The Tip Of The Iceberg Of The Coming Retirement Crisis That Will Shake America To The Core

TEC ^ | 07/25/2013 | Michael Snyder

[Chuzzlewit]

I’m not annoyed with government workers... I’m annoyed at government employee unions colluding and funding with union dollars, campaigns for people who then sit across the bargaining table from them.. it’s freaking corrupt.

I’m annoyed when a teacher gets a generous 300,000+ ( as in my 2 sisters back in Michigan and yep Detroit area) retirement packages, (paid for by me and you)...
..and then complains that they have to contribute just a small amount more out of their monthly paycheck towards their healthcare...

you bet I’m annoyed.. just because they worked, they are owed...and they both were in Wisconsin marching agains Gov Walker..... fighting against the man...bussed in by their commrads.

meanwhile, I made my choices long ago...and I’m not on any picket line against the man... I’m dealing... and I will deal...

as for billionaires... more power too them...nuttin against anyone that worked hard for their money.. for that matter I’m not against folks who made their money the old fashioned way, as Paul Harvey used to say, they inherited it..good for them. they hit the lottery..

what I don’t like is the sniveling whining crybaby Public Sector union employees that thought that good things are certain in life...and the foregone conclusion of a “life of Riley”... which is paid for by our tax dollars...

crap happens...deal

[Errant]

You dirty dogs (gov retirees) didn't even have to take the 20% sequester cut either, like the working gov stiffs (from sitting in one place too long). Oh, work for the government I've heard, "you'll never have to worry about the economy." lol Yeah, right...

You lucky dog retirees! ;)

CRS

[ckilmer]

a lot of municipalities may go bankrupt but the feds will do just fine.

that’s what will come of reversing capital flows around the world because of oil independence.

[Pajamajan]

"Right now; there are somewhere around 40 million senior citizens in the United States. By 2050 that number is projected to skyrocket to 89 million"

Not if Obamacare is implemented.
It's the final solution to this problem.
This is what the political elites want.

How do you handle the increasing costs of medical care for a growing number of elderly persons in a population?

Their (the elites) answer:
Have government take over health care, then don't provide medical care for senior citizens.
In fact, make it illegal for seniors to receive more than basic treatment i.e. an aspirin, exc...
(Never mind the fact that when you reach the senior yrs, is when you need the most care.)

This approach solves the pension problem too.
If you're dead, you won't be needing your pension/retirement benefits.

But, of course our dear leaders, and politicians, won't have to worry about their retirement/medical , because they've exempted themselves from their own laws.

Isn't it wonderful?

(I'm so relieved to know that I will be working til I drop dead, or until I die because the government/IRS wouldn't allow me to be treated for some condition.
But, at least it's comforting to know that our elitist, multi millionaire and billionaire elected officials will be living the high life to a ripe old age at our expense.(/s!.)

Sadly, it's the younger generations who will pay the highest price for this, but they really want to just get away from/avoid all the political stuff.
It's time for the Kardashian's tv show, and they need to focus on what's really important .(What shoes did Kim buy today?).

It's not like who gets elected to govern our country effects them/us.(/s!!!)

When are we all going to wake up?

[nascarnation]

You’re correct of course.
The Death Panels are an obvious fix for the SocSec and Medicare funding problems.
If Gen Y whines about grandma getting offed, offer up some bogus relief on student loans as part of the deal.

[Renegade]

Baby Boomers are armed to the teeth. Remember, Don’t pick a fight with an old man because if he can’t fight he will just kill you . Nuff said!

[napscoordinator]

Really????? I am off tomorrow because of Sequestration. I think you might be confusing my military retirement. I am working at the Naval Academy! lol. Take it easy! Have a great weekend!!!!!

[napscoordinator]

We may have but I just like to remind others of personal responsibility and choices in life (not you specifically). Sometimes I wish I would have gone into the civilian world like my friends did after college. They are making so much money it is sick! I went into the military and made peanuts the whole 24 years. I do get a retirement check that 40 percent is taken with taxes (live in Maryland so I am sure you understand). I work at the Naval Academy where I get a big check of 1300 dollars a payday (every two weeks).....although it will go down to 900 a paycheck beginning next week. I am not complaining either because I made my choices. When my families get together with my friends from high school and college and see the mini mansions, I just say “Thank God for what we have”. I explain to my kids that we put sacrifice before making big bucks.....They roll their eyes like you probably are...lol.

[Errant]

Oooh! A double dipper!! LOL

Have a great weekend yourself! You deserve it!!

Seriously,

:)

[familyop]

"we could eventually see a "super devaluation" of the U.S. dollar and keep our promises to the Baby Boomers using currency that is not worth much more than Monopoly money,..."

That's bull. "...not worth much more than Monopoly money" for products made in foreign currencies, the author means.

There's no "free global market." The U.S. dollar should be falling much against foreign currencies, when our country has such deficits in trade and balances of payments.

Allow the dollar to naturally devalue commensurate with our lack of production in the global market. Abolish the local, yocal, anti-competition regulations (county zoning in rural areas against small manufacturing operations, building regulations in the middle of nowhere, busybody, gossipy HOA witches, "open space"/tree/animal/worship Hun-ery, thieving planning office regulations, etc.).

Then eventually, products made in the U.S.A. will be less expensive. As it is, the dollar will be forced down by market pressures, little by little, and foreign product prices will go higher and higher.

Fire the political/regulator class. Abolish regulations. That's the answer. Out with "sustainable growth." In with sustaining manufacturing and building by strong, young men and their families.

[familyop]

"Not enough jobs...
Not enough people trained...
Stagnant economy
Over regulated
Over taxed
Not enough jobs..."

I excerpted parts of your list there for a good reason. Who would have any morale to try to work in that environment?

In my neighborhood (middle of nowhere), young descendants of highly esteemed and paid people won't be doing anything useful (regulating, snooping, propagandizing, socializing, bossing no one, etc.). The other young folks in my area (the cleanest of those--most often viewed in politics along with the rest as the most worthless of creatures) are doing useful things with broken equipment, raw materials, scraps and very little money--things that most folks in politics would not understand or believe. Those activities are done as hobbies for now, of course.

Doing technical/production work is, in practice, against the law (because of animal worship, environmentalism, coveting, HOAs, "open space," property values, heh, by older constituents). Besides, there's no one worth doing technical work for, yet.

"Destroyed health care program that cost more than normal people can pay"

It did, and it does. Few self-described journalists want to write about the truth of that matter (crazy medical costs gobbled by sedentary hogs).

"Waste
Fraud
Corruption
Lawlessness in every place you look
and
as a nation we do not know God."

Very true. Again, that doesn't look like a productive environment full of opportunities and good teachers. We, a very few of the lowest of the low, are teaching a few young people to do productive tasks (from building low-cost heating systems, to agriculture that is impossible for experts to preparing vehicles to last 50 years).

I care most about what I will leave behind. That's one of the attributes that makes me one of the most despised in contemporary politics. And as someone else mentioned earlier in the thread about their own locale, all of the other older folks in my area are lefties--extreme lefties pushing against private property rights and real production.

They use government to prevent production of any kind and do their best to ruin their neighbors. They praise bureaucrats and public school teachers while despising people who can repair, invent, design and make useful things. As for government, in the end, we get the government that we deserve. Same with the economy. I'm a Baby Boomer with loyalty to very few of my kind. I'm an old fashioned conservative, who is miles from peers in most thoughts and deeds.

Who needs planners? Who needs inspectors, when there's nothing to inspect? Potential buyers hire private inspectors anyway, and very few will hire the "professional" developers connected to them.

Who needs agricultural bureaucrats, who only write in favor of "native" plants and animals? Who needs socially pathological government teachers, when the supply of children is dwindling? Who needs local, self-designated landlords over empty "industrial parks" with business-killing flooring/land costs? Who needs women's studies instructors? ...or MBA chiefs, who in some current business models, number nearly as many as potential production Indians?

We didn't end many anti-competition regulations on local levels, so many of the greatest will become helpless to support themselves. We made our bed. We'll lay in it.

[Sequoyah101]

Nothing wrong with the government deal except that it is not equitable. It is a deal above market rates with protections for employment that are unheard of in the private sector. Relative to the private sector government employees are way over paid for the work they do and their benefits are orders of magnitude better than most in the private sector.

The government worker is not wrong for taking the deal. The deal is wrong to be offered. Bureaucrats and politicians have absolutely no sense of economics, financial responsibility or value. Everything is worth what they put into getting it... NOTHING. Not a damn thing. They confiscate their money. Governement is supposed to be a support function to the rest of the country. It is a support function that consumes 25% of the revenue of the nation. NO company can run on that kind of overhead. It is unheard of and prohibitive. It is a going out of business model and that is what is now happening. The US is going out of business.

[RFEngineer]

You do know that with your military retirement that you are a defacto millionaire, right? The benefits you receive would require a principal of well over a million bucks for someone to achieve. There is virtually no chance that a “regular schmoe” can amass this amount of money these days - because:

#1 taxes. To pay you, the government needs to tax the crap out of someone who actually generates value in the economy - reducing future productive effort and investment.

#2 Debt. Because the government has spent itself into oblivion, pretending it can afford your retirement along with everybody elses government checks, they ‘pretend’ that they can actually set interest rates - which they set for themselves at a very low level - so they can borrow even more money. This will have to stop for a variety of reasons that the government cannot control.

That’s why you should plan to not have your checks for the rest of your life.

many federal/military retirees consistently fail to understand the actual cost of their pension/medical benefits to taxpayers, which leads to a failure to understand just how vulnerable they are to losing them.

Same goes for Social Security/Medicaid recipients.

[napscoordinator]

One thing I forgot is that government employees pay their own retirement. For example, I have 300 dollars taken out every month for my FERS retirement, 100 dollars for my TSP and they give me 30 dollars a month for the 1 percent that they give us for our retirement. So in my retirement account I have around 4000 dollars in the Retirement Account and 1800 in my TSP....I only started around 18 months ago. So because government employees contribute a GREAT deal to their retirement (basically paying for the entire thing), I can’t see how they can say, “Sorry, you don’t get any money that you already paid into. CSRS personnel put in even more towards their retirement. I don’t think people realize that. I think people believe that you work 40 years for the government and you get a check for the rest of your lives. No......you paid way more into the system then you will ever get out. Also you do not get to will the money you put into the system except the TSP. So really the government pension is all self contributed. So why are people thinking we get this for free? Nothing is free in this world.

[Sequoyah101]

Completely correct. I chose not to work for the government because by the time I got out of school I considered most government employees parasites on the economy. And guess what? My Dad was a civil service employee for right at 40 years. I was proud of him and what he did.

Through most of those years a civil service job was much lower paid than the public sector but had some continuity. Still though, there were tiers of employees. Many temporaries and then there were the budget cuts and layoffs. Until the insanity of Base Line Budgeting and the AUTOMATIC increases and use it or lose it operations ups and downs and layoffs in civil service work force were a way of life. Lots of guys had two jobs and got called back when things got better. In his last 10 years he spent more time dealing with the unions and idiotic grievances than he did managing the project.

The old civil service retirement program was a combination of points and years and the high 3. FERS was supposed to become more market based but the rates of return are unrealistic. I remember Dad thinking FERS was awfully lush compared to civil service retirement. I’ve looked at the calculator and it looks pretty lush to me as well. Federal employees can get a term for an annuity people in the private sector can only hope for and that self employed people can NEVER have.

I thought the deal was unrealistically good and that the people would not allow it to continue or be delivered, that the deal would be undone because I thought it should be undone. It is too good compared to the market.

There are federal and state employees now who have pensions that have a guaranteed NPV of millions of dollars. To provide a certain annuity with inflation protection of 80% of a base of $100,000 requires a present value of between $2,000,000 and $3,000,000 and carries no risk. Most people can’t possibly save this kind of money and manage it successfully on their own. On top of this plus retirement deal a federal employee has outstanding medical benefits.

[napscoordinator]

I understand the military pension and how lucky I am to have that. I am referring to the government employees who paid money for their retirement. I don’t think we are going to figure this out tonight. Have a great night!!!! Talk with you tomorrow.

[Sequoyah101]

Military, that is another subject. Every consideration offered is earned and deserved. NO UNION represents the military... thank God. Military retirement is compensation for sacrifice. It is the only compensation that can be offered for the best years of a life so that we can have a consistent, experienced cadre to lead the temps.

[Lou L]

Are you saying his REAL PRICE MONEY after taxes is just $1.3 Mill.?

It'll actually be less than that after he pays US federal and state taxes. Plus, most top pro golfers pay their caddies 10% of winnings, and Bones McKay earned every penny. Most pro golfers pay for their own transportation to and from the venue, as well as lodging and food.

[Lou L]

I don’t understand why he’s still living in California though...The only way to remedy that is to leave.

I agree with that. CA is the model for how to tax the hell out of people and businesses. Many other PGA pros live in Florida, that has no income tax. My only guess is that Phil has strong roots in CA, still has family there, and is well-established. I understand he has his own practice range, complete with greens with 6 or 7 different types of grasses to simulate different greens around the world. If CA keeps sucking him dry though, it'll just be a matter of time.

[CSM]

“I am told that the Hebrew language does not even have a word for “retirement”.

We didn’t either until my grandparents generation. Even then, it wasn’t normalized as an expected entitlement.