90.9 WBUR - Boston's NPR news station
Top Stories:
Here and Now with Robin Young
Public radio's live
midday news program
With sponsorship from
Mathworks - Accelerating the pace of engineering and science
Accelerating the pace
of engineering and science
Wednesday, October 19, 2011

States Look To Increase Retirement Age, Change Benefits For State Workers

Across the country, state retirement pension funds are facing a $1 trillion shortfall, and that has many lawmakers looking to rewrite those retirement plans.

This year, 14 states increased the retirement age. For example, in Massachusetts, the State Senate has already voted to raise the minimum age from 55 to 60 and the age for full retirement benefits from 65 to 67.

Sixteen states also voted to change the rules this year, so that new, and in some cases current, state workers will have to chip in more for their pensions.

And some states have already moved from a defined benefit pension, where workers are guaranteed a monthly check for life, to a 401-K program, which is much less generous, and transfers the risk from the state to the worker.

As Chris Christoff, reporter for Bloomberg News puts it, “The only thing guaranteed about 401-K programs is how much a worker puts into it, not how much money they get out of it.”


  • Chris Christoff, Bloomberg News state house bureau, Lansing, Michigan

Please follow our community rules when engaging in comment discussion on this site.
  • Bill in Niles, MI

    Well, I think the retirement depends at least somewhat on what sort of work they are actually doing.  Are we going to raise the retirement age of police and firefighters also?  If so, how do you compare that to the “private sector”?  There aren’t too many private sector jobs that involve running into a burning building or facing down and armed criminal.  Or what about a public sector doctor or nurse, who not only earns less than their private sector counterparts but also find themselves dealing with a disproportionately high number of patients with problems like tuberculosis or HIV/AIDS?

    • Anonymous

      Nurses, no matter where they work or who they work for, are equally exposed to serious illness and diseases.  Those same patients that enter any state run medical facility are the same ones that also enter clinics and hospitals in the private sector.  Also keep in mind that there are private sector nurses that are working in county and city jails.  As a private sector nurse I have taken care of my share of people with Tuberculosis, HIV, AIDS, MRSA, etc.  Who did you think takes care of those patients that have serious and contagious diseases when they are released from state run institutions?  

  • J Frog

    Of course with Michigan, you could actually retire when you were 46!!!


    You could “buy” services years and all kinds of other tricks.  It had to be changed.

  • Dick Kobayashi

    I am a state retiree here in Mass. I have studied the system and note that the relationship between the state and current employees and retirees is a contractual one. The US Constitution has a contract clause that prevents states from abrogating contracts and states can not go to bankruptcy court.  Also states have unlimited power to tax wealth and income, so even if pension investments do poorly and a state does not put in adequate contributions, aren’t the benefits of current members guaranteed in a way by the state’s power to tax?

  • Rick

    You mentioned MI’s state 401(k) but not that the state recently reabsorbed 401(k)s for many recent employees. My latest statement just arrived, balance 0. Last month a termination check arrived for 21 cents. I keep it because it is worth more as an example than money. BTW, the party now in charge of MI is the same one that invented 401(k)s as Social Security substitutes.

  • BHA in Vermont

    No question that dumping defined benefit plans in favor of 401K plans shoots employee retention/loyalty in the foot. The company I work for did that ~10 years ago and effectively blew off retirement medical at the same time. IF you are employed through a certain age range AND make it to what used to be ‘retirement eligible’, the medical insurance premium money MIGHT last 5 years.

    We see lots of people job hopping. No reason to stay around if others are offering similar or better money. 

  • Ruffner

    I’m a public worker – and I have to say: this is deferred compensation.  Sure, the private sector has a less generous deal on the back end, but a more generous one on the front end.  Changing the retirement age, or reducing benefits is a way of reneging on already agreed deals.  I’m a little tired of hearing people from the “private sector” who take larger pay up front and then want to cut other’s pay retroactively. 

  • CSquared

    I live in Oregon and it is my understanding that if an employee works only 5 days in any given year, it puts a full year into the pension formula.  Judges in this state max out their pensions by working 35 days a year after they retire to continue to have years credited to maximize their retirement.  These formula manipulations add burden to the pension costs for little benefit to current works and taxpayers.

  • PR

    As a 40 year old whose state retirement plan is losing money, whose employer stopped contributing years ago, and who is supporting previous retirees with much better benefits, I think pragmatics need to win out.  
    Retirement at 62 is no longer practical and many 62 year-olds, if not the majority, could keep working and contributing to the system.   I have every reason to expect to keep working until at least age 70 without a reliable pension.

  • Howard

    Speaking of state systems, this is circulating on the web with regard to our congressmen.
    Congressional Reform Act of 20111. No Tenure / No Pension. A Congressman collects a salary while in office and receives no pay when they are out of office. See #3 below.2. Congress (past, present & future) participates in Social Security. All funds in the Congressional retirement fund move to the Social Security system immediately. All future funds flow into the Social Security system and Congress participates with the American people. It may not be used for any other purpose.3. Congress can purchase their own retirement plan, just as all Americans do.4. Congress will no longer vote themselves a pay raise. Congressional pay will rise by the lower of CPI or 3%.5. Congress loses their current health care system and participates in the same health care system as the American people.6. Congress must equally abide by all laws they impose on the American people.7. All contracts with past and present Congressmen are void effective 1/1/12. The American people did not make this contract with Congressmen. Congressmen made all these contracts for themselves. Serving in Congress is an honor, not a career. The Founding Fathers envisioned citizen legislators, so ours should serve their term(s), then go home and back to work.If each person contacts a minimum of twenty people then it will only take three days for most people (in the U.S. ) to receive the message. Maybe it is time.

  • Lynnpeppey

    As a retired City of Milwaukee laborer, I was able to retire at 55 . I don’t think I could have physically worked another 5 or 10 years. Laboring is hard after 32 years. This is not sitting in an office all day. Incidentally my pension is $ 2084 after taxes. I have enough to pay my property taxes and spend a little money in the city I faithfully worked for for 32 years. I also volunteer in an urban school library where there is not a Librarian anymore.

  • Chuck Mire

    If you have children or grandchildren, you can get a sobering idea of the path that our country is on and has been on for some time.  Everything is equated to the “bottom line” so that stock prices will rise and we are supposed to therefore have short-term “happiness”.  I say “short- term” because in our country, we find it hard to think past ‘the next quarter’ – bean counters, one and all. I did NOT enjoy this program, but I watched it anyway to become more informed of just what layoffs (excuse me, “downsizing”) look like up close – it’s called empathy and if you don’t have it, you or your children/grandchildren may experience some of these tragic stories themselves in the future and then maybe you will ‘get it’.  Unfortunately, on a program such as Fox “News”, they would just gloss over the subject matter of this one hour program in maybe 3-5 minutes before moving on to something frivolous so that you wouldn’t become ‘too disturbed’ – that’s bad for advertising. When did we really change?  Remember good ‘ole’ Ronald Regan?  That was the real beginning of “damn the torpedoes & full-speed ahead” for business growth – even if it meant that some of the ‘true believers’ of the buy/spend propaganda that they swallowed were left by the wayside late in life after giving of their labor and efforts like faithful dogs for many long years - just asking for a fair shake.  It continued on with with Bill Clinton because the whole nation was in a whoopee-do mood.  During and beyond those years has become the ‘butt’ of so much comedy that everyone knows the story – unless you have been living in a cave. How far we have fallen - Think of your kids/grand kids which will put you in a longer frame of mind than ‘the next quarter’.  That’s what I have to do – I am too old to be hurt by any of Corporate America’s bullshit – and I saw it for what it was a very long time ago.  I know that many of you are not as fortunate but hopefully you will remain vigilant – which you will not do by just watching sports, Fox TV, YouTube or any of the other cutesy distractions of modern life.  You play right into the hands of what Corporate America & Wall-Street wants you to do with a steady diet of this fluff.  I understand that this is much easier that having to use your brain so much that it actually starts to hurt – but that is the price you must be willing to pay if you are to remain vigilant. I have attached a poem I wrote in May of 1996 in a jpeg picture format, when the first of the real ‘downsizing’ was taking place.  Though dated, I think that you will see that not much has really changed since then. My thoughts at the time are obvious. I hope you will pass this on to others.

    • Chuck Mire

      In my post, I failed to link to the one-hour program I was referring to.  It was a Frontline Program titled “Close to Home”, and is available for viewing online here:


  • Bizyz

    what state and local goverment employees dont seem to realize is that there are millions of working adults who have neither a defined pension nor a 401k.then there are those people who had worked for a company for many years only to see their pensions disappear when the company they worked for went bankrupt or simply discontinued their pension plan altogether.and,looming in the background is the seldom discussed pension benefit guarantee corporation which in recent years hasnt been exactly flush with cash to pay for employee pensions that go bust.considering how generous public employee pension and retirement benefits can be i get the impression that as long as they get theirs,the rest of us who work in the private sector have no other choice than to keep paying the taxes that go into these cadillac level benefit packages.this ongoing situation helps contribute to ballooning local and state budget defecits that politicians cant seem to grow the balls to deal with as they themselves have a stake in these programs.

  • Kap_99

    What about smaller pensions and a higher retirement age for firefighters and policemen that are no longer running into burning buildings and running down crooks?   There are  many desk jobs as these public employees move up the pay scale.

  • Anonymous

    “Who guard the pension guardians?”      Was there any effective oversight for the funding decisions made by state pension managers, year after year after year.   In the underfunding of state pension obligations, the general public now demands state workers make sacrifices in order to maintain services and not raise taxes.   However, year after year, the same public (state workers too) elected the officials, who in turn assigned the pension fund oversight to managers.  It was the elected ones and their managers, acting as agents of the public (“the agents”), who had the sole power over the ultimate money decisions for how to fund the well-known pension obligations.   The agents, not the workers, chose to underfund for years, taking the easy-out of passing the consequences of underfunding onto future elected officials and future managers.   Over years and years,  the agents fully knew that stock markets are volatile, yet did not adequately have a rain-day contingency, and they knew full-well the established life expectancy rates and the well-established retirement formulas, adding up so that the total pension obligations were no secrets over many years.    Yet, the agents failed to ensure an adequate flow of money EACH year, and allowed the underfunding hole to grow larger and larger year after year.    The agents’ dereliction of fiduciary duty to the public {and the workers too} is especially obvious during the stock market’s bonanza years when sufficient funds, other than new tax dollars, were coming into the state.    Apparently, no one was auditing the public’s agents’ performance, even though the public and not the agents will be the ones served the bill caused by unchecked mismanageent .   It is understandable that the public does not now want to be stuck with the pension bill from its failure to “guard the guardians” for many, many years.   However, that is the logical outcome of failing to have checks and balances to monitor the monitors when so much money is involved.   

  • Anonymous

    Ya gotta love it, bringing back the concept of dieing at work before you can retire and the good old idea of people getting rich off other people’s money and leaving them with next to nothing in their 401(k)s.  Like he said the only guarentee is that you have to put money in, not that you’ll ever get anything out! 
    So now everyone can retire poor except for the top executives who harvest the retirement plans for their benenfit and leave the workers with nothing but the illusion that one day they can afford to retire.  Need to rethink our motto – Land of the free (if your rich enough) home of the poor (if you spend your life working).
    You know that the legislators are all being paid by the rich to pass this stuff too, and poisoning the people in this country against any retirment security and its working!

Robin and Jeremy

Robin Young and Jeremy Hobson host Here & Now, a live two-hour production of NPR and WBUR Boston.

August 18 33 Comments

More Americans Are Flocking To The South

A New York Times interpretation of census data finds the South is seeing significant in-migration for the first time.

August 18 10 Comments

As Pot Laws Relax, Restrictions On Research Still Tight

The firing of a University of Arizona doctor highlights the complexity and politics of marijuana research.

August 15 8 Comments

Facing Backlash, SeaWorld Expands Killer Whale Habitats

SeaWorld has faced criticism over its treatment of captive killer whales since the release of the documentary, "Blackfish."

August 15 9 Comments

Training Police To Put Aside Their Biases

Criminologist Lorie Fridell says police officers can and should be trained to recognize their own internal biases.