$4 million. That’s how much you need in your 401k plan to retire at the same annual retirement pay as a typical police officer, teacher, or transit worker manager in the northeast.
However you slice it, teachers (in the Northeast) and police officers and many government workers are millionaires.
I’m not talking about exceptions. I’m talking about millionaires made up of every single police officer, teacher, transit worker at a manager level, and most bureaucrats in New York (assuming they work 25 years or more).
How is it that you can work 37 weeks a year, and work 25 years, retire at age 50 or 55, and have the equivalent of $4 million in your 401k? Simple. Have taxpayers pay for it on your behalf. And I’m not talking about having the 1% paying for it. I’m talking about the construction worker, the secretary, the Starbucks barista, the cashier at your local Stop and Shop. Public sector workers are literally stealing from our citizenry, and shamefully do so with a clear conscience (it should be noted that these workers hide behind their unions, and so we complain about the “teacher’s union” rather than “teachers”. But make no mistake, teachers fund and vote in that union and it is “teachers” who are perpetrating this).
Take another example, a long-time employee with an MBA working as a middle manager at, say, Pepsico. Such a person probably makes the same amount as a 25 year high school gym teacher (ugh!), but the differences are huge. The Pepsico person works 48 weeks a year, not 37 like the gym teacher. The Pepsico worker sets aside $15,500 a year from her salary (with a small match from her employer) to fund her 401k, versus most public sector workers who don’t have to set aside a penny from their salary. This employee is also subject to market fluctuations that can temporarily (or permanently) devastate their 401k balance while the public sector worker is guaranteed their payment regardless of market conditions. And the Pepsico employee likely must work 45 years to retire, 15 more years than a local teacher, and 25 more than the local police officer. Just think about these numbers and you go numb.
And every day presents a new challenge to that Pepsico employee, both stimulating challenges as well as challenges to their employment longevity. The gym teacher, math teacher, and the government employee only need not commit a felony and their salary, benefits, and retirement pay are safe and sound (and even a felony often can’t stop the flow of pay and benefits to teachers in New York).
How did all this come about? How does a police officer retire after 20 years (sometimes at age 41!), and receive $125,000 a year in retirement for the rest of his/her life, and never pay a dime for healthcare?
Well, it’s complicated, but it can be boiled down to 2 factors. One is fat contracts committed to during flush times. But the biggest factor is political blackmail and cronyism. Public sector unions contribute huge sums of money to Democrat politicians, and these politicians pay them back with ridiculous retirement benefits and healthcare coverage (using taxpayer– said another way, using you– money). These contributions have become indispensable for Democrat candidates, and without them they are doomed to lose elections, and so they accept them and the cycle continues.
This is a matter of right and wrong, and people like governors Scott Walker (R, Wisconsin), Chris Christie (R, New Jersey), and Andrew Cuomo (D, New York) are finally standing up to it. And they are getting attacked in the most brutal ways by the public sector unions for doing so, and they had best not assume a dime of contributions from public sector unions. And, worse yet, they can expect their opponents in the next election to be flush with union money in hopes of defeating those fighting for fairness.
It is critically important for our citizens to become aware of what is happening here and how much it is costing them. I believe that if our citizenry was broadly informed on this subject, it would stop. And maybe even public employees would become embarrassed when they look at the hard working citizens in their towns and know that they are taking their money and rewarding themselves wildly inequitably.
We need public sector workers to operate under the same terms that private sector citizens do. Their number of working years, retirement pay, healthcare benefits, and job security should be similar to that of the citizens that fund their compensation. Anything more or less is unfair and should not be tolerated.