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Post by residentx on Nov 17, 2012 7:14:02 GMT -5
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Post by Darth Stateworker on Nov 17, 2012 8:13:49 GMT -5
I saw that yesterday in the AM Roundup.
PEFs strategy - and the strategy of every other union in the state - should be to start pointing out that pension rates will soon start falling, because unless there is another market crash, that's reality since we're a year or two (maybe 3 at most) away from the losses of the recession cycling out of the 5 year rolling average used to calculate ECRs.
I suspect the the rhetoric from the other side will begin to significantly increase, because soon enough, they'll lose their favorite talking about about pensions doing nothing but going up in perpetuity. So they have to accomplish their mission to get a Constitutional Convention to change this very soon, or they won't be able to do so, because the facts will no longer mesh with their rhetoric and people won't fall for it anymore.
The same thing will happen to the other part of the anti-pensions strategy, where people like Edmund attack the discount rate the funds use as too "optimistic". If the markets continue to recover, the fund should far outperform the even the old discount rate routinely in the short term. This argument however works a little better for them, because people generally don't understand that the discount rate is a long term goal, so when a fund doesn't meet it in the short term, it's easy to paint it as a "failure" of pension plans when it is not. This is possible because the vast majority of people don't know the first thing about investing.
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