PERS Study Commission Recommendations Don't Go Far Enough
Governor Barbour's PERS Study Commission released its report yesterday. JJ has the video and data helpful to analyzing the situation. There is also commentary at Cottonmouth and Ya'll Politics.
Although I often disagree with the commentary at Ya'll Politics, this statement is dead on:
What the Legislature will do with these recommendations is anyone's guess. But burying our heads in the sand isn't the answer; we must begin to eat this elephant and find a way out of our current situation.
The solution is definitely not to kick the can down the road for 5 years as suggested by Democratic Senator Hob Bryan. That would be a weak self-serving move that would make the problem worse in the long run.
Fact is, the PERS Commission's recommendations don't go far enough. There will always be shortfalls as long as the underlying investment returns assumption is inflated and unrealistic. The current assumption is 8%. The commission recommends reducing the assumption to 7.5%. Problem is, the actual average return for the last 10 years was 5.41%—still 2% lower than the recommended assumption.
Who really believes that the stock market it going to perform much better over the next 10 years than it did over the last 10 years? Hell, it could even perform worse. In 2001 the world was not confronting a spreading sovereign debt crisis that will force governments world wide to cut spending.
The world in 2001 was also not confronting the current oil supply crunch where every time it looks like the economy gets going, oil prices spike causing the economy to stall. There is no solution to the oil supply crunch because demand is increasing in emerging economies as fewer countries export oil because of increased domestic consumption and the depletion of existing oil fields.
This is a “Houston, we have a problem” moment in the world, U.S. and Mississippi. Ignoring the problem is not the answer. Does it suck for PERS participants? Absolutely. Is it unfair? You bet. But cuts are going to have to be made. And the sooner they start cutting, the smaller the cuts will have to be.
Now is the time for leadership among Mississippi politicians—particularly Republicans since they are in control. Will they step up and make hard decisions on tough issues like PERS? Or will they pander to the far right and pass embarrassing legislation on social issues and pass laws to help CEO's? We're about to find out.
Now is the time for leadership among Mississippi politicians—particularly Republicans since they are in control. Will they step up and make hard decisions on tough issues like PERS? Or will they pander to the far right and pass embarrassing legislation on social issues and pass laws to help CEO's?
Gosh, I can't begin to imagine how that will turn out.
If you suggested picking an atheist to lead a church, or a child molester to teach elementary school, people would think you're nuts.
But somehow it's supposed to be rational to have your gov't run by Republicans who hate the very idea of government.
The current program is out of whack. I had a case a few years back where I was able to prove that an injured state employee was better off financially 5 years after having to leave work, because of the excessive generosity of the PERS system.
So when you hire people for state jobs and tell them the benefits of working for the state is this or that; up to and including their salary, you are just telling a lie?
I retired from the state secure in the knowledge that I had met my obligations; or was it a BIG lie, I will have to have my job back so as to meet my personal needs that I assumed I had already taken care of!
PERS is not broken; it works with the promise of the future in a mechanism called the stock market which is working just the way it is supposed too! Impatient knee jerk reactions to a system that is NOT understood is pure politics, and demonstrates an unwillingness to provide for the long term wellbeing of constituents.
If this is the model for progress in Mississippi, then all is doomed and there will be little or no need for state employees in the near future, or at the very least VERY hard to hire any at any price.
PERS - 4 years USMC, 26 years State; with 2.25 years UNUSED LEAVE = 32.25 years!
Married to a state employee / father to 3 state employees!!!
26 years (11 child “Egleâ€-15 Scoutmaster T92 Raymond) Boy Scouts of America, 13 years volunteer Credit union board member, NRA Life, Paid 33 year mortgage in 22 years, Masters Degree in Art Ed. Miss. College, Military Police USMC (Once a Marine, always…) 4 years – Hon. Discharge, Presidential Unit citation, Good Conduct, USMC Rifle Team; I kept/keep my promises, maybe Mississippi can keep it’s…………….. If NOT can I have my Old Job back?
Got a 2or3% raise every 3 or 4 years, started at 9,000 (wife and kid) finished 32,000 (wife 3 grown state working kids) NEVER got consistent cost of living increases....
Respectfully Submitted
John R. Blair Jr.
2126 Boyd Rd. (was under proposal for Eminent domain, Ted Kendal helped to stop it)
Utica MS, 39175