Posted by Kendall Harmon

The daughter of a 92-year-old priest who is paying interest on a loan agreed with the Church of England Pensions Board at 8.6 per cent - more than twice the cur-rent average - has questioned the morality of the scheme.

In 1985, the Revd Eric Quin took out a shared-equity loan in order to purchase a three-bedroom cottage in Cheshire for £45,750. With his wife, he paid £20,750 to put down a 45-per-cent deposit. The Pensions Board paid the remainder, £26,500, on the understanding that it would be entitled to 55 per cent of the final sale price.

The initial interest rate was three per cent - much lower than the 12-per-cent mortgage rate at the time. This rate was gradually increased in line with the pensions of all the fund's members. Mr Quin is now paying interest at a rate of 8.6 per cent. The property has risen in value to £200,000.

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Filed under: * Anglican - EpiscopalAnglican ProvincesChurch of England (CoE)* Culture-WatchReligion & Culture* Economics, PoliticsEconomyCorporations/Corporate LifePersonal FinancePensionsStock MarketThe Banking System/Sector* International News & CommentaryEngland / UK* TheologyEthics / Moral Theology

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Posted April 4, 2014 at 5:30 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

True to their "live to work" reputation, some baby boomers are digging in their heels at the workplace as they approach the traditional retirement age of 65. While the average age at which U.S. retirees say they retired has risen steadily from 57 to 61 in the past two decades, boomers -- the youngest of whom will turn 50 this year -- will likely extend it even further. Nearly half (49%) of boomers still working say they don't expect to retire until they are 66 or older, including one in 10 who predict they will never retire.

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Filed under: * Culture-WatchAging / the ElderlyMarriage & FamilyMiddle AgePsychology* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsStock MarketThe U.S. GovernmentMedicareSocial SecurityPolitics in General* TheologyAnthropologyEthics / Moral Theology

0 Comments
Posted January 21, 2014 at 6:15 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

While plenty of baby boomers, born from 1946 to 1964, have become affluent and many elderly around the U.S. face financial hardship, the wealth disparity of this father and daughter is emblematic of a broad shift occurring around the country. A rising tide of graying baby boomers is less secure financially and has a lower standard of living than their aged parents.

The median net worth for U.S. households headed by boomers aged 55 to 64 was almost 8 percent lower, at $143,964, than those 75 and older in 2011, according to Census Bureau data. Boomers lost more than other groups in the stock market and housing bust of 2008, and many also lost their jobs in the aftermath at a critical point in their productive years.

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Filed under: * Culture-WatchAging / the ElderlyChildrenMarriage & FamilyMiddle AgePsychology* Economics, PoliticsEconomyHousing/Real Estate MarketLabor/Labor Unions/Labor MarketPersonal FinancePensionsStock MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentMedicareSocial Security

0 Comments
Posted December 18, 2013 at 6:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The department of finance has said California’s debt was paid down to less than $28-billion (U.S.). But that doesn’t include government employee pension and health benefits that have been promised but not funded. Stanford University estimates that unfunded pension liabilities are as much as $497-billion.

Meantime, a report by the Pew Center suggests that unfunded state retiree liabilities are $77-billion and growing. Most agree that until California deals with these two areas, it will only be pecking away at its monstrous fiscal challenges. It’s difficult to imagine state legislators not having to deliver some extremely unpleasant news to tens of thousands of government employees in the coming years.

Despite its financial woes, California continues to talk about a high-speed rail line between Los Angeles and San Francisco that would cost tens of billions. On another front, the state ruled against allowing fracking for oil and gas despite having the largest shale deposits in the country. Many believe this one move alone could have helped release California from the grips of financial despair.

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Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in General

0 Comments
Posted December 14, 2013 at 9:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The pension age could be pushed back to 70, and older Australians forced to use growing equity in their homes to help pay for government services under proposals designed to help Australia cope with an ageing population.

In a paper titled ''An Ageing Australia: Preparing for the Future'', the Productivity Commission projects Australia's population will grow from about 23 million in 2012 to about 38 million by 2060, with a substantial increase in the number of retirees as people live longer.

That will mean lower overall participation in the workforce, and more pressures on governments to pay for higher health, aged care and pension costs.

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Filed under: * Culture-WatchAging / the ElderlyLaw & Legal Issues* Economics, PoliticsEconomyPersonal FinancePensionsPolitics in General* International News & CommentaryAustralia / NZ* TheologyEthics / Moral Theology

0 Comments
Posted November 21, 2013 at 4:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The Anglican Church of Canada has asked clergy for its support in a plea to Ontario pension fund regulators to give it a three year extension of time to address a cash crunch in the church’s pension plan.

In a July 2013 letter to the 1,600 active members and 2,600 retirees covered by the church pension programme the plan administrators told the clergy their approval was needed before the government would grant the plea for more time. “With funding relief, we will have three years to try to improve our plan’s funding level,” they wrote. “At the end of three years, we will do another valuation of the plan. If there is still a solvency funding shortfall, we will likely have no choice but to cut benefits.”

The average age of plan participants is 52.5....

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Filed under: * Anglican - EpiscopalAnglican ProvincesAnglican Church of Canada* Christian Life / Church LifeParish MinistryStewardship* Culture-WatchLaw & Legal Issues* Economics, PoliticsEconomyPersonal FinancePensions* TheologyEthics / Moral Theology

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Posted August 9, 2013 at 5:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Church Pension Group issued a statement Tuesday saying it is trying to ensure that clergy and employees in parishes that have left The Episcopal Church have access to their funds, in accordance with federal laws.

"In doing so, we are following protocols required by the Internal Revenue Code to avoid any adverse consequences for the participants in the plans," the statement said. "We expect to complete this process shortly. In the meantime, all funds remain invested in the options selected by these employees, and all accounts are fully viewable on (a) website."

[Canon Jim] Lewis said he has consulted lawyers for the diocese and is unaware of any legal issues precluding employees from rolling over their plans. He believes that preventing employees from doing so could be illegal.

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Filed under: * Anglican - EpiscopalEpiscopal Church (TEC)TEC ConflictsTEC Conflicts: South Carolina* Culture-WatchLaw & Legal Issues* Economics, PoliticsEconomyPersonal FinancePensions* TheologyEthics / Moral TheologyPastoral Theology

4 Comments
Posted June 5, 2013 at 2:21 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The retirement savings of more than 80 non-clergy employees of the Diocese of South Carolina and its parishes are being held hostage by their former pension plan at the Episcopal Church (TEC).

The lay employees have been trying to arrange for the rollover of their retirement savings since February, when they first contacted the Church Pension Group, which provides retirement, health and other benefits to employees of The Episcopal Church, its parishes, dioceses and other institutions. The employees became eligible to rollover their funds into another qualified plan when their employer, the Diocese or the parishes that voted to disassociate from the denomination, officially ceased to be employed by any TEC organization or parish.

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Filed under: * Anglican - EpiscopalEpiscopal Church (TEC)TEC Conflicts* Economics, PoliticsEconomyPersonal FinancePensions* South Carolina

19 Comments
Posted June 3, 2013 at 10:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

To retirees, the offers can sound like the answer to every money worry: convert tomorrow’s pension checks into today’s hard cash.

But these offers, known as pension advances, are having devastating financial consequences for a growing number of older Americans, threatening their retirement savings and plunging them further into debt. The advances, federal and state authorities say, are not advances at all, but carefully disguised loans that require borrowers to sign over all or part of their monthly pension checks. They carry interest rates that are often many times higher than those on credit cards.

In lean economic times, people with public pensions — military veterans, teachers, firefighters, police officers and others — are being courted particularly aggressively by pension-advance companies, which operate largely outside of state and federal banking regulations, but are now drawing scrutiny from Congress and the Consumer Financial Protection Bureau.

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Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--* TheologyAnthropologyEthics / Moral Theology

0 Comments
Posted April 28, 2013 at 4:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

...the Labor Department’s latest jobs snapshot and other recent data reports present a strong case for crowning baby boomers as the greatest victims of the recession and its grim aftermath.

These Americans in their 50s and early 60s — those near retirement age who do not yet have access to Medicare and Social Security — have lost the most earnings power of any age group, with their household incomes 10 percent below what they made when the recovery began three years ago, according to Sentier Research, a data analysis company.

Their retirement savings and home values fell sharply at the worst possible time: just before they needed to cash out. They are supporting both aged parents and unemployed young-adult children, earning them the inauspicious nickname “Generation Squeeze.”

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Filed under: * Culture-WatchAging / the ElderlyHealth & MedicinePsychology* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentMedicareSocial Security* TheologyEthics / Moral Theology

1 Comments
Posted February 5, 2013 at 11:08 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The finances of the US’s multi-employer pension schemes have deteriorated so quickly over the past year that the body that insures them will almost certainly run out of cash in 20 years, according to a new report.

The chances of the Pension Benefit Guarantee Corporation – the publicly created but privately funded body that insures the nation’s occupational pension schemes – going bust went from 1 in 3 at the end of 2011 to more than 9 in 10 by the end of 2012, a report prepared for the PBGC and released on Tuesday said.

Read it all (may require subscription).

Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--* TheologyEthics / Moral Theology

0 Comments
Posted February 1, 2013 at 7:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Read them all.

Filed under: * Anglican - EpiscopalEpiscopal Church (TEC)TEC Diocesan Conventions/Diocesan Councils* Christian Life / Church LifeParish Ministry* Economics, PoliticsEconomyPersonal FinancePensions* International News & CommentaryMiddle East

6 Comments
Posted December 14, 2012 at 5:45 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Justin Welby, a former oil executive, may have hoped to have left the problems of Mammon behind on his appointment as Archbishop of Canterbury, but he could be plunged into an immediate cash crisis.

The Church of England’s pension deficit could reach £500m by the end of this year, putting a huge financial burden on congregations, an independent pensions consultant has warned.

John Ralfe said congregations, who already pay £68m annually to support the Clergy Pensions Scheme’s 24,000 members, will have to find £108m a year if an existing plan to eliminate the deficit over 12 years is not extended.

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Filed under: * Anglican - EpiscopalAnglican ProvincesChurch of England (CoE)* Christian Life / Church LifeParish MinistryStewardship* Economics, PoliticsEconomyCredit MarketsCurrency MarketsPersonal FinancePensionsStock Market

2 Comments
Posted November 26, 2012 at 6:15 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Americans in their late 30s are now the group most likely to doubt they will be financially secure after retirement, a major shift from three years ago when baby boomers nearing retirement age expressed the greatest worry.

The survey findings by the Pew Research Center, released Monday, reflect the impact of a weak economic recovery beginning in 2009 that has shown stock market gains while housing values remain decimated....

“My biggest fear is not being able to retire,” [37 year old Nicole] Gilliard said as she came out of the courthouse on Meeting Street after work Monday. “I have a 5-year-old, and my biggest fear is that I’m going to have to keep working to put her through school.”

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Filed under: * Culture-WatchPsychology* Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentSocial Security

0 Comments
Posted October 23, 2012 at 6:15 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

When Jeanne Majors, 63, took an early retirement in December 2005, she assumed that she would pick up a part-time job and be in good financial shape. She didn't know that her future would quickly fall apart.

Majors, who is single and lives in Brooklyn, N.Y., learned the hard way about the retirement obstacles that most women face today. When the economy slid into the recession, she lost her part-time job and could not find another.

"They wanted somebody young," Majors says. "Or if I was a man, somebody would have hired me at my age. I'm not sorry that I retired, but things didn't turn out the way I wanted it to. Everything went bust."

Read it all.

Filed under: * Culture-WatchAging / the ElderlyWomen* Economics, PoliticsEconomyPersonal FinancePensionsStock MarketThe Banking System/SectorThe U.S. GovernmentMedicareSocial Security

2 Comments
Posted September 28, 2012 at 8:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Here we are, smack dab in the middle of convention season. Cue the balloons. The Republicans had their turn last week, the Democrats come next. And there are plenty of personal finance issues being aired by the two guys who want to be president. But what are the issues voters are most interested in?

Marketplace's David Gura recently traveled through both states hosting this year's conventions as part of our coverage of the how all the tub-thumping plays out where it really matters: the economy.

Gura started down the I-4 corridor, which cuts through Daytona Beach, Orlando and site of the Republican Convention, Tampa. That highway has a high concentration of undecided voters. Some view it as the line between the more conservative north and more liberal south.

Read or listen to it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeHousing/Real Estate MarketLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe U.S. GovernmentSocial SecurityPolitics in GeneralOffice of the President

0 Comments
Posted September 4, 2012 at 8:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

South Carolina's pension fund investments have generated far less over the past year than hoped, but officials say there's no cause for alarm.

Preliminary numbers from the state's Retirement System Investment Commission show a return on investments of 0.6 percent for the fiscal year ending June 30. The state assumes a 7.5 percent annual return when calculating what it needs to keep the system solvent long-term.

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Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyCredit MarketsLabor/Labor Unions/Labor MarketPersonal FinancePensionsStock MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

0 Comments
Posted August 25, 2012 at 7:31 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Fiscal woes that have caused high-profile bankruptcies in California are surfacing across the country as municipalities struggle with uneven growth and escalating health and pension costs following the worst recession since the 1930s.

Budget crunches already have prompted Michigan lawmakers to authorize emergency fiscal managers, and led the mayor of Scranton, Pa., to temporarily cut the pay of all city workers to the minimum wage.

In a majority of the nation's 19,000 municipalities—urban and rural, big and small—stagnant property tax revenues, less aid from states and rising costs are forcing less dramatic but still difficult steps.

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Filed under: * Culture-WatchUrban/City Life and Issues* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifePersonal FinancePensionsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralCity Government

0 Comments
Posted August 11, 2012 at 9:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The new rules could hit pension plans in states like Illinois and New Jersey particularly hard, and even raise borrowing costs for certain municipalities, analysts say. "This could be the event that incites a bigger policy response than what we've seen so far," says Matt Fabian, managing director at Municipal Market Advisors, a research firm.

The exact impact of the new rules by the Governmental Accounting Standards Board isn't clear. According to researchers at Boston College, pension liabilities at 126 state and municipal pension plans would jump by roughly $600 billion, or about 18%. The estimate is based on 2010 financial data and doesn't reflect the stock market's recent rebound or moves by many U.S. states to rein in pension costs.

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Filed under: * Culture-WatchLaw & Legal Issues* Economics, PoliticsEconomyPersonal FinancePensionsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralCity GovernmentState Government

0 Comments
Posted June 23, 2012 at 9:31 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Thousands of state workers could find themselves facing a life-changing decision later this month — whether to retire or not — and with less than a week to make it.

Lawmakers are poised to make major changes in the state’s Retirement Systems that would affect the more than 214,000 state and local government employees covered by that pension system.

State senators want some of the changes to take effect July 1.

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Filed under: * Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government* South Carolina

1 Comments
Posted June 11, 2012 at 5:38 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Every generation has an incentive to borrow money from the future to spend on itself. But, until ours, no generation of Americans has done it to the same extent. Why?

A huge reason is that earlier generations were insecure. They lived without modern medicine, without modern technology and without modern welfare states. They lived one illness, one drought and one recession away from catastrophe. They developed a moral abhorrence about things like excessive debt, which would further magnify their vulnerability.

Recently, life has become better and more secure. But the aversion to debt has diminished amid the progress. Credit card companies seduced people into borrowing more. Politicians found that they could buy votes with borrowed money. People became more comfortable with red ink....

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Filed under: * Culture-WatchHistoryPsychology* Economics, PoliticsEconomyConsumer/consumer spendingPersonal FinancePensionsTaxesThe U.S. GovernmentThe National DeficitPolitics in GeneralCity GovernmentState Government* TheologyEthics / Moral TheologyTheology: Scripture

3 Comments
Posted June 9, 2012 at 2:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The city of Chicago is near insolvency. City workers are bracing for pay and benefit cuts. And Rich Daley, the former mayor who had his behind kissed by the powerful in this town and by much of the media for two decades, has an inside deal that should make sane people sick to their stomachs:

An eventual pension of more than $180,000 for life, according to a Tribune/WGN-TV investigation.

Daley did it on the sneak, our reporters found....

Read it all.

Filed under: * Culture-WatchUrban/City Life and Issues* Economics, PoliticsEconomyPersonal FinancePensionsPolitics in GeneralCity Government

3 Comments
Posted May 3, 2012 at 6:12 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The economic recovery has not made Americans feel more secure about their financial future. In fact, many workers fear more cuts in retirement benefits and higher out-of-pocket health care costs, according to a survey by Towers Watson, a retirement consulting firm.

As a result of their worries, more than half, 55%, of workers say they are willing to give up some of their future pay increases in order to have more guaranteed income in retirement, the survey found. And 50% say they would also trade a portion of their pay to ensure health care benefits.

"This may reflect their firsthand experience with financial market volatility, continuing worries about the economy and fears of future cutbacks to benefits," said Kevin Wagner, Towers Watson senior retirement consultant.

Read it all.

Filed under: * Culture-WatchPsychology* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--

0 Comments
Posted February 28, 2012 at 5:32 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Mary Rich worked for a hospital in northern New Jersey for 25 years, first as a registered nurse and later as an executive. One of the job’s benefits was a traditional pension that she expected to receive at retirement. Now that benefit seems unlikely to be around by the time she retires.

Rich’s financially troubled former employer, the Hospital Center at Orange (HCO), shut down in 2004. The pension plan currently has $5.25 million in assets, which are being distributed at the rate of $2.7 million per year. By the time Rich reaches retirement 12 years from now, the money will be gone.

Under normal conditions, a pension plan such as HCO’s would have been back-stopped by the Pension Benefit Guarantee Corporation, the federally sponsored agency that insures most private sector pension plans. When plans go belly up, PBGC takes them over and continues to make payments; most participants receive 100 percent of promised benefits. But HCO’s case wasn’t typical. A year before it closed, HCO had declared itself to be a “church plan” – meaning that it was claiming an exemption to federal pension law and PBGC coverage.

Read it all.

Filed under: * Culture-WatchLaw & Legal IssuesReligion & Culture* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensions

0 Comments
Posted January 30, 2012 at 11:12 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The federal government is understating the liability for its employee pension plans by $80-billion because it does not use “real world” investment returns in its calculation, a new report says.

A C.D. Howe Institute study has concluded the federal liability for pension plans now totals $227-billion, which is $80-billion more than the government reports in its Public Accounts.

“Ottawa’s calculations do not reflect investment returns available in the real world,” says co-author William Robson, who is CEO of the C.D. Howe Institute.

Read it all.

Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsPolitics in General* International News & CommentaryCanada

1 Comments
Posted December 13, 2011 at 3:44 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Like many middle-class American baby boomers, Linda Carmona-Sanchez is anxious about slipping into poverty and says whatever dreams she once had about retirement in her "golden years" have turned into nightmares.

"We don't value people here in this country, and we value you less if you're not healthy and strong," Carmona-Sanchez, 55, said.

"To me it would almost be a welcome blessing to know that I would die rather than to be old and have to live in poverty," she said.

Her anxiety is widespread....

Read it all.

Filed under: * Culture-WatchAging / the ElderlyMiddle Age* Economics, PoliticsEconomyConsumer/consumer spendingPersonal FinancePensions

7 Comments
Posted November 9, 2011 at 5:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

A financial transaction tax would be the wrong choice for Europe at any time; and particularly now.

To understand the impact of FTT, we need to answer four essential questions. Is it an efficient means of raising tax revenue? Would it benefit the end-users of the financial markets, both businesses and consumers? Would it enable the creation of economic growth and jobs? And would it make financial markets more stable?

First, financial services is a mobile, global and highly competitive sector. The European Commission’s suggests that Europe would lose 10 per cent of its securities market, 40 per cent of its spot currency market and 70 to 90 per cent of its derivatives market if FTT were introduced.

These are alarming numbers and economically very damaging — and they are not mere conjecture. Sweden’s FTT (from 1984 to 1991), resulted in between 90 and 99 per cent of traders in bonds, equities and derivatives moving from Stockholm to London. This was an expensive lesson for Sweden. Its experience should prevent Europe from making a similar mistake.

Second, what will be the impact on users of financial markets, including ordinary consumers? Economic theory suggests that a transaction tax would largely be passed on to end-users, whether they are savers, investors or businesses. The European Commission itself makes this point.

Read it all (requires subscription).

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifePersonal FinancePensionsStock MarketTaxes* International News & CommentaryEngland / UK

0 Comments
Posted November 7, 2011 at 8:06 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

South Carolina’s teachers and state employees are willing to pay more to fix the retirement system — but only if they get a raise first.

That’s the plan endorsed by the S.C. State Employees Association and the S.C. Education Association, which together represent 30,000 of the state’s 141,000 teachers and state employees.

The plan, which the groups submitted in writing to House and Senate subcommittees studying the retirement system, says teachers and state employees are willing to increase their contribution to the retirement system by 0.5 percent, but only if they receive at least a 2 percent raise — a “cost-of-living adjustment” for state employees and a “step increase” for teachers.

Read it all.

Filed under: * Culture-WatchEducation* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government* South Carolina

0 Comments
Posted November 1, 2011 at 8:01 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

After decades of drift, denial and inaction, Rhode Island’s $14.8 billion pension system is in crisis. Ten cents of every state tax dollar now goes to retired public workers. Before long, Ms. Raimondo has been cautioning in whistle-stops here and across the state, that figure will climb perilously toward 20 cents. But the scary thing is that no one really knows. The Providence Journal recently tried to count all the municipal pension plans outside the state system and stopped at 155, conceding that it might have missed some. Even the Securities and Exchange Commission is asking questions, including the big one: Are these numbers for real?

“We’re in the fight of our lives for the future of this state,” Ms. Raimondo said in a recent interview. And if the fight is lost? “Either the pension fund runs out of money or cities go bankrupt.”

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

2 Comments
Posted October 23, 2011 at 2:02 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Like their secular counterparts, many clergy who devoted their attention to less temporal matters than financial planning now find themselves amid shrinking church budgets and a poor economy being forced to work beyond traditional retirement ages.

It is an especially critical issue in smaller churches that still do not set aside money for clergy retirement. In a 2008 study of Church of Christ clergy in Texas, just a quarter of respondents said they had plans to fully retire.

But it is also a burden for larger, mainline Protestant denominations. As memberships shrink and many older clergy find it financially untenable to retire, even fewer younger clergy are able to find work.

Read it all.

Filed under: * Christian Life / Church LifeParish MinistryMinistry of the OrdainedStewardship* Culture-WatchAging / the Elderly* Economics, PoliticsEconomyCredit MarketsPersonal FinancePensionsStock MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--

2 Comments
Posted October 10, 2011 at 5:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The wealth of nations, the [Social Trends Institute] report says, is inextricably associated with the health of families. And, amongst other factors, the global retreat from marriage and from family has depressed economic growth and has deeply hurt two generations of children.

“Evidence drawn from Europe and North America indicates that children who are raised in an intact married home are more likely to excel in school and be active in the labour force as young adults,” the report says. “An abundant social-science literature, as well as common sense, supports the claim that children are more likely to flourish, and to become productive adults, when they are raised in stable, married-couple households.” Yet, with the global decline of these households, “the sustainability of humankind’s oldest organization, the family – the fount of fertility, nurturance and human capital – is now an open question.”

The report cites studies that indicate that American children who are raised outside of “an intact married home” are two to three times more likely to suffer serious social and psychological problems....

Read it all.

Filed under: * Culture-WatchAging / the ElderlyChildrenMarriage & FamilyPsychology* Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifePersonal FinancePensionsThe U.S. GovernmentSocial SecurityPolitics in General* International News & CommentaryCanada

1 Comments
Posted October 4, 2011 at 6:01 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Stocks are getting pummeled as the prospect of a global slowdown increases. The S&P 500 is now down more than 10% year-to-date. Meanwhile, already superlow bond yields are getting even lower, thanks to the Federal Reserve's latest extraordinary easing action. The 30-year U.S. Treasury bond at one point on Thursday yielded less than 2.8%.

That is the kind of one-two punch that will worsen pension deficits while also making the contributions required to fill holes even bigger. This could crimp earnings and cash flow at some publicly traded companies while putting already strained state and local-government plans under even greater pressure. In turn, this could be another weight on markets and add to further economic uncertainty.

And, if nothing else, the market's current malaise again highlights the lunacy of both public and private pension funds continuing to believe on average that they can generate annual returns of 8%.

Read it all.

Filed under: * Culture-WatchPsychology* Economics, PoliticsEconomyCorporations/Corporate LifeCredit MarketsPersonal FinancePensionsStock MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--

1 Comments
Posted September 23, 2011 at 5:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The Church in Wales will next week consider taking a further step towards equality for gay clerics by providing improved pension rights for their civil partners.

But progressive elements in the Church remain uneasy that while there is an acceptance that priests can have a monogamous sexual relationship, the same tolerance does not extend to Bishops.

During a two-day meeting starting on Wednesday of the Church’s Governing Body, it will be recommended that surviving civil partners of retired clerics should receive a pension based on the priest’s entire working life. Until now, the rate of pension has only been calculated from 2005, when civil partnerships were first allowed.

Read it all.

Filed under: * Anglican - EpiscopalAnglican ProvincesChurch of Wales* Christian Life / Church LifeParish MinistryMinistry of the Ordained* Culture-WatchSexuality--Civil Unions & Partnerships* Economics, PoliticsEconomyPersonal FinancePensions

2 Comments
Posted September 19, 2011 at 7:28 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Retirement plans and living standards for nearly half a million South Carolinians are in the hands of state politicians.

On the line are cost-of-living increases, the number of years public employees must work before they earn retirement pay and future contribution rates, all of which stand to change as the state's top elected officials try to figure out a way to deal with the retirement system's $17 billion funding mess.

Risky investment strategies and too-generous retirement benefits over the years coupled with the recession have been blamed by fiscal watchdogs as the reason the state's pension plan has long-term stability problems.

Read it all from the front page of the local paper.

Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyCredit MarketsLabor/Labor Unions/Labor MarketPersonal FinancePensionsStock MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government* South Carolina

2 Comments
Posted September 16, 2011 at 3:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

“The current situation is dire, and necessitates decisive steps to put the city back on a path to solid financial footing and future prosperity,” Governor Lincoln Chafee, who joined Flanders in announcing the bankruptcy petition today, said in the statement. “We will be exploring all options to provide quality services at an affordable cost to all taxpayers.”

Central Falls, a city of about 18,000 located about 6 miles (9.7 kilometers) north of Providence, is the fifth municipal entity to file for bankruptcy this year, compared with six in all of 2010, according to data compiled by Bloomberg. The filing followed last week’s move by lawmakers in Jefferson County, Alabama, to postpone a vote on proceeding with what would be the biggest U.S. municipal bankruptcy.

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralCity Government

0 Comments
Posted August 1, 2011 at 4:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The small city of Central Falls, R.I., appears to be headed for a rare municipal bankruptcy filing, and state officials are rushing to keep its woes from overwhelming the struggling state.

The impoverished city, operating under a receiver for a year, has promised $80 million worth of retirement benefits to 214 police officers and firefighters, far more than it can afford. Those workers’ pension fund will probably run out of money in October, giving Central Falls the distinction of becoming the second municipality in the United States to exhaust its pension fund, after Prichard, Ala.

Read it all.

Filed under: * Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralCity Government

4 Comments
Posted July 12, 2011 at 4:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The major advanced economies should not just be worried about Greece, it said, they should be worried about themselves. If the huge debt levels of the major economies prompt the world financial markets to wonder if those debts will be honoured, so that the markets take a set against sovereign debt in general, the majors, too, will be in big trouble.

But as the British economist Dr Diane Coyle reminds us in her new book, The Economics of Enough, it is worse than that.

We have known for years that the major advanced economies are facing immense pressure on their budgets from the ageing of their populations. They are committed to generous pension payments and healthcare spending for their retiring baby boomers at a time when, for many countries, their populations will be falling.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHealth & Medicine* Economics, PoliticsEconomyPersonal FinancePensionsTaxesPolitics in General* International News & CommentaryAmerica/U.S.A.England / UKEuropeGreece

0 Comments
Posted July 6, 2011 at 10:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Put aside the cruise brochures and let the garden retain that natural look for a few more years. Demography and declining investment returns are conspiring to keep you at your desk far longer than you ever expected.

This painful truth is no longer news in the rich world, and many governments have started to deal with the ageing problem. They have announced increases in the official retirement age that attempt to hold down the costs of state pensions while encouraging workers to stay in their jobs or get on their bikes and look for new ones.

Unfortunately, the boldest plans look inadequate. Older people are going to have to stay economically active longer than governments currently envisage; and that is going to require not just governments, but also employers and workers, to behave differently.

Read it all.

Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyPersonal FinancePensionsThe U.S. GovernmentBudgetSocial SecurityPolitics in General* International News & CommentaryEurope

1 Comments
Posted April 10, 2011 at 2:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

If you want to understand better why so many states—from New York to Wisconsin to California—are teetering on the brink of bankruptcy, consider this depressing statistic: Today in America there are nearly twice as many people working for the government (22.5 million) than in all of manufacturing (11.5 million). This is an almost exact reversal of the situation in 1960, when there were 15 million workers in manufacturing and 8.7 million collecting a paycheck from the government.

It gets worse. More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined. We have moved decisively from a nation of makers to a nation of takers. Nearly half of the $2.2 trillion cost of state and local governments is the $1 trillion-a-year tab for pay and benefits of state and local employees. Is it any wonder that so many states and cities cannot pay their bills?

Every state in America today except for two—Indiana and Wisconsin—has more government workers on the payroll than people manufacturing industrial goods.

Read it all.

Filed under: * Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentBudgetThe National DeficitPolitics in GeneralCity GovernmentState Government* International News & CommentaryAmerica/U.S.A.

12 Comments
Posted April 2, 2011 at 4:45 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

More workers are pessimistic about their retirement future than at any time in the past two decades, according to the Employee Benefit Research Institute 2011 Retirement Confidence Survey.

The percentage of workers who are not at all confident about saving enough money for a comfortable retirement reached 27% in 2011, compared with 22% last year. When combined with those who said they are not too confident, the total reaches 50% of workers.

"That is sobering," says Greg Burrows, senior vice president of retirement and investor services at the Principal Financial Group, a partner with the EBRI survey. "Hopefully this will spur some action."

Read it all.

Filed under: * Culture-WatchAging / the ElderlyMiddle Age* Economics, PoliticsEconomyCorporations/Corporate LifeLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--* International News & CommentaryAmerica/U.S.A.

1 Comments
Posted March 16, 2011 at 11:08 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Coming up with bigger contributions to pension funds will require states to make difficult choices about the size of their work forces, their commitment to public services and the viability of their employee benefits, which are often said to be irreversible and protected by state constitutions.

“The amount they have to be contributing could potentially be two to three times as much as they’re contributing now,” said Joshua Rauh, an associate professor of finance at Northwestern University, who has been challenging the way most cities and states measure their pension promises. “If you don’t want to count on the stock market to pay for all this, this is what you’re going to have to contribute.”

Mr. Rauh and a number of other analysts say the states’ biggest problem has been a failure to understand how much benefits will really cost. Instead of the states’ models, these analysts have come up with alternatives that more closely approximate those used by insurance companies.

Read it all (emphasis mine).

Filed under: * Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsStock MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

0 Comments
Posted March 13, 2011 at 5:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Lawmakers and governors in many states, faced with huge shortfalls in employee pension funds, are turning to a strategy that a lot of private companies adopted years ago: moving workers away from guaranteed pension plans and toward 401(k)-type retirement savings plans.

The efforts come as the governors of Wisconsin and Ohio, citing dire budget problems, are engaged in bitter showdowns with public-employee unions over wages, pensions and collective bargaining rights.

The new plans allow states to set a firm, upfront limit on the amount they will contribute and leave it up to the employee and the financial markets to make the money grow. In a traditional pension system, the employer promises a certain benefit, then must find a way to pay for it.

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

18 Comments
Posted March 1, 2011 at 11:06 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The 401(k) generation is beginning to retire, and it isn't a pretty sight.

The retirement savings plans that many baby boomers thought would see them through old age are falling short in many cases.

The median household headed by a person aged 60 to 62 with a 401(k) account has less than one-quarter of what is needed in that account to maintain its standard of living in retirement, according to data compiled by the Federal Reserve and analyzed by the Center for Retirement Research at Boston College for The Wall Street Journal. Even counting Social Security and any pensions or other savings, most 401(k) participants appear to have insufficient savings. Data from other sources also show big gaps between savings and what people need, and the financial crisis has made things worse.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyMiddle Age* Economics, PoliticsEconomyPersonal FinancePensionsStock MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentSocial Security

3 Comments
Posted February 20, 2011 at 2:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Ohio public school teachers would pay a larger share of their retirement costs, work until they're older and see pension benefits cut under changes approved Thursday that aim to keep their primary pension fund solvent by saving $10.9 billion.

The State Teachers Retirement System board approved a host of changes to the benefit program that serves the bulk of the pension fund's 470,000 members. The changes must be approved by lawmakers and the governor.

Spokeswoman Laura Ecklar said the package marks the end of a two-year effort to find a way to keep the pension fund afloat for the long haul.

Read it all.

Filed under: * Culture-WatchEducation* Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralCity GovernmentState Government

0 Comments
Posted February 1, 2011 at 5:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

“Industrial relations” are back at the heart of politics—not as an old-fashioned clash between capital and labour, fought out so brutally in the Thatcherite 1980s, but as one between taxpayers and what William Cobbett, one of the great British liberals, used to refer to as “tax eaters”. People in the private sector are only just beginning to understand how much of a banquet public-sector unions have been having at everybody else’s expense.... In many rich countries wages are on average higher in the state sector, pensions hugely better and jobs far more secure. Even if many individual state workers do magnificent jobs, their unions have blocked reform at every turn. In both America and Europe it is almost as hard to reward an outstanding teacher as it is to sack a useless one.

While union membership has collapsed in the private sector over the past 30 years (from 44% of the workforce to 15% in Britain and from 33% to 15% in America), it has remained buoyant in the public sector. In Britain over half the workers are unionised. In America the figure is now 36% (compared with just 11% in 1960). In much of continental Europe most civil servants belong to unions, albeit ones that straddle the private sector as well. And in public services union power is magnified not just by strikers’ ability to shut down monopolies that everyone needs without seeing their employer go bust, but also by their political clout over those employers.

Read it all.

Filed under: * Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentPolitics in GeneralState Government

3 Comments
Posted January 9, 2011 at 1:18 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

An Ohio pension fund has sued Wells Fargo & Co to recover losses suffered when a bank that it bought put the fund's money into a risky investment vehicle that failed.

The School Employees Retirement System of Ohio, represented by state Attorney General Richard Cordray, said it lost $29.6 million because a unit of Wachovia Corp mismanaged a securities lending program marketed as a "low-risk" way to boost returns.

Read it all.

Filed under: * Culture-WatchEducationLaw & Legal Issues* Economics, PoliticsEconomyPersonal FinancePensionsThe Banking System/SectorThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

0 Comments
Posted December 29, 2010 at 6:58 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

A study by Northwestern University's Kellogg School of Management calculates the combined underfunding of pensions in all municipalities at $574 billion. States have an estimated $3.3 trillion in unfunded pension liabilities.

Nunes says 10 states will exhaust their pension money by 2020, and all but eight states will by 2030.

States' troubles are becoming bigger. Hitherto, local governments have acquired infusions of funds from federal budget earmarks, which are now forbidden. Furthermore, states are suffering "ARRA hangover" - withdrawal from the American Recovery and Reinvestment Act, aka the 2009 stimulus.

There are legal provisions for municipalities to declare bankruptcy. Some have done so. As many as 200 are expected to default on debt next year. There are, however, no bankruptcy provisions for states.

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifeLabor/Labor Unions/Labor MarketPersonal FinancePensionsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentPolitics in GeneralCity GovernmentState Government

0 Comments
Posted December 28, 2010 at 11:31 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Cities across the nation are raising property taxes, largely citing rising pension and health-care costs for their employees and retirees.

In Pennsylvania, the township of Upper Moreland is bumping up property taxes for residents by 13.6% in 2011. Next door the city of Philadelphia this year increased the tax 9.9%. In New York, Saratoga Springs will collect 4.4% more in property taxes in 2011; Troy will increase taxes by 1.9%.

Property-tax increases aren't unusual, in part because the taxes are among the main sources of local revenue. But officials say more and larger increases are taking hold. "This year we have seen a dramatic increase in our cities and towns having to increase property taxes" for pensions and other expenses, said Jack Garner, executive director of the Pennsylvania League of Cities and Municipalities.

Read it all.

Filed under: * Economics, PoliticsEconomyHousing/Real Estate MarketLabor/Labor Unions/Labor MarketPersonal FinancePensionsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralCity Government

0 Comments
Posted December 24, 2010 at 10:33 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

...the declining, little-known city of Prichard is now attracting the attention of bankruptcy lawyers, labor leaders, municipal credit analysts and local officials from across the country. They want to see if the situation in Prichard, like the continuing bankruptcy of Vallejo, Calif., ultimately creates a legal precedent on whether distressed cities can legally cut or reduce their pensions, and if so, how.

“Prichard is the future,” said Michael Aguirre, the former San Diego city attorney, who has called for San Diego to declare bankruptcy and restructure its own outsize pension obligations. “We’re all on the same conveyor belt. Prichard is just a little further down the road.”

Many cities and states are struggling to keep their pension plans adequately funded, with varying success. New York City plans to put $8.3 billion into its pension fund next year, twice what it paid five years ago. Maryland is considering a proposal to raise the retirement age to 62 for all public workers with fewer than five years of service.

Illinois keeps borrowing money to invest in its pension funds, gambling that the funds’ investments will earn enough to pay back the debt with interest. New Jersey simply decided not to pay the $3.1 billion that was due its pension plan this year.

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralCity Government

0 Comments
Posted December 23, 2010 at 7:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Now the city faces a rare and crippling crisis. On Jan. 1 city property values will decline immediately because higher taxes will be needed to stabilize its pension fund. All of that will occur because the state, in the new year, will be able to take over the pension plan since the mayor and council are nowhere near a deal that will deliver the $200 million-plus needed to bring the plan up to 50 percent funded, from the current 29 percent.

That takeover will mean the city will be forced by the state to pay much higher contributions into the fund year after year. The state doesn't care where the money comes from -- even if it means sharply higher taxes -- only that the city shore up its pension program.

City Council members keep saying that such a hit won't come for years, but that lackadaisical attitude is part of the reason they and the mayor have failed to find a compromise.

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralCity Government

2 Comments
Posted December 22, 2010 at 8:59 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

State Street Corporation (NYSE: STT), one of the world's leading providers of financial services to institutional investors, announced today that it has been appointed by the General Synod Pension Plan of the Anglican Church of Canada to provide custody, fund accounting, securities lending and foreign exchange services for CAD $600 million in assets.

The General Synod Pension Plan of the Anglican Church of Canada is a multi-employer Pension Plan registered with the province of Ontario and has been in existence since 1946. The General Synod Pension Plan of The Anglican Church of Canada provides pension benefits to clergy and lay employees of the Anglican Church of Canada and related organizations.

Read it all.

Filed under: * Anglican - EpiscopalAnglican ProvincesAnglican Church of Canada* Culture-WatchReligion & Culture* Economics, PoliticsEconomyCorporations/Corporate LifeCredit MarketsPersonal FinancePensionsStock MarketThe Banking System/Sector* International News & CommentaryAmerica/U.S.A.Canada

0 Comments
Posted December 17, 2010 at 6:54 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Religious denominations have long provided retired clergy and staff with secure pension payments—more secure, in some cases, than corporate retirement plans.
But some recent bumps have drawn attention to the vulnerabilities of so-called “church plans,” which are exempt from federal regulations aimed at safeguarding retirement funds for private-sector retirees.

As cash-strapped states and private companies revamp, freeze or end their pension programs altogether, participants in church plans are now realizing how church plans can be riskier than they appear, observers say.

“As a group, employees in so-called church plans are far more at risk than other private sector employees,” said Karen Ferguson, director of the Pension Rights Center, a Washington-based watchdog group.

Read it all.

Filed under: * Anglican - EpiscopalEpiscopal Church (TEC)* Christian Life / Church LifeParish MinistryMinistry of the LaityMinistry of the Ordained* Culture-WatchAging / the ElderlyReligion & Culture* Economics, PoliticsEconomyPersonal FinancePensionsStock Market* Religion News & CommentaryOther Churches

1 Comments
Posted December 14, 2010 at 11:29 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The trustees of the Church Pension Fund have decided not to grant a cost-of-living-related increase for retirees and surviving spouses in 2011, according to fund president Dennis T. Sullivan.

In a letter posted here on the Fund's website, Sullivan added that the trustees will not make a "one-time special supplement" benefit payment as they did in 2010.

"I know this decision will be a disappointment to many of you," Sullivan wrote.

This will be the second year in a row that the Fund has not made a cost-of-living-related increase.

Read it all.

Filed under: * Anglican - EpiscopalEpiscopal Church (TEC)* Culture-WatchAging / the Elderly* Economics, PoliticsEconomyPersonal FinancePensions

7 Comments
Posted December 6, 2010 at 4:27 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Five weeks after the Legislature passed a budget that promised to close a $19 billion budget shortfall, California has sunk back into yet another fiscal crisis, this time facing a $26 billion gap that is posing a major new challenge for the incoming governor, Jerry Brown, and seems almost certain to force deep cuts in a state already reeling from three years of financial turmoil.

The departing governor, Arnold Schwarzenegger, has called a special session of the Legislature for Dec. 6 to begin dealing with one part of the problem: a projected $6 billion shortfall in the $126 billion budget passed in October, a record 100 days late. Mr. Schwarzenegger’s aides said the governor, a Republican who has fought repeatedly with Democrats in pushing through deep spending cuts, will propose another round of reductions to get the state through the end of this fiscal year in June.

“There’s no more easy stuff to cut,” Susan Kennedy, Mr. Schwarzenegger’s chief of staff, said Monday. “We are cutting into bone now.”

Read it all.

Filed under: * Economics, PoliticsEconomyConsumer/consumer spendingCorporations/Corporate LifePersonal FinancePensionsTaxesPolitics in GeneralState Government* TheologyEthics / Moral Theology

13 Comments
Posted November 17, 2010 at 12:34 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

For the past few decades, many local and state governments evaded... [certain set] requirements, using an array of accounting gimmicks and rosy economic predictions to routinely understate pension fund liabilities and overstate assets. All the while, cozy arrangements between politicians and public employee unions fueled pension benefit increases. According to a study by the Pew Center, state and local governments today face at least $1 trillion of unfunded pension promises.

The problem is exacerbated by significant differences between the laws governing public pensions and those in the private sector.

Private sector pensions are required by federal law (Employee Retirement Income Security Act) to conform to certain minimum pension funding rules. These rules require more accurate measurement of pension liabilities and assets and prevent companies with significantly underfunded pension plans from making new promises they can’t afford to keep. State and local government plans are not subject to these federal laws, and many failed to take it upon themselves to responsibly ensure that they would be able to make good on their promises....

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

1 Comments
Posted October 3, 2010 at 7:01 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The problem with the business cycle under this analysis, you’ll notice, is not the bust — it’s the boom. That’s when the bad investment decisions are made, largely because political influence in the markets (housing policy, tax breaks, artificially cheap money and other interest-rate subsidies, risk subsidies, etc.) distorts economic calculation.

Which brings us back to the entitlements. It’s easy to say: Well, we’ll just raise the retirement age, or cut benefits, or means-test them, or raise taxes on the wealthy who receive them (which amounts to means-testing, but Democrats like that version better). And, yes, that probably is what we will do, eventually. But that does not get us out of the economic pickle: People have been making decisions for years and years — decisions about saving, investing, consuming, working, and retiring — based at least in some part on what are almost certainly faulty assumptions about what sort of Social Security, Medicare, and other benefits they will receive when they retire. When those disappear, a lot of consumption is going to have to be forgone — and a lot of capital dedicated to producing those goods and services for consumption will be massively devalued. Businesses will have to retrench, probably in a way that is more disruptive and more expensive than the housing-bubble recession necessitated.

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsThe U.S. GovernmentSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

2 Comments
Posted September 19, 2010 at 2:20 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Earlier this year, Illinois said it had found a way to save billions of dollars. It would slash the pensions of workers it had not yet hired. The real-world savings would not materialize for decades, of course, but thanks to an actuarial trick, the state could start counting the savings this year and use it to help balance its budget.

Actuaries, including some who serve on the profession’s governing boards, got wind of what Illinois was doing and began to look more closely. Many thought Illinois was using an unorthodox maneuver to starve its pension fund of billions of dollars, while papering over a widening gap between what it owed and how much it had. Alarmed, they began looking for a way to discourage Illinois’s method before other states could adopt it.

They are too late. The maneuver, and techniques that have similar effects, are already in use in Rhode Island, Texas, Ohio, Arkansas and a number of other places, allowing those states to harvest savings today by imposing cuts on workers in the future.

Read it all.

Filed under: * Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

4 Comments
Posted September 18, 2010 at 5:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The consequences of doing nothing would be painful. But they would be far less harmful than the consequences of an unconditioned federal bailout, which would mean massive new fiscal commitments at the federal level.

Unfortunately, leaders in Illinois and elsewhere are now talking quietly about the possibility of a federal bailout. Such speculation undermines state and local efforts to reform pension systems or make other hard choices. Why agonize over unpopular budget cuts or tax increases if the feds will ride to the rescue?

Bailing out state pensions would be astronomically expensive. According to a Pew Foundation estimate this year, the total unfunded liabilities of the 50 states' pension funds amounted to about $1 trillion in 2008. Another recent study, by Josh Rauh of Northwestern and Robert Novy-Marx of the Chicago Booth School of Business, estimated that the unfunded liability was closer to $3 trillion. Adding the liabilities of municipal pension funds makes the total even larger.

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentPolitics in GeneralCity GovernmentState Government

10 Comments
Posted August 20, 2010 at 5:29 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Fidelity administers 17,000 plans, which represents 11 million participants. In the second quarter, some 62,000 workers initiated a hardship withdrawal. That's compared with 45,000 in the same period a year ago.

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--

0 Comments
Posted August 20, 2010 at 7:15 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

America's baby boomers—those born between 1946 and 1964—face a problem that could weigh on the economy for years to come: The longer it takes for the economy to recover, the less money they'll have to spend in retirement.

Policy makers have long worried that Americans aren't saving enough for old age. And lately, current and prospective retirees have been hit on many fronts at once: They have less money, they earn less on what they have, their houses aren't rising in value and the prospect of working longer to make up the shortfall has dimmed significantly in a lousy job market.

"We will have to learn to make do with a lot less in material things," says Gary Snodgrass, a 63-year-old health-care consultant in Placerville, Calif. The financial crisis, he says, slashed his retirement savings 40% and the value of his house by about half.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHistoryMiddle Age* Economics, PoliticsEconomyConsumer/consumer spendingHousing/Real Estate MarketPersonal FinancePensionsStock MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--

0 Comments
Posted August 16, 2010 at 7:20 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

There’s a class war coming to the world of government pensions.

The haves are retirees who were once state or municipal workers. Their seemingly guaranteed and ever-escalating monthly pension benefits are breaking budgets nationwide.

The have-nots are taxpayers who don’t have generous pensions. Their 401(k)s or individual retirement accounts have taken a real beating in recent years and are not guaranteed. And soon, many of those people will be paying higher taxes or getting fewer state services as their states put more money aside to cover those pension checks.

At stake is at least $1 trillion. That’s trillion, with a “t,” as in titanic and terrifying.

Read it all.

Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyCredit MarketsLabor/Labor Unions/Labor MarketPersonal FinancePensionsStock MarketTaxesPolitics in GeneralState Government

4 Comments
Posted August 7, 2010 at 11:02 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

As the Evangelical Lutheran Church in America (ELCA) fights to stay out of a legal battle over unpaid pension benefits, all sides agree on at least one point:

More is at stake than the millions of dollars owed to some 500 pensioners of Augsburg Fortress, the ELCA’s publishing arm.

Last month, the ELCA asked a federal court to be dropped from a suit filed by stakeholders in Augsburg’s recently dissolved pension plan. The ELCA contends it bears no responsibility under the 1974 Employee Retirement Income Security Act because Augsburg Fortress’ pension program is a “church plan.” Church plans are exempted from ERISA requirements, which include sufficient funding to meet promised obligations.

Some Lutherans, however, don’t like what they’re seeing.

Read it all.

Filed under: * Culture-WatchBooksReligion & Culture* Economics, PoliticsEconomyCorporations/Corporate LifePersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--* Religion News & CommentaryOther ChurchesLutheran

1 Comments
Posted July 30, 2010 at 7:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Oregon government stands at the edge of a financial chasm as precarious as any in its 151-year history, hemmed in by the global recession, questionable spending decisions and a budget-draining combo of skyrocketing expenses and sluggish growth.

Consider this sobering fact: State expenses, including payroll, health and retirement benefits, and debt payments, are slated to rise by nearly $4 billion over the next two years -- a 26 percent jump. During the same period, however, revenues to pay those expenses are expected to increase by a little less than $2 billion, or about 14 percent -- and that assumes a return to a robust economy.

Oregon simply can't keep up.

Lacking a substantial tax increase, which appears unlikely, the state won't have the money to offer the same level of services, pay and benefits to the same number of people.

The state has faced tough times before, but this crisis is a game changer, economists and political leaders agree. Past budgetary tricks, such as borrowing or sweeping money from other state funds, won't cut it.

Read it all.

Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

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Posted July 27, 2010 at 6:00 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

You may find it here.

Filed under: * Anglican - EpiscopalEpiscopal Church (TEC)* Economics, PoliticsEconomyCredit MarketsPersonal FinancePensionsStock Market

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Posted July 22, 2010 at 6:48 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Many states are acknowledging this year that they have promised pensions they cannot afford and are cutting once-sacrosanct benefits, to appease taxpayers and attack budget deficits.

Illinois raised its retirement age to 67, the highest of any state, and capped public pensions at $106,800 a year. Arizona, New York, Missouri and Mississippi will make people work more years to earn pensions. Virginia is requiring employees to pay into the state pension fund for the first time. New Jersey will not give anyone pension credit unless they work at least 32 hours a week.

“We can’t afford to deny reality or delay action any longer,” said Gov. Pat Quinn of Illinois, adding that his state’s pension cuts, enacted in March, will save some $300 million in the first year alone.

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Filed under: * Economics, PoliticsEconomyPersonal FinancePensionsPolitics in GeneralState Government

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Posted June 19, 2010 at 4:00 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

According to the Pew Center on the States, state pensions and other retiree benefit programs are underfunded by $1 trillion. And that estimate was made before the stock market swoon of 2008.

That number is an aggregate of all states, some of which are in relatively decent shape, and some of which are courting disaster. Too many states and localities created pension plans that are way too generous, allowing some workers, particularly those in law enforcement and other emergency response areas, to retire as early as their 40s, to "double dip" by collecting a salary and pension at the same time, or to manipulate pay in a way that inflates their pensions. In New Jersey, for example, a local lawyer and Democratic Party official cobbled together some part-time work for local government to claim a pension of more than $100,000.

The shortfall is made worse when cash-strapped governments make unrealistic projections about investment returns or underfund their plans by failing to make adequate annual contributions.

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Filed under: * Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsPolitics in GeneralState Government

3 Comments
Posted June 16, 2010 at 8:04 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Public school teacher pensions are a ticking time bomb. They’re short by $933 billion in assets needed to cover promises to retirees, or more than $18,600 per public school pupil.

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Filed under: * Culture-WatchEducation* Economics, PoliticsEconomyPersonal FinancePensionsStock MarketThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralCity GovernmentState Government

5 Comments
Posted June 14, 2010 at 7:35 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The Internal Revenue Service is drafting guidance that could require employers with religious affiliations to warn workers when their pensions have lost their federal safety net.

Over the past decade, more than 100 employers, including hospitals, schools, nursing homes, charities and other nonprofits, have converted their pension plans to "church plans," a largely unregulated category of pensions that generally cover clergy and lay employees of churches and synagogues.

Church plans are exempt from federal pension rules, including those that require employers to fund the plans and insure them with the Pension Benefit Guaranty Corp., or PBGC, a federal agency that pays the benefits if a pension plan runs out of money.

"They said: 'Hallelujah, I'm a church plan,' and no longer have to meet funding requirements, or pay premiums, said Andrew Zuckerman, the IRS's acting director of employee plans, at a meeting for pension groups this year.

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Filed under: * Culture-WatchLaw & Legal IssuesReligion & Culture* Economics, PoliticsEconomyPersonal FinancePensionsTaxes

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Posted June 5, 2010 at 1:03 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

Yesterday was my 58th birthday. If I were a Greek worker I could retire. Although pension payments in Greece normally start around 61, special provisions allow anyone to retire at 58 if they have been in employment for 35 years. That, as it happens, is how long I have been at work. My index-linked pensions from the Greek Government would be worth 75 to 90 per cent of the average salary in the country, guaranteed for the rest of my life by the State.

If you want to know why Greece is going bankrupt and why the euro seems to be on the verge of disintegration, look no farther. The best argument I have ever heard for a break-up of the euro was this observation in a German newspaper: “The Greeks go on to the streets to protest against an increase of the pension age from 61 to 63. Does this mean that Germans should extend the working age from 67 to 69, so Greeks can enjoy their retirement?”

This, however, is not another article about self-indulgent Greeks and self-righteous Germans. The battle over bailouts in Europe is only a sideshow compared with the great social conflict that lies ahead all over the world in the next 20 years. This will not be a struggle between nations or social classes, but between generations — and it is a conflict that, in Britain, begins in earnest this year. The end of the Second World War in May 1945 marked the start of the baby boom, which lasted until the mid-1960s. Now, 65 years later, the corresponding retirement revolution is about to shake up our society, economy and political institutions.

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Filed under: * Culture-WatchAging / the ElderlyHistoryYoung Adults* Economics, PoliticsEconomyPersonal FinancePensionsThe U.S. GovernmentSocial SecurityPolitics in General* International News & CommentaryAmerica/U.S.A.England / UK

2 Comments
Posted June 2, 2010 at 5:39 am [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

The state of California's real unfunded pension debt clocks in at more than $500 billion, nearly eight times greater than officially reported.

That's the finding from a study released Monday by Stanford University's public policy program, confirming a recent report with similar, stunning findings from Northwestern University and the University of Chicago.

To put that number in perspective, it's almost seven times greater than all the outstanding voter-approved state general obligation bonds in California.

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Filed under: * Culture-WatchAging / the Elderly* Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsPolitics in GeneralState Government

14 Comments
Posted April 7, 2010 at 4:55 pm [Printer Friendly] [Print w/ comments]

Posted by Kendall Harmon

But the comfortable retirement promised to retired firefighters and police officers is taking its toll on the city where DeGenova still lives. Today, Cranston is staggering under a huge underfunded pension liability equal to more than twice its annual budget, and paying the pensions of retired police officers and firefighters now absorbs some 20 percent of the city's budget.

"Right now the unfunded liability is well over $240 million," says Mayor Allan Fung. "And so it's a big obligation and is basically a ticking time bomb for the city of Cranston that we are trying to get a handle on."

How this happened is a monument to political shortsightedness. For years, Cranston operated a separate pension fund for more than 500 police and firefighters who regularly contributed money from their paychecks to the fund. (Other municipal employees were part of the state pension system.) Instead of setting the money aside and investing it, the city used the funds to pay operating expenses — everything from shoveling snow to paying employee salaries, says former Mayor Stephen Laffey.

"It was like taking your 401(k) plan and saying, 'I have to buy a lot of bubble gum with it.' That's what they did, and they really did it with a straight face," Laffey says.

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Filed under: * Economics, PoliticsEconomyLabor/Labor Unions/Labor MarketPersonal FinancePensionsThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

9 Comments
Posted March 24, 2010 at 6:30 am [Printer Friendly] [Print w/ comments]




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