NM pension fixes put lipstick on a pig

Education Retirement Board member Brad Day has a must-read column in today’s Albuquerque Journal in which he outlines the sorry state of New Mexico’s pension system and how the situation is both getting to the point at which it will be irreparable and how the unions and the groups in charge of maintaining the system would prefer to stick it to the taxpayer rather than actually make these systems sustainable.

The pension bills passed this session may slow the bleeding, but more transformative changes like a shift to a defined-contribution system are needed.

Interestingly enough, a shift away from defined benefit to defined contribution, 401K plans, was recently approved by 83% of Boeing’s engineers. I don’t know all of the particulars of the negotiations and Boeing is obviously a private company, but it is possible to convince workers of the benefits of controlling one’s own retirement as opposed to relying on a business or government’s investments.