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State Politics Wed May 13 2009
AFSCME Council 31 Director: "No one's getting rich on a state pension."
American Federation of State, County, and Municipal Employees (AFSCME) Council 31 Executive Director Henry Bayer knocks one out of the park in an editorial going after the Civic Federation for their loopy contention that legislators can cut $4bn out of the state budget and should go after public employee pensions. Bayer makes the point that people in labor are constantly trying to communicate to the public: that it serves no one to keep attacking the comparatively minor benefits other working people get through unionization, that the goal should be raising the standard of living for all working people, not trying to snatch hard-earned benefits away.
Meanwhile, the Civic Federation types get golden parachutes and have eliminated defined benefit pensions for everybody but themselves. Defined benefit pensions are good enough for the Masters of the Universe, for geniuses who lose billions of dollars like Bank of America chief Ken Lewis, but not good enough for a state social worker who has spent thirty years helping tens of thousands of families be more productive members of our society (as an example). These union members are not getting rich on these pensions--they have to get up and go to work every single day, they worry about making ends meet, they live the life that most Americans live, but they've bargained for a little better compensation and benefit.
The response of corporate America, of course, is to take away from workers (always in the name of "the consumers") while they keep more and more for themselves.
Tell 'em, Henry:
And how have the companies on the Federation Board responded to their own crisis?
J.P. Morgan Chase's CEO James Dimon's compensation was $30 million in 2008, 11 percent more than the year before. His pension includes a defined-benefit plan and an add-on with extras for those earning more than $1 million a year. Then there's the Executive Retirement plan which is "intended to enhance the long term financial security to key members of the financial team."
Yes, you would hate to have the guy who lost you $68 billion last year quit the team after such a great season.
Kenneth Lewis, whose Bank-of-America representative on the Federation Board is clamoring for a pound of flesh from the state's teachers and other public employees, netted $24 million in 2008. He, too, has a defined-benefit pension, but his supplemental plan was frozen, at a mere $47 million. Poor Ken.
So there you have it: The spectacle of corporate masters whose companies' have totally tanked while their CEO's continue to rake in obscene amounts of income. And Illinois lawmakers are lining up like lemmings to follow them off the cliff.
The irony is that the federation's plan, though it will cause pain to anyone contributing to a state-funded pension plan, and greater pain to future retirees, won't solve the pension crisis. It won't get rid of that pesky $70 billion liability. That amount must be paid. The state's constitution requires it.
No one's getting rich on a state pension.
Disclosure: I was employed by AFSCME Council 31 between 2005 and 2007
Rich / May 14, 2009 5:49 PM
Thank you, and thanks to Henry Bayer! I suppose I should give disclosure too: I'm a non-union public employee now and was formerly with AFSCME. Damn right no one's getting rich on a state pension--except maybe the legislators who are getting ready to pretend to balance the budget on the backs of teachers.
It kills me how when so many people have lost benefits and buying power and are looking at a future without dignity or security, the response of so many is to turn on ordinary public employees and demand that our pensions be taken away, rather than ask why *everyone* isn't entitled to a basic level of benefits and a guarantee of enough income to live on after a lifetime of hard work. The middle class didn't arise spontaneously like mushrooms after a rainstorm: it was created by working Americans who grasped that if the robber barons had the power of capital, our power must be in numbers and unity. Now we've got the crabs-in-a-bucket syndrome.
We are not the enemy, folks--give some attention to the people who are picking all of our pockets and laughing at us all, and ask yourself why they want you to think we're the enemy.