Koch’s Mercatus Center Agenda on Pensions
The Montana Watchdog did a fine little piece on the Koch funded Mercatus Center, the powerful anti-regulation, anti-EPA lobbying group. Within the article is something we all should pay attention to — the Koch agenda to reform public pensions. Why on earth would a industry titan be interested in pension reform? Answer: to advance an agenda of corporatism and privatization.
Here is the spin first:
State legislatures and governors nationwide are looking for ways to reduce spending and fill revenue holes as state budget deficits totaled some $191 billion and $130 billion in the 2010 and 2011 fiscal years, respectively. Below are 11 “bold” reform ideas suggested by Daniel Rothschild, managing director of the Mercatus Center’s State and Local Policy Project, that he says could help states balance their 2012 budgets and avoid boom-and-bust budgeting cycles in the future.
The Mercatus Center at George Mason University is source for market-oriented ideas—bridging the gap between academic ideas and real world problems. Mercatus works to advance knowledge about how markets work to improve lives by training graduate students, conducting research, and applying sound economics to offer solutions to society’s problems.
11. Reform your public pensions
Nationally, state and local pensions are underfunded by as much as $3 trillion—a figure some three times as high as total explicit state debt. Almost all state and local governments provide defined benefit plans, while few such plans exist in the private sector. States should reform their pension systems, enrolling all nonvested workers in defined contribution plans.
[That translates to privatizing pensions and linking them to the stock market. Also, the $3 trillion of unfunded pension has been highly debated among economists and analysts.]
This change would not only clarify the liabilities of retirement plans, but it would also give state workers more freedom to change jobs and move between the public and private sectors since they can roll over contributions between jobs. In addition, states with heavily unfunded pension liabilities should consider increasing employee contributions, reducing future benefit accumulation, reducing cost of living adjustments (COLAs), and raising retirement ages. Failure to do so puts off the day of reckoning for underfunded plans and ultimately makes fixing the problem more costly.
There you have it, the plan to reform public pensions, tie them to the stock market where their is considerably more risk versus bonds where most pension monies are tied. Then the language insinuates benefit reductions, COLA reduction, upping retirement age, etc. THIS is actually what the right-wing wants to do with Social Security. They are attempting to implement their plan in 16 states, starting with Wisconsin.