America's public pensions matter

America's public pensions matter
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Superstar college coaches. Flagship state university presidents. Do you think high-profile figures like these represent the average worker? I sure don’t. There’s a lot of attention being paid to public pensions right now as America faces a retirement crisis, and states face pressure to offer expensive tax loopholes and tax breaks to big corporations like Amazon, Foxconn, Walmart and other businesses.

Unfortunately, there’s a tendency to focus on the flashy outliers, which are the handful of regional celebrities who have negotiated individual contracts for a lifetime of financial support. In truth, the average person receiving a public pension is a retired teacher, police officer, firefighter or nurse. With every paycheck, they earn their modest pensions that keep them afloat in retirement. When I say modest, I mean it. The average monthly public pension payment in Oregon is just over $2,500.

Growing up in Pennsylvania, I remember my local paper publishing a list of the 100 recipients of the largest public pensions every year. These were superintendents of school districts, heads of universities and police chiefs who had worked for 40 years and more. This list completely ignored the average public employee with a pension.

The main purpose of this annual article was to create pension envy by driving a wedge between those receiving a pension and those who were not. What the article never mentioned is that public employees on average receive less in pay than their counterparts in the private sector, or that our county’s public servants were just that. They are our neighbors, friends and family who work keep our communities running.

The article also ignored the fact that millions of public workers are not eligible to earn Social Security. So after years of very public attacks on Pennsylvania’s public pensions, young people are wary of teaching as a profession. In fact, the number of people studying to become an educator in Pennsylvania has fallen by 63 percent since the recession began.

Public pensions are a tradition for a reason. They made the American dream possible for generations. As they spread across the country from the 1930s through the 1960s, suddenly seniors who had worked all their lives were freed from the desperation and poverty that awaited those in earlier decades. More seniors could safely retire, and young workers were incentivized to work hard and accept demanding jobs, knowing they would be compensated for their efforts and commitment in retirement. The system wasn’t perfect, but it rewarded grit and steadfastness. It was good for our economy and our culture.

Today, many companies have abandoned pensions, leaving employees to gamble their retirements on risky 401(k)s. Fortunately, only a few states have followed suit, for two reasons. First, one analysis after another showed that converting to a 401(k) doesn’t save money. Second, states seem to understand the negative impact this change would have on getting good people to commit to a lifetime of public service. Unfortunately, some states are undermining pensions in other ways.

Every year, states like Kentucky, Kansas and Pennsylvania defer, skip or partially pay into their pension systems, while public employees contributed to them from each and every paycheck. These cuts actually hurt local economies. In Oregon, for every $1 taxpayers contribute to public pensions, more than $6 is produced in total economic activity. When pensions are cut, economies miss out on their stimulating effect.

But this is about more than the numbers. It’s about what values our states stand for and what kind of economy we want to build for our country. Communities have long recognized that after long years working demanding and vital jobs, public servants should receive what they’ve earned. When states cut pensions, it signals that hard work isn’t worth it.

This isn’t the kind of message you want to send to your children or to attract the best public servants to work in our schools, our public safety institutions, or provide care for those most in need. It replaces self-sufficiency and dignity in old age with dependence and uncertainty. No wonder 80 percent of citizens agree that attacks on pensions have made it harder to achieve the American dream.

This is about getting the facts straight as we try to allocate our resources wisely. It’s about millions of nurses and cops, not a handful of football celebrities. It’s about whether showing up on time and getting the job done for decades still means something in this country. Our parents and grandparents believed that it does. I do, too.

Andrew Collier is communications director of the National Public Pension Coalition, which represents public sector employees across the country.