1 00:00:03,880 --> 00:00:06,720 Speaker 1: It's the big take from Bloomberg News and I Heeart Radio. 2 00:00:07,160 --> 00:00:12,120 Speaker 1: I'm West Pasova today. Just how safe is that money 3 00:00:12,720 --> 00:00:27,240 Speaker 1: in your pension plan? People around the country wake up 4 00:00:27,240 --> 00:00:30,280 Speaker 1: every day wondering whether they've saved enough to provide for 5 00:00:30,320 --> 00:00:34,560 Speaker 1: themselves and their families. Working a job that provides basic dignity, 6 00:00:34,880 --> 00:00:37,160 Speaker 1: a good middle class job, you can raise a family. 7 00:00:37,200 --> 00:00:42,000 Speaker 1: I'm a job that provides a dignified retirement, and we'll 8 00:00:42,040 --> 00:00:44,800 Speaker 1: give you peace of mind. But the reality is, for 9 00:00:44,880 --> 00:00:49,920 Speaker 1: so many people, the goalpost keep moving. Millions of Americans, 10 00:00:50,120 --> 00:00:54,480 Speaker 1: including public employees and people working union jobs, are counting 11 00:00:54,520 --> 00:00:57,040 Speaker 1: on a pension to provide them with a steady stream 12 00:00:57,080 --> 00:01:01,080 Speaker 1: of income when they retire. But some corners of America's 13 00:01:01,120 --> 00:01:05,959 Speaker 1: pension system have gotten a bit rickety. Pension plans can 14 00:01:05,959 --> 00:01:10,399 Speaker 1: be underfunded or they underperform, and that's a problem even 15 00:01:10,440 --> 00:01:13,679 Speaker 1: if you don't have a pension, because when they get 16 00:01:13,720 --> 00:01:16,679 Speaker 1: into trouble sometimes the government has to step in and 17 00:01:16,800 --> 00:01:20,840 Speaker 1: bail them out with taxpayer dollars. President Joe Biden, you 18 00:01:20,880 --> 00:01:23,560 Speaker 1: heard just now, that's exactly what he did at the 19 00:01:23,680 --> 00:01:27,440 Speaker 1: end of last year, given thirty six billion in federal 20 00:01:27,440 --> 00:01:31,360 Speaker 1: funds to shore up the Union pension plan. Why is 21 00:01:31,440 --> 00:01:34,039 Speaker 1: this happening and what can be done to fix it? 22 00:01:34,520 --> 00:01:38,800 Speaker 1: By colleagues Neil Weinberg, Susanne Woolley and Kala Gardner are 23 00:01:38,880 --> 00:01:42,720 Speaker 1: here to explain. Neil, Susanne, Akala, thanks for being here. 24 00:01:43,760 --> 00:01:47,240 Speaker 1: Good to be here. Likewise, thanks for having us. Susanne. 25 00:01:47,280 --> 00:01:50,600 Speaker 1: Let me start with you. Pensions have always been considered 26 00:01:50,920 --> 00:01:52,920 Speaker 1: very safe. You didn't have to think about it. Your 27 00:01:52,920 --> 00:01:54,960 Speaker 1: employer put away the money, and when you retired it 28 00:01:55,040 --> 00:01:57,160 Speaker 1: was there for you. And yet in recent years, both 29 00:01:57,240 --> 00:02:00,560 Speaker 1: public pensions and pensions run by private companies have run 30 00:02:00,600 --> 00:02:03,920 Speaker 1: into some pretty rocky terrain. Can you tell us just 31 00:02:04,120 --> 00:02:08,000 Speaker 1: what is the general landscape of what's happening with pensions? Sure? 32 00:02:08,280 --> 00:02:11,200 Speaker 1: Sort of the holy grail of retirement for many people 33 00:02:11,280 --> 00:02:15,120 Speaker 1: would be the defined benefit pension because you get, you know, 34 00:02:15,160 --> 00:02:18,000 Speaker 1: a set amount of money every year for the rest 35 00:02:18,080 --> 00:02:22,560 Speaker 1: of your life. It's guaranteed. That has largely gone by 36 00:02:22,560 --> 00:02:26,280 Speaker 1: the wayside in the private sector and it's been replaced 37 00:02:26,280 --> 00:02:31,400 Speaker 1: by defined contribution plans. Yes, you're four O, one K 38 00:02:32,000 --> 00:02:36,840 Speaker 1: and FOREI one case are great, but the returns aren't guaranteed. 39 00:02:37,200 --> 00:02:40,400 Speaker 1: And with the old defined benefit plans they were managed 40 00:02:40,480 --> 00:02:44,639 Speaker 1: by investment professionals, you know, big pools of money, and 41 00:02:44,720 --> 00:02:47,200 Speaker 1: now you're four owen k you are all of a 42 00:02:47,200 --> 00:02:50,919 Speaker 1: sudden expected to be the investment manager and handling all 43 00:02:50,960 --> 00:02:54,280 Speaker 1: the risk for saving enough, you know, and saving in 44 00:02:54,320 --> 00:02:57,480 Speaker 1: the right things for your retirements. So there's been a 45 00:02:57,520 --> 00:03:02,639 Speaker 1: lot more risk foisted onto individual retirees in America and 46 00:03:02,680 --> 00:03:06,320 Speaker 1: a lot of that safety and surety of a steady 47 00:03:06,360 --> 00:03:11,400 Speaker 1: stream of income has been stripped away. And pensions, of 48 00:03:11,440 --> 00:03:14,040 Speaker 1: course eliminated that risk because it, as you say, the 49 00:03:14,160 --> 00:03:18,360 Speaker 1: money would just be there. But Neil, you've just written 50 00:03:18,360 --> 00:03:23,119 Speaker 1: a big story about public pensions and how the investment 51 00:03:23,400 --> 00:03:27,400 Speaker 1: professionals who used to run pensions that Suzanne was just 52 00:03:27,440 --> 00:03:30,080 Speaker 1: talking about have now been replaced in a lot of 53 00:03:30,080 --> 00:03:33,679 Speaker 1: ways by amateurs. Well, a lot of the pensions that 54 00:03:34,120 --> 00:03:37,800 Speaker 1: serve state and local employees were set up around World 55 00:03:37,800 --> 00:03:41,200 Speaker 1: War Two, in some cases well before that, and it's 56 00:03:41,280 --> 00:03:44,240 Speaker 1: usually in state law that says the people who are 57 00:03:44,280 --> 00:03:47,360 Speaker 1: going to be the directors of these pensions are people 58 00:03:47,400 --> 00:03:53,240 Speaker 1: who are rank and file members. These are state employees, teachers, policemen, 59 00:03:53,640 --> 00:03:56,880 Speaker 1: they are government officials, they are members of the public, 60 00:03:57,080 --> 00:04:00,000 Speaker 1: and they are chosen largely because they're members of these group. 61 00:04:00,160 --> 00:04:04,440 Speaker 1: They're not chosen because they know anything about investing. Over 62 00:04:04,440 --> 00:04:08,960 Speaker 1: the last twenty years, these pension systems have gone from 63 00:04:09,000 --> 00:04:13,400 Speaker 1: having a pretty plain, vanilla sort of portfolio of investments. 64 00:04:13,600 --> 00:04:17,719 Speaker 1: It was government bonds and common stock too much more 65 00:04:17,800 --> 00:04:23,400 Speaker 1: exotic things, private equity, hedge funds, private real estate. And 66 00:04:23,640 --> 00:04:26,640 Speaker 1: the result is you have people who are not investment 67 00:04:26,640 --> 00:04:33,640 Speaker 1: professionals who are overseeing an phenomenally complex, multibillion dollar investment systems. 68 00:04:34,040 --> 00:04:37,400 Speaker 1: And this is a huge mismatch, which leads to the 69 00:04:37,480 --> 00:04:41,039 Speaker 1: question of you know, who's guarding the handhouse. It's almost 70 00:04:41,080 --> 00:04:45,679 Speaker 1: like it's parallel to the individuals who are now forced 71 00:04:45,800 --> 00:04:49,239 Speaker 1: to manage, you know, a lot of investments and risks 72 00:04:49,279 --> 00:04:52,279 Speaker 1: and are sort of pushed into being their own investment manager, 73 00:04:52,720 --> 00:04:55,240 Speaker 1: and they don't have any background in this either. One 74 00:04:55,240 --> 00:04:58,400 Speaker 1: of the really interesting things we were talking about recently 75 00:04:58,480 --> 00:05:01,159 Speaker 1: is the fact that if want to invest in some 76 00:05:01,320 --> 00:05:05,480 Speaker 1: of these so called alternative assets as an individual, you 77 00:05:05,560 --> 00:05:09,279 Speaker 1: need to be accredited an accredited investor, meaning you have 78 00:05:09,360 --> 00:05:11,760 Speaker 1: to have a certain net worth or a certain financial 79 00:05:11,800 --> 00:05:16,159 Speaker 1: sophistication as deemed by the Securities and Exchange Commission. The 80 00:05:16,200 --> 00:05:20,600 Speaker 1: people who are overseeing these multibillion dollar pension systems are 81 00:05:20,640 --> 00:05:23,960 Speaker 1: not in many cases accredited investors. They couldn't buy this 82 00:05:24,040 --> 00:05:27,520 Speaker 1: stuff for their own portfolio, for their own retirement, but 83 00:05:27,600 --> 00:05:30,920 Speaker 1: they're buying it for tens or hundreds of thousands of people. 84 00:05:31,440 --> 00:05:35,280 Speaker 1: And what is an example of these alternative investments. This 85 00:05:35,279 --> 00:05:38,839 Speaker 1: would be private equity or hedge funds. It could be 86 00:05:38,960 --> 00:05:42,120 Speaker 1: private real estate, It could be something else that is 87 00:05:42,200 --> 00:05:46,360 Speaker 1: exotic so called real assets. Yes, things like that. One 88 00:05:46,360 --> 00:05:49,400 Speaker 1: of the key aspects of these investments is that they're 89 00:05:50,000 --> 00:05:54,719 Speaker 1: opaque and they're not sort of easily tracked by the 90 00:05:54,880 --> 00:05:58,920 Speaker 1: average individual. And also they tend to be more expensive 91 00:05:59,080 --> 00:06:02,719 Speaker 1: than more standard investments, and that raises the question of 92 00:06:03,320 --> 00:06:06,279 Speaker 1: you know, are you getting a much higher return for 93 00:06:06,360 --> 00:06:09,840 Speaker 1: that investment that you're paying a lot of money for. Well, 94 00:06:09,960 --> 00:06:12,520 Speaker 1: critics would argue that there's a lot of smoke and 95 00:06:12,600 --> 00:06:15,479 Speaker 1: mirrors going on and the returns are not really that good. 96 00:06:15,720 --> 00:06:19,160 Speaker 1: Supporters would say, you get what you pay for, although 97 00:06:19,320 --> 00:06:22,000 Speaker 1: some people in the investment community say you get what 98 00:06:22,080 --> 00:06:26,479 Speaker 1: you don't pay for in terms of expenses. So the 99 00:06:26,600 --> 00:06:28,719 Speaker 1: upside is you can make a lot of money, big 100 00:06:28,760 --> 00:06:30,960 Speaker 1: return on these investments. To downside, you can lose a 101 00:06:30,960 --> 00:06:33,880 Speaker 1: lot when you're playing with people's retirements. That's pretty risky stuff. 102 00:06:33,880 --> 00:06:36,479 Speaker 1: And I guess all of what you're saying raises the 103 00:06:36,560 --> 00:06:40,839 Speaker 1: question is why are these funds not being run by 104 00:06:41,080 --> 00:06:44,600 Speaker 1: the smartest investment minds. Why don't they just hire really 105 00:06:44,600 --> 00:06:47,640 Speaker 1: great investment managers to manage this much money? Well, there's 106 00:06:47,640 --> 00:06:49,920 Speaker 1: a couple of reasons. One, I would say, you know, 107 00:06:50,000 --> 00:06:53,799 Speaker 1: these large pension systems tend to have very professional staff, 108 00:06:54,320 --> 00:06:57,279 Speaker 1: and so many of these people who are working either 109 00:06:57,560 --> 00:07:01,000 Speaker 1: on the staff of these state and local pensions, their consultants, 110 00:07:01,040 --> 00:07:05,040 Speaker 1: their money managers. These are all financial professionals, but they 111 00:07:05,040 --> 00:07:09,200 Speaker 1: are overseen by lay people who may not be in 112 00:07:09,240 --> 00:07:12,720 Speaker 1: a great position to evaluate the advice they're given. When 113 00:07:12,720 --> 00:07:15,840 Speaker 1: you have this many people's retirements at state, Obviously, the 114 00:07:15,840 --> 00:07:18,560 Speaker 1: federal government takes in interest to make sure that a 115 00:07:18,600 --> 00:07:20,960 Speaker 1: lot of people don't get stuck out in the cold. 116 00:07:21,120 --> 00:07:23,440 Speaker 1: You cover the White House. What has the Biden administration 117 00:07:23,480 --> 00:07:29,160 Speaker 1: would have passed administration's done to oversee all of this money? 118 00:07:29,440 --> 00:07:32,600 Speaker 1: I would say even more than just the federal government, 119 00:07:32,640 --> 00:07:36,480 Speaker 1: But like Joe Biden specifically has a vested interest in 120 00:07:36,720 --> 00:07:40,440 Speaker 1: keeping union labor leaders happy. You know, he sort of 121 00:07:40,640 --> 00:07:43,880 Speaker 1: ran his campaign really wanting to get Pennsylvania back after 122 00:07:43,960 --> 00:07:47,640 Speaker 1: Trump wanted in sixteen, and so he's really sort of 123 00:07:47,640 --> 00:07:50,880 Speaker 1: hedged his campaign as presidency, if you will, um sort 124 00:07:50,960 --> 00:07:54,240 Speaker 1: of being this person who kind of walks the line 125 00:07:54,240 --> 00:07:56,880 Speaker 1: between progressive politics but also appealing to people in the 126 00:07:56,920 --> 00:07:59,760 Speaker 1: Midwest who have really been hit hard by you know, 127 00:08:00,000 --> 00:08:02,200 Speaker 1: economic headwinds. And I think it's important to talk about 128 00:08:02,240 --> 00:08:04,840 Speaker 1: that as well, because many of these money managers are 129 00:08:04,840 --> 00:08:07,360 Speaker 1: dealing with the same issues that people on Wall Street 130 00:08:07,400 --> 00:08:09,880 Speaker 1: in general are are dealing with. You know, last year 131 00:08:09,960 --> 00:08:12,760 Speaker 1: we saw stocks have the worst years since two thousand 132 00:08:12,760 --> 00:08:15,320 Speaker 1: and eight, and so these are pretty widespread issues, and 133 00:08:15,360 --> 00:08:18,560 Speaker 1: Biden has been really a consequential economic leader because of 134 00:08:18,600 --> 00:08:20,840 Speaker 1: these headwins. Actually have a lot of voters in those 135 00:08:20,880 --> 00:08:24,080 Speaker 1: states that you just mentioned who have mentioned plans are 136 00:08:24,080 --> 00:08:26,040 Speaker 1: looking towards retirement wondering if the money is going to 137 00:08:26,120 --> 00:08:29,800 Speaker 1: be there totally, and Biden sort of, you know, again, 138 00:08:29,880 --> 00:08:33,560 Speaker 1: he wanted to to win Pennsylvania in and so his 139 00:08:33,640 --> 00:08:37,480 Speaker 1: first big event was at a Teamsters union hall. So 140 00:08:37,600 --> 00:08:40,920 Speaker 1: he's really been sort of continuing to do events with 141 00:08:41,040 --> 00:08:43,920 Speaker 1: union leaders. We saw him in Boston just a couple 142 00:08:43,960 --> 00:08:46,480 Speaker 1: of months ago with union leaders and then also in 143 00:08:46,600 --> 00:08:50,040 Speaker 1: Oregon boosting Democratic candidates there for the mid terms. So 144 00:08:50,080 --> 00:08:52,080 Speaker 1: he's really made an effort to sort of be seen 145 00:08:52,600 --> 00:08:55,720 Speaker 1: um with unions like the International Brotherhood of Electrical Workers, 146 00:08:55,920 --> 00:08:58,840 Speaker 1: and really felt like, you know, he's really prioritized these 147 00:08:58,920 --> 00:09:01,640 Speaker 1: relationships and these allies because he wants them to come 148 00:09:01,679 --> 00:09:04,160 Speaker 1: out and vote for him again. Obviously should he run 149 00:09:04,200 --> 00:09:08,000 Speaker 1: for re election in four Neil, So we just you 150 00:09:08,040 --> 00:09:11,720 Speaker 1: describe a situation where you have professional staff but run 151 00:09:11,760 --> 00:09:15,520 Speaker 1: by amateur directors. Why not just have professionals period? Why 152 00:09:15,760 --> 00:09:18,800 Speaker 1: did it happen that amateurs were in charge of this thing? Well, 153 00:09:18,800 --> 00:09:20,920 Speaker 1: a lot of this goes back to state law that 154 00:09:21,160 --> 00:09:24,200 Speaker 1: is many decades old, and I think the logic of 155 00:09:24,240 --> 00:09:27,719 Speaker 1: this originally was, well, who is most affected by this? 156 00:09:27,840 --> 00:09:32,880 Speaker 1: And obviously the answer is public workers, your fireman, your police, 157 00:09:32,920 --> 00:09:36,959 Speaker 1: your teachers, the public employees who are professionals. It might 158 00:09:37,000 --> 00:09:40,439 Speaker 1: be the treasurer or some other executive in the state 159 00:09:40,520 --> 00:09:43,800 Speaker 1: government or the city government. And then you had members 160 00:09:43,880 --> 00:09:46,480 Speaker 1: of the public. And in some cases these members of 161 00:09:46,480 --> 00:09:50,760 Speaker 1: the public were sought out for some financial expertise. In 162 00:09:50,800 --> 00:09:53,440 Speaker 1: many cases they were not how much money are we 163 00:09:53,480 --> 00:09:56,360 Speaker 1: talking about invested in these public pension funds that you 164 00:09:56,360 --> 00:10:00,640 Speaker 1: write about, We are talking about four trillion dollars is roughly, 165 00:10:01,080 --> 00:10:04,080 Speaker 1: which is a lot of money. The largest system in 166 00:10:04,120 --> 00:10:08,000 Speaker 1: the United States is the California Public Employees Retirement System 167 00:10:08,120 --> 00:10:11,160 Speaker 1: commonly known as KELPERS, which at the last count had 168 00:10:11,160 --> 00:10:14,679 Speaker 1: four hundred and forty eight billion dollars in assets. And 169 00:10:14,720 --> 00:10:17,000 Speaker 1: so it was the idea that the people who aren't 170 00:10:17,000 --> 00:10:19,520 Speaker 1: professional money managers but are in charge are kind of 171 00:10:19,640 --> 00:10:23,439 Speaker 1: keeping an eye out on what's happening to be overseers 172 00:10:23,440 --> 00:10:25,439 Speaker 1: in the sense that they have skin in the game, 173 00:10:25,520 --> 00:10:28,880 Speaker 1: and so they're just trying to be honest brokers. Well, 174 00:10:28,920 --> 00:10:32,040 Speaker 1: as these systems have evolved and the sort of division 175 00:10:32,040 --> 00:10:36,040 Speaker 1: of labor has mutated as well, what you find is 176 00:10:36,160 --> 00:10:39,839 Speaker 1: for most of these systems, job number one is deciding 177 00:10:39,880 --> 00:10:44,319 Speaker 1: how to invest these billions of dollars. However, they also 178 00:10:44,360 --> 00:10:47,240 Speaker 1: have a lot of other interests. If you are a 179 00:10:47,240 --> 00:10:52,040 Speaker 1: public employee and you want representation, because these pension systems 180 00:10:52,240 --> 00:10:54,760 Speaker 1: are involved in how long you have to work to 181 00:10:54,840 --> 00:10:58,240 Speaker 1: have a pension, what is the final formula used to 182 00:10:58,320 --> 00:11:02,439 Speaker 1: guarantee your pension, and a lot of other labor related issues. 183 00:11:02,520 --> 00:11:06,400 Speaker 1: Now they don't have the authority to actually make all 184 00:11:06,400 --> 00:11:10,040 Speaker 1: these changes, often its state legislatures, but they certainly want 185 00:11:10,040 --> 00:11:11,840 Speaker 1: to weigh and they certainly want to seat at the 186 00:11:11,840 --> 00:11:14,800 Speaker 1: table when these things are being discussed. As well as 187 00:11:14,840 --> 00:11:18,600 Speaker 1: just the basic administration, sending out the checks, answering the phones, 188 00:11:18,720 --> 00:11:21,840 Speaker 1: making sure the customer service is good for people who 189 00:11:21,840 --> 00:11:23,760 Speaker 1: are working or people who are tired so they can 190 00:11:23,800 --> 00:11:27,320 Speaker 1: get answers. So originally those were all sort of parts 191 00:11:27,440 --> 00:11:31,520 Speaker 1: of the responsibility, but more and more, as these pots 192 00:11:31,520 --> 00:11:35,320 Speaker 1: of money have increased in size and importance, it's become 193 00:11:35,640 --> 00:11:39,160 Speaker 1: very much an issue of not only overseeing money, but 194 00:11:39,280 --> 00:11:44,320 Speaker 1: overseeing money that's going into these expensive alternative investments. My 195 00:11:44,400 --> 00:11:48,360 Speaker 1: conversation with a Kala, Neil and Suzanne continues after the break. 196 00:11:57,120 --> 00:12:00,360 Speaker 1: For years and years, union workers have been driving trucks 197 00:12:00,360 --> 00:12:04,959 Speaker 1: from factories of stores, bagging groceries, constructing the buildings and 198 00:12:05,000 --> 00:12:07,760 Speaker 1: the bridges and the roads and use that we use 199 00:12:07,840 --> 00:12:10,960 Speaker 1: every day, and so much more. Imagine if you're not 200 00:12:11,040 --> 00:12:14,400 Speaker 1: a union worker, you have a good job, you're retiring, 201 00:12:14,480 --> 00:12:16,800 Speaker 1: about to retire, and you find out your pension plan 202 00:12:16,880 --> 00:12:19,760 Speaker 1: is gonna be cut. Imagine what that does to you. 203 00:12:20,720 --> 00:12:23,400 Speaker 1: So We've just write how some of these very big 204 00:12:23,440 --> 00:12:28,480 Speaker 1: pension funds are not run by investment managers. What are 205 00:12:28,480 --> 00:12:31,360 Speaker 1: the effects of that, Neil, So have they run into 206 00:12:31,360 --> 00:12:34,240 Speaker 1: trouble as a result of this? In some cases they have, 207 00:12:34,440 --> 00:12:35,880 Speaker 1: And I think it would be a bit of a 208 00:12:36,080 --> 00:12:39,360 Speaker 1: simplification to say, oh, well, they have lay people on 209 00:12:39,400 --> 00:12:42,160 Speaker 1: their boards, therefore they've run into problems. There's been a 210 00:12:42,240 --> 00:12:45,360 Speaker 1: multitude of problems. Some of this is demographic if you 211 00:12:45,400 --> 00:12:48,400 Speaker 1: look at the number of working employees has gone way 212 00:12:48,440 --> 00:12:52,280 Speaker 1: down compared to the number of retired employees. You've seen 213 00:12:52,400 --> 00:12:54,959 Speaker 1: some changes in law which in some cases have made 214 00:12:54,960 --> 00:12:58,960 Speaker 1: it more difficult for these pension systems. But clearly the 215 00:12:59,080 --> 00:13:01,840 Speaker 1: problem of who is ultimately at the top of these 216 00:13:01,880 --> 00:13:05,679 Speaker 1: systems is a real issue. And yes they do have 217 00:13:05,800 --> 00:13:08,960 Speaker 1: professional staff, and yes they do have outside consultants and 218 00:13:09,000 --> 00:13:12,640 Speaker 1: money managers. But arguably it is in the benefit of 219 00:13:12,679 --> 00:13:16,480 Speaker 1: all those people to increase the complexity, maybe not to 220 00:13:16,559 --> 00:13:19,600 Speaker 1: reduce the cost. They may not have the same interest 221 00:13:19,679 --> 00:13:22,839 Speaker 1: as the overall system. You also have a system where 222 00:13:22,960 --> 00:13:27,000 Speaker 1: if you have representatives for various groups on these boards, 223 00:13:27,280 --> 00:13:30,440 Speaker 1: they may have an interest in representing the union or 224 00:13:31,000 --> 00:13:35,040 Speaker 1: the politician who appointed them to the pension board. It 225 00:13:35,120 --> 00:13:38,160 Speaker 1: might not be that their primary interest is to the 226 00:13:38,160 --> 00:13:41,920 Speaker 1: whole pension system and making sure that it's run according 227 00:13:41,960 --> 00:13:47,480 Speaker 1: to pardon the phrase, fiduciary duty. Let's put some numbers 228 00:13:47,480 --> 00:13:50,480 Speaker 1: on this. How big a shortfall have some of these 229 00:13:50,520 --> 00:13:55,360 Speaker 1: pension funds run into. It depends on which system you're 230 00:13:55,360 --> 00:13:58,160 Speaker 1: talking about. Some systems are quite well funded and some 231 00:13:58,360 --> 00:14:02,520 Speaker 1: systems are almost bankrupt. And there have been a few cities, 232 00:14:02,520 --> 00:14:07,600 Speaker 1: including Chester, Pennsylvania, which recently declared bankruptcy, largely because of 233 00:14:07,640 --> 00:14:12,000 Speaker 1: its pension obligations and inability to fund them. Overall, I 234 00:14:12,000 --> 00:14:15,920 Speaker 1: think there's roughly a trillion dollars in money that is 235 00:14:16,000 --> 00:14:19,880 Speaker 1: needed to fulfill promises that is not available. That's a 236 00:14:20,120 --> 00:14:23,600 Speaker 1: trillion out of four trillion which they do have in 237 00:14:23,680 --> 00:14:27,480 Speaker 1: their kitties. So it's a significant underfunding, you know, roughly, 238 00:14:29,280 --> 00:14:32,640 Speaker 1: and it definitely got worse in twenty twenty two as 239 00:14:32,840 --> 00:14:36,280 Speaker 1: markets tanked. To give a sense of scale in terms 240 00:14:36,320 --> 00:14:40,640 Speaker 1: of underfunding, General Electric in twenty nineteen said it would 241 00:14:40,760 --> 00:14:44,200 Speaker 1: freeze its plan for twenty u S employees and shift 242 00:14:44,240 --> 00:14:46,840 Speaker 1: to a defined contribution plan a fowing K type plan 243 00:14:47,320 --> 00:14:50,560 Speaker 1: to help produce the deficit of its underfunded pension by 244 00:14:50,640 --> 00:14:54,080 Speaker 1: as much as eight billion. So a lot of private 245 00:14:54,120 --> 00:14:59,040 Speaker 1: sector pension plans over the years have frozen their plans, 246 00:14:59,240 --> 00:15:02,920 Speaker 1: meaning that the people that accrued benefits in those plans 247 00:15:03,320 --> 00:15:07,360 Speaker 1: will get paid out eventually, but no one else who 248 00:15:07,400 --> 00:15:10,680 Speaker 1: is joining the company as a new employee will be 249 00:15:10,720 --> 00:15:13,360 Speaker 1: allowed into the pension plan. And for the most part, 250 00:15:13,480 --> 00:15:16,600 Speaker 1: people who are still have that pension from you know, 251 00:15:16,720 --> 00:15:19,200 Speaker 1: years of former work with the company, they won't accrue 252 00:15:19,240 --> 00:15:23,120 Speaker 1: any more benefits. In the private sector, I think about 253 00:15:23,240 --> 00:15:26,400 Speaker 1: twelve percent of employees have access to one of these 254 00:15:26,440 --> 00:15:29,720 Speaker 1: traditional pension plans where you get a monthly check. It's 255 00:15:29,880 --> 00:15:35,360 Speaker 1: considerably higher in the public sector. And public sector employers 256 00:15:35,400 --> 00:15:39,800 Speaker 1: have also started to reduce the benefits for new employees. 257 00:15:40,200 --> 00:15:43,840 Speaker 1: Often by law, they can't cut the benefits of previous 258 00:15:43,920 --> 00:15:47,920 Speaker 1: employees existing employees. But if you become a teacher today, 259 00:15:48,240 --> 00:15:50,200 Speaker 1: you're not going to get the same suite deal that 260 00:15:50,280 --> 00:15:53,120 Speaker 1: the teachers a generation ago did. Right, They might cut 261 00:15:53,120 --> 00:15:55,760 Speaker 1: your cost of living adjustment, you know, limit that in 262 00:15:55,840 --> 00:15:59,800 Speaker 1: some way. People used to get retiree medical healthcare benefits. 263 00:16:00,000 --> 00:16:03,119 Speaker 1: That was a really juicy perk and that has been slashed. 264 00:16:03,760 --> 00:16:07,680 Speaker 1: And these private pension plans that you describe running into troubles, 265 00:16:07,720 --> 00:16:10,760 Speaker 1: they are run by professionals. So how much of this 266 00:16:10,880 --> 00:16:13,960 Speaker 1: has to do with the public pension structure which is 267 00:16:14,120 --> 00:16:17,520 Speaker 1: complicated and has a lot of different hands in it, 268 00:16:17,880 --> 00:16:20,280 Speaker 1: and it just being a very difficult thing to run 269 00:16:20,280 --> 00:16:23,480 Speaker 1: a pension. It is a difficult thing to run a pension, 270 00:16:23,640 --> 00:16:27,280 Speaker 1: and it probably doesn't help that in the private sector 271 00:16:27,360 --> 00:16:31,280 Speaker 1: you have a law which basically says if a corporate 272 00:16:31,320 --> 00:16:36,640 Speaker 1: pension plan is significantly underfunded, the company is obligated to 273 00:16:36,720 --> 00:16:40,480 Speaker 1: put money in. In the public sector, this is all 274 00:16:40,640 --> 00:16:43,800 Speaker 1: done on the state level and there is no national law. 275 00:16:44,080 --> 00:16:47,680 Speaker 1: And in some cases you've had public sector pensions where 276 00:16:48,320 --> 00:16:51,320 Speaker 1: the people who estimate how much is needed tell the 277 00:16:51,400 --> 00:16:54,240 Speaker 1: state legislatures and the governor and so on how much 278 00:16:54,320 --> 00:16:56,880 Speaker 1: they have to put in, and they are just ignored. 279 00:16:57,240 --> 00:16:59,600 Speaker 1: So they, you know, just don't put the money in 280 00:16:59,720 --> 00:17:02,520 Speaker 1: because as they have more pressing needs they need uh 281 00:17:02,840 --> 00:17:06,920 Speaker 1: bridges and roads and schools. Kayla Niela is talking about 282 00:17:07,000 --> 00:17:09,440 Speaker 1: how some of these public pensions have run into trouble. 283 00:17:09,520 --> 00:17:12,600 Speaker 1: One very big one you recently wrote about where Joe 284 00:17:12,600 --> 00:17:16,919 Speaker 1: Biden had to step in. Can you describe what happened there. Yeah, absolutely, 285 00:17:16,960 --> 00:17:20,840 Speaker 1: So basically, the Central States Pension Fund was at risk 286 00:17:21,359 --> 00:17:25,080 Speaker 1: of getting cut up to sixty of those monthly payouts 287 00:17:25,119 --> 00:17:28,200 Speaker 1: to their members, and so Biden swooped in with this 288 00:17:28,320 --> 00:17:31,320 Speaker 1: measure and the American Rescue Plan UM it's also known 289 00:17:31,359 --> 00:17:34,679 Speaker 1: as the Butcher Lewis Act, and gave him thirty six 290 00:17:34,760 --> 00:17:38,080 Speaker 1: billion dollars over for a long term period for them 291 00:17:38,119 --> 00:17:41,600 Speaker 1: to start sort of replenishing their deficit to those users. 292 00:17:42,000 --> 00:17:44,520 Speaker 1: So this was like a bailout exactly. And I think 293 00:17:44,520 --> 00:17:48,000 Speaker 1: bailout is the word that Republicans would use because they've 294 00:17:48,000 --> 00:17:50,399 Speaker 1: really criticized this measure and said, you know, this is 295 00:17:50,440 --> 00:17:52,960 Speaker 1: not related to the pandemic, you know, as the American 296 00:17:52,960 --> 00:17:56,040 Speaker 1: Rescue Plan was originally intended. But this was just a 297 00:17:56,080 --> 00:17:59,160 Speaker 1: way for Biden to please union leaders. You know, they 298 00:17:59,160 --> 00:18:01,880 Speaker 1: don't want to tell our own members that we're cutting 299 00:18:02,040 --> 00:18:06,160 Speaker 1: your benefits. The interesting thing about Central States Pension Fund 300 00:18:06,280 --> 00:18:09,080 Speaker 1: is it's a multi employer pension funds, so it's a 301 00:18:09,080 --> 00:18:12,480 Speaker 1: group of multiple companies who are all sort of putting 302 00:18:12,520 --> 00:18:16,280 Speaker 1: in money towards giving these monthly payments out to their members. 303 00:18:16,359 --> 00:18:19,840 Speaker 1: And what kind of workers are in that mostly labor industries, 304 00:18:19,840 --> 00:18:22,920 Speaker 1: but trugging is pretty big for Central States, and most 305 00:18:22,920 --> 00:18:25,520 Speaker 1: of these employees are in the Midwest. Some of the 306 00:18:25,560 --> 00:18:30,520 Speaker 1: biggest numbers are Michigan, Ohio, Missouri, Illinois, which also happened 307 00:18:30,560 --> 00:18:33,640 Speaker 1: to be battleground states for Biden as well. I thought 308 00:18:33,640 --> 00:18:36,560 Speaker 1: it was also interesting when President Biden announced this, he 309 00:18:36,680 --> 00:18:40,840 Speaker 1: said that the financial problems Central States pension was having 310 00:18:41,119 --> 00:18:44,760 Speaker 1: were due to changes in the economy and attacks on unions. Uh, 311 00:18:44,760 --> 00:18:47,359 Speaker 1: he didn't say anything about how well or poorly they 312 00:18:47,400 --> 00:18:50,080 Speaker 1: may have been managed, and I think he doesn't want 313 00:18:50,080 --> 00:18:52,679 Speaker 1: to upset them, right, He wouldn't say that specifically, but 314 00:18:52,760 --> 00:18:54,800 Speaker 1: I do think, you know, White House officials are also 315 00:18:54,840 --> 00:18:58,600 Speaker 1: saying some of these multi employer pension funds they've lost 316 00:18:58,720 --> 00:19:02,320 Speaker 1: employers and worker so there's less people, actual individuals who 317 00:19:02,359 --> 00:19:06,160 Speaker 1: are putting money intowards these programs. And there's also been, 318 00:19:06,240 --> 00:19:08,919 Speaker 1: you know, a loss of some of these industries, like 319 00:19:09,080 --> 00:19:12,080 Speaker 1: like trucking, like even the auto industry. So some of 320 00:19:12,119 --> 00:19:16,040 Speaker 1: these plans used to have maybe twenty companies twenty years ago, 321 00:19:16,080 --> 00:19:19,120 Speaker 1: and now that's sort of dwindled down to maybe ten 322 00:19:19,280 --> 00:19:28,479 Speaker 1: or twelve. We'll be right back Neil in you're reporting, 323 00:19:28,520 --> 00:19:32,560 Speaker 1: you show the shortcomings of the way public pensions are run. 324 00:19:32,800 --> 00:19:35,000 Speaker 1: But everybody was taking a hit on their investments last year. 325 00:19:35,040 --> 00:19:37,160 Speaker 1: How much can you really lay at their feet versus 326 00:19:37,200 --> 00:19:39,840 Speaker 1: it just been a really bad year for investing. Well, 327 00:19:39,880 --> 00:19:42,840 Speaker 1: I certainly wouldn't blame pension funds because we all had 328 00:19:42,840 --> 00:19:45,320 Speaker 1: a bad year in the markets. But I would say 329 00:19:45,359 --> 00:19:48,680 Speaker 1: that it's certainly an open question whether it's you're going 330 00:19:48,720 --> 00:19:51,919 Speaker 1: to maximize your returns by having people who don't know 331 00:19:52,040 --> 00:19:55,120 Speaker 1: much about investing at the very top of the pyramid 332 00:19:55,240 --> 00:19:58,760 Speaker 1: at these public pension funds. I looked at Canada they 333 00:19:58,800 --> 00:20:03,360 Speaker 1: have largely replaced these novices with financial experts at their 334 00:20:03,440 --> 00:20:06,440 Speaker 1: large plans. And I also looked at the Netherlands, where 335 00:20:06,480 --> 00:20:10,640 Speaker 1: interestingly they started a system after the Great Financial Crisis 336 00:20:10,680 --> 00:20:14,000 Speaker 1: where the directors of public pension funds have to be 337 00:20:14,040 --> 00:20:19,840 Speaker 1: accredited by their central bank. Taylor, Are there any plans 338 00:20:20,040 --> 00:20:22,480 Speaker 1: in the US by the Bidy administration all to take 339 00:20:22,480 --> 00:20:24,400 Speaker 1: a hard look at the way pensions are being run 340 00:20:24,520 --> 00:20:27,800 Speaker 1: to prevent things like what happened with the Central States 341 00:20:27,800 --> 00:20:30,480 Speaker 1: pension fund. Well, I think it's it's important to say 342 00:20:30,560 --> 00:20:34,119 Speaker 1: that the bailout that the Central States spended pitted from 343 00:20:34,240 --> 00:20:36,960 Speaker 1: is available to other multi employer pension plans as well, 344 00:20:37,000 --> 00:20:39,520 Speaker 1: so they are able to actually apply for this through 345 00:20:39,520 --> 00:20:41,840 Speaker 1: the American Rescue Plan to sort of shore up their 346 00:20:41,880 --> 00:20:45,320 Speaker 1: own pension plans. So that's definitely available still for them. 347 00:20:45,359 --> 00:20:48,399 Speaker 1: But the Biden administration says that they believe that there 348 00:20:48,480 --> 00:20:50,880 Speaker 1: was over two hundred multi employer plans that they thought 349 00:20:50,920 --> 00:20:54,359 Speaker 1: were going to be insolvent by at least six and 350 00:20:54,359 --> 00:20:57,120 Speaker 1: they said that this program would ensure that at least 351 00:20:57,160 --> 00:21:00,520 Speaker 1: through one that these plans should be well to stay 352 00:21:00,520 --> 00:21:03,119 Speaker 1: in place with that assistance. So, you know, there's definitely 353 00:21:03,160 --> 00:21:05,720 Speaker 1: a lot of money. This thirty six billion dollars was 354 00:21:05,880 --> 00:21:08,080 Speaker 1: just for Central States, and so there has to be 355 00:21:08,359 --> 00:21:10,800 Speaker 1: at least a couple more billion dollars for these other plans, 356 00:21:10,920 --> 00:21:14,000 Speaker 1: being that these applications are still open. Neil and Suzanne, 357 00:21:14,000 --> 00:21:16,399 Speaker 1: you talked about how taxpayers are kind of creeping up 358 00:21:16,440 --> 00:21:20,119 Speaker 1: paying the bill for this. As more and more money 359 00:21:20,160 --> 00:21:25,000 Speaker 1: goes toward funding pensions, are we likely to see pensions 360 00:21:25,040 --> 00:21:27,919 Speaker 1: looking to more government money in order to help them out. 361 00:21:27,960 --> 00:21:29,960 Speaker 1: I don't know many people who turned it down if 362 00:21:29,960 --> 00:21:32,359 Speaker 1: it was available. Is that another way that kind of 363 00:21:32,359 --> 00:21:33,760 Speaker 1: all of us are going to wind up footing the 364 00:21:33,760 --> 00:21:36,480 Speaker 1: bill here. I think we already are, and I think 365 00:21:36,520 --> 00:21:39,639 Speaker 1: that is sort of wrapped inside that number that I 366 00:21:39,680 --> 00:21:44,800 Speaker 1: gave you, where the amount of payrolls for public organizations 367 00:21:45,040 --> 00:21:47,880 Speaker 1: that is going to pay pensions rather than salaries has 368 00:21:47,920 --> 00:21:51,359 Speaker 1: gone up fivefold in recent years. So it's sort of 369 00:21:51,400 --> 00:21:54,639 Speaker 1: like we're all getting a thousand cuts, death by a 370 00:21:54,680 --> 00:21:58,120 Speaker 1: thousand cuts, or taxes by a thousand cuts. The public 371 00:21:58,160 --> 00:22:01,040 Speaker 1: burdens certainly is going up. And that's not just for 372 00:22:01,080 --> 00:22:03,720 Speaker 1: people with pensions, but if you have just for one 373 00:22:03,840 --> 00:22:06,879 Speaker 1: k it's affecting you too in that way absolutely. I 374 00:22:06,920 --> 00:22:10,280 Speaker 1: mean your local taxes, your property taxes might go up 375 00:22:10,840 --> 00:22:13,199 Speaker 1: because of that. I talked to somebody who's on the 376 00:22:13,200 --> 00:22:17,160 Speaker 1: board of a public plan in Pennsylvania, a state senator, 377 00:22:17,480 --> 00:22:20,000 Speaker 1: and when she was campaigning, she said that was one 378 00:22:20,040 --> 00:22:23,879 Speaker 1: of the most common complaints she got when she knocked 379 00:22:23,920 --> 00:22:27,440 Speaker 1: on doors was people saying, the pension system is causing 380 00:22:27,480 --> 00:22:32,960 Speaker 1: my taxes to go up. Suzanne, how were it should 381 00:22:32,960 --> 00:22:35,640 Speaker 1: people who have pensions in general b that the money 382 00:22:35,720 --> 00:22:38,000 Speaker 1: is going to be there for them, well, people who 383 00:22:38,000 --> 00:22:42,800 Speaker 1: have private pension plans and plans that are frozen. There is, 384 00:22:42,920 --> 00:22:46,320 Speaker 1: of course, the federal agency, the Pension Benefit Guarantee Corps, 385 00:22:46,760 --> 00:22:50,119 Speaker 1: who is sort of a backstop if a company goes 386 00:22:50,200 --> 00:22:53,680 Speaker 1: bankrupt and can no longer pay its pension obligations, and 387 00:22:53,840 --> 00:22:57,280 Speaker 1: so there is that they often don't pay the full amount, right, 388 00:22:57,320 --> 00:23:00,000 Speaker 1: they'll get some some percentage, and a lot of people 389 00:23:00,000 --> 00:23:02,240 Speaker 1: will have wound up on a very short end of 390 00:23:02,280 --> 00:23:05,360 Speaker 1: the stick in the last couple of decades, especially high 391 00:23:05,400 --> 00:23:08,280 Speaker 1: income people, because there's a cap on how much they'll pay. 392 00:23:08,400 --> 00:23:12,120 Speaker 1: So if you are getting a very modest pension, you'll 393 00:23:12,119 --> 00:23:14,600 Speaker 1: probably get all or most of your pension. If you 394 00:23:14,680 --> 00:23:17,840 Speaker 1: were to coin a common example, an airline pilot with 395 00:23:17,880 --> 00:23:20,320 Speaker 1: a lot of years of experience, you're gonna get a 396 00:23:20,359 --> 00:23:24,840 Speaker 1: big haircut. Yes, it's definitely not a replacement, and it's 397 00:23:24,880 --> 00:23:30,000 Speaker 1: incredibly hurtful for people who have planned their entire retirement 398 00:23:30,040 --> 00:23:33,520 Speaker 1: out very judiciously, but all of a sudden, through no 399 00:23:33,600 --> 00:23:36,840 Speaker 1: faults of their own, see one huge part of their 400 00:23:36,880 --> 00:23:40,960 Speaker 1: planning just completely evaporate. Yeah. I just wanted to jump 401 00:23:41,000 --> 00:23:43,960 Speaker 1: in here too and say that this is also like 402 00:23:44,040 --> 00:23:46,800 Speaker 1: a part of the Biden brand, Like he calls himself 403 00:23:46,800 --> 00:23:51,360 Speaker 1: regularly the most pro labor, the most pro union president 404 00:23:51,359 --> 00:23:54,120 Speaker 1: in history. So it's definitely a part of a wider 405 00:23:54,160 --> 00:23:59,680 Speaker 1: strategy in his administration, sort of almost co opting Trump's 406 00:23:59,680 --> 00:24:04,040 Speaker 1: a America First, his America First initiatives. And so we 407 00:24:04,119 --> 00:24:07,919 Speaker 1: had this Big Chips Bill, which is basically an allocation 408 00:24:07,960 --> 00:24:10,960 Speaker 1: from Congress of about fifty billion dollars to sort of 409 00:24:11,280 --> 00:24:15,480 Speaker 1: encourage foreign countries to invest in America, to create these semiconductors, 410 00:24:15,520 --> 00:24:17,720 Speaker 1: you know, these little chips that are in cell phones 411 00:24:17,800 --> 00:24:21,560 Speaker 1: and washing machines, and sort of bring more investment back 412 00:24:21,600 --> 00:24:23,959 Speaker 1: to America that has been lost to places like China. 413 00:24:24,280 --> 00:24:27,159 Speaker 1: And so he's definitely sort of using this message that 414 00:24:27,240 --> 00:24:31,440 Speaker 1: was specifically Trump branded in places like Ohio and Michigan, 415 00:24:31,720 --> 00:24:33,960 Speaker 1: where Trump, you know, once did really well, and he's 416 00:24:34,000 --> 00:24:37,040 Speaker 1: sort of trying to kind of re appealed to those 417 00:24:37,119 --> 00:24:39,879 Speaker 1: to those voters, many people that have felt disenfranchised by 418 00:24:39,880 --> 00:24:43,520 Speaker 1: the Democratic Party. And we've seen him just continuously go 419 00:24:43,960 --> 00:24:46,760 Speaker 1: on trips to places like Pennsylvania. He's always talking about, 420 00:24:46,960 --> 00:24:49,200 Speaker 1: you know, where he grew up in Scranted in Pennsylvania, 421 00:24:49,240 --> 00:24:52,680 Speaker 1: and so yeah, he's just trying to relate with these communities. 422 00:24:52,720 --> 00:24:55,399 Speaker 1: He talks about how his grandfather worked in the coal 423 00:24:55,480 --> 00:24:58,199 Speaker 1: industry and so it's definitely a part of the Biden 424 00:24:58,240 --> 00:25:02,840 Speaker 1: persona protecting the incomes of Americans. Of course, it has 425 00:25:02,880 --> 00:25:05,120 Speaker 1: to be noted that Biden has some work to do 426 00:25:05,359 --> 00:25:08,920 Speaker 1: shoring up his support among unions after the big railroad strike, 427 00:25:09,000 --> 00:25:11,720 Speaker 1: where a lot of rower workers felt like they were 428 00:25:11,800 --> 00:25:14,640 Speaker 1: not done right by the deal that they eventually had 429 00:25:14,680 --> 00:25:17,240 Speaker 1: to take. I think if you look at the politics 430 00:25:17,240 --> 00:25:19,840 Speaker 1: of this, you can also draw an analogy with the 431 00:25:19,880 --> 00:25:24,359 Speaker 1: bailout or the reduction that people got for their student loans, 432 00:25:24,600 --> 00:25:27,520 Speaker 1: where basically we had a system in place and it 433 00:25:27,600 --> 00:25:30,160 Speaker 1: was supposed to work in some way, and the Biden 434 00:25:30,160 --> 00:25:34,920 Speaker 1: administration decided, presumably in part due to political calculations, that 435 00:25:35,080 --> 00:25:37,600 Speaker 1: it was a good idea to offer people a bail 436 00:25:37,600 --> 00:25:41,400 Speaker 1: out beyond what was written on paper. And the interesting 437 00:25:41,480 --> 00:25:43,159 Speaker 1: thing that you you bring up about this to and 438 00:25:43,200 --> 00:25:46,560 Speaker 1: load of forgiveness is the same sort of criticism that 439 00:25:46,600 --> 00:25:49,560 Speaker 1: Republicans had for the bailout is the same ones that 440 00:25:49,600 --> 00:25:52,680 Speaker 1: they said for the student will forgiveness plan, which is basically, 441 00:25:53,440 --> 00:25:55,960 Speaker 1: this is no longer about the pandemic. You're using the 442 00:25:56,000 --> 00:25:59,200 Speaker 1: pandemic as an excuse to sort of push these big 443 00:25:59,240 --> 00:26:02,440 Speaker 1: social spending bills and to sort of benefit your constituents. 444 00:26:02,440 --> 00:26:05,160 Speaker 1: With the student loans program, it's it's young people, um. 445 00:26:05,200 --> 00:26:08,760 Speaker 1: With the spailout, it's union workers and labor leaders, and 446 00:26:08,800 --> 00:26:11,320 Speaker 1: so it's just it's definitely a continuous criticism that the 447 00:26:11,359 --> 00:26:14,440 Speaker 1: Republicans have had, and it's certainly a question of whether 448 00:26:14,760 --> 00:26:18,080 Speaker 1: or how long can bin and say programs are because 449 00:26:18,119 --> 00:26:21,760 Speaker 1: of the economic situation of the pandemic Neil, given the 450 00:26:21,840 --> 00:26:23,640 Speaker 1: rough time that some of these pensions have been through, 451 00:26:24,200 --> 00:26:26,080 Speaker 1: do you expect there to be changes in the way 452 00:26:26,080 --> 00:26:29,320 Speaker 1: they're run to prevent these kinds of shortfalls in the future. 453 00:26:29,440 --> 00:26:31,320 Speaker 1: Is this just the way it's going to be? I 454 00:26:31,359 --> 00:26:34,920 Speaker 1: think they're kind of ongoing in part, as we mentioned, 455 00:26:35,400 --> 00:26:39,560 Speaker 1: the new employees, new teachers and firemen and police are 456 00:26:39,600 --> 00:26:44,160 Speaker 1: not getting nearly as generous pension benefits as their predecessors did. 457 00:26:44,200 --> 00:26:48,040 Speaker 1: In some cases, you're seeing lots of tinkering around the 458 00:26:48,200 --> 00:26:53,160 Speaker 1: edges to make this system less costly, because in most states, 459 00:26:53,160 --> 00:26:58,320 Speaker 1: in most cities, it's virtually impossible to take back promises 460 00:26:58,400 --> 00:27:02,280 Speaker 1: once you've made them. Oh Weinberg, Suzanne Wally, Kayla Gardner, 461 00:27:02,280 --> 00:27:04,600 Speaker 1: thanks so much for talking with me today. Thank you, 462 00:27:05,160 --> 00:27:08,440 Speaker 1: thank you, thanks for having us. You can read more 463 00:27:08,520 --> 00:27:12,280 Speaker 1: reporting from Suzanne Woolley, Eil Weinberg and a Kayla Gardner 464 00:27:12,600 --> 00:27:15,920 Speaker 1: at Bloomberg dot com. Thanks for listening to us here 465 00:27:15,920 --> 00:27:18,560 Speaker 1: at The Big Take, the daily podcast from Bloomberg and 466 00:27:18,560 --> 00:27:21,280 Speaker 1: I Heart Radio. For more shows from my Heart Radio, 467 00:27:21,440 --> 00:27:25,000 Speaker 1: visit the Heart Radio app, Apple Podcasts, or wherever you listen. 468 00:27:25,480 --> 00:27:28,240 Speaker 1: Read today's story and subscribe to our daily newsletter at 469 00:27:28,240 --> 00:27:31,240 Speaker 1: Bloomberg dot com slash Big Take, and we'd love to 470 00:27:31,280 --> 00:27:34,200 Speaker 1: hear from you. Email us with questions or comments to 471 00:27:34,320 --> 00:27:38,280 Speaker 1: Big Take at Bloomberg dot net. The supervising producer of 472 00:27:38,280 --> 00:27:42,119 Speaker 1: The Big Take is Vicky Viergelina. Our senior producer is 473 00:27:42,520 --> 00:27:47,639 Speaker 1: Katherine Fink. Our producers are Michael Falero and Malbarrow, with 474 00:27:47,680 --> 00:27:52,880 Speaker 1: additional production support from Rebekashassa and Sam Debauer. Raphael lum 475 00:27:53,000 --> 00:27:57,800 Speaker 1: Siley is our engineer. Original music by Leo Sidrin. I'm 476 00:27:57,800 --> 00:28:00,840 Speaker 1: West Casova. We'll be back tomorrow with another Big Take 477 00:28:06,280 --> 00:28:06,399 Speaker 1: Um