[yummyfajitas]

The first thing they need to do is reduce the pension funding requirement, which was forced by a 2006 law.

Yes, rather than fully funding their pensions like any private company, they should be allowed to push massive problems into the future like the public sector does.

[rdl]

Private companies don't really fully fund their pensions, but during the period where pensions were common in private companies, those companies were expanding in revenue and headcount, so it was ok. Was.

High-risk private enterprises don't do pensions now (can you imagine a Zynga Pension Plan?). Approximately everyone has shifted to defined-contribution from defined-benefit. The problem is USPS and the fully-private companies with legacy pension plans are both in long-term decline and have underfunded pensions, but USPS is particularly large in workforce and obvious in long-term decline (and political).

[yummyfajitas]

Private companies are legally obligated to fund defined-benefit pensions. There are some waivers given out, but it is generally required.

http://thomas.loc.gov/cgi-bin/bdquery/z?d109:HR00004:@@@L&#3...;

Though strangely, defined benefit non-pension plans (e.g., retiree health care) are not required to funded. That's a loophole which should definitely be closed.

You are correct that the private sector has abandoned pensions for defined-contribution retirement plans, and with good reason. The public sector should do the same.

[quinnchr]

"The PPA increases the funding target for single-employer defined benefit pension plans from 90 percent to 100 percent of the plan’s present value of all accrued benefit liabilities"

Cool, now just make them fund the next 75 years of expected liability, instead of just the current liability.

[Danieru]

They already do, that is what "present value of all accrued benefit liabilities" means.

[quinnchr]

Hmm yes those 1/3 of Fortune 1000 companies who do decide to prefund (which is entirely optional, unlike for the USPS) do so at average of 30% of liability. At the USPS pre-funding rate they're projected to have 73% of future liability funded by 2016.

I think you're on to something though, we should definitely require private sector retirement benefits to be pre-funded by 100%, then we can all point our fingers and say how obvious it is that the private sector is less efficient.