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The Real Story on Public Employees Benefits

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This week, Ezra Klein has an excellent piece on the Washington Post’s website that gets to the truth behind public employees benefits.

He demolishes the myths that too many right wing politicians and propagandists cling to, demonstrating for example, how retirement security for public service employees is not overburdening state budgets. Klein says, “Pension obligations currently account for 3.8 percent of the average state’s spending. That’s not where the current crisis is coming from.” AFSCME retirees receive an average of $19,000 per year after retirement and contribute toward their pensions throughout their working careers.

Klein makes a powerful argument that the problems facing state governments are all because of the failure of Wall Street and the horrible economy.

“In the months before the financial crisis, in fact, states had built up record rainy-day funds and were starting infrastructure projects. Then Wall Street collapsed, and so too did the revenue states got from taxing property, incomes and sales. At the same time, the need to spend on social services went up rather than down. The result? A terrible strain on state budgets. But not one you can blame public employees for.”

The facts are clear: state and local public employees make 11 to 12 percent less in salary than those in the private sector, when education and experience are considered, as demonstrated by recent research by the Center for State and Local Government Excellence.  And state and local public employees’ total compensation (including salaries and benefits) is approximately 7 percent less than that of private sector workers.