1. The fund's balance is calculated whereby the investment return is to equal annual liability of implied payouts to the retirees now and for each year in the future based on the number of "projected" employees.

2. The 1st trick government played on the employees is: the employee does not own 1c of those funds. Local government investment funds are "strictly participatory", the employee gets a benefit but does not own 1c of the fund.(The same as if you bought a train ticket. You get a ride but do not own the train).

3. The 2nd trick government played on the employee and the taxpaying public was: the actuarial projections used to say what the funds balance should be. If they could get away with saying they were going to get a projected 7% return average over the next ten years and in reality they were getting a 14% return, here they just doubled the funds balance over what was needed and the employee will not get 1c extra and the taxpayer and employee gets hit for higher contributions when in fact they should have received refunds. (1990 - 2000 most were accomplishing 16% to 21% per year and the employee was told 7%, or the actuarial projection being used not the real rate of return)

4.  The third trick pulled off by government was; they would hire many new employees to cover surpluses in the pensions. This was done by "vesting" the new employee with the full amount from the fund to equal the employee's projected payout when they retired. EXAMPLE: 1,000 new hires at this time will require say $785,000,000 additional in the fund at retirement, poof there goes 785 mill locked in. On the other hand, if they lay off 1000 new hire employees, gee-wiz , look we are over funded by 785 mill and they now can slip it out for their use. Local governments (especially NJ) will use this tactic to raise taxes let's say by 785 mill and then after the fact lay off employees where they now take out 785 mill from the fund and here they get two bangs for the buck, 785 tax increase plus 785 from the fund or 1.5 billion in benefit and the public nor the dismissed employee is any the wiser.

What you must keep in the forefront of your mind is the power base that has been created by "where" those funds are invested. Any project, corporation, or fortune can be guaranteed internationally by where those funds (trillions in composite totals) are invested. So, the underlying motive was not the employee or the taxpayer, it was the power base of who was going to be the next millionaire if not billionaire based on where that money was placed and thus more, more, more, anyway, more. Bigger is better, more slices of the pie to go around. (and I note in final effect not primarily to the employee or the taxpayer, quite the opposite)

People would not look being that the gang would throw out sound bites to make the public and employees not look (make them falsely feel guilty if they even thought about looking)

 

The good point of that excessive growth in the government pensions was that it helped drive the economy over the last forty years and gave the ability to control a guaranteed high return on the funds as a monopoly of no equal, whereby the takeover of the international market place through the use of those funds occurred. The bad point was those funds were getting their best return from "International" investments taking advantage of the cheap labor and thus; outsourcing and a drop in US investments.

Now you know why the markets have done what they have done over the last twenty years and those government pension fund balances were ever growing and in the black each year. The control of those funds built up the definition of underlying greed applied, and I make special note that as a result of the 911 event, my did they make a killing for the stage to be set at that time and over the next six years. Set the stage for almost doubling their funds in some cases. Coincidence I guess. To bad those mid-eastern boys did not know what our boys knew here. They could have become wealthy instead of having their countries looted and over a million of their people killed. Dumb Mid easterners. I guess they were not as greedy as we were, but give them a chance we are in the process of assimilating them and they will be conditioned to follow our ways. We dangle that greed carrot oh so well to convert populations, even to new comers with strange and old ways.

On a last note per government pensions, even though government accounts in their fund balances for the full ride on the train, the employee only has an optional ticket on the train so where they get off on the ride, if before the end of the tracks, they do not get a refund, the funds balance does. The employee gets the benefit up to the point of where they get off. So it is "very" important to look at governments growth over the last 5, 10, 15, 20, 30, 40 years to compare government employees vs. population growth. You may just notice some excessive trends there that may need a little trimming. My suggestion would be to look at where government was in 1960 and after accounting for population increases, use that as a target mark for the return of government size to where it should be. New Zealand did it, why not we....? Knock out the implanted greed factor (kill it now before it is to late) and it could, no would happen as time goes; over night..