I remember the first time I had to grapple with death as a young child. A teacher, understanding the pain I was going through, gave me a copy of The Giving Tree to help me learn how to process love and loss in life. To this day, it remains one of my favorite books and a heartwarming reminder of how teachers are so much more than just teachers. They leave a mark on our lives. Whether your teacher made a difficult concept click, a formula stick, or your heart tick with a new passion, there's no denying teachers' essential role in a functioning and enterprising society. That's why it's so important to create an environment that enables the best educators to enter and stay in the field.
For generations, defined benefit pensions have been a key component of compensation packages intended to attract and keep the most talented teachers in our public schools. For the teachers who love the job, these plans have delivered modest but reliable retirement income and the job retention incentive has provided stability to classrooms across the nation. Considering the enormous responsibility teachers bear, it's a solid and necessary investment. But now, anti-pension ideologues behind a concerted effort to diminish retirement security for all public workers have tried to spread misinformation about retirement systems for teachers. No one should buy into these misleading claims.
Two organizations, Bellwether Education Partners and the Urban Institute, both funded by Enron-billionaire John Arnold's foundation, recently put out two separate reports that they say point to a fault in teachers' retirement savings systems nationwide. Neither report has gotten a lot of traction because they are chock full of conflations and straight up lies. The report authors misrepresent the basics of a pension system to make a disingenuous argument that young teachers are paying for benefits for older and retired teachers that they will never see themselves. They punctuate their point with unrealistically high teacher turnover rates that lack citation.
The release of the reports is a desperate attempt to pit young teachers against those who are further into their careers, and then strip all teachers of their retirement security. We would all be better off if the reports focused on actually improving teacher pay and increasing support for new teachers rather than distorting the facts to build a case for risky 401(k)-style plans.
401(k)-style, or defined contribution plans, are a bad deal for both taxpayers and teachers. Research shows that it costs almost twice as much to provide a worker with the same level of benefits using a 401(k) than it does with a defined benefit plan. In fact, 401(k)-style plans primarily benefit Wall Street bankers, who take much higher fees for themselves.
While it's true that some teacher retirement systems are still recovering -- retirement systems across the board took a hard hit during the Great Recession -- the bulk of them are in good standing. The Wisconsin Retirement System, for example, is fully funded and has been for more than 10 years. North Carolina's teacher pensions are funded at 95 percent. New York's are funded at 93 percent. And the Center for Retirement Research at Boston College recently projected that public pension systems nationwide will reach an average funding level of 80.5 percent by 2018.
Instead of so-called reforms that would decimate teachers' retirement savings, we should be looking for ways to keep good teachers in the classroom. Retirement security is a critical part of making teaching a more rewarding career, and traditional pensions are simply the best and most cost-efficient tool available to provide it.
By pooling and professionally managing retirement assets, teachers and taxpayers benefit from a more economically efficient system where retirees can continue to receive the same level of benefits whether the markets are in a boom or bust period. All said, defined benefit plans yield the best returns in the long term and offer the financial security and peace of mind that we can all agree our teachers deserve.
The claims of the many so-called free market advocates simply don't add up. You can't credibly claim that markets work, that good teachers lead to good educational outcomes, and then propose cutting pay and benefits. But that is the argument they make over and over again.
What these two reports really show is that John Arnold and his surrogates will do anything to propel their misguided efforts to undermine working peoples' futures, even going after those, like teachers, who dedicate their lives to making a difference in our communities.