A letter in the Wilkes-Barre Times Leader attacks the Commonwealth Foundation for supporting moving state government and school districts employees to a defined-contribution retirement plan, like a 401(k). The argument? Basically that Gordon Gekko wants a 401(k), and that CF is shills for Wall Street.
There is a huge logical flaw in this attack-the-messenger approach: Wall Street already benefits from the pension plans. Pennsylvania’s pension systems’ team of financial advisors invests in stocks, bonds, mutual funds, and even risky hedge funds and derivatives.
The benefits of a defined-contribution plan would be on workers, who would have greater flexibility and own their retirement fund, and taxpayers, whose costs would be affordable and predictable. In contrast, HB 2497, the so-called state pension “reform” bill, would cut worker benefits and delay payments into the funds at a cost of $27 billion over 30 years.