Liberal politicians in Washington D.C. often complain about the federal tax code being too regressive and thus placing too large a burden on low-income families while allowing "millionaire, billionaire, private jet owners" to get a free pass (one must to be willing to ignore actual statistics to reach this conclusion but lets just take the word of Bernie Sanders at face value for the moment).
Of course, if these same politicians are truly concerned about massive wealth transfers from low-income taxpayers to the rich, then they should promptly take notice of an article published by the Pocono Record today highlighting some of the most egregious annual pension payouts awarded to retired public employees in Pennsylvania...payouts that are funded by tax receipts from one of the most regressive taxing systems in the country given Pennsylvania's 3.07% flat tax.
Three years after retiring as president of Pennsylvania State University, Rodney Erickson is netting $477,590 a year — from a state pension.
Gary Schultz, the former Penn State vice president who pleaded guilty in the Jerry Sandusky scandal, takes home $330,699 in pension benefits. Former state lawmaker Frank Oliver, a Democrat who represented North Philadelphia, gets $286,117.
But despite reforms in the system — which mostly affect future retirees — and a move by some states to cap retirement payments, a separate class of Keystone State pensioners will continue to receive checks that alone put them among the top tier of all income earners in the United States.
As the costs of public pensions continue to be a point of debate for struggling state and municipal governments, the Inquirer and Daily News reviewed data for hundreds of Pennsylvania’s highest-paid beneficiaries, all current through August.
They showed that 20 state retirees collect more than $215,000 a year — a payout so big it exceeds an IRS mandated pension cap and must be paid from two plans. More than 500 retirees collect $100,000 or more.
(Former Penn State President Rodney Erickson)
To put this farce into perspective, if Erickson manages to collect his ~$475,000 annual paycheck for a period of 20 years, with a 2% annual COLA, then Pennsylvania taxpayers, including those at the lowest end of the income spectrum, will be on the hook to provide him with $11.5 million to fund his "glory years."
Meanwhile, these ridiculous payouts to public "servants" come despite the fact that Pennsylvania has one of the worst funded pension plans in the country. All of which means that contributions from taxpayers will only get worse the closer the ponzi scheme gets to running out of cash.
Of course, while these same public servants will undoubtedly defend their taxpayer-funded handouts by citing their contributions into the pension fund we all know those contributions are minimal compared to the burden placed on John Q. Taxpayer.
Officials in the system say such retirees earned their benefits — contributing a percentage of their pay to the state’s defined-benefit plan, along with their employers. Critics say the six-figure payouts reflect a policy that isn’t grounded in fiscal reality.
“Professional state employees should make a good living, but they are not entitled to make a killing,” said Eric Epstein, coordinator with the Rock the Capital reform group in Harrisburg and an advocate for pension changes. Some of the payouts, he said, “are excessive pockets of gluttony that are deeply disturbing” as Pennsylvania confronts a $70 billion shortfall in its retirement obligations.
Many of the best-paid retirees worked in the court system, the legislature, or academia, the records show. Of the top 500, 124 worked at Penn State, and 143 at schools within the State System of Higher Education.
The pensions traditionally are calculated using a formula that includes an employee’s highest average salary over a three-year span and years of service.
But don't hold your breath waiting for Elizabeth Warren and/or Bernie Sanders to comment on this massive wealth transfer from Pennsylvania's low-income families to it's wealthiest...to do so might suggest they somehow take issue with the many public pension ponzi schemes around the country that support the millions of voters on which they depend for votes.