Editor’s Note: This piece is an ongoing investigative series in partnership with Watchdog.org’s state-level journalists. Pension budget woes beset nearly every state in the union and cities and municipalities are also being hit with unprecedented pension debt. Baby boomers are retiring. Some state and local budgets allocate more funds for pensions for retirees than they use for actual services and current worker pay. Once again, the younger generation is saddled with debt from a previous profligate era.
Just in time for the holidays, the National Conference of Public Employees Retirement Systems has released its “naughty” list of organizations who are highlighting the problems that public employee pensions are causing for state governments and taxpayers.
The non-profit trade association released a list of 28 think tanks, foundations and other nonprofit groups it claims take “biased and unreasonable positions that undercut the interests of public pension plan participants and beneficiaries.”
Given that NCPERS manages $3.7 trillion in pension assets for some 21 million public employees and retirees (such as teachers, firefighters and law enforcement) it is no surprise it takes issue with those who publish studies on how unfunded liabilities exacerbate problems facing cash-strapped cities and states.
NCPERS executive director Hank Kim said in a statement the list is intended as an aid to transparency.
“Pension funds are naturally leery of paying fees to service providers that support organizations that intentionally undermine public pensions, and can use our list to identify potential conflicts,” Kim said.
The wide-ranging list includes national free-market think tanks such as the American Enterprise Institute, Reason Foundation and R Street Institute as well as the left-leaning Brookings Institution and Urban Institute. Several state-level think tanks made the cut, as well, including the California Policy Center, Wyoming Liberty Group and Michigan-based Mackinac Center for Public Policy.
NCPERS claims to have developed an objective process to determine whether these groups “engage in ideologically, politically, or donor driven activities to diminish public pension sustainability.” The process includes evaluating entities on the following criteria:
Interestingly, neither the Chicago-based Heartland Institute nor the Illinois Policy Institute were included on the list. Both think tanks have published extensive work on the circumstances that led to Illinois’ $117 billion unfunded pension hole in 2015 — worst in the nation, a designation Illinois Policy Institute CEO John Tillman says deserves recognition.
“Illinois ranks dead last in how much its government owes its public sector retirees. And the Illinois Policy Institute recognizes that getting there takes years of completely disregarding fiscal responsibility by Illinois’s political leaders,” Tillman told Watchdog.org. “With everything we’ve done to publicly shame the poor decision-making by the Illinois political class that racked up a $117 billion pension debt, I’m a little hurt we didn’t make the list.”
But Tillman is hopeful his organization can make up lost ground in 2017.
“Our New Year’s resolution is clear. Our staff will have to work harder to point out the irresponsible and delusional thinking supporting defined benefit pensions by those in charge,” Tillman said. “We will continue to promote better ideas such as defined contributions as enjoyed by most of private-sector America. We’ll work harder to earn our place on that list.”
Here is the entire list:
*New in 2017