Pensions are part of employee salaries. Not budgeting for them is like buying a house, and not budgeting for anything past the first mortgage payment.
Why are we talking about defaulting, or haircutting pensions, instead of defaulting... On any of the other people or companies that the state owes money to?
Changing 'future' pension payment rules, where a pension kicks in after 20 years of employment, when you are on year 19, should not fly.
I fail to see how social security, which is a national program for all citizens, is any less holy than pensions. Pensions are usually backed by city and state govt which have much shallower pockets.
What I'm saying is if the federal government can cut back social security benefits there's no reason we shouldn't cut future pension benefits
SS is a welfare program. This is fundamentally different from a salary. Welfare programs can, and do change just before, or just after, you become eligible for them. This is fine. This is social programs are supposed to work. (Although, generally, their accounts should not be plundered to fund illegal wars.) There was no contract that you signed when you started paying into SS. It's a tax, which funds a welfare program.
Salaries, on the other hand, are sacred. Pensions aren't social programs. They are deferred salaries. Cutting pensions is a salary clawback.
If you're going to stop paying the pensions you're obligated to, you damn better have declared bankruptcy, and let your creditors - including the pensioners - pick over your carcass.
There are other programs administered by the Social Security Administration (e.g. SSDI) that are welfare programs, but that's not what the previous poster was talking about.
The fact that the payments are structured much like a pension is tangential. For example, nothing stops the feds from restructuring it into flat payments.
What do you base this statement on? The Federal Government enumerates the exact formula used to determine future social security benefit payments, even for people 40 years away from retirement. Given a known salary scale, a 22 year old can calculate their expected future social security benefit down to the penny. This future benefit is funded by a 12.4% tax/contribution from your salary. It's a % contribution for a defined benefit.
How is that any different than a state or municipal pension?
They are in fact so similar that, in some states, participation in the state's pension plan entirely replaces (rather than compliments) participation in social security.