Driving Federal Government Employees Into Retirement

Washington Monthly ^ | Dec. 28, 2011 | Keith Humphreys

[Poundstone]

My family and I went to the VA hospital for Christmas services, during which the kindly chaplain said goodbye to the veterans to whom he had been ministering. Like a record number of federal government employees, he has decided to retire this year.

Because the federal workforce is older than the general population, a certain number of retirements are to be expected. Yet according to the actuaries at the federal Office of Personal Management, workforce age isn’t enough to account for the surge in federal retirements. It’s not hard to see what other factors are driving federal government employees to the exits.

[sonofagun]

No it is your fault and the fault of other liberal Federal employees for sucking the lifeblood out of the private sector via onerous taxation and onerous regulation such as by the EPA.

Wow!!

What can I say?

Do you blame Sergeant Jones for the war in Iraq?

Direct your ire to the proper target which is the congress and the executive branch for creating such a monstrously bloated beaurocracy rather than the receptionist who answers the phone!

[chrisser]

Granted, traditional pensions are disappearing in the private sector

Disappearing?

I'm 45. I've probably worked for 12 private companies and interviewed at dozens more over my career. None had a pension plan.

Pensions are the near-exlusive domain of the public sector, and it's been that way for decades.

[kabar]

Federal pensions are not being phased out. Federal employees have a three legged stool of pension support, i.e., FERS, SS, and the TSP. Where did you come up with the information that would lead you to believe that federal pensions were being phased out?

FERS is a defined benefit play (as is CSRS), something that some in Congress would like to do away with.

"U.S. Senator Richard Burr (R-NC), along with Senator Tom Coburn (R-OK), introduced on Thursday the Public-Private Employee Retirement Act of 2011 (S. 644) to address long-term liabilities facing the federal government. The legislation would end the defined benefit pension portion of the Federal Employee Retirement System (FERS) for new federal government hires starting in 2013, leaving fully in place the Thrift Savings Plan with the current match (up to 5%) for both current and future federal workers. The bill would also apply to Members of Congress."

"Currently, federal workers enjoy both a defined benefit pension and a Thrift Savings Plan (equivalent to a 401(k)) with up to a 5% match, paid for by the taxpayers. The average private sector employee gets a 401(k) with a 3% employer match and no pension. Federal workers also continue to enjoy federal health care benefits (FEHB) after they retire, a benefit that is becoming increasingly rare in the private sector."

"According to the Senators, the FERS system is currently underfunded by nearly a billion dollars. The old federal pension system, the Civil Service Retirement System (CSRS), is underfunded by $673 billion. In the coming years, as more of the retirement burden falls on the FERS system, the required federal government contributions to FERS will skyrocket, especially in comparison to what federal workers will put into the system. In 2012, the federal government will contribute $22.2 billion to FERS. By 2065, those required contributions will rise to $239.5 billion, with the government paying out $415.3 billion in benefits."

[precisionshootist]

"Federal pensions are being phased out. New workers now contribute to defined contribution plans, with employer matching. "

"employer matching"?. Excuse me but that is still myself and others in the private sector paying for their retirement

Even the employee "contributions" are payed by.....you guessed it, the private sector! And here is something no one talks about. Government employees don't pay ANY taxes, ever! The source of a government workers entire paycheck COMES FROM TAXES, therefore it's impossible for them to PAY them. They are simply handing back some of the money that was taken from the private sector in the first place.

Government workers have NOT earned these pensions. The money is simply being taken from those in the private sector that have earned and produced wealth.

Massive numbers of government "workers" is why this country is broke.

I don't mean this on a personal level for anyone but this IS the truth.

[kabar]

Since 1983 all new hires in the Federal Government, including Congress, must pay into SS.

[kabar]

FERS is a defined benefit system. It replaced CSRS.

[kabar]

If you view the federal employee as not really paying any taxes, then what about the private sector recipients of federal funds such as the defense industry, contractors, consultants, etc.? Or the doctors who receive Medicare and medicaid payments? Or the supermarkerts that cash in the receipts from 46 miullion food stamp recipients? The government controls close to 50% of our economy. The $3.5 trillion annual federal budget is paying for more than just federal employee salaries and benefits. And ditto for state and local governments. The line between the public and private sectors is somewhat blurred. It is called crony capitalism.

[Lurker]

but yes, retiring now does lock in your benefits for life under the current system.

Sort of like a leech then.

[Poundstone]

You have no idea what you’re talking about.

[dennisw]

The federal government dumped its defined benefit system (CSRS) in 1987.

You would think this was a loss for the Federal drones but it wasn't. Because Federal salaries have soared to undeserved new heights since then. This nullified the loss of defined benefits pension and health. To generalize....... You work in county or state Gov't you get a nice juicy defined benefits plan. You work for the Federales and you get paid more, but get no defined benefits. The nation's five wealthiest counties ring Washington DC. Two of them are mostly rich blacks due to hopping aboard the USG's affirmative action gravy train

BTW under Obama unprecedented numbers of Federale drones have been bumped into higher GS pay grades. So more liberal drones than ever are collecting $120,000- $130,000 - $150,000 on up

Pay will go up for many, despite Obama's proposed freeze ...

www.federaltimes.com/article/20101130/BENEFITS01/.../1001

Nov 30, 2010 – The federal pay freeze proposed Monday by President Obama will not ... next GS grade in either year, and those promotions would come with pay raises. ... Obama's plan would freeze the pay scales for the General Schedule ...

Chaffetz: Freeze step increases - FederalTimes.com

www.federaltimes.com/article/20101206/BENEFITS01/.../1001

Dec 6, 2010 – President Obama last week proposed a federal pay freeze that would cancel the annual adjustment to the GS pay scales and freeze other civilian employees' pay ... "Within-grade increases are a statutory right," Palguta said. ...

 

 

[precisionshootist]

"The government controls close to 50% of our economy."

but they produce 0% percent of the wealth!

Where you are getting confused with doctors receiving medicare, recipients of federal funds and such is just the immense and deliberate tangled web of redistribution of wealth confiscated from those that produced it.

There are NO "Federal Funds" only funds that have been taken from those that produced them in the first place.

Take ten people on an island. Seven of them work to produce food and shelter. The seven also donate (taxes) some of the food and shelter to the other three who provide "public sector" services. It's clear the other three could not donate (pay taxes) any food or shelter because they have not produced any. Lastly, If the first seven quit working the other three have no food and live out in the cold whether they continue to provide their services or not.

[kabar]

Save me the sophistry. I favor limited government and a government in accord with the Constitution. One of the primary responsibilities of the federal government is the common defense.

Is your point that the federal government and/or all government must be eliminated entirely because it is the product of the redistribution of wealth thru taxation?

[dragnet2]

Yeah, he’s knows what he’s talking about. Where do you think the feds get their money to match anything, Mr. Federal Government Retiree?

[precisionshootist]

Is that what you read in my post? I did not say anything about eliminating all government. providing for common defense IS one of the the very few legitimate functions.

My post was to illustrate the fact that government does not produce ANY wealth. Government consumes wealth. This includes every government paid employee and ALL the costs associated with that employee, including salary, benefits, pensions, buildings to work in, desks, computers, pencils, the light bill, the phone bill and on and on.

Our country is going bankrupt paying for excessive government.

[kabar]

My post was to illustrate the fact that government does not produce ANY wealth.

Do you really have to state the obvious on a FR?

[gramho12]

And I’d you actually read my post I did not specify “federal” employees. You can get your point across without the snark.

[gramho12]

And if you read my post again I did not specify “federal employees”. You can get your point across without the snark.

[precisionshootist]

"My post was to illustrate the fact that government does not produce ANY wealth. Do you really have to state the obvious on a FR?"

You would be surprised.

[sonofagun]

FERS is a defined benefit system. It replaced CSRS.

I suppose that depends on how one defines a "defined benefit system".

CSRS is a classic defined benefit system in that the employee pays a percentage of his salary into the plan and can determine what his pension will be based basically on years of service.

FERS relies heavily on a Thrift Savings Account, similiar to 401K, with employer matching some of the employee contributions.

FERS also relies heavily on Social Security, much like the private sector, as part of its plan.

[sonofagun]

And I’d you actually read my post I did not specify “federal” employees. You can get your point across without the snark.

I apologize for the "snark", however, a federal employee is very much a "public employee".