Comments on: What Felix Salmon gets wrong about public pensions Thu, 21 Jul 2016 07:57:19 +0000 hourly 1 By: RossEisenbrey Fri, 28 Feb 2014 16:14:14 +0000 Salmon’s total smackdown was well-deserved. John Arnold wants to have it both ways. He wants to cut the benefits of public employees, including retirees, but he doesn’t want to admit it. His stated position shifts over the course of the debate from opposing both benefit elimination and cuts to being against the elimination of benefits to being for cuts as long as they aren’t drastic. Here is Arnold: “Salmon repeatedly claims that my wife, Laura, and I and our foundation, LJAF, “support plans making it easier for governments to default on existing promises.” Nothing could be further from the truth. We strongly believe that pension reform should not aim to cut or eliminate benefits…” But he ends up praising the Florida benefit cuts because they are only about 5% at age 58. (They get bigger at higher ages.)
In the real world beyond this blog, Arnold promotes the elimination of traditional defined benefit pension plans and replacing them with cash balance plans or 401k-style DC plans. Experience shows the latter do not provide retirement security to the majority of employees. The transformation Arnold favors has occurred already in the private sector, and the result is a retirement savings crisis that portends poverty or near poverty for tens of millions of workers nearing retirement.
My question to John Arnold is, Do you support the Illinois pension “reforms” that cut COLAs for the already-retired and change benefits going forward even for employees who have worked 30 years or more and are close to retirement?