My Unsustainable Pension...

I heard a guy talking today about the "unsustainable pensions" that the public school teachers are getting, and how they are causing such a problem with Ohio's budget.

But here's the problem with that statement. The State Teachers' Retirement System of Ohio (STRS) doesn't get any money from Ohio's budget. None. Really. I even called them and asked.

It is true, that when I retire in two years, I will get a pretty good pension for life. But every penny of that will come from money that teachers and their school boards have put into STRS along the way. STRS of course invested this, and the fruits of those investments are what fund my retirement. Of course, as a public school teacher, that money came from taxes. But it is a "public" school, so I kinda think that's expected.

If you want to say we're overpaid, get too much sick time, top notch health care, work too little, and have cushy jobs, that is your right. I will disagree, but at least those are judgment calls, and a fair discussion would make sense. If we have to give up some of those things to help Ohio balance its budget, those would be fair negotiations. But to say my pension is breaking Ohio, well that's just plain wrong.

Will I get a better pension than you? I don't know. If you're only counting on social security, then yes I will. But while you and your employer have been putting away somewhere around 12% of your salary, my employer and I have been putting in almost double that. And whether it's out of my paycheck, or from the school board, that's all money that could have gone directly to me. Instead it went to my retirement.

I honestly think that a lot of people assume my retirement is going to be paid by Ohio taxes in the coming years. No, STRS is self-contained. If I die early, I won't come close to getting all my money back. If I live till I'm 100, then I'll be using the money of somebody who died early. Actuary tables figure that all pretty well.

And why is it such a problem now? If you think it's because our pensions have grown, then you're wrong. The pension payout plan from STRS has stayed pretty constant over the last 40 years or so, with only minor changes. What hasn't stayed the same is the value of STRS' investments. When the economy came crashing down a few years back, everybody's investments tanked, including those of STRS.

So if you want to blame someone for the "pension problem" of public employees in Ohio, blame whoever caused the economic crash in 2008. And I don't think that was the teachers.