Law enforcement officers and their departments train and incorporate new training when situations arise that completely change the paradigm of normalcy.  The North Hollywood Bank shootout is one of those incidents.  Those of us in law enforcement, both active and retired are facing a paradigm shift, one that many Americans working in the private sector have learned the hard way.  We who work in the public sector are going to learn that the only things that are guaranteed in life are death and taxes.  Retirement, even medical retirement, though supposedly guaranteed and foolproof, aren’t.  Governments, no matter what form they are, do not keep their promises when the rubber meets the road.

Prichard, Alabama is a case in point.  In the 1980s and 1990s, crime rose, much of the middle class  and 2 major employers left, costing both workers and revenue, Prichard was left devastated.  The city declared bankruptcy for the first time in 1999.  Struggling along, Prichard hired an actuary in 2004 to analyze and summarize their pension plan.  The report concluded that the pension funds would be depleted as of 2009.  True to the report, the fund was empty in 2009.

The city of Prichard tried to file under Chapter 9 bankruptcy, but failed to qualify as they had no bonds, one of the qualifications for that type of bankruptcy.  While the case was being litigated, pensioners of the city, firefighters, police officers and other city retirees did not receive their pensions for almost 2 years.  The case was finally settled out of court with pensioners receiving one third of what they were promised.

Recently in the news is the city of Stockton, California.  It is currently in mediation with creditors to determine whether to go into bankruptcy.  Stockton is not the only city, or state, that is in financial trouble.  Central Falls, Rhode Island declared bankruptcy in 2011 when the pension fund of firefighters and police officers nearly ran out of money.  The state refused to assist and the city was forced to negotiate like Prichard did with pensioners receiving sharp cuts in their pensions.

More ominous is, according to The Pew Center, 34 states have underfunded pensions.  Although many of these states are already addressing the issue, four states, Illinois, Kentucky, Connecticut and Rhode Island are less than 55 percent funded, 25 percent under the 80 percent recommended for a healthy pension fund.  Illinois made their situation worse, diverting funds from their pension fund to cover budget shortfalls.  In 2005 and 2006 alone, more than $2.3 billion was diverted by the state legislature.  They are currently funded at 45 percent and continuing to fail to deal with the spending issues the state faces.

As one can imagine, there is a whole lot of finger pointing going on.  Public sector unions, George Bush, Obama, the recession, the rich, Wall Street and a few more culprits are on the list.  I would place it squarely on the shoulders of most of our politicians, as well as the voting public.  It resides with politicians that are more concerned with passing out favors to ensure re-election, lining their pockets along the way and voters for not holding politicians accountable for financial responsibilities or failing to understand that there is no such thing as “free money”.  Most disgusting is the blatantly dishonest accounting and budget maneuvers that have been done to hide from the public the full scope of the $3.9 trillion, yes trillion, hole in pension funding.  This must be dealt with through the political process for the rest of our lives, but it doesn’t deal with the situation at hand.

If responsible political choices are made, there is a likelihood that this situation will resolve more favorably than that of Prichard or Central Falls.  Some in unions will push the issue, demand their “rights” and strike, have “Blue Flu” and the like, but the old saying goes “you can’t get blood out of a turnip”.

It’s worthwhile to remember that many Americans working for private companies have lost all pensions as well, not to mention, a crushing tax burden on top of that.  Many who tried to build their own retirements through saving lost almost half of their value.  We cannot rely on the federal government to provide a bailout of either states or individually.  Those who have been disabled or medically retired on Social Security Disability face that program to run out of funds in 2016.  Medicare is not far behind.

Understanding the situation we face, a saying my grandparents, who faced the Great Depression, comes to mind.  “No sense in crying over spilt milk.”  The damage has been done, the question to ask is what can be done to mitigate the impact to us in our daily lives and then to deal with the fallout on the next generation.  Rethinking our lifestyles, financial decisions and future plans is the beginning of lessening the impact from the painful choices that will either be well planned by responsible representatives or forced without mercy by a financial collapse if there are no adults in the room.

Having a plan for the worst case scenario is a skill we are taught thoroughly throughout our careers as law enforcement officers.  Utilizing it in our personal lives is a practical, pragmatic and effective response to the situation, rather than ignoring storm clouds on the horizon or engaging in self or socially destructive knee jerk reactions.

Understandably, potential threats to pensions we have worked for makes for strong emotional reactions and should potential become actual threats, outrage is not unreasonable.  At the same time, what makes this country so exceptional is the American spirit of overcoming every adversity no matter the odds.

From the Revolutionary War soldiers enduring the Valley Forge winter with little food, little warmth and great suffering, to immigrants of all nationalities enduring discrimination, poverty to, at last, make their way.  We have the Greatest Generation who survived the Great Depression, achieving through that suffering the strength of character to endure battles like D Day and the Battle of the Bulge and win.  Learning their lessons of sacrificing, enduring, helping each other, thinking out of the box and refusing to give up, we can positively influence the trajectory the nation is facing.

Just as there were a few faithful soldiers during our first war who endured throughout the war, even without pay, because they were needed, should things go sideways, we will be needed.  Let’s be prepared.

For more information on this article:

http://www.nytimes.com/2012/03/17/business/untouchable-pensions-in-california-may-be-put-to-the-test.html?_r=1&pagewanted=all

http://www.nypost.com/p/news/opinion/opedcolumnists/morgan_big_secret_DSB0O9VFZwDih1ZrjkeaAN

http://mdjonline.com/view/full_story/19032198/article-Study–States-diverted–757B-from-employees%E2%80%99-pension-funds?instance=secondary_story_left_column

https://en.wikipedia.org/wiki/Prichard,_Alabama

http://www.senategop.state.il.us/index.php?option=com_content&task=view&id=156&Itemid=67

http://www.washingtonpost.com/politics/social-security-disability-trust-fund-projected-to-run-out-of-cash-by-2016/2012/05/30/gJQA3AfH1U_story.html

Juli Adcock began her career in law enforcement with the Escambia County Florida Sheriff’s Office as a patrol deputy until she was injured in a riot situation. She transferred to Judicial Security and retired in 1998. Juli pursued career advancement training with an emphasis on officer survival, interviews and interrogation. She worked with a local Rape Crisis Center and in victim’s advocacy, complementing her college course work in psychology. She currently resides in New Mexico and is an instructor with The Appleseed Project (www.appleseedinfo.org). The Appleseed Project is a rifle marksmanship clinic teaching the fundamentals of firing an accurate round downrange every 3 to 4 seconds, out to 500 yards, as well as American history. She has trained military personnel at White Sands Missile Range who are certifying as Squad Designated Marksmen. Juli instructs basic handgun skills to new gun owners in preparation for responsible personal gun ownership and the Concealed Carry class for the State of New Mexico. She can be reached at juliadcock222@msn.com or through Law Enforcement Today.

Abraham Lincoln once said, “you may fool all of the people some of the time, you can even fool some of the people all of the time, but you can’t fool all of the people all of the time.”

Public sector workers have found themselves in the crosshairs of one of the most aggressive smear campaigns ever witnessed. Cops, firemen, teachers, nurses all found themselves being blamed for creating the recession and for putting this country on a path of financial instability.

The architects of this campaign were the right wing zealots who needed to find a fall guy to take the blame for the damage they inflicted on this country. They argued, “Corruption on Wall Street didn’t put us in a recession, it was those greedy public sector workers!!” That campaign has devastated public sector unions throughout this country. It has made the future of our children less certain and insured that the next generation of public sector workers will struggle to attain the same financial status we enjoy today.

I am a police union president in New York City. New York has a long history for being a strong labor state. For decades police officers enjoyed access to a strong labor relations model, excellent pension benefits, and excellent health benefits. All of these benefits were bought and paid for using the strategy of setting aside a little of our raises for important things, like pensions and low cost health care. That strategy is the direct opposite of the greedy Wall Street worker.

In 1878 New York City became the first municipality in the country to grant a pension plan to police officers. The police argued the job was just as dangerous as the armed forces and they demanded a pension similar to the military. Ever since then police officers in New York have enjoyed a pension which insured, should they be severely injured or killed, their family would be taken care of. It allows public safety workers to do their job without distractions which would prove fatal. That all changed two weeks ago.

In the cover of darkness politicians in the State capital scampered like rats through the halls just before 6am to pass a bill which established a new pension system for all state employees and employees of the City of New York. Known as Tier 6 this new plan is a classic example of the wrong diagnosis leading to an unnecessary treatment. Instead of healing a broken wrist, Tier 6 amputates the whole arm.

I am used to politicians saying one thing and doing another, yet this is different. This bill cuts in half the benefit a family receives if an officer is severely injured or killed in the line of duty. It provides no financial incentive to stay after twenty two years of service, and stops officers from being able to borrow their own money. A lifeline for many young officers.

Retirement income is a financial necessity for many. The alternatives are living in poverty, family assistance, or government assistance. A 2010 study by the National Institute on Retirement Security shows that public employee retirees added $358 billion into local economies, creating over 2.5 million jobs.

Retirement income is an earned right and not a gift from the government. The issue is not having fewer people with a lower retirement benefit, but it is about an adequate benefit for all working people. The fact that the private sector has reduced or eliminated pension benefits doesn’t mean we should be doing it for cops, firemen, teachers, and other public sector employees.

Most importantly, defined benefit pensions are a form of deferred wages, and if wisely funded and investment strategies are not reckless than the system provides less risk than defined contribution plans like 401K’s where all the risk falls on the employee.

In 2009, the national average retirement benefit paid for state and local workers was $23,300 per retiree (U.S. Bureau of Labor Statistics).  That number seems negligible when we compare it to the monthly salary paid to those in the financial industry and on Wall Street, yet they seem to be winning the battle of public opinion.

What can unions do? First, they must hold accountable every politician who casts a vote against the working class. Any attacks on collective bargaining, pensions, healthcare, or working conditions need to be addressed with a strong rebuff. That means no support; no bodies on Election Day, no contributions, no endorsements and most importantly remember them in the ballot box. Make unions relevant. Tell them you are watching. Wisconsin has proven that unions can make a difference. Younger workers need to be educated. This is really their fight. All unions, especially law enforcement unions should have a positive relationship with the community. We need the voting public on our side. The time is now. We have too much to lose.

John M Fleming is president of the New York City Detective Investigators Association, (DIA). The DIA represents all detectives employed in the five District Attorneys’ Offices in NYC and the Special Narcotics Prosecutor. These detectives average over 26 years of police experience and are recognized as experts in Organized Crime, Political Corruption, Cold Case homicides and narcotics investigations. Before being elected in 2001 he served as a narcotics detective and worked primarily with a federal drug task force investigating narcotics trafficking along the East Coast. He is also a professor of police science for the State University of New York (SUNY).

In just about every police department, around the country, there is a spectrum of officers, of all ranks, who are somewhere from fresh out of the academy to old, slow, and grey haired (like me) who seem to have been the police forever.  One thing they probably all have in common is a portion of each and every paycheck goes into their pension fund.

Once there, the pension fund managers combine that money with a specific required payment from the municipality or state and then invest this money.  After a set amount of years an officer is eligible to retire and collect this pension.  Of course what the officer collects usually depends on how old they are and how long they have worked.

This pension is actually a part of the salary package that the officer earns for his or her many years of service.  This is a debt owed to the officer just like his salary is owed to him on payday.  This debt owed to the officer is paid monthly after he retires.  It is a lawful contract between the officer and the municipality or state.  Don’t forget that under current social security regulations, most officers receive little if any social security benefits even if they have paid a fortune into FICA for years.

Many of us have worked a long time looking forward to this light at the end of the tunnel.  We have worked nights, weekends, missed holidays, and family events.  We have worked in the worst weather and under the worst conditions.  Of course we didn’t just do this because of the pension at the end of the tunnel.  We did it because it was the right thing to due.

While the economy was booming, all of these pension funds were doing very well with their investments.  While we continued to pay into these funds, on each payday, many of the states and municipalities saw this as an opportunity to postpone payments and shift this money to other projects.  Then the market crashed.  Fund managers started to get worried.  They needed the money that was owed to the funds from the states and municipalities.  This was a lot of money.

States and municipalities saw pension funding become their largest budgetary item.  The correct and honorable thing to do would be pay your debt.  Instead these municipalities for the most part are choosing to try to find a way out of paying now that the bill has come due.

Imagine this; your house needs to be painted so you hire a guy to paint it.  You give him some of the agreed upon money so that he can start.  When the house is finished you tell him that the money you owe him is just too much money.

You tell him he is just being greedy to expect all that money.  Shame on the painter for expecting all that money, he is just being unreasonable.  In the meantime you decide to plant some lovely tulips in the flowerbeds around your house and put up a new fence.  You tell the painter times are tough and he is just going to have to get used to it.

This is what a lot of municipalities are trying to due and are being supported by groups like the Civic Committee of the Commercial Club of Chicago and the Illinois is Broke group as well as others all over the country.  I use Illinois as an example because I live there and I am most familiar with it, but this problem is nationwide.

The real problem these groups are having is they have realized that to make changes to the existing fund benefits is in many cases unconstitutional.  In these cases they are proposing a rather shortsighted plan.  New legislation has been proposed in many states changing pension funds to a two-tier plan.

Newly hired police officers will be given the option to join a 401(k) plan.  The municipality will not contribute anything.  There are variations from state to state with some offering no change to currently contributing officers up to allowing the officers to switch to a 401(k) or choose to increase their contribution and work longer before they are eligible for retirement. These plans don’t sound all that bad until you look at a couple recent studies that have come out from some very well respected sources.

The National Institute on Retirement Security (NIRS) released a study showing just how pension funding actually improved economic conditions for the community and country. The NIRS analysis shows that for each dollar paid out in pension benefits, $2.37 in total economic output was supported. For every dollar contributed by taxpayers to state and local pension funds, $8.72 in total output was supported nationally.

This was further supported by a report from the Government Accounting Office, GAO that 401(k) plans just do not have the same impact as traditional pension plans so why the rush to push them. Simple, rather than let people see that municipalities have mismanaged the money entrusted to them by the voters they would rather take the short-term option and avoid paying the bill.

As a young officer or a senior officer you probably ask what can you do about this problem?  Well, actually, you can do a lot just by being informed about what is happening in your municipality and state.  There are many facebook and web pages that provide you with information on pensions in your area.  Illinois has the Illinois Public Pension Fund Association and We Are One Illinois with both Facebook pages and websites.  California has Lets Talk Pensions on Facebook and nation wide there is the National Public Pension Coalition on Facebook as well.

Additionally most police unions constantly have links and articles on their websites on these issues.  In Chicago the two unions representing the CPD Sergeants and Lieutenants have joined forces and maintain First Responder Pension Facts on the Internet and Facebook.  These sites keep you current on all pending pension legislation in Illinois.  Please remember, I am most familiar with Chicago, so you need to do a little research yourself for your area.

Here in Illinois, these groups have been very successful blocking some legislation that would have been very harmful to both state and municipal pension plans.  These groups are only successful because they have united law enforcement officers and firefighters statewide.   Without that sort of strength our pension funds would have been ruined.  When detrimental legislation comes up these groups have been able to garner such huge support that the state legislators have had no choice but to stop and listen.

During one such legislative push an Illinois State Representative was quoted, as saying all the representatives were receiving so many calls about the legislation that no one could make any outgoing calls from their office lines.

If you are a young officer, do not make the mistake of thinking it will be fine just because retirement looks so far away to you.  Ask anyone ready to retire and they will tell you that it was surprising just how quickly it snuck up on them.  Do your homework now so that there will be a light for you at the end of the tunnel.

Learn more about this article here:

http://civiccommittee.org/initiatives/StateFinance/Public-Awareness-new.html

http://www.illinoisisbroke.com/

http://pensiondialog.wordpress.com/2012/03/09/facts-and-data-that-tell-the-pension-story/

www.firstresponderpensionfacts.com