The recent editorial in the Albuquerque Journal on government employee pensions is spot-on: taxpayers should not foot the bill for New Mexico’s pension debacle. We at the Rio Grande Foundation have outlined the problem and outlined the specific reforms needed to actually fix the problem:
Step 1—Fix the Public Sector Over-Employment Problem
Step 2—Transform Defined Benefit System into a Defined Contribution System
Step 3—Continue to Increase Employee/Retiree Contributions to the Retiree Healthcare System
Step 4—Expand the Private Sector
Unfortunately, so far, it seems like most legislators are more willing to stick taxpayers with the bill for underfunded pensions than they are to stand up to the unions. The ultimate problem with these “defined benefit” plans is that politicians can easily be convinced to sweeten the pot while sticking future generations of taxpayers with the bill. The proverbial chickens are now coming home to roost.