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What you need to know for 08/22/2017

Spinning the numbers on public pensions

Spinning the numbers on public pensions

You’ve heard it over and over, including in this column: Public employees get generous pensions.

You’ve heard it over and over, including in this column: Public employees get generous pensions. And you’ve heard the examples — the Rotterdam patrolman with his $95,000 a year, teachers retiring at age 55 with 60 percent of pay, and that sort of thing.

Then along comes the state comptroller, Thomas DiNapoli, to say no, no, the whole thing is a misunderstanding, just a lot of “misleading reports in the media.”

“The average pension is just over $19,000 per year,” he declared recently.

And as a reasonable person you think, well, $19,000 a year is not very much after a lifetime of service (in government one always says service, not employment). We can’t begrudge government workers such a pittance as that.

Alas, now we have the Empire Center for New York State Policy to clear up these apparent contradictions.

The center has done a bit of analysis and put out a report showing how numbers can be used selectively to make a desired point.

Sure, the average state pension may be just $19,151, but that includes people who did not work a full career, people who worked maybe just long enough to get vested, as the jargon has it, and then moved on to other employment elsewhere. Years later they start collecting their nominal little pensions, based on perhaps five or 10 years of work, and those pensions go into the average.

Also employees opt for different survivor benefits — select a larger benefit for yourself, and your surviving spouse gets less. Select a smaller benefit for yourself, and your surviving spouse gets more. It’s a crapshoot, but the point is, the reduced benefits for survivors also go into the average, as if the survivors were themselves retirees.

That’s how Comptroller DiNapoli gets the counterintuitive $19,151-a-year average pension.

Last year more than 1,000 state and local employees retired after just five to nine years of work somewhere in their past and began collecting annual pensions averaging $3,791, which is pretty meaningless.

A more realistic way to look at things is in terms of people who retire after working a full career. What do they get? Well, a bit more than $19,151.

State and local workers who retired last year after 35 or more years of employment began collecting an average of $55,858. Teachers similarly situated began collecting an average of $82,241. For police and firefighters it was $97,793.

Not bad, if you can do it.

Deputy Comptroller Tom Nitido tells me it’s not fair to focus on people who retire after 35-plus years, because “most public employees retire after 25 or 30 years,” but in my view that’s just another illustration of how cushy the system is.

And 35 years is not an extraordinarily long career. It simply means starting work at age 25 or 30 and continuing to 60 or 65, as most people do. If most public employees bail out sooner than that, it’s because the pension system generously allows them to do it.

And even those who bailed out sooner did a lot better than the comptroller’s cooked-up $19,151. Regular state and local employees who left after 25 to 29 years still averaged $31,502.

Police and firefighters at that level averaged $69,499. And teachers with between 20 and 35 years averaged $48,726.

When you consider further that there is no state income tax on these state pensions, and that retirees get reimbursed the approximately $100 a month cost of Medicare, you see it’s a sweet deal indeed. (The comptroller says nothing about either of those additional goodies.)

What else does he say on the home page of his website, where he offers that $19,151 number?

He says, “For all the tales of bloated pensions, less than one-half of 1 percent of retirees receive more than $100,000 per year,” which makes that concern seem trivial indeed, though the reader with a calculator at hand will find that one-half of 1 percent of 352,771 retirees is still more than 1,700 people.

The way he spins all of this, it’s clear that he is functioning more as a propagandist for the unions than as a neutral guardian of the public fisc. He’s not lying, he’s just spinning — selecting numbers that make it sound as if public pensions are no problem.

An average of a lousy $19,151 a year! A mere half of 1 percent getting big pensions. No problem at all. “This Public Pension System Works,” is the headline over his declaration.

He does a good job, in my view, he’s just got the wrong employer. He ought to work for CSEA or PEF.

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