Basic Math/ Basic Truths
The other week at an interesting gathering of fellow
retirees in Skokie, I listened to an illuminating presentation by Rich
Frankenfeld from TRS. It was a long
drive, but well worth it. In his update,
Rich covered a variety of areas for concern:
the financial condition of TRS, health insurance information, various
plans available to all of us in the room, and other “major issues” including
the threat and possible outcomes for SB1.
The President of the Skokie Organization for Retired Educators
(S.O.R.E.) is, of course, Fred Klonsky.
Of note was another
review of the changes to Cost of Living Allowances under the new SB1 for Tier 1
retirees and the forced “simple” interest for Tier 2.
While speaking to several of the points in his program, Rich
dropped a small piece of information that caught my interest.
“Our eldest recipient
of a pension in from TRS is currently 108 years old.”
Spoiler alert (Biss, Nekritz, Madigan, et.al.): Klonsky
quickly retorted that he was personally planning to beat that number.
108 years old?
I’ll assume it was a she,
but still what an incredible and protracted life-span.
Born in 1906. The year Theodore Roosevelt warns the nation
that we face a corporatist elite that would endanger all our freedoms; the year
The
Jungle is published; and the year of the Windber Strike by 5000 workers
in Pennsylvania marching to join with the nascent United Mine Workers.
Started teaching in
1927. A lanky but gifted pilot takes
an outrageous gamble to fly solo across the Atlantic and somehow land in Paris,
France.
I envision her teaching 40
years while the world struggled to survive economic collapse, bleed
profoundly to thwart fascism, endure the pervasive terror of an accumulation of
nuclear weapons, Viet Nam…
She retires in 1967.
According to the Chicago Tribune, an average salary for a
teacher in 1967 was between $6800 and $7400.
By the way, even then the Tribune seemed concerned about the increases
in teacher salaries over the last decade.
So, assuming she has her full time in and she has a stipend,
let’s figure her 75% of salary for her retirement annuity at $6000 per year.
She earns a Cost of
Living Allowance in 1968. And, still
alive, she receives that COLA for 47 years!
YOU GO,GIRL!
On the other hand, this is an unexpected extension in a life
span that actuaries or Senators like Dan Biss would call an unexpected
change in assumptions. We all
live too long now; therefore, SB1.
But when you actually run the numbers, it seems less onerous
than the Senator would have me believe.
In fact, her final annuity earnings seem closer to penury than an easy subsistence.
3% Compounded COLA on $6000 over a period of 47 years
= $24,071.
3% Simple Interest COLA on $6000 over a period of 47
years = $14,460.
For all of the "freeze pension" naysayers in Illinois who would have no COLA for us, even a sustained $6,000 is worth cutting. Numbers and facts matter little to those who do not believe in fairness and the humane treatment of our fellow citizens.
ReplyDeleteThis is a great blog, but it appeals to reason. Reason is meaningless to the unreasonable. Yesterday, I attended a small group of retired professionals who believe themselves to be liberals. Cutting existing retired teacher pensions seemed to them like just one of those nasty collateral-damage accounts that require a shake of the head and a shrug of the shoulders. One actually said, "Well, that couldn't happen to me; I'd be covered in some kind of grandfather clause." Oddly enough, he is a retired military officer and a retired college professor from a southern state.
Add the liberal head-in-sand deniers to the right-wing naysayers and the result is depressing.