You can go here to read a current study on the state of public employee pensions in various states surveyed, the adjustments that various states have been making, and possible future outcomes. In essentially all cases the predictions are very cautiously optimistic. That is, there are many caveats given at the end of the study.
Among those caveats are various that also apply to Social Security. For instance, will the legislative bodies resist adding perks once the financial crisis dies down? Will the economy maintain enough stability over time to reliably predict the financing? Will governments resist the temptation to “borrow” from any pension funds? All those are obviously in doubt.
However, let me point out an incongruency or two. Remember that I commented that the same caveats apply to Social Security. Yet, look at the cartoon above. It has become a political talking point to claim that somehow public employees are robbing the public. A couple of years ago, people such as then-famous Glenn Beck began to claim that somehow the Founding Fathers really intended public employees to not really be employees but to either serve the nation at their own expense or at what would be essentially poverty wages.
Massive articles are written to claim that somehow the pensions negotiated by public employees are unfair and theft. The conclusion is that they must be lowered without any input from the employees, and that any employees that object should probably be fired.
But, do you realize that every argument that is applied to public employee pensions applies to Social Security? How are employee pensions financed? Why the employee has part of their wages deducted and supposedly deposited into the retirement fund and the employer contributes a certain percentage as well. How is Social Security financed? Exactly the same way. Supposedly both funds are supposed to be managed in such a way (even if merely invested) so that the money will be available as the employees retire. There is no difference, in theory, between the two sets of funds.
In both cases, supposedly what is being received is not an entitlement, but a disbursement of earned funds. And, if the fund has been mismanaged or is insufficient, then one of two things should need to happen. Either disbursements from the funds need to be curtailed, in other words, retirees get less money or income needs to increase, in other words, current employees and employers have their deductions/contributions increased to a level that covers current deficits and allows for future disbursements.
So, what people argue for one fund should completely apply to the other fund. But, mysteriously no anti-public-employee retirement fund people do so. I have seen multiple Facebook postings about how Social Security is not an entitlement and that how—if the money had been invested—there should be enough. The therefore is often that the government is required to pay out as a moral imperative. The same people will turn around and feel no moral imperative to pay out to public employees who have contributed under the same exact system as Social Security.
So, if you are against lowering Social Security payouts, if you are against the revised cost of living calculations, if you claim that Social Security is not an entitlement but an earned benefit, if you say that it is the government’s moral responsibility to keep a promise that was made decades ago, if you claim that it is the government’s problem if they did not invest the funds but stole them, then you should have no problem making the same arguments in support of public employee pensions. To do otherwise simply makes you yet another political hypocrite.