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Crockett Column: The Teacher Pension Problem Will Return, Again

The pension bill, which Gov. Mark Dayton supports, is expected to become law though some lawmakers are stunned at the growing expense. Pensions are supposed to be covered by employer and employee contributions that are then invested by the state, but Minnesota stopped paying the full cost of pensions in the early 2000s. Imagine if you did that with your mortgage and then tried to catch up to avoid foreclosure....

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Teachers Pension, on Downward Slide, Wants to Lower Return Assumption: Admits to $9 Billion Deficit Even with Taxpayer Cash Aid

The Teachers Retirement Association (TRA) told legislators last month that it wanted to drop its assumed rate of return from 8.5% to 7.5%. TRA is the last fund in the U.S. to assume an 8.5% rate of return; the average is now 7.36%. The other pension funds in Minnesota assumed 8%. Why do Minnesota funds think they can earn more than other funds in the country? What if they are wrong? TRA is the last public fund in the entire United States to assume 8.5%. ...

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U.S. Unfunded Pension Liabilities Exceed $6 Trillion: Minnesota’s Share is at least $118.7 Billion

With every paycheck, public employees faithfully hand over a percentage of their pay, and taxpayers match or exceed that contribution. Both should be able to trust that the pension funds, and State of Minnesota, have wisely set the right contribution rates, actually paid the full contribution each year and prudently invested the funds so when retirement comes, teachers, cops and the rest of our state and municipal workforce have the pension they were promised. ...

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What Counts as a “Crisis” at the Teachers’ Pension Funds?

TRA admits to a $30.7 billion liability but only has $21.2 billion to cover those promised pensions. TRA says based on the 2017 valuation, it only has $0.69 on the dollar to pay pensions to teachers. If there are no changes, it will only have 50% of funds in 2046. TRA used 2017 numbers because the markets were up—a lot. If it uses the 2016 valuation, the fund is expected to have only 37% of the needed funds in 2046. Why isn’t this a crisis? ...

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Do teachers oppose or support forced union dues?

I have no doubt that most teachers are dedicated professionals who just want to teach—and like the mean girls we all knew in school, that it is a small minority of teachers bullying and enforcing a trade union mentality that is making teachers miserable and creating a hostile environment for the free exchange of ideas. Let’s win that basic freedom back for teachers and our schools. ...

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Employee Freedom Update: Who are Mark Janus and Rebecca Friedrichs?

Who are Mark Janus and Rebecca Friedrichs? And why did I write about them in The Wall Street Journal today? If the Supreme Court rules in Janus’ favor, every government employee across the country will have the right to choose for himself or herself whether to give money to a union. This is equivalent to Minnesota passing a right-to-work constitutional amendment-- only better because it will be the law of land. ...

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Supreme Court agrees to hear First Amendment Case: A Victory would end Public Employee Unions’ Monopoly Power

If Janus wins, unionized public employees in non-right-to-work states like Illinois and Minnesota will be able to keep their jobs, even if they do not join or financially support the union. The result could be a significant decrease in public employee union membership, millions of dollars less revenue from dues and fees and further erosion of organized labor’s political clout at the state and national level. ...

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Meet the people who are running the teachers’ pension fund (into the ground)

If you are a young teacher or in the middle of your career, I hope you are putting money away in a 403(b). If you are retired, think about how you can help the Center get the truth to teachers. How do we talk to teachers about this vital issue so they will think critically about what TRA tells them about the health of the fund—and educate themselves on how pensions work—and do not work. ...

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