Workers being driven out of public service

Those committed to reducing the effectiveness of state agencies, shrinking the rolls of public employees and ultimately privatizing public services are winning their agenda, one retirement at a time.

Today's edition of The State reports that public employees are leaving their posts in droves, buying time and taking early retirement before devastating changes to the retirement system go into effect on July 1.

In fact, our lawmakers haven't even decided on all the ways they will change the system to make it less attractive to potential employees, but they're well on their way to destroying the commitments that decades of previous legislatures have made to public workers.

Reporter Adam Beam found an example that represents how the proposed changes victimize veteran workers, and explained how many of them are reacting.

An increasing number of state workers are electing to retire before changes are made to the state’s pension system.

Take Win Hughey, 56, for instance. In 1984, Hughey left behind the life of a women’s shoe salesman to manage a warehouse for the state’s prison system.

He says he did it because, as a state worker, he could keep his unused sick and vacation days to add an extra 7 percent to his retirement benefits. But beginning July 1, the rules for the state retirement system are expected to change. Already, the S.C. House has passed a bill to stop Hughey from using his unused days to increase his pension. The Senate will begin discussing that proposal next week.

But Hughey is not going to wait around to find out what happens. Instead, he will retire June 30.

“I’m 56. I planned to work until I was 62,” he said. “(But) there is no incentive for me to work.”

No incentive to work.

Governor Nikki Haley has just completed a media spree to sell her books, and she missed no opportunity to tell television interviewers that South Carolina is a fantastic place to start a business.

What she neglected to say is that South Carolina has little regard for the citizens who work for a living. If it did, veteran public employees like Hughey would find greater incentive to work than to retire.

Beam writes, "Hughey is one of the unintended consequences of retirement reform," but I respectfully disagree. What is happening to and among our public employees is entirely intentional; one has only to review the speeches of anti-public-employee lawmakers, and their proposed legislation, of the past decade to see the intentions spelled out clearly.

The only difference between then and now is that the consequences of bad economic decisions by lawmakers offer a convenient rationale that changes to the retirement system must now be made, or else. In fact, they don't -- but no matter, sufficient numbers of lawmakers now exist to adopt job-killing impacts to the state's public employment and retirement system.

Lawmakers are changing the state’s pension system in an attempt to reduce its $13 billion deficit. But anything that prompts workers to retire earlier than they normally would have retired – like cutting their benefits – costs the state more money. That’s because there are fewer people paying into the retirement system and more being paid by the system.

So far, 5,603 workers covered by the pension system have filed applications to retire this year – or 819 more than at this time last year.

And more and more of those filing to retire are buying “service time” – or credit for additional years of work – so they can retire early. Since November, 3,912 people have filed applications to buy added years of service covered by the retirement system. That’s 1,035 more than during the same period a year earlier.

For more tenured state workers, buying service time will become far more expensive after July 1 if the proposed pension changes become law.

The state’s two largest retirement systems have more than 216,000 active members. Not all are eligible for retirement.

As of July 10, 2010, the latest numbers available, the two systems had 19,774 people who were eligible or nearly eligible for retirement. An extra 819 people retiring this year represents 4 percent of that total deciding to retire.

(State law says you have to have at least 28 years on the job – or be at least 65 years old with at least five years of service – to be eligible for full retirement benefits. Police officers and firefighters can retire with full benefits after 25 years of service or if they are at least 55 years old with at least five years of service.)

Thus far, the higher number of state workers opting to retire has not “put undue stress on the system,” said David Avant, managing legal counsel for the state retirement system.

But added retirements could have a big impact on some local governments, whose workers – along with many public-school teachers – are covered by the state retirement system.

Now we get down to brass tacks. Here's where privatizers find their bread finally buttered after investing in legislative campaigns.

Apply enough pressure to local governments, and they'll eliminate public services, opening the door to contracting with private companies to provide the same services for a profit. That includes every category of services from emergency response personnel to municipal road repair, to law enforcement, to public education.

Draining the public pool leaves all boats run aground.

The prospect concerned Columbia city manager Steve Gantt so much that he had his staff calculate how many of the city’s roughly 2,000 employees were eligible to retire on June 30. The answer: 230, including the city’s chief financial officer and some senior managers in the police and fire departments.

If all of those city workers choose to retire, it would cost the city $1.5 million to pay off unused sick and vacation days, Gantt said.

“I can’t imagine if all those folks decided to bail so they fell under the old criteria instead of the new criteria,” Gantt said. “It is what it is, and we’d have to do what we have to do. But I do have some concern about the financial implications.”

What would your own community do if suddenly 12 percent of its firefighters -- including the most experienced ones -- were forced to retire? Or 12 percent of your public hospital workers, social service workers, teachers, police officers or sheriff's deputies?

Under the House plan, state workers would get to keep the benefits they already have accrued under the current system. However, they would accumulate lower benefits going forward for their service beginning July 1.

But Hughey said it is not worth it for him to stay. Instead, he plans to get another job in the private sector and use his retirement benefits as supplemental income.

“I won’t have as much time off with my family, won’t have the seniority,” he said. “I’ll have to work more. It’s OK, working doesn’t bother me. I just wish I had the (retirement) plan they said I could have.”

Did you catch that?

Hughey wishes that lawmakers would keep their promises to public workers.

Don't we all.

Greenville News defends public employment penalties

Editors of the Greenville News praised today the legislature's move to raise public employees' required contributions to their retirement fund, calling it "not perfect" but "necessary."

Indeed, it's imperfect. It's also unnecessary, as lawmakers could have adopted -- could still amend themselves and adopt -- a host of alternative strategies, from raising sufficient revenue to address the state's obligations while holding public workers harmless, to restoring all of the positions that have been eliminated in recent years, which would infuse the retirement system with a wave of new contributions from new, potentially younger, employees.

Or, the legislature could have exempted all current employees from higher costs, but established higher contribution levels for all prospective employees.

Of course, lawmakers could have done something even more honorable and committed themselves to giving public employees decent wages and salaries.

This being South Carolina, I reckon it's too much to ask. We have corporate tax breaks to protect and private school vouchers to fund. It's a matter of priorities.

For the editors of the News, the priority is protection of the state's bond rating, not protection of public workers.

The fix is needed because the S.C. Retirement System fund faces an unfunded liability of at least $13 billion. That liability would double to $26 billion by 2041, according to a recent report in The State newspaper.

Such rapidly increasing liabilities would jeopardize pensions for workers who are depending on the state pension fund to maintain their standard of living in retirement.

The unfunded liability could have an impact on state taxpayers, too. If the state is unable to meet obligations to retirees -- or if it appears those obligations will go unmet -- South Carolina could lose its much-coveted AAA credit rating. That would lead to higher interest rates if and when the state borrows money, and those higher interest rates would lead to higher taxes for everyone in the state.

So when public employees -- many of whom qualify for and receive public assistance due to their low incomes -- pay this additional penalty for the privilege of being a public worker and hoping for a small pension in their retirement, they should feel good about it. After all, they're paying more so that the rest of us won't be bothered.

It's a great burden they carry, I'm sure, but that's why we have an institutionalized and permanent underclass in South Carolina -- to do the work of the wealthy, and to protect them from feeling any pain.

Say, is it still true that the tax on purchases of yachts is capped in South Carolina at $300? It's highway robbery; I don't see why the yacht-sales tax couldn't be cut in half, or eliminated altogether. But that's a note for another day.

These are not easy decisions. But poor decisions and the economic collapse of 2008 have put the state pension fund -- and pension funds in many states -- in a significant hole. That unfunded liability would have significant consequences if it was not fixed. For starters, state employees might not receive the benefits they have been promised. That needed to be addressed.

Great points, but let's pause for a moment on the reference to "poor decisions;" they deserve some attention, and not to be glossed over.

South Carolina has enjoyed some boom years recently, when times were so spectacularly good that we could afford to cut taxes here, cut taxes there, give corporate incentives to locate in our state, give a passel of new corporate tax breaks, and still achieve our highest priorities -- among them, to weaken public schools, cut public employment rolls, reduce public services, and make the poor suffer even worse.

Hey, what's good governance if we can't achieve our priorities?

I have to believe that if, among all that tax-cutting and tax-breaking and incentivizing during the good times, our lawmakers had also invested a teensy bit more in the state retirement system, we might not have wound up in a precarious position as we have. I learned about compound interest in the fifth grade, so it mustn't take much brain power to understand that a tiny increase in investment, when invested appropriately, yields great rewards over the long term.

Poor decisions, indeed, if our legislators didn't attend to their responsibilities year after year after year after year when they could have honored their obligations to the state's workers.

If this bill passes the Senate and is signed by the governor, lawmakers will have been successful in implementing reasonable changes that will preserve benefits for public employees and protect taxpayers from the potential default of the retirement fund. Of course, the state needs to continue watching the fund's performance, and it needs to ensure that further adjustments are not needed.

God forbid that additional adjustments will be needed. We'll have to re-institute poorhouses in which to lodge our public employees when they're evicted from their rental houses, and when their public assistance benefits finally expire.

Other states are facing the same situation as South Carolina and some of them have begun exploring a move toward the 401(k)-style retirement funds that many private-sector workers rely on.

Oh, that's a fine idea. Let's leave our public workers' retirement benefits at the mercy of the stock market and its corporate master, who have just proven since 2008 that they answer to no authority but themselves, and they respect nothing but their own profits.

If that's our best option, we might as well send letters to our public employees advising them to work until they die, as it's the only way to ensure a little income through that eventuality -- with an emphasis on little.

Editors of the News seem more than a little enamored of this notion:

Legislators should at least study such an idea to determine if it's a long-term option for the state's retirement fund. The recent changes, however, could buy some time to see if more dramatic changes would be needed.

After all, public employment is public service, and public service is about sacrifice. Who better to demonstrate sacrifice than our public employees?

It is not unreasonable to ask state employees to make some sacrifices to ensure their retirement remains stable rather than asking taxpayers, many of whom are seeing less stable benefits, to foot the entire bill.

Especially -- it goes without saying -- our wealthiest citizens, who struggle already with the exorbitant sales taxes on their mansions, acreages and yachts. Damn it all, the line must be drawn somewhere!

That's especially true in an era when private-sector workers are being asked to get by with less help from their employer for retirement because of wage cuts or freezes, frozen benefits, and change-overs to defined contribution retirement plans.

Let's not stop with that short list; by all means, let's add because of statutes that prevent private-sector workers from bargaining collectively with their employers.

If we're going to kick the proletariat in the teeth, make sure to get all the way to the ones in the back, the wisdom teeth. Anything worth doing is worth doing well.

These changes are fair, sensible and deserve to be passed. Then lawmakers need to watch carefully to ensure the pension fund can stay on the path to solvency while continuing to provide promised benefits to the many retirees who will rely on this fund during their golden years.

Golden years.

One laughs to keep from crying.

Lawmakers punish public employees, expand charters

The South Carolina Education Association publishes by email a weekly update of legislative activity, and the update from the past week documents the damage done by our lawmakers to the state's retirement system.

To wit:

The House passed H.4976 (Ways and Means Committee), the bill that changes the S.C. Retirement System this week. Included in this bill are:

• Increases in employee contributions 1% to 7.5%
• Removes sick and annual leave from the Average Final Compensation(AFC)
• Lowers benefits by changing to five years of salaries from three years in benefit calculations
• Increases service years to 30 years for personnel hired after July 1, 2012
• Prohibits participation in TERI for personnel hired after July 1, 2012
• Increases employee contributions for General Assembly members 1% to 11%
• Prohibits General Assembly members from drawing retirement while still serving

Only two amendments were introduced during the debate on this bill. The first amendment sponsored by Rep. Jimmy Bales (Richland) would have allowed SCRS participants with ten years of service to keep their annual and sick leave in the AFC. The second amendment sponsored by Rep. Harry Ott (Calhoun) would have provided SCRS participants with 23 years to maintain the current plan. Both amendments failed before the bill passed 86-27. The bill now goes to the Senate.

The Senate Finance Special Retirement Subcommittee met to hear comments from all groups that have a vested interest in the redesign of the S.C. Retirement System (SCRS). Jackie B. Hicks, The SCEA President presented our requests to keep annual and sick leave in the AFC calculation, as well as maintaining the current calculation of benefits at the last three years instead of five.

So let's process this news.

As a result of these changes, public employees will pay more into their retirement accounts.

But public employees can expect to receive less in state retirement benefits.

And public employees will have to work longer than they presently do, before qualifying for full retirement benefits.

And they lose their deferred-retirement-option program.

And nobody is exempted from these changes, so people who made financial decisions twenty years ago based on their expectation of the state and its retirement system are punished, penalized, degraded and ultimately forced to work longer, for less, to receive lower benefits for the rest of their lives.

It hardly seems fair that the only change to be suffered by legislators themselves is that they can't receive benefits while serving in the legislature.

But is that change retroactive? Do those who already collect big retirement checks while keeping a death-grip on their seats have to give up their spoils until they give up their power? It's unclear.

Additionally, the SCEA report notes the changes to the state's charter school statutes that were approved this week:

The Senate passed the charter school bill, H.3241 (Owens-Pickens), which revises the charter school laws in the state. This bill was amended to:

• Allow more charter schools to form including sponsorships by universities
• Provide opportunities for single gender schools
• Gives charter school students access to sports and extracurricular activities in traditional schools

The House has voted to nonconcur with the Senate amendments and the Senate has voted to insist on its amendments. The bill will now head to a Conference Committee where the Senate has appointed Senators Matthews, Hayes and Fair to be its representatives.

Now universities will be able to grant charters. Yet the funding for these charter schools won't come from the universities' own budgets; these new charters will continue to drain the treasuries of local school districts.

Is it fair that local school boards -- who had their authority to deny charter applications stripped from them -- should see their appropriations diverted to charter schools in their areas?

And single-gender schools -- that's the very definition of segregation, isn't it? Are single-race schools next? What about single-religion schools? And if not, why not, when the precedent of establishing segregation as a defining characteristic of such a school has already been set?

And I must, to ease the throbbing pain in my brain, ask this simple question: If parents want to enroll their children in charter schools, why should traditional public schools be required to accept those charter-school students who desire the sole benefit of playing sports?

If traditional public schools are good enough for the purpose of playing games, why aren't they good enough for earning grades?

Out-of-state readers: Welcome, and help!

I've noticed something about the readers of Educating South Carolina over the past year, and it has both entertained and puzzled me: Many of ESC's readers are reading from outside South Carolina.

I don't mean that a bunch of South Carolinians are taking vacations across the border and checking-in via their Blackberries. I mean there have been a good many readers from across the nation, regularly visiting the blog and hanging around a while.

I know this because Blogspot lets me track my readership from day to day, and lets me know where they're reading from. It's a nice thing to know -- and now's probably a good time to say a big howdy to the 29 folks who read regularly from here in South Carolina: Howdy! And thanks for reading.

But let me extend a hearty welcome and ask some questions -- in all good humor and out of sincere curiosity -- of those reading from Far Off: What is it that attracts you to our pain, our heartache, our yearning to be free of foolish shackles, our constant struggles to overcome the kakistocracy of our government, our daily performance of the rites and rituals of living as broad-minded and big-hearted educators in one of the reddest of red states?

Why do you visit?

Of course, South Carolinians make up the lion's share of readers, thankfully. But since January 1 of this year, 453 North Carolinians have stopped by, 250 Georgians, 150-plus Texans, 129 Tennesseans, 128 New Yorkers, 117 Floridians, 104 Ohioans, and 103 Californians. And those are the states from which more than 100 readers have come to the blog these past two and half months. In fact, ESC has been visited by readers from every single state in America since January 1 except one: South Dakota. I reckon South Carolina and South Dakota have enough in common.

Is it schadenfreude? Delectatio morosa? Epicaricacy? I hope that's not it.

Or is it, perhaps, given the current state of affairs across the nation -- thanks to education deform (not reform), "Waiting for Superman," Michelle Rhee and Scott Walker -- are you looking for news from a state that has always had it worse? To offer you guidance on your own downward spiral?

If that's it, come and sit a spell. O, the tales we can tell.

See, educators in South Carolina have never had collective bargaining rights, never had any rights at all. We have had the right to take a tiny little salary and call it a living.

We've had the right to be demoted when a principal or superintendent wanted to give his niece or nephew, fresh from college, a plum role usually earned by a veteran teacher, or in a newly-renovated classroom usually assigned by seniority.

We've had the right to keep working through the flu, and through viruses, because sick leave is hard to come by. We've had the right to pay for our own substitute teachers when we want time off, and have the time to take off, and have a principal who'll let us take it off.

We've had the right to be grateful for our jobs. That's a big right we have. A lot of our colleagues, especially during the past decade, have lost that right through budget cuts that went to pay for corporate tax breaks, because keeping our corporate owners happy is far more important that educating the children of poor and working people.

But I digress. You'll get there soon enough, I know, because South Carolina has always been a sort of anchor, holding our professions and our society in place, somewhere around 1951.

Though many states have journeyed farther ahead -- winning all sorts of rights and benefits, organizing and empowering themselves, rising up to govern and influence their own lives and livelihoods -- we've stayed right here, half wishing that we could be doing the same and half knowing, in the darkest corner of our hearts, that you'd all grow tired soon enough of pulling and pushing for progress, and that when you take your collective eyes off the ball, you'll come snapping backward like a ball on a long rubber string.

We're America's ball and chain. But we come to accept it, adapt to it, even appreciate its familiarity, like that song Annie Lennox sings: "I love you like a ball and chain."

O no, fair readers from Far Off. South Carolina's educators have never been so organized that we could demand better health care benefits, the way that many of you have done in your states. We've operated on the take-what-we-get principle, because to do otherwise might land us on our ear, without pitiful health care benefits AND without a job.

I know that where you live, educators often have time to write books, do research, earn a second doctorate, or take a year's sabbatical and study in Europe. We've envied that.

Not here, no, not here. We're too busy. We've got second and third jobs to work, many of us, because it costs so much to add our families to our state health plan coverage, and that money has to come from somewhere.

Why do we stay here, you ask? Good question. Snow is one good answer; snow and ice tend to corrode the undercarriage of a car, and corrode the good spirits of a happy educator, too. And you may have noticed that many of you from Far Off tend to drive quite differently than we do here -- no offense meant -- and it's just safer to keep off of snowy and icy roads.

Yes, it is funny, I know, when you hear that we've got a little snow shower coming and we race to empty the store shelves of the staples: Milk, bread, peanut butter, moon pies, Little Debbie cakes and batteries. We laugh about that, too, while we're piled up on the sofa, drinking hot chocolate and waiting for those two inches to melt so we can go back to school tomorrow.

So climate has something to do with it. But community has a bigger role to play, I think. We know one another here; even if we don't know one another personally, by name, we know one another culturally speaking.

Within a year, a brand-new teacher in a medium-sized school will learn where all of her colleagues attend church (and if they don't, God forbid, and are in danger of hellfire and torment everlasting), where her colleagues' children are attending college and what teams they root for, who got their jobs by luck or merit and who got them because the superintendent in the next district over has a cousin who works in our district office and a favor got repaid, and which children's parents are regulars in the crime blotter and which ones' parents are "the town" this-or-that (the town lawyer, the town doctor, the town dentist, the town dance instructor, the town clerk, the town police chief, etc).

Though there is misery in public employment, there is some strange comfort in knowing that the misery is shared by many others.

It's familiarity again -- knowing every thing and every one, and knowing that they'll all be the same tomorrow and next year. For some of us, familiarity is like a warm handmade quilt to wrap up in and hide. For others of us, it's one of those heavy Army-surplus wool blankets: never big enough, itchy and too hot, too fast. Those who feel comfortable in it find no reason to leave, despite the misery. Others adapt, sadly and eventually, to the chafing. Those that don't adapt to the chafing do leave and never come back.

Are you, readers from Far Off, the sons and daughters of ones who never adapted to the chafing?

Or are you those who left so long ago, never to return? Are you checking in from time to time, looking for signs that it's okay to come back home?

If you are, then let me tell you this quickly: It's time to come back home. Now. Bring your parents, bring your grown-up children and your still-little children.

I say it's time because we're tired of fighting alone, and because you have a lot to teach us about how you organized and empowered yourselves in Far Off, and won the rights you did.

I say it's time because, frankly, although we say we don't like hearing folks say, "Well, back in New Jersey, here's how we did it," we need to know how you did it -- not everything, but the important things.

I say it's time because things move in cycles, like the pendulum of a clock swinging back and forth. We've been in this present darkness so long that it must be time for the light to come out again soon.

I'm hopeful of it.

Who knows? If enough of you come back, we might soon have enough like-minded ones of us that we can move our state legislature a step back toward progress.

We might soon have enough that we can speed the pendulum along, back to the center.

We might soon have enough that we can pull up that anchor and begin moving forward from 1951, maybe a decade or two.

We might soon have enough that we can lift our old familiar ball and chain, lay it on the anvil, and strike with enough collective force that we can unbind ourselves and our state for good. I know we can't change our history, but with enough people pulling together, we can climb up out of our present and decide our own future.

So, tell me, readers from Far Off: Who are you? What draws you to read here? What advice can you offer us? And when can you come and help?

House robs veteran state employees' retirement benefits

If this action occurred at the intersection of Main and Gervais streets in Columbia, the police would be called, someone would be arrested and 220,000 charges of grand larceny -- felonies, all -- would be filed.

But because it happened a couple hundred yards away, in the House Ways and Means Committee meeting, it's entirely legal. It's still highway robbery -- still grand larceny -- but it's legal.

What happened is this: Committee members voted to take retirement benefits away from 220,000 state employees by making them pay one percent more per year, by stretching out the period of years upon which the retiree's final average compensation is based, and by robbing employees of their ability to include unused sick leave and vacation leave in their benefit calculation.

Stealing back their unused sick leave and vacation leave alone will cost retirees roughly $1,000 per year, or five percent of their lifetime benefit. That's because most state employees are not paid well -- we're not talking about Steve Spurrier or those secret legislative retirement packages; we're talking about municipal workers who began their careers during the Carter administration. State retirees collect an average retirement benefit of $18,500 per year.

The Ways and Means Committee unanimously approved Tuesday a bill requiring newly hired employees to work an additional two years to collect full retirement benefits, while current employees could still retire after 28 years.

It would require workers to contribute more toward their retirement. The committee approved a phase-in, increasing the contribution from 6.5 percent of their salary to 7.5 percent over two years, instead of in one shot July 1.

This is called paying more and getting less.

Other parts of the bill are meant to prevent what's called spiking. Benefits would be based on employees' last five years of pay, rather than three.

Until the pay freezes of the past four years, state employees could count on a little bit of an increase in their pay each year -- enough of a raise to add cheese to a Whopper combo, not enough to buy a new Oldsmobile -- and an employee's final average compensation was calculated on their last twelve consecutive quarters, or three years. Lawmakers have decided its wiser to stretch that out to twenty consecutive quarters, or five years, in order to lower the employee's potential retirement benefit.

The difference means that during winter months, when heating fuel prices spike, retirees will be keeping their thermostats down at 65 degrees rather than 72 degrees.

Various attempts were made to limit the carnage, including throwing some veteran state employees under the bus in order to protect other ones.

The Palmetto Teachers Association believes employees within five years of retirement should be exempted from those changes, while the South Carolina Education Association wants all current employees exempted from them.

Why only exempt employees within five years of retirement? That boneheaded notion concedes that the theft from those just outside the arbitrary five-year line is legal, fair and ethical.

In fact, every current state employee should be exempted from any changes that are made to the retirement system. It's a foreign concept, I know, but there's an issue of fairness here: The agreement made with a public employee when he or she is hired is the agreement that should stand throughout that employee's career. You don't change the terms of the contract ten years down the road, or 20 years, or 28 years, and make the changes retroactive to day one.

That is r o b b e r y.

I noticed that a district court judge in Florida ruled on behalf of teachers and public employees there just yesterday, saying that any changes made to the retirement system may be prospective -- meaning they apply to future public employees -- but not retroactive. Sure, that's Florida, and South Carolina's lawmakers take no direction from Florida's laws, but then South Carolina lawmakers take no direction from their own laws, either.

Rep. Joe Neal, D-Hopkins, said the changes and increased contribution requirement will "inflict pain and damage on very vulnerable people."

The average salary for all employees who are paid at least partially through the state budget is $49,000. Nearly 56 percent of public employees earn less than $35,000 yearly, according to the state Budget and Control Board.

Neal's absolutely right. Ask the nearest public employee what he or she earns, and marvel at how little it is -- even teachers in your child's school. There's no danger of becoming wealthy as a public employee in South Carolina, unless you're a heart surgeon at the Medical University of South Carolina, or you coach football at USC.

The State newspaper quoted Rep. Jim Merrill on the matter:

“The easy thing to do would be for this committee and the House to do nothing. You do nothing and everybody walks away and no election impacts, no dirty emails,” said state Rep. Jim Merrill, R-Berkeley, chairman of the subcommittee that crafted the bill. “What the committee did is it rolled up its sleeves and made difficult decisions.”

Yet I've seen no one discussing the difficult decision of replacing all those public employees laid off and fired during the past several years' budget cuts, when everyone understands that adding more public employees would infuse the retirement system with fresh contributions.

Nope, no one's mentioned that. Can't afford it.

But we can afford to give $37 million in tax breaks to wealthy parents who enroll their children in private and parochial schools.

Something's rotten in this picture, as The State cannily observed.

Just moments before discussing the retirement bill, the House Ways and Means committee approved a bill that would give tax deductions to parents of home-school and private-school students. If that proposal becomes law, it would cost the state $36 million, money that state Rep. Brian White, the budget committee’s chairman, said he did not know where the state would get.

“They should have dug deeper to protect current employees just like they dug deep on (the private- and home-school deduction),” said Carlton Washington, executive director of the S.C. State Employees Association. “State employees expect the General Assembly to do what was promised to them.”

Wise words from the state employees' leader. Promises were made.

But in South Carolina, a promise made by our legislature is just so much hot wind.

Free Times details state's pension reform dilemma

The cover story in this week's edition of the Free Times of Columbia digs deep into the mess that's been stirred up around our state retirement system and the punitive measures being considered by lawmakers to right the ship.

The entire matter can be boiled down to a simple fact which leads to a simple solution.

Simple fact: During the past 12 or so years, thanks to deep and damaging budget cuts to public services, we've drastically cut the number of state employees who contribute to the largest account of the state retirement system.

Simple solution: Rebuild public services and the ranks of public employees, to ensure that sufficient numbers of employees are contributing to the system.

See the simplicity?

But because this is South Carolina, the simple fact is ignored and the simple solution will never be considered. Thus, we're left with a morass of allegations and recriminations from the grand tradition of "I know you are but what am I?" and lawmakers looking for even more ways to cut public employment, cut retirement benefits for those still working, and eliminate opportunity for people who might work for the state in the future.

It's a privatizer's dream -- which means that for some lawmakers who have long antagonized the retirement system, it's a dream come true.

The Free Times opens its coverage with the political drama, the finger-pointing and accusations of wrong-doing to score political points. Then it gets to the problem at hand.

But the fundamental force driving the debate is something much more powerful and longstanding than political tit-for-tat: It’s demographics.

In 1999, there were more than three state workers for every retiree. Now, there are less than two. (The ratio has changed from 3.16 workers for every retiree to 1.71.) Part of the changed ratio comes from cutbacks in state government; part of it comes from people living longer.

Either way, the math is clear: It says that in order to keep the state pension system viable, South Carolina needs to pay out less to retirees, bring in more from employee or employer contributions, make more money on its investments — or some combination of all three.

“Certainly the demographics of where we are is having an impact,” says Sen. Thomas Alexander, a Republican from Oconee who sits on the Senate Finance Committee and co-chairs a subcommittee looking into retirement issues. “It’s not a bad thing that people are living longer, but the system has to be reflective of the trends so we are viable for the long term,” he adds.

The official numbers go like this: On June 30, the value of the South Carolina Retirement System Fund stood at $25.4 billion. In fiscal year 2011, the fund paid out almost $897 million to retirees. Meanwhile, its unfunded liability — the amount of shortfall in the system over a 30-year period if nothing is done to stabilize it — is $13.4 billion. That’s up from just $177,000 in 1999, according to a 2010 story in The State.

Officials characterize the situation as a serious challenge, but one that can be managed with just a few tweaks to the system.

Starting with the simple solution I identified: Re-open public employment, restore the thousands of jobs cut during the Sanford administration, and bring a wave of new public servants into the fold.

Or maybe not.

No, of course not. Logic and rational decision-making has never been our state's strongest suit.

As of Jan. 12, the value of the state’s pension fund had dropped to $24.3 billion, according to a weekly portfolio summary put together by the Investment Commission. The decline came at a time when the Dow Jones index was virtually unchanged — it closed at 12,414 on June 30 and 12,471 on Jan. 12 — underlining Treasurer Loftis’ concerns about the fund’s performance and investment philosophy.

As for the other side of the ledger, some experts think the estimate of $13.4 billion in unfunded liabilities is unrealistically low.

A 2011 study by researchers at the University of Rochester and the Kellogg School of Management found that even taking into account economic growth, contributions by local and state governments to pension systems would have to increase by a factor of 2.5 for pension systems to be fully funded. In terms of yearly contributions, the study, “The Revenue Demands of Public Employee Pension Promises,” estimates that South Carolina would have to increase its yearly contributions from $1.5 billion to $3.6 billion for its pension system to be fully funded — an increase of $1,186 per household per year for each of the roughly 1.7 million households in the state.

One of the researchers on the study, Joshua Rauh, says South Carolina’s shortfall could be as high as $53.5 billion, according to the Post & Courier.

A Pew Center report also finds South Carolina in a challenging situation. In its 2010 report “The Trillion Dollar Gap,” it found that South Carolina’s liabilities are funded at 70 percent. The center divided states into three categories: solid performer, needs improvement and serious concerns.

South Carolina was one of 19 states listed in the category of serious concerns.

Since then, the percentage of the state’s pension liabilities that are funded has dropped to about 66 percent. By comparison, in the late ‘90s the state pension fund was nearly fully funded, hovering around 98 or 99 percent.

Notice that no one mentions the thousands of job cuts, or the benefits that would accrue to the system if those jobs were restored in the budget.

Why not? Because our lawmakers have engaged in a slash-and-burn policy when addressing public services, and it's likely that the state or its decimated agencies have already let contracts to private entities to provide what were formerly public services. The beauty of that system, of course, is that public money moves into the private sector through a closed spoils system -- it's not what you do, it's who you know! -- and public employees are wiped off the public employment rolls, meaning the state's obligation for health care and retirement benefits is reduced, too.

But South Carolina is now bearing witness to the fallout from that slash-and-burn policy, and decision-makers are scrambling to figure out ways to legally cut retirement benefits for those still on the job, while charging them more for the lesser benefits.

Charles Logan is a retiree who was a deputy director at the S.C. Land Resources Commission and later a section chief at the S.C. Department of Natural Resources.

During his long tenure as a state worker, Logan witnessed or participated in lots of meetings before legislators “begging for money” for his agency, he says.

“I saw so many of them just had a complete disregard for state employees,” he says. “They looked at state employees as almost peasants — or servants almost. A lot of them were not just egomaniacs but also weren’t knowledgeable about programs.”

He takes aim directly at the Legislature for mishandling the state’s pension fund — specifically, the TERI program and 28-year retirement.

“I find it disgusting that South Carolina’s politicians act like they’re rescuing the solvency of the S.C. Retirement Fund when their actions have caused the severe decline in the retirement fund,” he wrote in a recent letter to Free Times.

“When they passed the TERI plan, it was originally intended just for teachers, but they also used it for favoritism and political payback that they could give to people — their cronies that they wanted to dole it out to,” Logan says in a follow-up interview. “But then there was a lawsuit [in 2005] saying that it was unfair to just pick out a specific part of the public employees, so it had to be applied to every public employee. At that point, they should have canned the program — it just sucks money out of the retirement system.”

Sen. Alexander emphasizes, however, that both the TERI program and the 28-year retirement were done for public employees and retirees, and that they were implemented at a time when the pension fund was close to fully funded.

Logan doesn’t deny that the programs were beneficial to state workers; he just takes issue with the Legislature launching programs without paying for them. He says he’s collected more than a decade’s worth of articles, editorials and letters to the editor from throughout the state, all urging the Legislature to be more prudent in its management of the state pension fund.

“It’s obvious what they are going to come up with,” Logan says. “They are going to act like they are the saviors keeping [the pension fund] from going under when they caused the problems to begin with. And they will do it on the backs of the public employees: They will raise the contributions and they will cut the cost-of-living adjustments — yet they will not touch their own retirement system.”

“I don’t have any confidence in them,” he says. “How can you have confidence in the General Assembly?”

Hard to argue with the facts.

It's an object lesson to those willing to learn: When you make political decisions for short-term gain, you do long-term harm.

So, in the absence of doing what's smart and what's right, what solutions are being discussed?

Apparently, paid actuarial consultants have proposed converting our retirement system from defined benefit -- in which everyone knows what benefit they'll receive when they retire -- to a defined contribution system, in which the state and its employees contribute to a retirement account, but no benefit is guaranteed; a retiree's benefits are then subject to the whims of the stock market -- benefits might get better when the market does well, benefits might bottom out when the market falls off. Under such a system, the only ones who benefit are the investment bankers; they get paid whether the market grows or crashes.

As much doubt as some retirees might have in the Legislature, it could be worse. Speaking at a Jan. 5 legislative workshop for the media, GOP Rep. James Merrill of Charleston said legislators are determined to keep the pension checks coming — and not, as actuaries have advised, to move from a defined-benefit to a defined-contribution system.

If legislators did move to a defined-contribution system, state employees would get a taste of life in the private sector — no guaranteed pension whatsoever, just a small yearly contribution to an IRA or 401K.

In order to keep the pension system afloat, however, there will need to be changes — big ones. Those changes might include reducing cost-of-living adjustments, raising the retirement age or changing the number of years it takes for an employee to be fully vested in the system.

“Everything will be on the table,” Alexander said at the Jan. 5 legislative workshop.

Easy choices will not make a dent, Democratic Rep. Gilda Cobb-Hunter said at the event. Plus, she added, she’s interested in solving the problem once and for all.

“I am not interested in kicking the can down the road,” she said.

Meanwhile, the demographic wave continues to create pressure on all sides — employees, retirees, legislators, fund managers and taxpayers — toward a solution that likely no one will be happy with, and that might have to be revisited over and over in the coming years.

Much as retirees — and everyone else — might wish it were otherwise, there are no guarantees.

Lawmakers propose robbing, then punishing, public employees

It's the same old song.

State Constitution empowers lawmakers to raise revenues necessary to fully fund the state's essential obligations and institutions. It doesn't give that power to the rest of us, only to the 170 men and women sitting in judgment in Columbia.

And when their decisions to rejigger how we invest retirement system funds, at precisely the moment of an economic downturn, results in a big drop in investment returns, what's their best proposal?

Rob more money from the pockets of poor, working-class public employees, then punish them further with cuts to retirement benefits.

This is not creative problem-solving; this is abrogation of responsibility. Deadbeat dad-ism. Absentee landlord-ism.

Here are the highlights identified by The State newspaper:

State workers to put more in, get less out

A look at the financial impact of proposed retirement changes

The average state employee would pay an extra $408 a year in retirement contributions.

State retirees, over the next 30 years, would receive $8 billion less in benefit payments.

State taxpayers, over the next 30 years, would pay $8.3 billion less into the retirement system.

It's a win-win-win, right? For everyone except those poor individuals who were willing to devote their careers to public employment, knowing that it meant lower wages but safe, secure retirement benefits that let us age in dignity.

Proposals like these drain the dignity from the process.

Proposed changes to the state retirement system immediately would cut $2.2 billion from its $13 billion deficit, according to a review of the plan by an independent accounting firm.

That is because, under the proposal, state workers’ retirement benefits would be based on five years of salary instead of three years of salary, a move that could lower benefits. And state workers could no longer include unused sick and vacation days to earn higher benefits.

The proposed changes mean that, over the next 30 years, state retirees would get $8 billion less in benefits than they would have under the current plan. And state taxpayers — required by law to contribute to the state retirement fund — would contribute $8.3 billion less than would have been required under the current plan.

House lawmakers plan to introduce a retirement bill this week, following months of negotiations with state workers, retirees and Gabriel Roeder Smith & Co., the consulting firm paid hundreds of thousands of dollars to advise lawmakers on the retirement system’s finances.

Here's the answer -- and it wouldn't have cost the state those "hundreds of thousands of dollars": Treat public employees with dignity and respect. Either pay them up front in much higher wages, or afford them the retirement security that comes from having reasonable retirement benefits they can count on.

“We are pushing hard to make sure we take corrective action now,” said House Majority Leader Rep. Kenny Bingham, R-Lexington. “If we can do it now, we’re really going to save the system a great amount of pain in years to come.”

Corrective action was necessary two decades ago, when lawmakers chose a path of atrophy: Paying less from state resources, investing less from state resources, cutting corporate taxes by loopholes and wholesale, demanding more from employees and offering less to them.

Or, if you want to look at things in the much longer view: Corrective action was necessary two generations ago, when lawmakers voted in 1954 to establish South Carolina as a "right-to-work-for-less" state, anchoring us forever to the old plantation and mill labor systems.

The S.C. State Employees Association opposes the changes for current employees, which would have the biggest impact on the deficit, according to the consultants’ review.

“We didn’t get into this scenario overnight, and we’re not going to get out of it overnight,” said Carlton Washington, the association’s executive director. “It would be, we think, punitive to punish employees who have provided the committed service over a number of years and built their portfolio around those expectations.”

Washington hit the nail on the head: South Carolina punishes its public employees -- just as it allows private employers to punish its workers -- for not being born into the state's aristocracy and ruling elite. Born powerless, we're kept powerless with a corporate boot on our collective neck.

In addition to benefit changes, state workers would have to pay an extra 1 percent from each paycheck into the retirement fund — an average increase of $408 a year. State Rep. Gilda Cobb-Hunter, D-Orangeburg and a member of the House retirement ad hoc study committee, said Monday she will push to have that increase phased in over two years to lessen the impact.

Why accept this proposal at all? Rather than offering to lessen the impact by phasing it in over two years, why not send those high-paid consultants back to the drawing board and asking them this question: How much revenue must be raised and appropriated to the retirement system in order to preserve -- and even strengthen and improve! -- retirement benefits while holding harmless our public employees who don't have the extra thousands of bucks to cover this gap.

Say it with me: Public employees are not responsible for this problem. State lawmakers had, have and will always have the power to do what's right.

But Bingham, who is also a member of the retirement committee, said the reason for the 1 percent increase is to “make sure the (retirement) system got an infusion immediately.”

The system needs an infusion immediately? Easy fix: Immediately eliminate all corporate tax loopholes and instruct a grand total of one staff person to direct all necessary additional corporate tax revenues directly to the retirement system. And when the system is solvent, apply the rest of the additional revenues directly to the base student cost under the Education Finance Act.

By my calculation, that should take care of the retirement system AND restore the base student cost to 2012-13 levels.

Problem solved. And I won't charge a penny for the consultation.

But, no, that leaves public employees whole. It affords them a little dignity. It helps them sleep a little more soundly at night. So it's absolutely unworkable. If slavery and mill culture taught us anything, it's that the ruling class must keep its workers hungry and anxious in order to get the most compliance. So, another quarter-turn to the thumbscrews.

If passed into law, the proposal means new employees would have to work 30 years, or reach age 65 with five years of service, in order to retire with benefits. And they would be ineligible for the TERI program, the controversial program that allows employees to retire and receive benefits while still working.

Current employees — who are eligible to receive retirement benefits after 28 years of service — would be exempted for both of those changes.

All of the changes would apply to members of the S.C. Retirement System, the largest of the state’s five pension systems, which includes state employees, local government employees and teachers.

Police officers, firefighters and other law enforcement officers have their own retirement system. They also would have to use an average of five years of salary to calculate their retirement benefits. And they would be banned from using unused sick or vacation days to determine the amount of their benefit checks.

But law enforcement officers — including new hires — still would be able to retire after 25 years of service.

Lawmakers would not escape unscathed, either.

Under the bill, a state lawmaker would have to give up his or her seat in the Legislature in order to receive retirement benefits. The proposal would end the practice of lawmakers retiring but remaining in office and replacing their $10,400-a-year salaries with much larger pension benefits — more than $30,000 a year, in some cases.

My heart bleeds for our lawmakers, forced to retire before they could collect their thirty grand a year for life. How will they live?

For advice, they might consult their public workers, who've been living on pittances for generations.

Our lawmakers giveth, and our lawmakers taketh away

Tears of joy may have erupted across South Carolina last week as a House committee approved a plan to raise state employees' and educators' salaries by two percent (and law enforcement officers' salaries by five percent), effective July 1. These folks have had their incomes frozen by the legislature for years, with some not seeing an increase since 2007.

But they've dried up pretty quickly as the rest of the proposal has come to light.

They would have to pay an extra 4.6 percent for their state health insurance and most likely will have to pay an extra 1 percent of their salaries into the state retirement fund to help make up for its $13 billion deficit.

Result: Net loss in salary.

That's right. Same work, one more year, more students in classes, fewer colleagues to share the burden, greater expectations, fewer resources for classroom instruction, no advocacy from the state's highest-ranking leaders, no rights to take collective action, and for all of this bounty, state employees and educators will take home less pay.

And this is called a good start.

For lawmakers, maybe. It's an election year. There's a budget surplus of nearly a billion dollars. So throwing public workers a bone looks good, feels good, and gets a little media coverage. It's a great day in South Carolina.

But not so great a start for public employees.

For years, Jo Ellen Dowdy, a high school math teacher in Lexington-Richland 5, considered her job as “secondary income” to her husband, a mortgage broker. But when her husband lost his job during the housing crash, their family of four had to depend on Dowdy’s teacher salary.

A raise would “mean a lot,” she said.

“We’ve made it through, but there were a lot of sacrifices to be made,” she said. “The salary should get to the point where a male can raise his family as a teacher instead of having to look at it as a second salary sort of profession.”

But Carlton Washington, executive director of the S.C. State Employee Association, called the pay increase “disappointing and short-sighted.”

For months, lawmakers have said state employees will have to make sacrifices to help resolve the $13 billion deficit in the state’s retirement fund.

“They have a billion dollars in new money this year, and 2 percent is what they recommend?” Washington said. “A 2 percent raise when employees are 20 percent behind inflation and a 4.5 (percent) increase in health insurance last year and a proposed increase in health insurance this year? That (salary) recommendation just does not represent shared sacrifice.”

The 2 percent increase for teachers would apply to all school district employees. It is possible because lawmakers agreed to give an extra $152 million to education in the state’s fiscal year that starts July 1, bringing the basic amount the state pays school systems for each student up to $2,012 from its current $1,880. Most of that money is dedicated for teacher salaries.

“Every single employee is important to the district. Everybody is needed in their role and everybody should be rewarded,” said state Rep. Kenny Bingham, R-Lexington. “With the retirement issues we are all dealing with, if we don’t provide them some remuneration, we are going to be in trouble.”

Update: We're not going to be in trouble. We're in trouble.

We've laid off educators. We've cut public employee rolls. We've furloughed. We've hiked health care premiums. We've done little else but give away massive corporate tax breaks.

The cupboard's bare; even the mice and cockroaches have vacated for Georgia and North Carolina. Now, Providence has defied our regressive tax policies and delivered an additional billion dollars to the kitchen, and the best our chefs can do is serve up some crumbs -- claiming that the meat and potatoes have to go to pay down old obligations.

Law enforcement issues also weighed on the committee.

The state Department of Public Safety had requested $4.2 million to hire an additional 56 officers, including 40 new state troopers. It did not get the money. Instead, its workers would get a 3 percent raise in addition to the 2 percent raise for all state employees, for a total of 5 percent. That raise also applies to Class 1 police officers at the Department of Natural Resources and the Department of Probation, Pardon and Parole Services.

“We are losing tenured officers to local governments who are now paying more,” said state Rep. Mike Pitts, R-Laurens, chairman of Ways and Means’ Law Enforcement subcommittee.

That extra 3 percent raise does not apply to officers at the State Law Enforcement Division. Instead, lawmakers gave SLED roughly $2.5 million to hire 45 new SLED agents.

“We had a discussion about that. The bottom line is ... I needed the agents to be able to do the jobs that SLED is supposed to be doing,” SLED Chief Mark Keel said, noting the additional raise only would have applied to the agency’s Class 1 police officers, not its full staff.

Here's a thought. How about restoring all the step increases in public employee compensation that have been frozen for the past two, three, four, five years -- all of them, not just two percent's worth of them. And how about addressing class size by bringing back educators to the classrooms?

And if we've lost so many law enforcement officers, how about slicing off a big chunk of revenue to bring back those folks, too?

What? All of that will mean raising revenues on South Carolina's wealthiest? Assessing taxes on fair market value for those mansions on the golf courses? Maybe even levying a millionaire's tax? A luxury tax?

Well, if that's all it takes, what's the hold-up?

What a blessing it is that God gave South Carolina so many blessed entrepreneurs and wealthy folks who can afford to shed a little excess change to help the rest of us. How godly of them to exhibit the generosity. And how blessed we would be to have lawmakers who take seriously their charges to South Carolinians.

Public employees, I guarantee, would settle for only sufficient blessings to have a little money in their pockets at the end of the month, so maybe they could save a little bit, too. They don't need the mansions of gold and titanic yachts and Humvees; I suspect they'd be happy with finishing out their mortgages, knowing their health care is safe and having a little retirement security.

Retired teachers ask lawmakers to do the right thing

Issues like these don't get the coverage they deserve. In support of the retired educators in your area, I hope you'll forward this note to your own friends and family, and encourage them to support retirees' efforts to get the benefits they've been promised.

Last week, a group of retirees came to Columbia to speak with lawmakers.

Retired Barnwell County school teacher Jerry Bell says he flirted with the idea of taking a part-time job to supplement his state benefits but he says he doesn't have the time.

"Retired state employees don't just go home and collect their checks,” said Bell. “Retired teachers in my area run the food banks, and the animal shelters."

Bell, along with other former and current state employees are asking lawmakers not to drastically change the pension system and guarantee cost of living adjustments.

"1% increase over 10 years is like a 40% decrease,” adds Bell. “When you don't get that one percent increase, you're not getting it forever."

The South Carolina Public Pension Coalition claims there's a billion dollars of revenue available in state coffers, yet teacher and state worker salaries have remained frozen for the last four years.

Lawmakers say reforming the pension system is one of their top priorities this year. They are considering proposals that will increase how much workers pay into it.

"Teachers work hard, state employees work hard,” said Bell. “This state wouldn't run without teachers and state employees. We expect to be treated with respect."

Lexington State Representative Kenny Bingham is on a committee that will look at pension reform. The Republican lawmaker told WACH-Fox he's too tied up with the budget to talk about the issue, but will do so next week.

Retired public employees gave decades of their lives to public service, at low wages and salaries, counting on the state to keep its commitment of retirement benefits. Now those benefits are in jeopardy. Our public retirees don't deserve the anxiety they're suffering. They did their part.

Retired public employees blamed for budget instability

The way the dialogue is being framed tells the tale; we can see from a mile away who the bad guys are going to be:

South Carolina taxpayers should expect the amount of money they pump into the state pension system to increase in the coming years as the program struggles to close a widening $13 billion shortfall.

At the same time, the state might be forced to shift resources from areas such as education and transportation to the retirement system to help close that gap, pension experts said.

It's South Carolina's retirees. Not the ones who retired from Lockheed Martin up north and built monstrosities overlooking their sailboats on the bay, not the ones who think Cracker Barrels are so quaint and rustic, not the ones who can't eat grits.

I mean the ones who spent their careers in the public service of South Carolina and its municipalities -- the teachers, the emergency response personnel, the city maintenance guys, the lunch ladies, the bus drivers, the civil service workers and magistrate's secretarial pool, the town clerks, the police dispatchers, the state parks interpreters, the firefighters, the folks at the water department, the prison guards, the folks who salted the roads before an ice storm and who cut and carried away the fallen trees afterward.

They're all the bad guys.

They're greedy, and they're stealing from the rest of us to pad their twilight years with luxury.

Right?

Maybe not so fast, crime fighters. Let's review a little history.

Back in the day -- let's take the mid-twentieth century for starters -- public employees didn't earn much money. They were low on the economic totem pole. A public service job was good for only one thing: employment. So long as you did your job, kept your head down, didn't break any expensive public property and were johnny-on-the-spot when an emergency broke loose, you kept your job for a solid 30, often longer.

Then came the economic boom times of the 1950s and 60s, when citizens' expectations of government grew, so the state added workers to meet those expectations. You wanted to have enough law enforcement to prevent any stir. You needed enough firefighters to protect the new city neighborhoods and suburban developments. You wanted enough public health workers to answer the questions when the baby was colicky, and enough teachers to keep up with the bulging elementary school enrollments. Et cetera, et cetera.

But excited new public employees weren't excited by the permanently low wages, so our elected leaders offered a grand bargain: Take these public service jobs at low pay, said our leaders, and we'll do two things: We'll invest in health insurance and retirement plans for you, and we'll increase your wages when we can.

Public workers took the grand bargain. After all, they too had children who needed a doctor visit once in a while, and they too dreamed of retiring while they still had some life to live, just like the swells.

That worked a while. Life was good, relatively speaking. Raises didn't come often, and when they came, they were meager. Still, you had the promise of employment, a guaranteed paycheck.

Soon enough, however, it was crystal clear that workers in the private sector, who might be doing the same or similar work, with the same or similar education and experience, were getting along a bit better. Public employees, to the extent that they organized themselves at all, asked for better pay.

Their elected leaders were pressed from both their public employees, with their low wages, and their private-sector pals, who suppressed their own employees' wages to just a shade above public employment. If you raise public employees' wages, said the private-sector leaders to their elected pals, then we'll have to raise ours, and that's gonna cut into our affection for your candidacies.

So our elected leaders came back to their public employees with a grander bargain: We can't afford to raise your wages, they said -- we don't have that kind of money -- but what we can do is to improve your health insurance plan a little bit each year, and to invest more in your retirement accounts each year, so that when you retire, you'll have security and can live just like the swells. You can take your family for weekends on the lake, babysit your grandchildren, and shop for the tykes at Christmas and Easter just as well as the fat cats at the country club.

And it was a great bargain. Thanks to promising markets stretching to the horizon, a little more investment in those days would yield a reasonable reward when retirement day came. Public employees understood the concepts of simple interest and smart investments. And they accepted the deal.

Year after year, through the 1970s, the 1980s, and into the 1990s, public employees accepted artificially low wages in exchange for the promise of good health care and retirement security. They saw others fly by them on the ladder of upward mobility, and they kept working. They scrimped, saved and clipped coupons to tend their own families, as the families in the newer neighborhoods seemed to get ahead without trying so hard. Still, our public employees kept working.

And some reached their goal: The full 30, the alleged gold watch, and the little camper at the lake. They collected their retirement check and it kept them ahead of bill collectors. The lucky ones paid off their mortgage at just the right time, so theirs was theirs.

Those who'd come after them kept working, seeing the first waves of those old promises paying off. So it seemed it would for them, too, and for those who'd come along even later.

But a day came in the 1990s when the tide turned. Those old-guard electeds who'd cut the first grand bargains were fading out, and the next guard behind them didn't share their old sense of commitment. Through the 1980s and early 1990s, when lawmakers wanted to pass tax cuts, they still found the money to honor their commitments to their longsuffering public employees. Now, it seemed, there wasn't enough money to do both. Lawmakers chose tax cuts, and they began wearing away at the old grand bargain.

One year, it was not enough money to fund a cost-of-living adjustment for retirees. Another, it was not enough money to continue one particular feature of the state health plan. Another year, maybe it was both. Later, maybe public employees would have to accept an increase in co-payments for doctor visits, or a higher prescription drug rate, or another increase in the out-of-pocket maximum.

Lawmakers cut taxes some more and approved sweetheart deals to exempt corporate giants from paying income tax. Well, that meant they couldn't afford another tick upward in the employer contribution to the state retirement system, so they raised employee contributions.

To employees in their second and third decades of service, still shy of retirement and now with one or two sons or daughters in college, these were bitter pills to swallow. Promises had been made. Wages paid to them had been kept low purposefully, with the guarantee of better benefits to come.

Unfortunately, as we all discover in our interactions with our legislature, what is written can be unwritten, what is done can be undone, and what is promised is never really promised.

Public employees who have remained in public service through the past decade have learned this lesson again with each monthly. Not only has the tide turned decidedly out, but our public employees and retirees find themselves blamed for the alleged instability of the state retirement system, and more generally for the sorry state of our budget priorities. Wages are still pathetic. State health care provisions -- what is left of them -- are so cost-prohibitive that workers are loathe to use them, but for emergencies. And pension security? The only people assured of pension security are the white-collars collecting fees for every stock trade in the foreign and domestic markets. Lawmakers champ at the bit to rewrite state retirement rules -- "reforms," they call it -- and they betray no lack of malignant creativity.

So, what pension security?

Now comes the media, wrapping up matters in the tidiest narrative: Greedy public employees, goes the tale, have leveraged their weight to bilk the state for years, pumping up their fat retirement benefits at the expense of necessities -- education, transportation -- and mortgaging their children's and grandchildren's futures for their own comfort and joy. Cue the scary music.

State lawmakers in recent months have discussed reforms, but those efforts might not be enough to fix the crisis, the experts said.

State and local governments contribute a percentage of public employees' wages to the South Carolina Retirement Systems' trust. That rate has ballooned over the last seven years as state officials enacted four increases in an effort to shrink the pension debt.

In 2005 public employers contributed 7.7 percent of wages for most pensioners; they now contribute 10.6 percent. Over that time, the Legislature raised employee contributions a half-percent to 6.5.

They ripped us off, cry the media.

To hit high return rates, South Carolina's Investment Commission in 2008 approved making riskier investments that can have big payoffs. But those big risks can come at a cost. After the stock market crashed that year, the state took a $7.6 billion loss. It has recovered somewhat since then but remains below pre-recession levels.

Other issues have amplified the retirement system's funding crisis over the past decade:
The Legislature passed measures that pumped up employees' benefits.
Baby Boomers began to retire and draw down pension reserves.
State data shows retirees are living longer than ever.

This all means that the system is paying out more money but taking in fewer contributions.

Look again at the issues that have "amplified" the "crisis."

First, lawmakers passed measures that "pumped up employees' benefits," we're told without any historical context.

Second, Baby Boomers are retiring; and, notice that instead of "collecting their earned benefits," they are "draw[ing] down pension reserves." As if they're thieves. As if they haven't delivered their years of service and earned their legitimate pension benefits.

Third, and worst of all: "State data shows retirees are living longer than ever."

What should be the alternative? That they should respectfully forego their benefits, go home to their Barcaloungers in the dark, and will themselves to die, so as to reduce the economic burden left for the rest?

What a callous and hard-hearted soul who contrived these talking points, these themes, these excuses for legislative treachery and neglect.

This is no hyperbolic reaction to the narrative offered by the Post and Courier of Charleston. Look at its next lines:

Taxpayers make up the difference for what investment income doesn't cover, pension analysts said.

"If the risks don't pay off, you're going to be in trouble," Biggs said. "The person getting screwed is going to be the taxpayer."

Innocent taxpayers, screwed by conniving, elderly town clerks and librarians who had the temerity to live past the actuarial projections for their life expectancies. It's their fault that the state retirement system is under water. Lawmakers who could have honored their commitments and appropriated millions more dollars during the past 15 years bear no responsibility for the state of things, no. Those old tax cuts upon tax cuts were necessary, right and proper. Political favors demand repayment. So those old commitments to invest in the system were dead weight; they had to go.

Pension experts including David Draine, a senior research associate at Pew Center on the States, said South Carolina should be worried. Some states over the past decade have "failed to operate their retirement funds in a financially responsible manner."

"South Carolina is one of them," he said.

Retired public nurses, living now in assisted living facilities -- it's them to blame, folks. They bled you dry and kept coming back for more.

South Carolina's pension fund has a reported $25.4 billion in assets, according to the July 2011 Comprehensive Annual Financial Report. It also has $38.8 billion in liabilities, the amount of pension money it will owe about 500,000 public workers, retirees and their beneficiaries in the system.

That means its so-called "unfunded liability" is about 65 percent. A Pew report from April put South Carolina near the bottom third of states nationally, ranked by funding level.

Retirement systems can operate safely without being fully funded. But experts recommend systems be at least 80 percent funded, according to the U.S. Government Accountability Office.

Keith Brainard of the National Association of State Retirement Administrators compared state pension systems to mortgages. Even if they don't have all the money up front, financially secure homeowners can afford a house if they pay for it over 20 or 30 years.

Likewise, fiscally sound retirement systems will be able to cover pensions for employees whose expected retirements are decades away.

But South Carolina's system is not financially sound, according to the Pew Center report, which said the state's long-term pension liability is "cause for serious concern."

Look not to the proposals of the powerful for the past decade and a half. Look not to the budget writers in the House and Senate for culpability. It's your old first-grade teacher who put you in this mess.

And that unfunded liability actually could be much higher than the state has reported. Economist Joshua Rauh of Northwestern University's Kellogg School of Management said in a 2010 report that states across the country, including South Carolina, drastically have underestimated their liabilities. South Carolina's pension debt is as high as $53.5 billion, he said.

"Employers don't want to hear that because they don't want to pay more, and elected officials don't want to hear it because they don't want to raise taxes," Biggs of the American Enterprise Institute said.

You see, we have no way yet to know the extent of the damage done by those old crooks who swilled black coffee to drive municipal utility trucks across ice at four in the morning, all those years ago. How could we have known that the old firefighters who saved our homes were destroying our neighborhoods by other means, all the while?

No matter. The damage they did is slowly being discovered. Never mind that lawmakers could take other steps to shore up the system, like hiring more public employees and reinstating those old commitments to strengthen and protect their retirement security. Nope; those left in the system will be charged for the bill. Increases in their employee contributions to the system are already being calculated, with the least additional harm to already damaged taxpayers.

The state expects the system to be fully funded in 30 years, contingent on "a sufficient employer contribution rate" -- that's the amount state and local taxpayers contribute -- among other assumptions.

"It could be a lower rate, or a higher rate, but until the future gets here and the actual plan results are evaluated against the previously projected results we won't know," Lindsey Kremlick, a spokeswoman for the state Retirement Systems, said in a statement.

And they won't be the only ones to suffer. All of the public services provided by these public employees will take their share of the medicine, too.

Beyond increasing contribution rates, strained governments also might be forced to shift existing resources, said Josh Barro, a fellow at the Manhattan Institute. State funds that ordinarily would have paid for road repairs and education could be diverted to the pension system in the future, said Barro, a pension expert at the conservative think tank.

That means children will suffer, and the roads that take them to and from their schools will accept their neglect.

Thankfully, no tax cuts will be rescinded; now wouldn't be the time for that. Corporate South Carolina will be appropriately protected from economic harm. After all, it wasn't corporate South Carolina's fault we're in this mess.

It's all our public employees' fault.

South Carolina's unfunded liability trailed most other states in the boom years of the late 1990s and early 2000s, when many retirement systems flourished. In 1999 the system was 98 percent funded, Draine of the Pew Center said. But at that time many systems had surpluses, he said.

Part of the problem then was that South Carolina constitutionally had been forbidden from investing in stocks until 1999. All its funds were in cash and bonds, even in the stock market's boom years.

In 2005, the state established the Investment Commission to manage and diversify the state's investment portfolio in hopes of reaping stronger returns. The state hired a chief investment officer -- Robert Borden, a $485,000-a-year employee who resigned in December -- and set up a six-member panel of political appointees to vote on investment strategies.

The group began making so-called alternative investments in hedge funds and private equity in 2008 -- the same year the stock market crashed. Such bets can deliver higher returns than more conservative investments, but they also carry higher risk.

In the years since the state only has increased the amount of money it puts in alternative investments.

The pension system's critics, including Investment Commission member Loftis, have said the state has put too much money in high-risk bets. Loftis also has said the state has paid too much in management fees, which topped $343 million last year.

Borden couldn't be reached for comment. Commission Chairman Allen Gillespie and Vice Chairman Reynolds Williams did not return requests for comment.

The investment losses were compounded by policy decisions that added to the unfunded liability. In 2000 the Legislature lowered the number of service years needed to retire from 30 to 28. Pension recipients have received annual cost-of-living raises of up to 3.5 percent all but one year since 1999.

"States that are in trouble now have kicked the can down the road and haven't set aside contributions," Draine said. "They've raised benefits without figuring out how to pay for them."

I hope we've learned our lesson.