Are you ready to scream Foul! over the inequity between government and private sector retirement funding?

Here’s a typical news headline we see whenever a government-employee pension fund drops:

State pension fund lost 2.8% in May

Seems like legitimate news – right? After all, that’s over $1 billion lost from a $50 billion retirement fund.

Or is it a diversion?

Here’s an example of a news article that the mainstream media should be running instead. The headline would be:

Social Security fund lost 100% in 2011 – again

and the article would read:

“After emptying 100% of the Social Security Trust Fund in both 2010 and 2009, the federal government spent nearly all of the fund’s yearly income again in 2011.

“$643 billion gone.

“Politicians withdrew all of the money paid into the Social Security Trust. They blew it on corporate bailouts, state government bailouts, foreign wars, aid to foreign governments, government employee retirement packages and other government hand-outs.

Now that’s news! But you never see this reported in the mainstream media.

Social Security is broke. Old Mother Hubbard empty. Congress has been raiding it for decades, depleting all of the retirement savings for hundreds of millions of private sector workers who paid into the fund and who depend on Social Security for their retirement.

Mainstream news coverage frequently laments that government employee retirement funds are only 70% funded. Or only 80% funded. They warn that we will soon have to cough up more tax dollars to pay for the remaining 20% or 30%.

But why should the focus be on a 20-30% shortfall in funding for government retirement plans — when millions of Americans have no backing at all for their retirement?

0% financial backing for Social Security versus an average of over 80% funding for government retirement funds.

Politicians have squirreled away close to 5 TRILLION dollars* for state, local and federal government retirees. An average of $250,000 for every government worker and retiree – a quarter of a million dollars - while saving nothing for private sector workers:

With no funds in the Social Security Trust Fund, hundreds of millions of private sector workers could face poverty in their senior years. They must rely solely on future taxes extracted from future workers – at the will of Congress – to see a return on the FICA taxes they’ve been forced to pay all their working lives.

Lavish funding of government retirement packages is a major cause of today’s astronomical government debt.

In 2010, concerned voters elected dozens of Congressman to do something about high government spending.

So far, they haven’t delivered. Rather, they continue to maintain and expand budget-busting government pensions for themselves and their political allies – while they blow through the retirement fund of ordinary taxpayers.

While some state lawmakers have begun to rein in the high cost of government employee benefits, they have only scratched the surface. Dramatic reductions in government retiree payouts and retirement fund subsidies are needed now to bring them in line with Social Security.

This will start to balance government employee compensation with what workers get in the private sector and stave off the debt crises that are unfolding in federal, state and local governments.

Meanwhile government employees will still enjoy a host of other advantages such as higher wages, better medical insurance plans with lower co-pays and lower deductibles, more vacation time, more personal and sick days, and more job security.

Question 1:

Will you vote out of office the politicians who raid your Social Security savings and cut your Social Security benefits — while they continue to pour billions of dollars into their own and their allies’ government employee retirement packages?

Question 2:

Will you vote for candidates who have the courage and integrity to take specific action that will bring government employee retirement pay and benefits in line with those of everyday taxpayers?

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* A little math can give us a rough idea of the combined amount of all local, state, and federal government employee retirement funds – despite the fact that politicians refuse to report this data completely. For example, one of the ways they hide what they spend on government retirement plans is by funding them through “off-budget” accounts that are virtually never covered in mainstream news stories and almost never disclosed in government reports.

Consider that the $50 billion government retiree fund discussed in this article covers Massachusetts state government retirees and a portion of local government retirees. There are separate funds to cover the remaining local government retirees.

All retirement funds combined for Massachusetts government workers may well be worth $100 billion. And that’s just one state.

Massachusetts has an average population of about 6.5 million people – but it’s also wealthier than other states. If we assume that $100 billion in government retirement funds for Massachusetts is twice the national average, that means $50 billion is saved per state, times 50 states. That comes to $2.5 trillion saved just for state and local government retirees. According to the PEW Center on the States, the actual number was $2.35 trillion as of February, 2010.

Add to that total federal retiree funds – which are likely $2.5 trillion again – or more.

We should not be surprised to find that:

$5 trillion – or more – is saved for about 20 million government workers.
$0 is saved for hundreds of millions of private sector workers.

That comes to a quarter million dollars saved in trust for every government worker (current and future retirees) — versus ZERO, zip, nada, zilch saved for every private sector worker.

Are you sitting up in your chair yet? Are you ready to scream, “FOUL!“