Tackling the retirement time bomb
Teacher pension systems around the country are falling into crisis due to poor investment returns, unfunded increases in benefits, and poor governance and management. The PIE Network just made thirteen great policy briefs available on how to advance education reform in the "new normal" of fiscal crisis in America's schools, and among them is a paper I wrote on the teacher retirement crisis.
I commend the full paper to your attention, but here are the key takeaways:
- Traditional pension systems are bad for many teachers and aren't structured to attract the best young workers.
- Retiree health care, which is free for many retired teachers, is a major contributor to cost growth in retirement benefits.
- The time for reform is now. There are lots of good examples of pension reform in the public and private sector that school districts and states can draw on. Fordham has an upcoming publication profiling several such cases.
My colleague Raegen Miller at the Center for American Progress also released a paper on this subject recently that is well worth reading.
Pensions can be a very technical subject, but they're also soaking up growing chunks of school funding. It's an issue that deserves greater attention from the wider education policy community.
? Chris Tessone