Getting America Unstuck: The Politics of Character and Craftsmanship by Steven Howard Johnson

Author:Steven Howard Johnson
Language: eng
Format: epub
Publisher: Civic Ethos Books
Published: 2017-12-15T00:00:00+00:00

The story was different in the public sector. In most states, a Defined Benefit pension agreement between a local government and its employees is legally binding. The commitment, once made, has to be kept.

On this front, there’s been good news and there’s been bad news. Readers will be relieved to know that successful public employee pension programs outnumber unsuccessful programs.2 On the other hand, faulty programs are still much too common.

Pension programs run by public agencies face exactly the same hurdles as those the private sector had created. (1) Agencies have to guess right about their own long-run future. Not every agency will be as large in twenty years as it is today. (2) Agencies have to guess right about the number of retirees that they’ll one day be supporting. (3) Their promised benefits have to be affordable; extravagant promises will empty the till. (4) Fund Trustees have to be cautious in estimating stock market returns; it isn’t safe to treat the stock market as a magic lamp capable of generating unlimited wealth. (5) Contributions to the pension fund from its government sponsor have to be large enough, year after year, to keep the program healthy.

It takes considerable wisdom to design a fund strong enough to meet all these tests at the same time, and yet that’s the key to delivering on the promises being made to the agency’s future retirees.

With wobbly standards of craftsmanship as a frequent norm, poor choices have been all too common. Public sector unions sometimes insist on pension benefits far too lavish for the agency they bargain with. Pension managers sometimes pretend the stock market will give them far higher returns than are likely. And local governments, especially in times of fiscal difficulty, have contributed less to their pension funds than was prudent.

Sometimes a local authority falls short on one count; sometimes a local authority falls short on several at the same time. Pension programs for the City of Detroit and the State of California have come to symbolize the harm that comes when public officials and pension trustees are too stressed to fulfill their long-term responsibilities.

The deeper lesson from the last half-century is that America requires a civic ethos of Character and Craftsmanship. These virtues have not been our long suit. Without the restraints of a wise civic ethos, one sees too many instances of snap decisions and bad outcomes. Our civic culture doesn’t teach us to give rigorous thinking the respect it deserves.

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