Work for the State 5 Years, Pay in Zero, Get $130,000 Pension
Posted: January 12, 2011 http://www.championnews.net/article.php?sid=2696
Work for Yourself 45 Years, Pay In $260,000 Get $28,000 Social Security.
By Bill Zettler
Anybody see a problem here?
This is what happens when you live in a state with no accountability,
no transparency and massive political malfeasance. You and I are in
effect tax slaves whose purpose in life is to work and pay exorbitant
taxes so the elitist politically connected public employees can live in
luxury when they retire - on our dime of course.
The
person from the first line of the title is Dr. Renee Hartz, a thoracic
surgeon hired by the University of Illinois to teach surgery. I am only
guessing about what she actually did because records of her activity are
very limited. In a Freedom of Information Act request I asked for her
contract or offer letter outlining her job responsibilities plus pay and
benefits included in her job offer. Despite pay totaling $567,479.10
per annum from 1991 to 1995 there were no records related to her hiring.
So who knows what she did or was supposed to do? However we do know she
was paid a lot of money to do it.
Since those wages were as of 1991 in current terms in would be about
$750,000. According to the American Medical Association, median income
for a Cardio-thoracic surgeon is $533,000 as of 2009. So her salary at U
of I was about 30% above the median.
Although I was unable to get employment contract info I was able to
get payroll records showing how her costs were distributed to various
university departments including the "employer" (that's you and me and
every other IL taxpayer) pension contributions and that is what I am
basing this analysis on.
How many $1 million/yr public "servants" can IL afford?
As we know, total compensation is what we taxpayers pay for, not just
salary. In the case of Dr. Hartz that additional pay includes a pension
worth more than $2 million cash or $400,000 per year worked. Then there
were healthcare benefits, vacations, malpractice insurance, etc. all of
which she would have had to pay for herself if she were a self-employed
surgeon. So even in 1991 dollars she cost us well over $1 million a
year. In current dollars that cost would be about $1.5 million/yr.
We were so generous in fact that we donated (had stolen?) $49,124.18
tax-dollars to her pension account in 2009, fourteen years after she
left state employment.
Our self-employed person, on the other hand, worked much longer and
contributed much more to his pension plan called Social Security. He
could even have been a thoracic surgeon. Not only did he contribute
$250,000 for his meager $28,000/yr pension he paid for all of his other
fringe benefits too such as health insurance, vacations (if he took any)
and if he was a doctor, malpractice insurance premiums. Compared to our
"servant" he had a pretty raw deal. Of course he didn't have access to
the unlimited, guaranteed funding provided by taxes.
I thought servants were supposed to work 7 days a week until they croaked?
Not our servants apparently. The days worked are fewer, the months
worked are fewer and the years worked are fewer and, in some cases, as
outlined below, much, much fewer.
If we consider someone in the private sector who graduated from
college at the typical age of 22 he would work 40 years until the age of
62 to get the minimum Social Security (max. $22,000/yr) and in a full
career, 44 years to age 66 to get full benefits (max. $28,000/yr).
If
we look at the total number of retirees in the five state pension
systems we come up with about 182,000. Of those 182,000 state retirees
only 279 worked at least 44 years (less than ¼ of 1 %), only 1,311
worked at least 40 years (less than 1%) and only 18,108 (10%) worked
even 35 years. That means 90% of the people pulling down state pensions
did not work even to the equivalent of age 57 (age 22 plus 35 years
work). Did 90% of the people you know in the private sector retire
before age 57?
That also means you can ignore the pensions public relations gambit
(paid for by the taxpayers of course) that the 4,200 pensions over
$100,000 represent only 2.3% of retirees. What they fail to mention is
that less than 1% of state pension retirees work what the rest of us
call full careers. We're paying 6-figure pensions for part-time
employees.
The State University Retirement System (SURS) is the most amazing
with zero, none, nada employees ever working more than 40 years before
retiring. And of those who have retired since 2001 only 3 have worked
more than 36 years. And keep in mind SURS employees pay zero for their
excellent health insurance while working and while retired.
Keep these numbers in mind when you here politicians and union
leaders talking about "modest" pensions. They are only modest because
the vast majority are part-time employees with short careers. Private
sector workers with similar careers to average TRS retirees (27 years
worked, $45,000 pension) would be getting $13,000 or less if they
retired on Social Security at age 62. So even at the low-end state
pensions are at least 3 times better than Social Security. At the
$100,000 level you are up to 7 times better (see here).
Instead of raising taxes by 75% let's raise employee pension contributions by 75%.
On average public employees in the IL retirement systems pay less
than 7% for these Golden parachutes we call pensions. Raising them by
75% would raise the contribution to about 12% a deal any private sector
employees would take in a heartbeat. Even then we taxpayers would be
paying more than 150% of the employee's contribution.
The following list of $100,000 pensions with 20 or fewer years worked
(top 50 of 133 total) is just one indicator of the out-of-control
output of the public-employee/politician industrial complex. Public
employees give the politicians millions in political contributions and
the politicians give the public employees billions in pension
contributions in return. Dr. Hartz and her $130,000 pension barely make
the list at number 49.
Where will it end? Either massive reform or bankruptcy - the status quo is doomed to failure.
SOURCES: Teachers Retirement System (TRS)
State University Retirement System (SURS)
State Employee Retirement System (SERS)
