patrick.net

Your pension is set up to pay $40,000/yr for say 20 years, $800,000.

You are paying $200,000 towards this.

Your pension is a deferred compensation plan to the tune of $24,000 per year, pushing your actual wages to $96,000/yr, $128,000 per year if the vacation blocks are adjusted for.

That's . . . a lot of money for a service that is hard to show actual wealth-creation.

I think the glibertarian wealth-creator argument is largely BS -- money flows to capital, away from the actual wealth-creators of the economy, but don't kid yourself that you don't have a VERY well-paying job in this new economy of suck.

Troy says

Your pension is set up to pay $40,000/yr for say 20 years, $800,000.
You are paying $200,000 towards this.
Your pension is a deferred compensation plan to the tune of $24,000 per year, pushing your actual wages to $96,000/yr, $128,000 per year if the vacation blocks are adjusted for.
That’s . . . a lot of money for a service that is hard to show actual wealth-creation.
I think the glibertarian wealth-creator argument is largely BS — money flows to capital, away from the actual wealth-creators of the economy, but don’t kid yourself that you don’t have a VERY well-paying job in this new economy of suck.

I can't say for certain if this pension is inflation adjusted--I doubt it. If not, then you really should account for it in your previous calculation...

1) I don't think I am expected to live to 88 nor would 20 yrs be average time someone lives after
retiremnet at 68.

2) You accounted for the growth of the money during the 20 years of money in, but not dring the out years. Assuming 5% yield, 505,00 can be annuitized to pay 40,000 per year for 20 years. So it's worth 505,000 at retirement if you want to assume 20 years. If you assume 14 years ( living to 82 ) then it's more like 402,000.

3) Without further analysis, yes, the benefits part of my compensation is pretty good. But I didn't even talk about how challenging it is teaching high school kids.

4) As for "wealth" creation. Some govt services do not create wealth. It can be argued as Jefferson did in his arguments for public education that it does indeed create wealth. But as far as I am concerned that's beside the point.

We took a long time building these problems and living a prosperity that was at least somewhat false. And sure, many are hurting and angry. But let's not cut off our nose to spite our face.

1) http://www.health.harvard.edu/press_releases/average-life-expectancy
I'd say you have a pretty good chance to live to age 88:
"According to the latest figures, average life expectancy in the United States is 77.6 years, compared with 75.4 in 1990, reports the July issue of the Harvard Health Letter. Furthermore, old age begets older age. Today, a 65-year-old American man can expect to live to 81.6; if he reaches the age of 85, he can expect to live to see 90. Women still outlive men—although the gap is closing—but the same demographic pattern holds. Old age adds to life expectancy."

3) There are many challenging professions that don't pay $40k in retirement.
I realize that unions were important to ensure a living wage. But I'm not so sure that now that there are minimum wage laws they're necessary. One could argue that they created, then destroyed, the auto industry.

I do believe that we should pay the best & brightest to teach our children. But unions ensure that teachers continue to teach, even when they're not good teachers.
http://online.wsj.com/article/SB10001424052748704804204575069502242529826.html
"It's not impossible to get rid of bad teachers, but it's extremely hard and expensive. A report this month in LA Weekly noted that in the past decade the Los Angeles Unified School District "spent $3.5 million trying to fire just seven of the district's 33,000 teachers for poor classroom performance."
The result? Four were fired, two others were paid large settlements and one was reinstated. The paper also reported that 32 underperforming teachers were initially targeted for removal "but then secretly paid $50,000 by the district, on average, to leave without a fight."

I do realize that these situations are often exceptions - and that many teachers are hard-working people who are dedicated to teaching our youth. But why should they be protected by the unions and heavily funded into retirement while many other people in various professions aren't accorded the same protections?

Is Mish saying that teachers are parasites - or is that they way that you're reading it? Right now the same argument is going on in Southern Nevada, where firefighters have manipulated their salaries to well over $100k per year. So far, from what I've read, IMHO unions are a way for public workers to ensure they'll never get fired while receiving excellent pay into perpetuity.

Elliemea, thanks for the quote. I didn't know how accurate I was.

"Furthermore, old age begets older age. Today, a 65-year-old American man can expect to live to 81.6"

The argument I hear is "why should one component of my compensation be something that everyone else doesn't get." That's an argument I don't understand. Maybe I could ask, how does the CEO get 150 million per year if everyone doesn't get that ?

As for the claim that unions are a way of protecting employees. Yes, it's true. And it's complicated. Maybe some employees don't deserve that protection. Maybe some should be more easily fired. But what about the 95% who end up committing themselves to these professions and then at least have some job security, especially between age 50 and 65.

Why is it that people say " I don't have that,...why should you ?" Why don't they say, "hey. that's pretty cool, more of us should have that.

Silly point I guess. We are so.....

I see your point. I just disagree with it. Unions collect dues, are extremely powerful lobbies. Spend lotsa money to get politicians to see things their way.

If the money you spend on dues went to your retirement, along with your private retirement contributions, you wouldn't need public contributions. A few overpaid union reps would be looking for real jobs, and teachers wouldn't be tenured for life.

IMHO, of course.

I'm playing nice (to quote you) - as a teacher you might better support your argument if you were to use correct grammar and spelling.

To name a few examples, your opening statement, "it's" and "retirments."

marcus says

Why is it that people say ” I don’t have that,…why should you ?” Why don’t they say, “hey. that’s pretty cool, more of us should have that.

Because if I don't contribute my earnings that go to pay your wages, people with guns come and throw me in jail.

To Elliemae. I'm A Mathematics teacher, and I have a masters degree in Math not English, although my personality is such that even if English were my subject, I would still sometimes make those kinds of errors in emails or in a forum such as this. Feel free to judge me. It's an interesting alternative to understanding where I'm coming from.

My union dues are something like $57/ month. So you're wrong. And you and others are proof that we would terribly compensated without our union. I agree about a very small percentage being overprotected by the union, but focusing on that alone is deciding to ignore the many benefits of the union. And yes, I know, they are benefits to us, not you, or maybe only very indirectly to you.

Troy, about your "thrown me in jail" point, I get it. And sadly, I also get it that only maybe in the distant future will we all have such "benefits." Or maybe never. I think they have you and Mish and others programmed to believe it isn't economically feasible.

I guess that we could argue all day about this - you believe in unions and I don't. Again, they were necessary when the common worker was forced to work unreasonable hours for unreasonable pay.

Not so much anymore.

marcus says

To Elliemae. I’m A Mathematics teacher, and I have a masters degree in Math not English, although my personality is such that even if English were my subject, I would still sometimes make those kinds of errors in emails or in a forum such as this. Feel free to judge me. It’s an interesting alternative to understanding where I’m coming from.

I do understand where you're coming from. But you are teaching our children - and if you aren't able to use a spell check and understand the need to effectively communicate your thoughts in writing, what does this teach our children?

Interesting.

A few typos are all I saw. But hey, enjoy your high horse.

I agree about us agreeing to disagree about unions. But the fact is that in most places, teachers are still extremely underpaid. Not so much in LA, but then our classes are way too large (avg of about 40 per class). Without our union, we would be screwed, and the quality of teachers would be much worse. I believe that in writing such as this, it goes without saying, that it is my not all that humble opinion.

marcus says

A few typos are all I saw. But hey, enjoy your high horse.

I rode him today, it was nice. He bucked a little but that's to be expected...