[Our man in washington]

There is one small bright spot in this mess, and you can thank Reagan for it. In 1986, they reformed the Federal pension system and had all incoming employees enroll in a much cheaper system that used mostly a 401(k) type plan. The problem is that everyone who started before 1987 stayed in the old system.

Over time, the percentage of retirees will shift from the old system to the new system, so things should actually be significantly better in 20 years than they are now, from a financial point of view.

[dragnet2]

Federal civil servants earned average pay and benefits of $123,049 in 2009 while private workers made $61,051 in total compensation, according to the Bureau of Economic Analysis.

[muawiyah]

With the average entry for federal employees at 35 years of age we already have more people retiring under the FERS system than are retiring under the CSRS system.

What we have are people who believe the federal retirement system is like the one they give their local school superintendent.

BTW, CSRS had a cap ~ you could never get more than 80% of your high 3, and for a long time there was a maximum working age of 70 ~ FERS has no cap. We will soon be seeing FERS employees sticking it out until they're over 90 years of age.

[businessprofessor]

,i. There is one small bright spot in this mess, and you can thank Reagan for it. In 1986, they reformed the Federal pension system and had all incoming employees enroll in a much cheaper system that used mostly a 401(k) type plan. The problem is that everyone who started before 1987 stayed in the old system.

Over time, the percentage of retirees will shift from the old system to the new system, so things should actually be significantly better in 20 years than they are now, from a financial point of view.

The reform was only superficial. Federal employees consistently underestimate their bloated retirement compenation focusing on the relatively low 1% benefit rate. Federal employees conveniently forget their very low contribution rate (less than 1 percent), the Social Security catchup (Federal retirees effectively can receive Social Security beginning at age 57), early retiree medical care extending into retirement, and the employer 401K contriibution (5 percent). Federal employees have both a defined benefit and defined contribution plan. In sum, federal retirement compensation is on par with the most generous state plans.

The worst part about federal pensions and health care is that it is all unfunded. The unfunded liabilities are enormous and growing as the article indicates. Contrary to assertions mande by apologists for this horrible situation, federal pensions are a large part of the debt problem and growing into a much larger problem.