Letter: Pension system works for taxpayers
To the editor of THE EAGLE:
The Berkshire Eagle editorial calling for "phasing out" public employee pensions in Massachusetts demonstrates a total misunderstanding of the system ("Heavy burden of pension funds," Jan. 17). The Eagle’s proposal would cost the taxpayers hundreds of millions of dollars a year while providing employees with fewer benefits, hurting many working families in the process.
In Massachusetts, public employees are not part of the Social Security retirement system. Neither the employees nor the employers pay 6.2 percent of employee salaries into the system. They don’t get Social Security benefits or 401(k)-style benefits as public employees; they just get a pension. And they largely fund that pension themselves.
Here’s how that plays out for teachers.
Teachers pay 11 percent of their salaries toward their pension benefits; the state pays about two percent -- and even less for new employees, whose benefits were recently cut. At that rate, teachers are funding more than 90 percent of their own pension benefit.
If the state followed the Eagle’s advice and got rid of pensions, those employees would have to be enrolled in Social Security. That would cost the state and municipalities hundreds of millions of dollars more a year than paying into the pension system. Like most large employers, the state would also be expected to contribute to a 401(k)-type of plan for employees, costing millions more.
Even after doing all that, the taxpayers would still be on the hook -- both legally and morally -- for the pension benefits promised to all those currently enrolled in the system.
In short, the state is currently acting responsibly by putting funds into the pension system to deal with the unfunded liability -- a liability caused by state and local governments not acting responsibly in decades past -- and by continuing to honor its pension obligations to current employees and retirees. In doing so, it is providing retirement security for people who have dedicated their lives to helping students learn and performing other crucial public services.
The writer is president of the Massachusetts Teachers Association.
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