Hemingway: When a public-sector pension is really a tax-paid trust fund 

Last year, Elinor Ostrom became the first woman to receive the Nobel Prize in economics, primarily for her insights about economic behavior.

Here’s one, from an interview last year: “Shaming and honoring are very important. We don’t have as much of an understanding of that. That’s not been part of our accepted way of thinking.”

Indeed, reading a New York Times cover story on public pensions last week, I began to wonder if it wasn’t time to bring back shame. That may be the only way to get the public-pension problem under control.

The Times reported that “13 New York City police officers recently retired at age 40 with pensions above $100,000 a year; nine did so in their 30s.”

When you retire in your 30s with an inflation-adjusted, taxpayer-funded, six-figure annual income for life, that’s not a pension; it’s a trust fund.

As a mitigating factor, the Times noted that many were special disability pensions. Police work is dangerous, but so is military service, and few disabled veterans receive benefits anywhere near that generous.

And what about the other 3,704 retired New York public-sector employees collecting six-figure pensions? According to the Congressional Research Service, the mean income for private-sector retirees is $31,757.

The CRS figure doesn’t count the value of health care, which most retired public employees get for free or at minimal expense to them. The CRS figure does include the average Social Security payout, which almost all public sector employees get on top of their generous pensions.

What did these public employees do to justify such egregiously generous benefits? Most likely, nothing. That’s just the way the system works.

The Times asked retired police officer Hugo Tassone of Yonkers, N.Y., to justify padding his salary with overtime to increase his retirement income. He retired at 44 and has a $101,333 annual pension.

“I don’t understand how the working guy that held up their end of the bargain became the problem,” Tassone told the Times.

Tassone did nothing illegal. Lawmakers should be held accountable for negotiating such sweet deals with public-employee unions. Such bargains almost always involve some sort of quid pro quo to help them get elected.

However, retiring young and expecting taxpayers to foot your generous income for 40 years or more is not OK. Just because something is legal does not mean one is honorable for taking advantage of the system.

That’s why the Times website contains all the salaries of New York workers with pensions of more than $100,000. The largest in the state goes to a former K-12 public school administrator, James Hunderfund, who earns $316,245 a year.

There are signs that the movement to shame public employees may catch on. The website www.californiapensionreform.com provides a searchable database of all 12,201 public employees earning six-figure pensions. In case you were wondering, Bruce Malkenhorst, a former city administrator of Vernon, earns a pension of $509,664 a year.

Every state and the feds should have such a database. Taxpayers nationwide are on the hook for $3 trillion in underfunded public-pension plans. But, political firestorms erupt whenever somebody tries to get a handle on these retirement rip-offs.

Even so, taxpayers have a right to know who’s responsible and to shame them for doing it.

Mark Hemingway is an Examiner editorial staff writer.

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Mark Hemingway

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