[quote=jpinpb][quote=jstoesz]They are essentially millionaires, because to be drawing 50k in pension benefits a year for 30 years, you have to have the equivalent of 1 mil in the bank accruing interest at 5%. [/quote]
Please tell me which banks I can deposit money and accrue 5% interest. I am in dire need of that. I won’t even address the 30 years part.[/quote]
That long pension “tail” is what killed GM and Chrysler. You could graduate from high school at 18 years of age and walk into a GM plant in Michigan, work for thirty years (the “Thirty and Out” program) and retire at 48 with full pension and bennies. This is what gave rise to the joke that GM was really a healthcare company that happened to build cars. The so-called “legacy” costs (burden of carrying former GM workers’ costs) were one of the factors that crippled Detroit’s ability to compete.
So the assertion that these workers will continue collecting pensions/benefits for an additional thirty years isn’t as far-fetched as you might imagine. And, just like GM, these costs are strangling California.
