My Perspective on Teacher Pensions

Much has been said about teacher pensions relative to its affect on state budgets. Some people complain that the state funding of teacher pension plans 'drains' or leaves too large of an unfunded liability. In terms of the unfunded element to pensions, it is largely due to the states borrowing from it and not repaying. Part of it is simply due to the fact that the state, over the years, has failed to pay its promised amount into the fund.

These same folks go on to say that teacher pensions should be cut or educators should pay more into the system. Some even call for the plans for the funds to be given to the teachers and they can create their own plan. The bottom line is this, states don't want to fund teacher and other public employee pensions. Simple as that.

Maintaining state pension plans is a must. In Illinois, for example, the Illinois State Constitution prohibits lawmakers from dropping public pensions. We need to keep pensions because, as in most states, teachers will not draw on Social Security. In other words, without the state pension, teachers would have NO retirement funds!

The current state of our pension plan is very positive. We have more money coming in than is paid out to retirees; the result, a net gain in funds each year. Why tinker with a plan that works?!

Does something need to be done with pensions? In my view, yes; otherwise, many states will be in even worse shape than they are now. Given the states poor management of teacher pensions, I don't want the legislators to act on their own.

The solution, as is always the best case scenario, is to let the various pension funds, educators and legislators work out the optimum solution through collective bargaining. State legislators acting on their own is not the way to tackle this problem.

Thanks,
Dick