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Comment: There was a great study done

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There was a great study done

There was a great study done in 2009 about pensions in the United States. Pensions, both private and public, tend to be a just part of compensation. Government and companies use pensions to defer payment. By offering their employees pensions, they can limit costs at the moment; the problem is, when the deferred costs hit them later, they often do not honor them, or, try and cut them.

They used an example of a factory worker working for a company with and without a pension. Over the course of a full career, the person without the pension would make about 80%, benefits and all, of what the person without the pension would make. Adding in the full pension benefit, he would make about 110%. Factoring in the cost of not having the pension right away (after all, it is deffered money), it is about 95%, right in line with what the non-pensioned worker was making. When you look at government pensions, it is largely the same. We can especially see this looking at public vs. private teachers.

So yes, I do have sympathy for these workers who are having their pensions cut. After all, they were given those pensions in exchange for lowered salary. It is unfair to take it away from them now. But that is the trick government pulls on its workers; it steals from them in the present promising future payments, and then simply defaults on the future payments.

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