Tuesday, January 13, 2009

Golden retirement for public employees - unfunded

An ice-berg problem. It doesn't look large: it only shows 1/10 of its size. But below the surface it is huge. Elected officials are happy to kick it down the field - it will hit the future, not them. And the beneficiaries know it's huge, but are happy to let it hit you and me later. The American Spectator : Golden Apples:
But an even more fractious battle is emerging over the array of generous defined-benefit pensions, employer-subsidized healthcare plans, job protections and degree- and seniority-based pay scales struck by states, districts and locals of the National Education Association and American Federation of Teachers. Evidence that such compensation fails to reward high-quality instruction or lure collegians into teaching, along with No Child's provision that all teachers must be well-versed in the subjects they teach, are forcing states and districts to rethink teacher compensation. The development of a statistical technique called value-added assessment -- which allows individual student test-score growth to be measured against those in the same grade -- also means that teacher performance can be objectively measured and rewarded accordingly. This is a battle already seen in districts such as D.C. Public Schools, where Chancellor Michelle Rhee is sparring with the AFT local over a pay plan that would allow teachers to increase pay by as much as $43,000 a year if they subject themselves to more-rigorous performance evaluations, as I've noted this month in Labor Watch, a newsletter on labor reform published by the Capital Research Center. But it is the mounting costs of the lavish retirement deals -- fueled by the upcoming retirement of Baby Boomers -- that will likely force states into embracing performance-based pay plans.
This article is at the national level, but we have the same huge problem in Washington.

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