If it can be reliably demonstrated that a government must, for its very survival, breach its pension contract with retirees, certain policies must be adopted, in order that a measure of fundamental fairness is preserved. What follows is an attempt to outline such policies now that the unthinkable is being actively considered by some state and municipal governments.
First: Those who obtained a pension after only 20 years of work on or before the age of 50, and without any personal contributions to the retirement fund while working, should be treated separately from those who worked a longer period before qualifying for their pension, and made regular contributions to the retirement fund.
Second: Those who are “double dipping” in any fashion, either by being gainfully employed in a new full-time or close-tofull time position, or by getting more than one pension, should be treated as a separate class.
Third: Additional retirement benefits obtained by virtue of a claimed disability should require recertification not less than every five years.
Fourth, every additional benefit beyond the pension should have some co-pay attached to it, however modest.
Fifth: Where a pension will be extended for more than one person’s lifetime, the monthly payments should be adjusted downward throughout the payout period.
Sixth: And most important, all pensions should be capped at a reasonable level, say $60,000. No pension should exceed the cap. There can, however, be a mechanism for adjusting pensions based upon changes in the cost of living.
These policies may appear extremely harsh and arbitrary. Whenever a contract is breached, there is always a measure of unfairness. However, what would truly be unjust would be an across-the-board downward adjustment of all pensions. Those surviving on modest pensions should not suffer because the system has been made unsustainable due to mismanagement and overly generous pensions now being paid to a select group of retirees