O Beholden Canada: America’s northern neighbor is beset by familiar pension-funding problems

City Journal ^ | 10/20/2014 | Steve Malanga

[SeekAndFind]

This summer, Montreal residents witnessed a strange sight: local police abandoned their traditional uniform pants and instead donned casual attire, ranging from camouflage and fluorescent-colored trousers to multicolored slacks. Some cops bizarrely even donned skirts. The dressing down was all done to show cops’ anger at the Quebec provincial government’s proposals to cut the costs of municipal pensions by getting workers to contribute more toward their retirement.

Call it Canada’s summer of pension discontent. Governments throughout the country are grappling with as much as $300 billion in unfunded government-worker retirement debt. In a country of just 38.5 million people, that’s a pension problem roughly equivalent to the one that California faces. And it’s widely shared.

Municipalities throughout Quebec, for instance, owe some $4 billion in retirement promises that have yet to be funded, prompting the province’s new Liberal government to demand this summer that workers pay more to bolster the system. A new report on the finances of Ontario’s government-owned utilities revealed their pensions to be unsustainable without deep subsidies from Canadian electricity customers. For every dollar that workers contribute toward their retirement, government-owned utilities now spend on average about four dollars, raised through electric bills—though the cost is even higher at some operations.

The news is even bleaker at the federal level, where Canada faces more than $200 billion in total retirement debt for public workers, when the cost of future health-care promises made to public-sector workers is combined with pension commitments. One big problem is pension debt at Canada Post, whose budget is so strained that the federal government gave the mail service a four-year reprieve on making payments into its pension system, even though it’s already severely underfunded.

[Gay State Conservative]

Don't know what Canada's doing about their retirement age but when the Social Security retirement age was set at 65 only something like 10% of the population lived to that age.Add to that the fact that there were something like 50 workers supporting each beneficiary it was no big deal.But today a huge majority of Americans reach 65 *and* the Boomers,in particular,had far fewer productive kids than did previous generations...so fewer workers supporting each beneficiary.

Somethings gotta give.

[Friendofgeorge]

I have the answer it`s easy.....Any pension above and beyond Social Security/Canada Pension etc has to be payed 100 % by the employee, and in fact should have nothing to do at all with the government.

[DJ Taylor]

"Something's gotta give."

Not to worry, just borrow the difference from China as the U.S. does.

[Buckeye McFrog]

Interesting. I know an actuary who has done some work in Canada, and he said that his Canadian clients would typically sneer at how badly these pensions had been botched in the U.S.

[Beagle8U]

“...lavish benefits...”. What utter Rubbish.Nobody in Canada (and this goes for the US too) has a “lavish pension”, much less a lavish lifestyle. The ONLY people with lavish incomes at retirement are the rich. Ordinary people without cushions retire on considerably less than their earnings before retirement. Trying to blame the working class for the the serious problems in the economies of Canada and the U.S. is BS on stilts. Malanga is always writing this kind mendacious nonsense.”

That comment from the article link pretty much sums up the attitudes of the public-sector leeches. They think it is criminal that taxpayers don’t want to pay them full wages to retire at 55.

The first order of business is to outlaw public sector unions.

Next pass a flat tax with no deductions. The demonrats will have a hard time raising taxes when their voter base has to pay the exact same rate of increase. No more class warfare!

Then convert all the pensions to a 401K with a set limit on taxpayer(government employer) match.

When EVERYONE is forced to support government, lazy government employees would get a swift kick in the a$$ from their neighbors if they didn’t do their jobs.

All those ‘touchy feely’ nonsense ideas liberals use to get elected would be greeted by outrage from voters that would have to pay for it.

Gang-Green’s bull$hit energy ideas? ‘Hang them from the lampposts’ shout the masses, we want coal and nukes!’

[Gay State Conservative]

“...lavish benefits...”. What utter Rubbish.Nobody in Canada (and this goes for the US too) has a “lavish pension”, much less a lavish lifestyle.

*Nobody*? You should do your homework before making such a blanket statement.For example...here in the Gay State we have a politician named Billy Bulger,who's the brother of Whitey Bulger (yah,that one...killed several dozen people,etc).Billy was the President of our State Senate as well as Chancellor of the University of Massachusetts.But in spite of having taken the 5th several dozen times before a Congressional hearing he gets a pension of $200K/yr courtesy of the taxpayers of the Commonwealth of Massachusetts.

And there are many,*many* other examples such of this just here in Massachusetts.

"Not many"? Maybe."Nobody"? Yah,sure.

[Beagle8U]

Perhaps learn to read?

That comment was from the article website, not from me.

[Squawk 8888]

To all- please ping me to Canadian topics.

Canada Ping!