Posted on 12/27/2016 4:08:04 PM PST by ARGLOCKGUY
For millions of public sector workers in the U.S., state-run pension funds are the only chance left for a comfortable retirement. In the hopes of providing a stable future for their families, an entire generation was duped into putting decades of their earnings into these supposedly ‘risk-free’ investments. Unfortunately, those who have entrusted the government to manage their life savings may end up destitute as a result.
Budgetary shortfalls that have plagued Detroit for years are now spreading to other municipalities. Since 2008, six local governments have been forced to renegotiate their debts in bankruptcy court, with many others on the same trajectory. The scale of the problem has been repeatedly understated by the media, but across the nation, a somber reality is beginning to set in.
States with large populations, like California, often find themselves in the spotlight when it comes to deficits, but there are several others that are in even worse shape. Illinois, New Jersey, and Connecticut are among those facing the biggest hurdles to meet their obligations to retirees. Instead of maintaining a surplus, politicians have continuously prioritized spending today on things like sports stadiums, for example, to ensure re-election. Policymakers on both sides of the aisle have echoed solutions that involve either massive cuts to benefits or shifting the financial burden onto the taxpayer. The price to prop up these insolvent funds will come in the form of higher property taxes, income taxes, and other stealth forms of subsidization.
The ongoing exodus of people from the Northeast to states that offer better opportunities and a lower cost of living is putting even more stress on the already fragile system. Pension payouts depend on the contributions of current workers, and as the labor force dwindles, so does the money available.
THE BIG FED FISH THAT GOT AWAY WITH A BUNDLE
The Office of Federal Housing Enterprise Oversight’s report says that F/M CEO Franklin Raines---a Clinton appointee---and other Fannie Mae bigwigs, deliberately and intentionally manipulated financial reports to artificially hit earnings targets in order to trigger multi-million dollar bonuses for senior F/M executives.
Ex-Fannie CEO Franklin Raines should be behind bars for life. He is a crook of the first order. This thief Raines cooked the FM books precipitating losses of $9B (that we know of) for the single purpose of creating bonuses for himself and other F/M insiders. The SEC said Raines broke accounting rules by playing with risky derivatives.
RAINES COOKS THE F/M BOOKS---WALKS AWAY A MULTI-MILLIONAIRE After Raines was fired and exposed as a fraudster for cooking the govt books, Raines walked away w/ $90 million dollars, a $26 million parachute, PLUS..... Raines gets a MONTHLY pension of $116,300 for life. Raines had already collected $4.87 million in "special performance" shares. Raines owns options giving him $5.8 million in net profit after redemptions, plus another $8.7 million in deferred compensation for his six years at the F/M helm. There's more.
Raines keeps $5 million of paid-up life insurance. He and his spouse get free medical and dental benefits for life, worth over $1 million. NOTE: Raines earned $20 million in salary, bonuses and stock awards (that we know of) in one year.
To keep Raines happy within philanthropic circles, Fannie Mae will match Raines' charitable contributions by $10,000 a year.
After he was fired, Raines told the F/M board that he's entitled to get paychecks until June 22 giving him another $600,000, which triggers a $2,000 monthly raise in his lifetime pension. He also said he's entitled to disputed options with a gross value of about $5.6 million.
When Bobby Deal retired from the Jacksonville Sheriff’s Office last month, he did so with the promise of a nest egg worth at least $4.9 million, a sum he’ll be paid over the next 25 years. Deal now earns nearly 50 percent more per year as a retiree than he did when he worked for the Jacksonville Sheriff’s Office.
That’s just for starters. A guaranteed 3 percent cost-of-living increase annually and the ability to bankroll a separate pension — funds from his Deferred Retirement Option Plan account potentially paid by taxpayers — will allow Deal one day to bring home twice as much money per year as a retiree as he did when he worked.
Deal, though considered highly paid when he was a cop, is far from alone as a pensioner who will make considerably more in retirement than when he was working. Deal is among a group of 16 July retirees who are guaranteed to turn $4 million in DROP benefits into $11 million in additional pension benefits. The DROP program is considered one of the greatest perks of the job for Jacksonville police officers and firefighters. It is much more lucrative than any other DROP program for state and other city employees.
No other police and fire pension fund in the state offers such lavish guarantees — money on top of a regular pension, potentially for life. And no other large municipal pension fund in the state is in such dire financial shape as the Jacksonville Police and Fire Pension Fund, which is $1.65 billion in debt and is so underfunded that the city’s bond ratings have suffered. “Our pension benefits are so generous that we really are creating millionaires,” City Councilman Bill Gulliford said. --SNIP--
MORE HERE http://jacksonville.com/news/crime/2014-08-30/story/5-million-cop-how-jacksonville-pension-program-can-turn-police
The public pension defined benefit scheme is a house of cards built by pols and union bosses to keep their own jobs and making false promises to union workers.
Do they have a clue how much money in present dollars it takes to pay a retired police officer $70 grand a year for 35 years AND provide healthcare? It’s close to 4 MILLION DOLLARS! How many 50 or 55 year olds who worked in blue collar type jobs have 4 million in their 401 K at 55?
The answer is NONE.
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