The Bad Faith of Neo-Liberals


I do not know why this kind of agreement should be any surprise to those who have been paying attention to what neoliberals have been trying to do to pensions across the USA. It has become a standard operating procedure for neoliberal pundits, bureaucrats, and politicians to seek to change the terms of pensions after prospective pensioners have made plans based on original contracts.

It is amazing to me that most people do not understand how pensions are actually a form of defrayed compensation. Rather than getting your full pay and benefits, you elect in agreement with your employer to be paid at a later date through a pension for the work you are performing now. This can also include defraying bonuses.

But greedy financiers trying to get their hands on public employ pensions as well as disingenuous politicians trying to balance budgets keep using every bit of bad faith at a neoliberal’s disposal to break the contracts that hard working folks have made with their employers and their government. In the case of veterans and civil servants, the two are one and the same, and an act of Congress can easily accomplish the task of betraying past service/loyalty for relatively small future gains.

How he [Paul Ryan] arrived at this vision boggles the imagination; most retirees struggle to integrate into a new workplace with skills that don’t directly translate while trying to keep pace with competitors roughly half their age. 73% of retirees are noncommissioned officers whose pensions are barely sufficient to keep them above the poverty line. As a rule of thumb, these people are figures of sympathy rather than valid targets of the socialistic “they don’t need it anyway” notion behind Ryan’s sales pitch.
Ryan and Murray obviously weren’t thinking about these issues. They also weren’t thinking about the fact that every veteran who has retired since the year 2000 made a decision upon reaching 15 years of service: either turn down a $30,000 career status bonus and retain an inflation-protected pension upon reaching retirement, or accept the bonus and also accept a 1% annual reduction in cost-of-living adjustment with a one-time “catch-up” at age 62. Most veterans chose inflation protection, which ends up being worth far more in most calculations than the bonus.
In summarily removing inflation protection from all military pensions, Congress breached the contract formed with those who turned down the 15-year bonus. It did this without holding a single committee meeting or public hearing. In a clear signal it wasn’t thinking strategically, Congress did this in a back room not populated by the joint chiefs, who claim to have been surprised by the provision altogether.

Via Business Insider

Posted by KWB wandering among the borderlands of the Ether.

4 comments

  1. It is frustrating to see how promises to workers are being dealt with by people who are only seeing dollar signs and economics. Promises are what pensions are, and there is just a little bit of morality that needs to be thrown into the mix when making such decisions to “rob” those who have built a life and rely on such pensions. Great post.

    1. Thanks Dalo… it is really important that folks everywhere keep an eye on this. One thing the greedy are wanting to do is get their hands on pensions–like the Texas State Teachers Retirement System–and turn it into something akin to a 401k. The difference, of course, is that those billions of dollars would go from a savings account with guaranteed payout to an investment account that could end up worth half or even less. As you say, it requires a kind of morality. Since the mores of most neoliberals have turned negative–if it is not accomplished by the market it is immoral–we all have to have a louder voice in saying, “Keep your promises! This is a DEBT, and anyone else who tried to default on a DEBT would be called unworthy if not evil.”

      1. There is something about the level of morality these days in business and politics. Simple promises, in cases like you mention, are being flipped and broken. This and similar action is becoming a common ‘state-of-affairs’ that people (myself included) are just turning the page as it is just another example of the way things are today… Posts like this are important, and a new goal for me this year is to become more active in trying to right this wrong (whether it is via my vote, discussion or writing). Thanks Keith.

      2. The best thing we can do is keep each other well-informed. Peeling away the cover-ups and double-speak is crucial. One of the reasons I made a point of using this particular article is because Business Insider would probably have no trouble with the reneging of agreements on teachers and civil servants. However, because the business community often staunchly supports veterans, they offer an opportunity to point out how all pensions are being messed with in similar or even more dastardly fashions.

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