State workers blame ‘greed’ of private sector for $33b shortfall
“We will end up sicker and dying earlier,” social services retiree Sylvia Seymour told a state commission charged with studying pension reform.
Maryland underfunded its pension system for years and now owes its teachers and state employees $33 billion in benefits over the next 30 years. The commission is considering a combination of benefits cuts, higher employee contribution rates and shifting some costs onto counties to help plug the gap.
Montgomery County Education Association President Doug Prouty warned that teachers would flee Maryland, class sizes would grow, and the quality of education would nose-dive if the state tweaks teacher benefits.
Corrections officer Greg Currie said he is terrified of losing his pension benefits.
“My survival instincts tell me my luck has run out, and now I’m going down,” Currie said, adding that he is eligible to retire. “These are the worst cuts I’ve ever seen. I survived the Maryland correctional system only to be slaughtered in retirement.”
County leaders attacked a proposal that would gradually shift 1 percent of teacher pension costs onto counties. Maryland is one of only three states in the U.S. that fully funds teacher pensions.
“We shouldn’t pick up the tab for something we didn’t cause,” said Harford County Executive David R. Craig. “This is a result of bad investors and bad investment policies and underfunding even in good years. … I think the solution to the problem is telling the General Assembly, ‘You caused the problem, you need to fix it.’ ”
A dozen speakers insisted that a rebound in the economy would solve the crisis.
“Let’s have some faith in the American economy, in our system which has consistently proven to rebound after a crisis,” said Patrick Moran, Maryland director of the American Federation of State, County and Municipal Employees union. He said the funding gap is a result of the “greed and irresponsibility” of the private sector, “not the result of meager pension payouts.”
The state’s actuaries have said positive returns alone cannot dig the state out of its $33 billion hole.
“I haven’t heard anybody yet today show an understanding that the state has to have a balanced budget and that if we empty all our cash funds we can only reduce the deficit to $1.6 billion,” commission member Barbara Hoffman said. But Maryland Classified Employees Association Secretary Agnes Valenzia reminded the commission of employees’ power.
“Let’s make one thing clear,” said Valenzia, a retired 29-year veteran of the Motor Vehicle Administration. “State employees do not work for the state, they run the state.”
