Tuesday, April 23, 2019

“More than a Million Teachers Don’t Have Social Security” by Cory Turner




“Teachers have staged protests in recent weeks in West Virginia, Oklahoma, Kentucky, Colorado and Arizona. Some are fighting lawmakers who want to scale back their pensions. It's no secret that many states have badly underfunded their teacher pension plans for decades and now find themselves drowning in debt. But this pensions fight is also complicated by one little-known fact:

“More than a million teachers don't have Social Security to fall back on. To understand why, we need to go back to Aug. 14, 1935. That is when President Franklin Delano Roosevelt signed the original Social Security Act. ‘This Social Security measure gives at least some protection to at least 50 million of our citizens,’ Roosevelt intoned.

“But of those 50 million citizens, one big group was left out: state and local workers. That was because of constitutional concerns over whether the federal government could tax state and local governments, says Alicia Munnell, director of the Center for Retirement Research at Boston College. ‘So, in the 1950s,’ Munnell says, ‘there were amendments added to the Social Security Act that allowed governments to enroll their workers.’
And many did, leading the Social Security Administration to trumpet in one 1952 promotional film that ‘most American families are now able to ensure for themselves an income that is guaranteed for life.’ Most American families ... except for a lot of teachers, says Chad Aldeman, editor of TeacherPensions.org. ‘Fifteen states do not offer all of their teachers Social Security coverage,’ Aldeman says, ‘and that means about 40 percent of the workforce is not covered.’
“Forty percent of all teachers. That's more than a million educators, in Alaska, California, Colorado, Connecticut, Georgia, Illinois, Kentucky, Louisiana, Maine, Massachusetts, Missouri, Nevada, Ohio, Rhode Island and Texas.
“Now, these teachers aren't benefit-less. The law requires that states that opt out of Social Security give teachers a pension that is at least as generous. ‘On the whole, teachers who don't get Social Security aren't necessarily disadvantaged if they work a full career and get a full pension,’ says Andrew Biggs, who studies retirement issues at the American Enterprise Institute.
But there are still risks, Biggs says. For one, many teachers don't spend a full career in the classroom, and some states' pension plans take a decade before teachers see any real benefit. ‘You know, in theory, you could work for 10 years as a schoolteacher, come out with very little on the pension end, but also not have earned any credits toward getting any Social Security benefits,’ Biggs says.
“In other words: 10 years of work with little retirement savings to show for it. There is another big risk for teachers who don't get Social Security — even the ones who spend a lifetime in the classroom. Many states that long ago opted out of Social Security have also underfunded their pension plans, badly. ‘We're kind of worried now,’ says Munnell of Boston College. ‘In some places, they're actually going to run out of money.’  
“Pension experts say this is a real conundrum in many places right now: how to fund pension systems that have been starved for decades without giving teachers a retirement plan that is not as secure as Social Security…” (Why More than a Million Teachers Can’t Use Social Security, NPR). 

Commentary:

Another injustice is the Windfall Elimination Provision and Government Pension Offset.  Click here for more information: WEP/GPO. 


Saturday, April 20, 2019

Robert Mueller's 448-Page Report on the Investigation into Russian Interference in the 2016 Presidential Election



"Attorney General William Barr delivered a redacted version of the Mueller report to Congress and posted the special counsel's findings online Thursday morning, April 18. The document's publication followed a Justice Department press conference that critics and Democratic lawmakers denounced as an effort to spin Mueller's findings and protect President Donald Trump" (Common Dreams).




Wednesday, April 10, 2019

Black Hole



“Scientists have obtained the first image of a black hole, using Event Horizon Telescope observations of the center of the galaxy M87. The image shows a bright ring formed as light bends in the intense gravity around a black hole that is 6.5 billion times more massive than the Sun.”



Sunday, April 7, 2019

Suspected rhino poacher is killed by an elephant and then eaten by lions in South Africa (by Livvy Doherty)




(CNN) Only a skull and a pair of trousers remained after a suspected rhino poacher was killed by an elephant and then eaten by lions in Kruger National Park, South African National Parks said.
The incident happened after the man entered the park with four others to target rhinos, according to a parks service statement released Friday.

His family were notified of his death late Tuesday by his fellow poachers, and a search party led by Kruger's regional manager, Don English, set out to recover the body. Rangers scoured on foot and police flew over the area, but due to failing light, it could not be found.

The search resumed Thursday morning and, with the help of added field rangers, what was left of his body was discovered.

"Indications found at the scene suggested that a pride of lions had devoured the remains leaving only a human skull and a pair of pants," the statement said.

Glenn Phillips, the managing executive of Kruger National Park, extended his condolences to the man's family.

"Entering Kruger National Park illegally and on foot is not wise, it holds many dangers and this incident is evidence of that," he warned. "It is very sad to see the daughters of the deceased mourning the loss of their father, and worse still, only being able to recover very little of his remains."

The four individuals who joined the illegal hunt were arrested Wednesday by the South African Police Service, and officers continue to investigate what happened.

The African rhino is targeted for its horn because of the belief among some who practice Eastern medicine that the horn has benefits as an aphrodisiac, making it more valuable than cocaine in parts of the world.

Of special concern is the black rhino, which is considered critically endangered after its population tumbled from about 65,000 to 1970 to 2,400 in 1995, according to Kruger National Park. 

Conservation efforts have since boosted their numbers, and the world's remaining 5,000 or so black rhinos live predominantly in South Africa, Namibia, Kenya and Zimbabwe.

In 2016, there were between 349 and 465 black rhinos living at Kruger and between 6,600 and 7,800 white rhinos, who also suffer from poaching, South Africa's Department of Environmental Affairs said.

Kruger is considered an intensive protection zone, and the government employs a range of resources to deter poaching, including aircraft, dogs, special rangers and an environmental crime investigation unit.

Of the 680 poaching and trafficking arrests made in 2016 by South Africa Police Services, 417 were in and around Kruger, the department said. In September, the department announced that six men -- including two syndicate leaders, two police officers and a former police officer -- had been arrested for trafficking in rhino horns.




Sunday, March 31, 2019

The Teachers' Retirement System of Illinois Cost of Living Adjustment




“‘...In the 21 years from 1969 through 1989 there was only one year that inflation was less than 3.3% and the average annual rate of inflation was just over 6.2%.  In making the decision in 1989 to change our annual increase from three percent simple to three percent compounded, the members of the General Assembly made what they felt was a reasonable assumption that inflation would continue and that it would grow at the rate that it had been for more than 20 years.  Since state pensions had not kept up with inflation they would provide a necessary increase, but they did not ask anyone to pay for it because they assumed it would not really be expensive.  The change would cost the state, but they assumed it would still run behind inflation. And growing inflation would mean the state would collect more tax revenue’ (Bob Lyons, former Trustee for the Teachers’ Retirement System of Illinois).

“Anticipating further elevated inflation rates, the General Assembly granted a change from 3% simple to 3% compounded COLA in 1990 to the retirees in TRS. 

“Since 1990, (high of 4.1% in 2007 and low of .1 in 2008) the average inflation rate for the country has been overall 2.4%.   As Mr. Lyons writes, ‘The reality is that the change from 3% simple to 3% compounded did just what it was supposed to do and it has more than protected us from inflation.’

“And he’s right.  On average, thus far, we are looking back nearly 30 years with a .6% positive break.  And in our current media environment of people turning on each other rather than to each other, this COLA correction seems unacceptable to those who criticize the Illinois ‘Pension Problem’ as simply an issue of too many benefits. The finger pointing by the Tribune and other anti-union organizations ignore the truth: the cost of pension would not be so overwhelming if there were no debt payment as a result of decades of avoiding payments.  

“Eric Madiar, the former Chief Legal Counsel for Senate Leader John Cullerton and author of a thorough exegesis ‘Is Welching on Public Pension Promises an Option for Illinois?' speaking before the City Club of Chicago, once reminded his audience: ‘Our current pension disaster cannot be blamed on salary or pension cost increases.  Between 1985 and 2014, pension funding liabilities grew by $97 billion.  Benefit increase only counted for 8%, or $8 billion of that growth.  Pay increases were actually less than actuaries had assumed they would be. And the actually helped bring down the unfunded liability by $1.3 billion.  The state's failure to fund the system accounts for 49 or 47% of that growth.  So simply out, the main reason we are in this mess is for insufficient pension contributions’ (City Club of Chicago). 

“But like any Zen Balance question, we are all awash in what may decidedly come again in another inevitable wave.  Okay, so now maybe we are .6 ahead.  Now.  But in the 15 years before the 3% compounded (1975-1989), we were battling an average of 6.7% inflation – or a 3.6% disadvantage even if pensioners had compounded COLA’s.  

“Maybe the General Assembly didn't foresee a lessening of inflation or the Great Recession, but they understood what continued rampant inflation was doing to state retirees.  

“And, it’s not pensioners that created the fiscal problems at the state or municipal levels; it is and will always be the avoidance of funding the pensions that now comprise the interest-laden debt which must be serviced yearly.  As Bob Lyons also wisely points out, ‘The truth is that this year 76% of the 8.5 billion going to pensions is to make up for the continuous past underfunding of the five systems.  If Illinois pensions were fully funded, all it would take to fund the pensions for all current employees would be just a little more than two billion dollars. The so-called pension problem in Illinois has in reality not been caused by the cost of our pensions, but by the failure to fully fund them’…” (For the complete article by John Dillon, click here).


Commentary:

On May 8, 2015, the Illinois Supreme Court delivered the judgment of the court, with opinion. All seven justices concurred in the judgment and opinion (Doris Heaton et al., Appellees v. Pat Quinn, Governor, State of Illinois, et al., Appellants)]. There are two interesting footnotes in the judgment on pension reform litigation regarding COLA: "By way of comparison, data published by the Social Security Administration show that Social Security increases, which are tied to the cost of living, averaged 3.98%, nearly a percentage point more than under the Illinois formula, between 1975 and 2014 (page 4)." (http://www.ssa.gov/OACT/COLA/colaseries.html.). "While the automatic annual increases have sometimes exceeded changes in the cost of living, these judgments are not cost of living adjustments, and as indicated earlier in this disposition, the increases have actually lagged the average increases granted by the Social Security Administration, which are tied to the cost of living" (page 27). 


Regarding the Cost-of Living Adjustment (COLA) of the Illinois Teachers’ Retirement System: 
 
Illinois Pension Code: 40 ILCS 5/16-133.1) (from Ch. 108 1/2, par. 16-133.1) Sec. 16-133. (Automatic annual increase in annuity):

(a) Each member with creditable service and retiring on or after August 26, 1969 is entitled to the automatic annual increases in annuity provided under this Section while receiving a retirement annuity or disability retirement annuity from the system. An annuitant shall first be entitled to an initial increase under this Section on the January 1 next following the first anniversary of retirement, or January 1 of the year next following attainment of age 61, whichever is later. At such time, the system shall pay an initial increase determined as follows:

(1) 1.5% of the originally granted retirement annuity or disability retirement annuity multiplied by the number of years elapsed, if any, from the date of retirement until January 1, 1972, plus

(2) 2% of the originally granted annuity multiplied by the number of years elapsed, if any, from the date of retirement or January 1, 1972, whichever is later, until January 1, 1978, plus

(3) 3% of the originally granted annuity multiplied by the number of years elapsed from the date of retirement or January 1, 1978, whichever is later, until the effective date of the initial increase. However, the initial annual increase calculated under this Section for the recipient of a disability retirement annuity granted under Section 16-149.2 shall be reduced by an amount equal to the total of all increases in that annuity received under Section 16-149.5 (but not exceeding 100% of the amount of the initial increase otherwise provided under this Section).

Following the initial increase, automatic annual increases in annuity shall be payable on each January 1 thereafter during the lifetime of the annuitant, determined as a percentage of the originally-granted retirement annuity or disability retirement annuity for increases granted prior to January 1, 1990, and calculated as a percentage of the total amount of annuity, including previous increases under this Section, for increases granted on or after January 1, 1990, as follows: 1.5% for periods prior to January 1, 1972, 2% for periods after December 31, 1971 and prior to January 1, 1978, and 3% for periods after December 31, 1977.

(b) The automatic annual increases in annuity provided under this Section shall not be applicable unless a member has made contributions toward such increases for a period equivalent to one full year of creditable service. If a member contributes for service performed after August 26, 1969 but the member becomes an annuitant before such contributions amount to one full year's contributions based on the salary at the date of retirement, he or she may pay the necessary balance of the contributions to the system and be eligible for the automatic annual increases in annuity provided under this Section. 

c) Each member shall make contributions toward the cost of the automatic annual increases in annuity as provided under Section 16-152.

(d) An annuitant receiving a retirement annuity or disability retirement annuity on July 1, 1969, who subsequently reenters service as a teacher is eligible for the automatic annual increases in annuity provided under this Section if he or she renders at least one year of creditable service following the latest re-entry.

(e) In addition to the automatic annual increases in annuity provided under this Section, an annuitant who meets the service requirements of this Section and whose retirement annuity or disability retirement annuity began on or before January 1, 1971 shall receive, on January 1, 1981, an increase in the annuity then being paid of one dollar per month for each year of creditable service. On January 1, 1982, an annuitant whose retirement annuity or disability retirement annuity began on or before January 1, 1977 shall receive an increase in the annuity then being paid of one dollar per month for each year of creditable service. On January 1, 1987, any annuitant whose retirement annuity began on or before January 1, 1977, shall receive an increase in the monthly retirement annuity equal to 8¢ per year of creditable service times the number of years that have elapsed since the annuity began.

Source: Illinois Pension Code