To the Editor:
On Thanksgiving Day, Scott Reeder of the Illinois Policy Institute (a conservative think tank) recommended that public employees be switched from pensions to 401(k) type plans. He said that 80 percent of “… private sector employers have embraced 401(k) plans.” He touts that employees can control their own retirement savings.
Wow! Sounds great. But in reality, the average person has accumulated about $80,000 in his or her 401(k). The average Illinois teacher pension is about $46,000. If I had a choice, I would choose a pension (actuarially based) over a 401(k) (Wall Street based) in a heartbeat. Wouldn’t you?
If Reeder were truly concerned about working people, he might suggest increasing Social Security benefits from the replacement of just 38 percent of a worker’s income to about 70 percent (along with increased worker/employer contributions, of course). But he is not really concerned about workers. He favors Wall Street, corporations and the wealthy, who all largely hate pensions.
On Dec. 5, Reeder criticized pension reform recently passed by the Legislature. What’s his worry this time? He writes that “… the burden of funding government workers’ … generous retirements falls on the shoulders of those of us with private retirement plans.”
Generous retirements? When the median Illinoisan’s income is $55,000, a $46,000 pension hardly is generous. And what about those “… with private retirement plans”? Wasn’t he singing 401(k) praises the week before? Aren’t 401(k)s great?
If they truly are, shouldn’t they be able to weather Illinois’ tax rate?