pension benefits creates $1.42 in total economic output here in our state.
It is important to remember that most opposition to public pensions is funded by billionaires such as the Kochs, the Yankee Institute, and the Reason Foundation — all looking to destabilize state and municipal systems to further their own self-interested agendas.
Then there’s John Arnold, a former Enron energy trader who has become the chief funder of anti-pension activity across the nation, saw his own net worth soar to $3.3 billion dollars by the end of this fiscal year and has spent nearly $50 million over the length of his career on his anti-pension crusade.
Much of the research from the pension- and union-haters is biased, often inflating issues to scare lawmakers into changing if not gutting pension systems. They claim that public employees are greedy and using their pensions to get rich, but the actual numbers show otherwise.
The average public pension benefit in Connecticut is about $36,000 a year. According to publicly available data from the state Comptroller, the average retirement benefit for current tiered, non-hazardous duty employees is around $18,600 a year. Clearly, we’re not getting rich off the system.
The pension haters have a goal in mind: to force public employees into risky defined contribution savings plans like 401(k)s, thereby transferring wealth from working families to Wall Street banks and traders.
In the 1980s, private sector businesses began closing their pension plans and opting for 401(k)s for their employees, but unlike 401(k) plans, public pensions have time to recover from economic downturns like we saw in 2008, which is why they continue to be the most affordable, durable and efficient retirement systems available.
Pensions cost 46 percent less than 401(k)s to administer while achieving the same target benefit. Even the architects of the 401(k), such as Sheldon Whitehouse, acknowledge the inadequacy of this vehicle to provide a dignified and stable retirement in the long term since 401(k) plans were never designed to be the sole retirement plan for Americans.
Every Connecticut citizen should have access to a secure and dignified retirement. However, destroying my pension and forcing me into a 401(k) won’t move Connecticut forward.
Let’s stop beating up on public service workers and begin developing real solutions to the challenges we face.
Xavier Gordon of Stamford is a state employee and president of AFSCME Local 269.