The Journal’s June 8 editorial reminded me of a vow I made to current and past state legislators when PERA landed upon hard times. I vowed to do whatever I could to lay the primary responsibility of the failure of PERA at their feet.
After the 2002 downturn in the economy, the state legislators and PERA enacted some minor and insignificant reforms to the system in 2004 and assured the public and public service employees that PERA was placed upon a “sustainable” future. The very same problems and solutions reappeared in 2006 and 2010 with the same “feel good” statements emanating from PERA’s board.
Each of these periods required additional taxpayer funding. At the root of this is recurring problem lies in what public choice economists and political scientists label as “concentrated benefits and disbursed costs.” Whereas the special interests (public employees and their unions) are small in relative size but have a lot to gain or lose and lobby legislators relentlessly to their benefit. The general public (taxpayers) are scattered, not organized and the cost is not worth the effort to fight these issues. The special interests and politicians know this concept all too well.
With the next economic downturn, which will most likely come sooner than later, the legislators will again have an opportunity to fix PERA. Let us hope that they have the courage and the sense of morality to reform PERA into a defined contribution plan.