JimmyPx makes a comment on my last post that I would like to address.
The first part is the statement that Social Security isn’t an entitlement. This is a common feeling, because many people seem to think that the term “entitlement” means free handout. That’s actually not what the term means. An entitlement is a government program guaranteeing access to some benefit, such as to welfare benefits or tax incentives, by members of a specific group and based on established rights. In other words, it’s called an entitlement because the recipient is entitled to it by law.
The second is his point that pensions are some kind of giveaway. Pensions, at least for fire personnel, I cannot speak for others, were intended as a bargain made to firefighters in lieu of pay. Back in the years following the Carter administration, fire departments were seeing lots of people leave for higher paying jobs in a private sector that was booming from the Reagan economy.
The problem is that the average hourly wage for a starting firefighter in Florida is somewhere around $17 an hour, not much more than the state’s minimum wage. Similar professions with similar education requirements get over $30 an hour. To solve this, the state kicked the can down the road by telling these employees that they could get a pension at the end of their career. This deferred the costs of higher pay.
It costs about 20% of payroll to supply a pension. This raised effective cost to about $20.40, which was still less than the cost of paying a competitive wage. The issue is that elected officials, not knowing much about economics, didn’t properly fund the pensions when they cut budgets so they could fund food pantries for illegal immigrant unwed mothers of anchor babies, as well other electoral baubles. This resulted in shortfalls that had to be made up by kicking the can down the road- just like the shortfall seen with Social Security.
So now you have people who continued working for you, even though the pay was lower, because they were looking forward to that pension. Twenty years later, they are ready to collect, and the city then tells them that they want to cut the pension because it’s too expensive. It’s akin to driving a car until it’s broken, then telling the dealer that you aren’t going to pay for it.
In my case, they took 3% of my gross pay in addition to the fact that I was paid less than my private sector counterparts. When I was approaching retirement age, they told me that they were changing the pension system. The biggest change was going to be that overtime would no longer be part of the calculation of your pension, even though they were still going to take 3% of my overtime pay. Since overtime was almost a third of what I was making, I decided to retire before the changes could take effect, even though it meant that I would get a lower pension amount. I now work as a nurse for a good deal more than I was making as a fire medic.
So we know that cutting pensions and Social Security are just ripping people off. We don’t want to cut the military. There are tons of things that the government does that one could make a good case against cutting them.
It doesn’t matter.
We are at the point where it is inevitable that the nation will collapse. All of those things will be unaffordable. They will all have to go.
It won’t happen until the collapse comes. When the checks don’t come, people will be PISSED. They will DEMAND that the government do something. History says that the something that they will wind up doing is some version of martial law.
16 Comments
Steve · June 5, 2025 at 10:39 am
The real issue is somewhere along the line, the rules changed. I’m guessing @JimmyPx is in the younger cohort, who see current pay rates, and assume payroll, especially government payroll has always been exorbitant.
Used to be a good framer with a few years experience could, if he were careful with money, be lower-middle class. Now he’s solid middle-class or higher. $100k guaranteed, $175k with overtime straight out of high school in my neck of the woods. Government positions like highway department, same. Engineers? Maybe $60k.
Elrod · June 5, 2025 at 11:16 am
“We are at the point where it is inevitable that the nation will collapse.”
Unfortunately, yes. The Bullshit Wizards in Congress may juggle the date around a little, but it’s a foregone conclusion that the whole mess will come crfashing down around our ears.
For many of us the concern is “before or after I shuffle of this mortal coil?”
Don’t count on too many tomorrows, we’ll have lots of sunrises, accompanied 1:1 by sunsets, but what haeppens in between will be, well, “epic.” Assuming there’s anyone left to write history books…..based on today’s Industrial Educational Complex Output, whatever history exists will be oral – maybe – but certainly not written.
Chris Mallory · June 5, 2025 at 11:27 am
Flemming v. Nestor, 1960 says SS has no contractual right attached to it. As for government employee pensions, they should not exist. No government employee should have a tax payer provided pension. Fuck anyone scum enough to take government employment.
Divemedic · June 5, 2025 at 2:45 pm
Well, that would be me. I served in the military AND worked for decades as a firefighter.
Dethrol · June 8, 2025 at 12:22 pm
That would be me also. Twice. I retired from the Army and then from the State Department. I’d just as soon you said nothing at all rather than reveal your contempt for me and my fellow patriots. Sleep well under the mantel of peace and freedom secured by the blood and sacrifice of the “scum” you revile.
JimmyPx · June 5, 2025 at 12:17 pm
Hi Divemedic, understand that I’m not saying “screw those people on government pensions” as I have family members who earned and are collecting their pensions as well as my wife who is a State employee who hopes one day to get a pension when she retires.
I was commenting on the state of things in general and as you said, the dumbass politicians never properly funded the pensions in most places so now they are a huge expense coming off the top of budgets. Also (not in Florida) but in many blue states the unions are in bed with the politicians and the pensions are insane and out of control.
Out of control pensions were on of the key drivers of the city of Detroit having to basically declare bankruptcy.
But you also made my point as we mostly agree that the government budgets need to be majorly cut but when your benefits might be cut you understandably get upset.
That’s true for everyone because most people are getting some kind of government check or benefit.
When it all goes BOOM, it will be 100x worse than what happened in Greece 10 years ago and it’s going to just be horrible. It’s too late to stop it as Elon Musk now realizes and I’m afraid that the crash is coming sooner rather than later.
Divemedic · June 5, 2025 at 2:50 pm
I agree that pensions shouldn’t exist. The answer is to pay people what the market dictates instead of kicking the can down the road using deferred pay (which is what a pension actually is). Having someone fulfill their end of the bargain (working for lower wages for 20 years or so) before screwing them out of the payment they were promised is simply wrong.
The problem is that government wants to buy lots of shiny baubles, but doesn’t want to pay for it.
If they can’t afford it at the time, they shouldn’t do it.
Still, at some point, the bill comes due. We are all going to have to take a bite of this shit sandwich someday.
Don Curton · June 5, 2025 at 12:20 pm
In private industry, the pension plan is considered part of the compensation package. In other words, you don’t just worked for your bi-weekly salary, you work for the compensation plan. The entire compensation package includes salary, pension plan, 401k matching funds, medical insurance plan, life insurance plan, paid vacation, company car, and any other “perk” they offer. So changes to the pension – AFTER you’ve already agreed to the compensation package and worked for years to earn your compensation, is cheating you after the fact. Flat out theft, in fact.
Anonymous · June 5, 2025 at 12:39 pm
My pension from TXU (largest public utility in Texas, covered 40% of Texas) starts on July 1, $215 per month for eight years of employment in the 1980s. I left them in 1989. TXU went bankrupt in 2014 or so due to the money men taking it private by creating bonds that paid 9%. Before TXU went bankrupt, they outsourced the 100% funded $4 billion pension plan to Fidelity. Somehow they were able to protect the pension plan from the money men.
https://www.reuters.com/article/world/americas/texas-power-company-energy-future-files-for-bankruptcy-idUSBREA3S0CQ/
Tsgt Joe · June 5, 2025 at 2:00 pm
In private business pension costs are included in overall labor costs, they are not an unearned “freebee”. In a previous lifetime (1980) I worked in a shop where the hourly labor costs was about $30. That figure was used to calculate bids and other things. The journeymen received IIRC $17.50 in their paycheck, add on employers portion of MA and SS, employers portion of medical, pension fund, workmens comp and other costs and you were quickly up to the $30. It could have been figured as hourly rate of $22.50 then deduct $5 for pension fund. Note, I really dont remember in detail what the actual figures were 45 years ago.
TLF · June 6, 2025 at 2:22 am
The feds (BLS) publish data on this: it’s a report called the Employer Cost of Employee Compensation. I think salary is about 60% of total cost overall, although it varies by industry.
The pension problem (and Social Security’s) is that earnings to the pension funds didn’t keep up during the long period when government bonds paid 2% in the 2010s. Most pension funds are heavily-invested in treasuries, and Social Security is (as far as I know) exclusively in them. So even well-run pension funds are in many cases in trouble.
Skippy Jif · June 5, 2025 at 2:44 pm
Pensions? Not for my generation.
A sibling lives off his and moved to the other side of the country to get away from the Fundamental Transformation.
If he goes back to work in the same field for another company, bye bye pension.
Remember when everybody flipped out over Shrubya Bush wanting to put it all in a Wall Street fund?
That would have been raided real fast.
Aesop · June 5, 2025 at 4:23 pm
Firefighter pensions are also somewhat cynical, knowing that quite a number of firefighters aren’t going to live to collect them, after years of sucking down a witches’ brew of toxic chemicals.
Which was how Social Security was enacted, giving a pension at age 65 knowing that most people would be dead by age 66.
And then modern medicine screwed up all their cunning plans.
Here’s an idea: fund the government entirely with tariffs, and give me back all my income taxes and social security deductions since age 14 to invest my ownself, and we’ll skip the interest on what they took out already.
I’ll be making twice what SS pays on interest of principal when I retire, and there’ll be a tidy sum when I die to will to next-of-kin.
All that would be lost would be billions of government-funded grift.
Any time government reaches for your pockets, for whatever reason, you should be swinging a machete.
Oh and that martial law thing?
That range will be hot in both directions.
Life expectancy for government becomes about 4 seconds, at that point.
dazed and confused · June 5, 2025 at 5:02 pm
What about all those states that are making gold legal tender or something? Are there any employers paying out in gold yet? Any food stores accepting gold at the checkout counter? Maybe counties should start accepting gold for property tax payments to speed this along.
Divemedic · June 5, 2025 at 8:56 pm
As I said in an earlier post, this is a money loser. A store isn’t going to take anything except official coins, because telling real rounds and nuggets from fake is too easy for the store to get scammed. A minimum wage cashier isn’t going to be very good at detecting fakes.
So with Eagles and other official PM coins, the issue then lies with premiums. The premium for coins is running about 10%.
Silver spot as a write this is $36.04.
Silver Eagles are selling for $41.42, which is a 15% loss. Even buying in 1500 coin lots at APMEX results in $41.09 per coin, which is still a 14% loss when converting dollars to silver coins.
Gold is even worse, as spot there is $3,377.
1/10 ounce Eagles (you aren’t going to spend a one ounce Eagle for groceries) are selling at APMEX for $431.92, which is a 28% loss in the conversion from dollars to gold.
Just not worth the trouble. You lose too much converting dollars to PM then PM to groceries. Especially when you consider that you are supposed to report any gain in the value of the coin between acquiring it and trading it for value, so you can pay capital gains tax.
Marco the Lab · June 5, 2025 at 8:56 pm
As I remember 15% of my paycheck was with held each time for SSI. That added up to 175,000$ over my lifetime. Go ahead cancel social security. What happened to all that money I paid in? I’d gladly take it lump sum zero interest today in lieu of much more in monthly payments. But the money is gone isn’t it? Just like everything else I paid in taxes.
Comments are closed.