This $700 Billion Public Employee Ticking Time Bomb Is Only 6.7% Funded; Most States Are Under 1%


by Tyler Durden
Zerohedge.com

We've spent a lot of time of late discussing the inevitable public pension crisis that will eventually wreak havoc on global financial markets.  And while the scale of the public pension underfunding is unprecedented, with estimates ranging from $3 - $8 trillion, there is another taxpayer-funded retirement benefit that has been promised to union workers over the years that puts pensions to shame...at least on a percentage funded basis.

Other Post-Employment Benefits (OPEB), like pensions, are a stream of future payments that have been promised to retirees primarily to cover healthcare costs.  However, unlike pensions, most government entities don't even bother to accrue assets for this massive stream of future costs resulting in $700 billion of liabilities that most taxpayer likely didn't even know existed. 

As a study from Pew Charitable Trusts points out today, the average OPEB plan in the U.S. today is only 6.7% funded (and that's if you believe their discount rates...so probably figure about half that amount in reality) and many states around the country are even worse.

States paid a total of $20.8 billion in 2015 for non-pension worker retirement benefits, known as other post-employment benefits (OPEB).  Almost all of this money was spent on retiree health care. The aggregate figure for 2015, the most recent year for which complete data are available, represents an increase of $1.2 billion, or 6 percent, over the previous year. The 2015 payments covered the cost of current-year benefits and in some states included funding to address OPEB liabilities. These liabilities—the cost of benefits, in today’s dollars, to be paid in future years—totaled $692 billion in 2015, a 5 percent increase over 2014.

In 2015, states had $46 billion in assets to meet $692 billion in OPEB liabilities, yielding a funded ratio of 6.7 percent. The total amount of assets was slightly higher than the reported $44 billion in 2014, though the funding ratio did not change. The average state OPEB funded ratio is low because most states pay for retiree health care benefits on a pay-as-you-go basis, appropriating revenue annually to pay retiree health care costs for that year rather than pre-funding liabilities by setting aside assets to cover the state’s share of future retiree health benefit costs.

State OPEB funded ratios vary widely, from less than 1 percent in 19 states to 92 percent in Arizona. As Figure 1 shows, only eight have funded ratios over 30 percent. These states typically follow pre-funding policies spelled out in state law. Many of them also make use of the expertise of staff from the state pension system to invest and manage plan assets.

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The Main Reason Congress Is Getting So Little Done Is... They Will Have 218 Days Off In 2017


By Michael Snyder
The End of The American Dream blog

Would you like to have a job that gave you 218 days off a year? According to the official calendar put out by House Majority Leader Kevin McCarthy, the House of Representatives will only be in session for 147 days in 2017. And that is actually an increase from last year. In 2016, there were only 131 legislative days for the House. So if you are wondering why Congress never seems to get anything done, this is one of the biggest reasons. The sad truth is that members of Congress simply do not spend a lot of time doing what they were elected to do.

 

If you are an average American worker with a full-time job, you probably put in around 240 working days a year. If you have to work that hard, why can’t Congress?

And actually things used to be even worse. The New York Times looked back at 2013 once it was done, and they found that the House was only in session for 942 hours for the entire year. When you break that down, it comes to about 18 hours a week.

If you go all the way back to 2006, there were just 104 legislative days in the House. It is almost as if they just decided to take pretty much that whole year off.

This is what I am talking about when I say that we need to “flush the toilet”. Those that are fortunate enough to be chosen to represent us in Washington should be some of the hardest working people in the entire country, and unfortunately we are getting just the exact opposite.

In the past there have been efforts to make members of Congress work full work weeks, but those efforts have always ended up failing

Some attempts have been made to force members of Congress to work full weeks. In 2015, for example, a Republican lawmaker from Florida, Rep. David Jolly, introduced legislation that would have required the House to be in session 40 hours a week when members of the House were in Washington, D.C.”A work week in Washington should be no different than a work week in every other town across the nation,” Jolly said at the time. Jolly’s measure failed to gain traction.

Congress gets especially lazy during the summer months. Many Americans don’t realize that every year Congress takes the entire month of August off. And actually, the House will be on vacation from July 29th all the way to September 4th in 2017.

Wouldn’t it be nice if you had the entire month of August off every year?

This year, U.S. Senator David Perdue is proposing that the August vacation be canceled because there is so much for Congress to do. According to Senator Perdue, there are five major tasks that need to be accomplished by September 30th

First, we have to complete the work on the first phase of repealing Obamacare and fixing our health care system.

Second, we have to pass a budget resolution that will work within the reconciliation process for changing the tax code.

Third, we have to use the appropriations process to fund the federal government by the end of the fiscal year on Sept. 30.

Fourth, we have to deal with our debt limit. The Treasury Department has used extraordinary measures to buy time since the national debt hit its limit of $19.8 trillion in March.

Fifth, we have to finally act on our once-in-a-generation opportunity to change our archaic tax code, but we will only be able to do so if we achieve the first four priorities.

If those things don’t get done in time, members of Congress should not expect the voting public to have any sympathy for them.

Of course there are many that would argue that members of Congress actually work very hard and that they need all of that time off to “serve their constituents”. The following comes from Snopes

Members of Congress have two jobs: represent their constituents and govern. These responsibilities do not always go hand in hand. Representing constituents means speaking with them in person, holding town hall meetings, organizing rallies, attending to casework, and otherwise being present in the district or state they represent. This is not easily done from a Washington office. Supporting or opposing legislation is an important part of a member’s? job. However, it does not come close to capturing members?’ range of responsibilities. This is why even when Congress is out of session, members are at work. Most members of Congress work a five-to-six-day week. The representative aspect of Congress?’s job is almost completely ignored in these statistics.

Yes, without a doubt it is important for members of Congress to go back and interact with those that elected them.

But at the end of the day their main job is to do the work that they were elected to do.

And even when they are in Washington, many of these Congress critters are spending much of their time on activities that have nothing to do with legislation. For example, in his new book entitled “Giant Of The Senate”, Senator Al Franken admits that he often spends much of his day on the phone raising money…

“It’s not uncommon to have three straight hours of call time scheduled as part of your day. … It’s brutal.”

This is why we need federal term limits. If members of Congress were not so busy constantly raising money for their next elections maybe they would have time to actually get something done in Washington.

In November the American people gave the Republicans control of the White House, the Senate and the House of Representatives. Enormous amounts of time, money and energy went into those campaigns, and now we want to see some results.

Instead of flying off for a month-long vacation in August, Congress should stay in town and get to work. The Republicans have already wasted much of the first half of 2017, and the mid-term elections are right around the corner.

It is time to change the way that Washington works, because right now we have a system that is deeply broken.

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The Way Congress Is Handling Health Care Explains Why They Have a 17 Percent Approval Rating

If it's even that high!


Michael Snyder
Economic Collapse
June 23, 2017

The Senate health care bill was unveiled on Thursday, and it appears to be dead on arrival. 

At least four conservative senators say that they can’t vote for the current version because it doesn’t go far enough, while several moderate Republicans are expressing concerns that it goes too far in repealing popular Obamacare provisions.  You can read the full text of the bill here.  Since Democrats are going to be united in voting against any bill that the Republicans put forward, Senate Majority Leader Mitch McConnell can only lose two Republican votes if he wants something to pass.  I don’t know how that is going to be possible, and so in the end we may be stuck with Obamacare for the foreseeable future and that would be a total disaster.

It is astounding to me that Republicans don’t want to pass the exact same clean Obamacare repeal bill that they got to Obama’s desk in 2016.  If they got that same bill to Trump’s desk, he would sign it.  Instead of trying to do everything at once, just repeal Obamacare and then start working on various pieces of the health care system one at a time.

According to Real Clear Politics, Congress currently has an average approval rating of just 17.6 percent.  It is an institution that has failed the American people over and over again, and we are never going to move things in a positive direction in this country until we do something to clean up that cesspool of filth and corruption.

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Video: George Washington's Farewell Address Warning About Political Parties


This is from George Washington's farewell address to the nation.  This was before the democratic and republican parties even existed. 

 
FULL SPEECH

 
 
 
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We Are The Government: Jury Nullification - Tactics for Taking Down the Police State


By John W. Whitehead
TheRutherfordInstitute.org
 

“The people have the power, all we have to do is awaken that power in the people. The people are unaware. They’re not educated to realize that they have power. The system is so geared that everyone believes the government will fix everything. We are the government.”—John Lennon


Saddled with a corporate media that marches in lockstep with the government, elected officials who dance to the tune of their corporate benefactors, and a court system that serves to maintain order rather than mete out justice, Americans often feel as if they have no voice, no authority and no recourse when it comes to holding government officials accountable and combatting rampant corruption and injustice.

We’re impotent in the face of SWAT teams that break down doors and leave toddlers scarred for life. We’re helpless to prevent police shootings that leave unarmed citizens dead for no other reason than the police officer involved felt “threatened.” We shrug dismissively over the plight of fellow citizens who have their heads cracked, their bodies broken and their rights violated for failing to jump to attention when a police officer issues an order. And we fail to care about the thousands of individuals who have been punished with extreme sentences for nonviolent offenses and are forced to spend their lives as modern-day slaves in bondage to private prisons and the profit-driven corporations they serve.

Make no mistake about it: virtually anything and everything is a crime nowadays (feeding the birds, growing vegetables in your front yard, etc.) to such an extent that if a prosecutor, police officer and judge were so inclined, you could be locked up for any inane reason.

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