Two publications that should be on the desks of everyone concerned about or interested in the future of retirement income in the United States: "Pensions in a Changing Economy" and" Pension Funding and Taxation: Implications for Tomorrow." Both are published by the Employee Benefit Research Institute, Washington. Both are composed of papers prepared for symposia on pension issues and provide a wealth of insights into and information about the nation's systems for providing retirement income - federal, state and local, and private.
The first, "Pensions in a Changing Economy," is a collection of the papers and responses presented at a symposium sponsored jointly by EBRI and the National Academy on Aging.
The topics give a sense of the policy issues likely to be addressed in Washington during the remainder of this decade: The Present and Future Economic Well-Being of the Aged; The Role of Pensions in Retirement Income; The Changing Character of Pensions: Where Employers are Headed; The Role of Tax Expenditures in the Provision of Retirement Income Security; and others.
The papers explore many policy options for changing, and perhaps improving, retirement income security. Some suggest mandatory pensions may be needed. Others argue lump-sum distributions from pension plans should be ended.
The figures presented in this publication are often surprising. For example, on average, retirees get almost three times as much income from their assets as they do from private pension plans. They get twice as much from earnings as they do from private pensions.
The second publication, "Pension Funding and Taxation," likewise is rich in data about the non-federal pension system as it reviews the history of tax preferences for pension plans, the justifications for those tax preferences, and the implications of recent and possible tax law changes.
Among the insights offered in the papers: The Civil Service Retirement System and the Federal Employees Retirement System had a combined unfunded liability in 1992 of $870 billion. For these plans the government was contributing 36.5% of pay, compared with 3.9% of pay contributed on average by private employers to their plans. Yet, the government would need to contribute 65.6% of pay in order to amortize the unfunded liability over 40 years - an added $35 billion a year.
Another interesting statistic: Although many critics of the private pension system suggest high-paid employees reap the greatest benefit from it, pensions primarily benefit those with incomes below $50,000 per year.
If you are interested in the strengths and weaknesses of the nation's various retirement programs (largely excluding Social Security), if you are concerned about how these weaknesses might be addressed, if you are interested in the continuing evolution of those systems, and the government actions that have affected and will in the future affect that evolution, these publications belong on your bookshelves.
They can be obtained from Johns Hopkins University Press, (410) 516-6964, for $15 and $15.95 respectively.
