Issue Position: What's Your Take on Pennsylvania's Pension Crisis?

Issue Position

The state's pension plans are headed for certain disaster. There is currently a $60 BILLION shortfall in these systems that threaten to cause a massive fiscal implosion. It's ruining the Commonwealth's credibility and is the driving force behind ever-increasing property taxes. This crisis was directly caused by failures of previous Governors and legislators to properly manage state policy. If this happened in the private sector, people would go to jail and their personal assets could be seized to help their victims. While I'd like to see that happen, it's just not legally possible when dealing with elected officials. Pointing fingers and playing the blame game will do us no good.

At this point in time, three elements of this crisis are crystal clear: 1) Taxpayers alone cannot afford to bail the pension systems out of trouble; 2) The courts will not allow any reductions in existing pension benefits by legislative action; and 3) the pension systems are on a trajectory to become insolvent at some point in the future, which would leave us in a situation similar to Detroit, where pensioners were paid mere pennies on the dollar despite promises made to them during their careers.

That outcome is wholly unacceptable and unfair.

As such, we need to 1) move new public hires away from defined benefit pension plans and toward a defined contribution (401k) plan as soon as possible without further deepening the current fiscal crisis; 2) ask existing pension plan members to VOLUNTARILY roll their benefit levels back to pre-Act 9 of 2001 levels (when the crisis first began); and 3) buckle down legislatively to adequately fund the pension plans until such time as no more retirees are depending on them.

It's not fair to put this entire burden on the taxpayer. Nor is it fair to strip public employees of benefits they were promised and helped pay for out of their own paychecks. Only by bringing all stakeholders to the table with compromise in mind can we ever get the Commonwealth out of this mess. We are, after all, all in this thing together and only together can we dig our way out of it. It won't be easy, but it is possible.

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