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Retirement. Retirement. Union soldiers were offered pension as an inducement to enlist. Bismarck paid his solders a pension as well in the 1880s. State workers began lobbying for pensions in the late 1800s, early 1900s. - PowerPoint PPT Presentation
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Retirement
Retirement
Union soldiers were offered pension as an inducement to enlist.
Bismarck paid his solders a pension as well in the 1880s.
State workers began lobbying for pensions in the late 1800s, early 1900s.
The whole idea of retirement is only 120 years old, but we treat it like a right.
Age Discrimination
Retirement rates increased from age discrimination at the beginning of the 20th century resulting from:
Shorter workdays
Scientific Management
Why 65?
“Age 65 is generally set as the threshold of old age since it is at this period of life that the rates for sickness and death begin to show a marked increase over those of the earlier years”
-Isaac Rubinow, 1916
“It is a commonplace fact that physical ability, mental alertness and cooperativeness tend to fail after a man is 65”
-Federal Government before the Supreme Court, 1936
Importance of Social Security Benefits to Those Aged 65+
34%
31%
35%
Less than 50% of Income
50% to 90% of Income
90% to 100% of Income
Data Source: Social Security Administration, 2012
The Increasing Retiree Population, 1992-2012
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
28,000,000
33,000,000
38,000,000
43,000,000
48,000,000
11.0%
11.5%
12.0%
12.5%
13.0%
13.5%
14.0%
14.5%
Number of Retirees (left) Percent of Total Population (right)
Data Source: Census Bureau, Current Population Survey, March Supplements, 2012
Th
ou
san
ds
Year
5,000
1910 1920 1930 1940 1950 1960 1970 1980 1990
4,500
4,000
3,500
3,000
2,500
Population currently over 65
Population over 65 by 2025
Who We Will Support in the Future
The State of the States
State Pension Funding Levels 2012
Source: Pew Center, 2012
Funding for Retiree Health Benefits, 2012
Source: Pew Center, 2012
Comparing Pension & OPEB Funding and Liabilities
Funded Unfunded
Retiree Health Benefits$659.6 Billion
$32.4 Billion
$659.6 Billion
State Pensions$3.06 Trillion
$759.7 Billion
$2.31 Trillion
Source: Pew Center, 2012
State Pension Reforms 2010
Source: Pew Center, 2012
State Budget Gaps
Source: Center on Budget and Policy Priorities, 2012
State Budget Gaps
Continued Growth of 8.3% Per Year Would Not RestoreLosses from Recession Until Fiscal Year 2019
Source: Center on Budget and Policy Priorities, 2012
Sales Tax Revenue in 3 Recoveries
Rockefeller Institute, 2013
Personal Income Tax Revenue in 3 Recoveries
Rockefeller Institute, 2013
State Revenue Losses Exceed Previous Recessions
Source: Center on Budget and Policy Priorities 2012
Comparing State Revenues to Previous Recoveries
Source: Center on Budget and Policy Priorities 2012
Source: Center on Budget and Policy Priorities 2012
Cuts in Services by Number of States and Category
Source: Center on Budget and Policy Priorities 2012
Tax Increases by Sector and Number of States
Source: Center on Budget and Policy Priorities 2012
How States Closed Budget Gaps by Cutting College Funding
Florida drastically reduced funding of higher education, which means less allocation to colleges. The current year tuition increase is 15%.
From 2009 – 2012, the tuition increase is 52%.
California has cut higher education by over $1 billion. Cal State increased tuition this year by 18%.
From 2008 through 2012, Cal State increased tuition by 80%.
City Pensions, Funded vs. Un-Funded
Source: Pew Center, 2013
Pension Funding: Cities vs. States
Source: Pew Center, 2013
The Federal Government
U.S. Federal Government Spending vs.. Receipts, 1980-2012
1980 1985 1990 1995 2000 2005 2010$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
Spending Receipts
Data Source: Bureau of Economic Analysis, 2013
In B
illio
ns
Government Revenue as Percent of GDP, 1979-2012
19
80
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
15%
16%
17%
18%
19%
20%
21%
22%
Data Source: St. Louis Federal Reserve, 2013
Distribution of Federal Spending, 2012
Social Security 773 20%
Defense De-partment 709
19%
Discretionary 609.816 16%
Income Security 512 13%
Medicare 478.052 13%
Medicaid 255.263 7%
Other Mandatory 233.784 6%
Net Interest 225 6%
Data Source: Office of Management and Budget, 2013
Effective Federal Tax Rates, All Payers, 1979-2011
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
19%
20%
21%
22%
23%
24%
Data Source: Congressional Budget Office
Source: IRS, Statistics of Income, 2009
Bottom 50%
Top 50%
Top 25%
Top 5%
Top 1%
3%
97%
86%
59%
38%
12%
88%
68%
37%
22% Income Share
Tax Share
Taxes and the Rich
Data Source: IRS, Statistics of Income, 2009
Bottom 50%
Top 50%
Top 25%
Top 5%
Top 1%
2%
98%
87%
59%
37%
13%
87%
66%
32%
17% Income Share
Tax Share
Taxes and the Rich
Steps in Tax Staircase
Payroll Tax $126 billion
Unemployment $ 40
ACA – personal $ 24
Bush-era Upper $ 56
Bush-era Lower $0
Alt Min Tax $0
Sequestered Cuts $ 85 (45 for this year)
Who gets hit first? The working poor.
