Posted on 12/23/2010 2:45:34 AM PST by abb
PRICHARD, Ala. — This struggling small city on the outskirts of Mobile was warned for years that if it did nothing, its pension fund would run out of money by 2009. Right on schedule, its fund ran dry.
Then Prichard did something that pension experts say they have never seen before: it stopped sending monthly pension checks to its 150 retired workers, breaking a state law requiring it to pay its promised retirement benefits in full.
Since then, Nettie Banks, 68, a retired Prichard police and fire dispatcher, has filed for bankruptcy. Alfred Arnold, a 66-year-old retired fire captain, has gone back to work as a shopping mall security guard to try to keep his house. Eddie Ragland, 59, a retired police captain, accepted help from colleagues, bake sales and collection jars after he was shot by a robber, leaving him badly wounded and unable to get to his new job as a police officer at the regional airport.
Far worse was the retired fire marshal who died in June. Like many of the others, he was too young to collect Social Security. “When they found him, he had no electricity and no running water in his house,” said David Anders, 58, a retired district fire chief. “He was a proud enough man that he wouldn’t accept help.”
The situation in Prichard is extremely unusual — the city has sought bankruptcy protection twice — but it proves that the unthinkable can, in fact, sometimes happen. And it stands as a warning to cities like Philadelphia and states like Illinois, whose pension funds are under great strain: if nothing changes, the money eventually does run out, and when that happens, misery and turmoil follow.
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(Excerpt) Read more at nytimes.com ...
Some very bad consequences of employees trustingtheir government to keep their word.
These folks took it like Americans, they went back to wok or they suffered in silence.
They did their jobs and got screwed, I didn’t see where any welfare payments stopped in the city.So it becomes a problem of who do you screw. Do you screw the working stiff who completed his duties and will suffer in silence or find a job, or do you screw the welfare recipient has never worked and who will hit the street with riots when the check doesn’t come.
I think we all know the answer.
Canary in the coal mine. I suppose the NYT’s idea of “doing something” is to have Washington ride to the rescue with taxpayer money.
Tea Party on, my friends.
A more fair something is to solve the problem locally, with retirees getting some pro-rated portion of the their pension, maybe 50 cents on the dollar. Better than nothing.
I know there has been a flurry of threads on this issue over the past couple of months and I often follow them. Does anyone have a ping list on this subject that you know of?
This is ridiculous. These folks worked for forty years and now can’t get their pensions. The state was supposed to put money way for each employer in order to pay their pension for life. These states have failed big time and this state is RED? Yieks!
When the host die, the parasite loses its food source. Yea, I know promises were made, but the host is dead.
This probably calls for a 50% surcharge on the existing wealth of all registered Democrats.
The squeaky wheel always gets oiled first.
Apparently they got too good of a deal. In private industry, this is known as bankruptcy. When a company over promises and goes belly up, it is considered bad management.
The same local government that overpromised on these pensions also ignored the clear financials.
Put another way, count the votes among the two groups.
I believe the federal government will take over these pensions. Sure the recipients won’t get the full deserved pension but probably will get 60-80 percent.
Under what Constitutional authority would the Fed gov’t take them over?
Try Pension Tsunami. It follows news on public pensions. pensiontsunami.com
These were city pensions, not state pensions. The city is bankrupt and cannot pay, so what do you propose?
It may not be fair to you, but what do you think happens to us in the private sector when our company goes bankrupt. Our pensions are affected also.
Eventually the US government has a plan than picks it up at REDUCED payments and that is what is going to happen here. Also don’t fall for the sob story that they tell. It is only used to get people to think the US government should bail out all pensions for government workers at 100%.
Why not? We can just print more money.
Prichard has been a disaster area for decades.
Better get used to it also. This is an ongoing problem that is NOT going away. Here in Memphis last year, they could have let 200 sanitation workers go and save millions by outsourcing.
Instead, to protect the union democrat brothers, they voted to raise our garbage fee $5-10 a month and reduce service. What a deal? Eventually they will be unable to keep raising fees or taxes and then the end comes quickly.
Quickly is near.
“But the plan allowed workers to retire young, in their 50s.
And its benefits were sweetened over time by the state legislature, which did not pay for the added benefits.”
At least with private companies people have 401K’s so they can be protected. What about the folks that had the pension but no 401k’s? That is what is not fair to those in their 60’s.
While I don’t agree with stiffing retirees on their pensions, the abuse of the system by public employees here in NJ would generate little sympathy for some of them from the public. The games they play (wracking up OT in their last few years to blow up their salary, on which their pension is based, is one favorite racket), as well as younger retirment ages than most of us will ever see, result in people being paid much more in retirement than they ever earned on the job. Once people are told how much the pensions actually are, the taxpayers are enraged (Governor Christie was kind enough to share some of the details here in NJ). When a municipality has this type of obligation hanging over it, no corporation or individual in their right mind would ever move there; it is unsustainable: your current services are reduced/cut to pay for things from 20 years ago. Why would a young couple move into an area to pay for services their parents used?
Yes, but with the rioter, you can shoot them for 'resisting arrest'... and then never have to send them another check again. While the retiree will pass away in much less time than a welfare rioter. So in the long-term, it's better to kill off the young welfare leeches. Cold, but true.
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