Sunday, March 27, 2011

One Simple Reason

There is a new Bill on Capitol Hill -- Public-Private Employee Retirement Parity Act -- that would do away the the remaining portion of a defined-benefit retirement for Federal employees. It is, of course, a Republican Bill.

Bill would end FERS defined-benefit annuity

”Two Republican senators introduced a bill that would end the defined-benefit portion of the Federal Employees Retirement System for new federal hires, starting in 2013. The bill would not affect benefits for current feds.

Sens. Richard Burr (R-N.C.) and Tom Coburn (R-Okla.) introduced the Public-Private Employee Retirement Parity Act March 17. The bill would apply to future federal employees, including members of Congress. FERS employees now receive a defined-benefit pension and also may participate in the Thrift Savings Plan, which is equivalent to a private-sector 401(k) retirement plan.”

This Bill is just plain wrong for one simple reason -- and the quote will help me explain it. As with the public sector’s dive in the Wall Street shark infested 401k waters showed, it makes all Americans become investors. But all Americans aren’t cut out to be investors.

Let’s think about a comparison. Let’s make my daughter the artist an investor and my local Congressman an investor. Give them both a $174,000 salary and let them invest for 20 years. Who do you think will walk away with the most money? Who do you think will get the best investment “advice”?

Pensions were supposed to protect workers in their old age. Even workers that don’t know anything about investing. That is the reason their pensions were supposed to be protected by people that did understand investing and had a fiduciary duty to protect a worker’s money.

Remember this?

The people on the left side of that curve deserve a pension too. And the good people on the right side of that curve should protect them from the thieves that reside on the same side (the right side) of the curve. Having the Federal Government acquiesce to the same greedy “logic” that gave us the Great Recession is wrong. And -- quite frankly -- morally reprehensible.

Don Brown
March 27, 2011

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