Can We All Just Unionize Already?

General TSP Discussion.

Moderator: Aitrus

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ArrieS
Posts: 1072
Joined: Sun Aug 05, 2012 10:56 am

Re: Can We All Just Unionize Already?

Post by ArrieS »

Aitrus wrote:If I were a business owner and I had to choose between keeping pensions or keeping the business alive, I'd keep the business alive. As the years pass and more and more of my employees retired, I would have more and more company money going out to workers who are no longer contributing. And then I have to hire more workers to replace those that were lost.
*facepalm*

That's not how pensions work. Or, rather that's not how they are supposed to work. A defined benefit plan is funded while the employee is working. If the company properly handles the fund there are no expenditures after the employee retires. The reason we hear about States and companies having problems with their retirement plans is incompetency. Incompetency of private industry. It's the private industry that has ruined every retirement pension fund you hear about in the news.

If you look at your LES you'll see the FERS retirement benefit paid by your agency at the bottom is 13.7%, at least for me when I calculate it. That's because FERS is set up to invest funds in federal bonds. So the Government has to contribute more to make up for the lack of long term returns compared to stocks.

Companies and states have gotten into trouble because they foolishly listen to private companies who promised returns on pension funds that didn't happen. This resulted in underfunding the pension funds because they believed them.

So no, modern problems that pensions have is from the incompetence of private industry. The Government has proven better at actually being able to handle money with FERS.

A defined pension fund doesn't require continued contributions after the employees retire.
Aitrus wrote:The only reason it's still workable in FERS / CSRS is because of how it's funded. The government doesn't actually produce anything, it provides a bunch of services that aren't directly paid for by the consumers at a register. Instead, those consumers are taxed, and that's a theoretical bottomless well of money so there's little oversight or consequence for overspending. Since most of the payers don't see how their money is spent (or misspent) for those services, they have no idea how raw a deal they're getting.
So no, all of this in regards to at least FERS is completely and utterly wrong.
OCTOBER: This is one of the peculiarly dangerous months to speculate in stocks in. The others are July, January, September, April, November, May, March, June, December, August, and February. - Pudd'nhead Wilson's Calendar

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evilanne
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Joined: Thu May 14, 2015 6:52 pm

Re: Can We All Just Unionize Already?

Post by evilanne »

Aitrius - As ArriesS pointed out, FERS is fully funded. The problem is that Congress has never properly funded CSRS. They keep going after FERS benefit, like increasing the retirement contributions of newer FERS employees, rather than addressing the underlying problem.

I'm not impacted by the Government Shutdown. I think the lesson that needs to be learned by many is that you need to live within your means, stay out of debt (as much as possible) and save for you future if you ever want to retire.

Retirement is a relatively new concept and was actually used for someone to take over power a few hundred years ago (I think it was in Europe, maybe France), for the purpose of taking political power. Nowhere in the Bible is there any mention of retirement. When and how you retire is up to you and the choices you make along the way.

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ArrieS
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Re: Can We All Just Unionize Already?

Post by ArrieS »

evilanne wrote:Retirement is a relatively new concept and was actually used for someone to take over power a few hundred years ago (I think it was in Europe, maybe France), for the purpose of taking political power. Nowhere in the Bible is there any mention of retirement. When and how you retire is up to you and the choices you make along the way.
Germany became the first nation in the world to adopt an old-age social insurance program in 1889. Is what I suspect you are thinking about. It was largely in response to strikes by workers that threatened the militarization of Germany.

The first corporate pension in the U.S. was established by the American Express Company in 1875.

Before that the US Government had pension plans. First one being paid to soldiers of the revolution.
OCTOBER: This is one of the peculiarly dangerous months to speculate in stocks in. The others are July, January, September, April, November, May, March, June, December, August, and February. - Pudd'nhead Wilson's Calendar

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Aitrus
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Re: Can We All Just Unionize Already?

Post by Aitrus »

I stand corrected, folks. Thanks for inspiring me to do some digging and educate myself a little.
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evilanne
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Re: Can We All Just Unionize Already?

Post by evilanne »

Yes, it was Germany but this is what I had heard before, which is slightly different from what is generally written about retirement history and Otto von Bismarck.
Otto von Bismarck (1815–1895) engineered his rise to power by making the astute observation that his rivals, all federally employed, were older than 65 years. Acting on his observation, he in 1870 allegedly masterminded legislation, which would force all public servants who reached the age of 65 to retire. After this maneuver, he ascended to power with ease (Hayflick, 1994a, 1994b).
https://academic.oup.com/gerontologist/ ... 1/5/561938

Whether this story is true or not is debatable but it wasn't until 1883 or 1889 that any legislation was proposed or passed depending on the source. Retirement age also varies, either 65 or 70.

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