Second Ave. Sagas

How much is that pension in the window?

Written by

Benjamin Kabak

in

,

As the MTA has come to grips with its $400 million operating gap, we’ve heard a lot about rising labor costs and pension problems, but few have quantified exactly how much of the fiscal pie pensions take up. In a piece this weekend in The Post, Susan Edelman explored the cost of these pension plans. The numbers are startling. She says that 24,000 former Transit employees enjoy pensions and full post-retirement health care benefits. “The transit agency spent $533.6 million on pension expenses last fiscal year,” she writes, “and is expected to pay $550.5 million this fiscal year.”

What can anyone do though? One solution would be to try to raise the retirement age from 55 to something more in line with corporate America, but the demands of physical labor take their tolls on workers’ bodies before desk jockeys start to feel the effects of age. Somehow, though, these pension costs are going to have be reeled in because as the MTA pays more to former workers, its current customers are losing out.

Comments

14 responses to “How much is that pension in the window?”

  1. Noah

    The problem is actually a greater societal one. If we had universal healthcare then the additional health payments would not be necessary and the only reason why their pensions seem high is because the union has managed to weather the storm that the rest of us have not been so lucky. There was a time when everyone had generous pensions to live off of, now we just have 401k’s which generally cover next to nothing. We should be fighting for the protections the MTA has won for the rest of us, rather than scorning them. The disgusting level of inequality that has come to this country is terrible, all in the name of capitalism, we have become a social and economic darwinian country.

    Reply
    1. Working Class

      Well said Noah.

      Reply
    2. Anon

      Noah,

      So right. It’s a shame that people who aren’t treated “well” in this regards by their employer (as the City does by having pensions for their employees) think that if they don’t have these benefits that no one should. That is such a negative and counterproductive worldview.

      In fact, the opposite is true. That by supporting these type of “benefits” … it keeps private employers in check. Private employers will no doubt lower the quality of work life if public/civil service employers do so.

      It is in private business *employees* best interests to have their civil service counterparts well taken care of —or we may just all become serfs one day.

      😉

      Reply
      1. Alon Levy

        Actually, what happens throughout the English-speaking world is that public employers pay generous pensions and private employers don’t, attracting people with their higher base salaries and more rational business cultures.

        Reply
        1. Anon

          LOL? like Walmart the largest private employer? Do go on.

          Reply
          1. Sarah

            One reason that progressives dislike Walmart and companies like it is that they break a sort of unwritten social code that Alon mentioned – they neither provide benefits, nor pay enough that people can afford to buy health insurance and pensions on their own.

            Reply
          2. Alon Levy

            Wal-Mart is an entirely separate issue. It’s not competing for the same pool of workers as the unionized public sector – it’s competing for lower-end workers, who’d be non-union anywhere. The service sector unions are trying to organize those workers; the more established unions don’t care.

            Besides, Wal-Mart’s labor standards aren’t that bad by the standards of the mom and pop stores they replace. The main issue with Wal-Mart isn’t wages – it’s that it’s a local subsidy hog that practices severe racial and gender discrimination.

            Reply
        2. rhywun

          Actually, public-sector salaries are now much higher than private ones, in addition to the much higher benefits public employees receive. Which isn’t surprising, given the apparently bottomless pit of money (our taxes) from which to draw.

          Also, Ben, the retire-at-55 benefit has nothing to do with the “physicality” of labor. All city workers get it, don’t they? It has everything to do with the control that unions have over elected officials in certain parts of the country. The reason these costs are out of control is because our elected officials are out of control–bought and paid for with union donations.

          It’s silly to blame the capitalism that so many of you despise–and which has made us a very wealthy and productive country. The socialist countries of your fantasies are suffering the same problems we are–and more quickly, as they too realize that you can’t get something for nothing.

          Reply
          1. Alon Levy

            What socialist countries are you talking about, precisely? I’m asking because the countries that adopted social democracy the most smoothly – Sweden, Denmark, Norway, Finland, and the Netherlands – have had some of the highest growth rates in Europe in recent years and the lowest unemployment rates, and have not suffered as much from the recession as the pre-recession laissez-faire success stories like Ireland.

            Mind you, none of those social democratic successes has anything like the TWU. In the Netherlands, the transit unions strike by not collecting fares but otherwise operating transit normally. And you’ll never hear a Swedish or Danish trade union demand a 4% raise for its members during a recession. Where unions do not have that sense of social responsibility, you get either union-busting and high inequality, as in the US and Britain, or high unemployment and stagnation, as in France and Italy.

            The link you give doesn’t control for qualifications or industry. You can’t compare Wal-Mart workers and janitors to subway drivers and soldiers; you need to compare soldiers to private security contractors and subway drivers to freight train operators.

            Reply
            1. rhywun

              The chart shows averages. Why do you say you “can’t compare”? Do you think public sector workers are generally more skilled than private sector workers? That’s just silly. I might as well respond with “you can’t compare industrial engineers to city hall office assistants”.

              Reply
              1. Alon Levy

                Yes, I think public sector workers are generally more skilled. The public sector jobs seem to be likelier to require college education and universally require high school education; nowadays even NYPD won’t hire you without two years of college or military background.

                Reply
                1. rhywun

                  Well, I can’t argue against that kind of bias. I’m just a dumb private-sector worker.

                  Reply
      2. Older and Wiser

        A good portion of that $500 + million goes to the MABSTOA pension fund for NYCT employees not covered by NYCERS. That fund is a legacy of the old (private corporation) Fifth Avenue Bus Company, which, like all too many private American companies was on its way to backruptcy before the public sector rescued it.

        Reply
    3. Nathanael

      Yep. Single-payer health care would strip out a huge portion of this so-called “pension” budget (the “health care” portion).

      Reply

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