[vkou]

And what percentage of general fund spending goes to salaries, and salaries of contractors? The other 80%?

Pensions are part of employee salaries. Not budgeting for them is like buying a house, and not budgeting for anything past the first mortgage payment.

Why are we talking about defaulting, or haircutting pensions, instead of defaulting... On any of the other people or companies that the state owes money to?

[cassieramen]

I think the big focus of the article is the "California Rule" that prevents changes to pension commits that have yet to be earned. It's like buying a house and having the real estate market crash. You can renegotiate your property taxes (lowered home value). You can refinance your mortgage.

[vkou]

Changing future pension payment rules is entirely reasonable, as long as your prior work results in pro-rated payouts.

Changing 'future' pension payment rules, where a pension kicks in after 20 years of employment, when you are on year 19, should not fly.

[shouldbworking]

Social security pushes back retirement ages continually. Not an extra year at year 19 of 20, but tacking on 5-10% to everyone's remaining time is reasonable and the govt does it all the time for other entitlements.

I fail to see how social security, which is a national program for all citizens, is any less holy than pensions. Pensions are usually backed by city and state govt which have much shallower pockets.

What I'm saying is if the federal government can cut back social security benefits there's no reason we shouldn't cut future pension benefits

[vkou]

> Social security pushes back retirement ages continually.

SS is a welfare program. This is fundamentally different from a salary. Welfare programs can, and do change just before, or just after, you become eligible for them. This is fine. This is social programs are supposed to work. (Although, generally, their accounts should not be plundered to fund illegal wars.) There was no contract that you signed when you started paying into SS. It's a tax, which funds a welfare program.

Salaries, on the other hand, are sacred. Pensions aren't social programs. They are deferred salaries. Cutting pensions is a salary clawback.

If you're going to stop paying the pensions you're obligated to, you damn better have declared bankruptcy, and let your creditors - including the pensioners - pick over your carcass.

[nugget]

Social security is a pension program with contributions made from salaries, and future benefits based on the amount of contributions and age at retirement, as opposed to need.

There are other programs administered by the Social Security Administration (e.g. SSDI) that are welfare programs, but that's not what the previous poster was talking about.

[vkou]

Unlike a pension, there is no enumerated entitlement of what you will receive out of SS. You didn't enter any contract when you started making payments. The government could shut it down tomorrow, and it would not be considered a default.

The fact that the payments are structured much like a pension is tangential. For example, nothing stops the feds from restructuring it into flat payments.