A "Ponzi scheme" or not... did Senator Faber still dodge the question?
From John Curry, September 8, 2011
John Curry to Senator Keith Faber, September 8, 2011
Senator Faber,
I thank you for your reply today one month after my original request. For some reason, the format on your letter today happens to "cut off" the print from both margins for a small amount of space, but if the readership wishes, they can copy it and paste onto Microsoft Word to be able to read it in its entirety. I find your statement, "While I am not necessarily for or against a defined contribution system, needs some clarification. It appears, by this statement, you are "leaving the door open" to the possibility of the adoption of a defined contributions pension model. This "changeover," if mandated, will result in increased costs to both taxpayers and retirement system participants.
I am saddened by the fact that your letter does not address the fact that "Ponzi schemes" are a violation of federal law and that your mention of these words as being associated with Ohio public pensions has done a disservice to all of my brothers and sisters who are stakeholders in these very same systems. It has also left a belief in many Ohio citizens minds that, for some reason, these systems are, in fact, "Ponzi schemes." This was an unacceptable utterance and was designed to turn Ohio citizens against the concept of Ohio's public service pensions and Ohio's public servants in today's highly charged political atmosphere.
Thank you,
John Curry
From: Senator Faber
To: John Curry
Sent: Thursday, September 08, 2011 1:34 PM
Subject: RE: Senator Faber....
I thank you for your reply today one month after my original request. For some reason, the format on your letter today happens to "cut off" the print from both margins for a small amount of space, but if the readership wishes, they can copy it and paste onto Microsoft Word to be able to read it in its entirety. I find your statement, "While I am not necessarily for or against a defined contribution system, needs some clarification. It appears, by this statement, you are "leaving the door open" to the possibility of the adoption of a defined contributions pension model. This "changeover," if mandated, will result in increased costs to both taxpayers and retirement system participants.
I am saddened by the fact that your letter does not address the fact that "Ponzi schemes" are a violation of federal law and that your mention of these words as being associated with Ohio public pensions has done a disservice to all of my brothers and sisters who are stakeholders in these very same systems. It has also left a belief in many Ohio citizens minds that, for some reason, these systems are, in fact, "Ponzi schemes." This was an unacceptable utterance and was designed to turn Ohio citizens against the concept of Ohio's public service pensions and Ohio's public servants in today's highly charged political atmosphere.
Thank you,
John Curry
From: Senator Faber
To: John Curry
Sent: Thursday, September 08, 2011 1:34 PM
Subject: RE: Senator Faber....
September 9th, 2011
John Curry
curryjo@watchtv.net
Dear Mr. Curry,
Thank you for contacting my office regarding the fiscal solvency of Ohio’s five public pension systems. I apologize for the delay in response and am happy to address any questions or concerns that constituents have regarding current state issues.
First, let me begin by pointing out the fact that all of the public employee pension systems are having major difficulties maintaining their legal obligation of being solvent for 30 years or more. If these pension systems continue down the road of maintaining billions of dollars of unfunded liabilities and not being able to maintain their current legal commitments, those who rely on these pension systems for a stable retirement will eventually not see any of their benefits or their healthcare.
In regards to my comment of the public pension systems being a Ponzi scheme, I see these plans as a system of investment that needs new investors to pay current investors and that to me seems circumspect at best. Ohio’s public employees deserve the assurance that the pension they invested in during their careers will always be available to them when they retire. As sponsor of Senate Bill 3 I am working diligently to find the best solutions to these solvency issues and to safeguard a pension for every public employee that has made considerable investments toward their future. While I am not necessarily for or against a defined contribution system, it needs to be recognized that this system transfers the investment burden from the taxpayer to the retiree.
As a recipient of one of these plans, it would be sensible for you to join the rest of the public pension members who seek reforms that will preserve their retirements and healthcare. If you have been paying attention to all of the news coming out on this subject then you would know that I have been doing everything possible to insure that these modifications occur. Because pension reform is a multi-faceted subject that requires careful deliberation, I have instructed the ORSC to get proposals for an actuarial review to evaluate the current plans purposed by the pension systems to reform the current defined benefit structure. I look forward to seeing if these reforms will be sufficient enough to sustain solvency for current and retired members while quickly eliminating their significant unfunded liabilities.
Again, I would like to thank you for your e-mail. If you have any other questions or concerns regarding this issue or any other state issue please do not hesitate to contact me or my office.
Sincerely,
Keith Faber
President Pro Tempore
12th Senate District
KF/sbb
posted by Kathie Bracy at 9:43 PM
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