Thursday, April 15, 2010

Facing Up to a Pension Crisis

A puzzle from Philosophy 101: If a tree falls in a forest and no one hears it, does it make a sound? A puzzle from the prairie: If an earthquake occurs in Illinois and no one notices, is it really a seismic event?

Gov. Pat Quinn called it a "political earthquake" when the state's Legislature recently voted -- by margins of 92-17 in the House and 48-6 in the Senate -- to reform pensions for state employees. There is now a cap on the amount of earnings that can be used as the basis for calculating benefits. In some states, employees game the system by "spiking" their last year's earnings by accumulating vast amounts of overtime pay.

Just a note to my Fayette County readers: Here in Fayette County, contrary to the move being made across America to ditch these business / county / state budget killers, the current County Commission initiated and approved a move to a defined benefit program. It's not going to hurt the county immediately, but if we're around here in a few years, we'll feel the impact when taxes go up, or they hafta make major cuts in services, increase fees, etc...

No comments: