Survey shows strong support for public workers

The results of a recent survey commissioned by the Pew Center on the States are quite surprising.

An overwhelming majority of the voters surveyed have favorable views of public service workers, and a solid majority have favorable views of their unions.

Also, two out of three people queried about the health of public pensions responded that there were either no problems with them or that the problems were minor.

The results are surprising because during the last decade the discourse on public pensions has been dominated by those who have exaggerated the problems of  public pensions and demonized public services workers and their unions.

But the survey results also suggest that voters can be swayed to support cuts to or the elimination of public pensions if the message for doing so if framed in the right way.

David Sirota, who broke the story about Pew’s survey in Salon, said that the survey’s results show that “the American public is powerfully rejecting the right’s anti-public-worker crusade.”

The survey was conducted by the Mellman Group, which usually works for Democratic candidates, and Public Opinion Strategies, which usually works for Republican candidates. They surveyed 1,000 voters and found that

  • 93 percent have favorable views of teachers,
  • 92 percent have favorable views of firefighters and police, and
  • 74 percent have favorable views of state employees.

Moreover, 57 percent have favorable views of teachers’ unions, 53 percent have favorable views of state employees’ unions, and only one-quarter think that public pension benefits are too high and only one-third think that there were major problems with public pensions.

“The overarching takeaway from these numbers is pretty straightforward,” writes Sirota. “The political class’ assumptions about the politics of public employees, budgets and pensions are way off the mark,” and Americans haven’t been persuaded by propaganda that demonizes public employees and their pensions.

However, cautions Sirota, these results won’t stop those who want to reduce or eliminate public pensions from pursuing their quest.

And, in fact, some other responses to the survey suggest that voters could be swayed to support public pension cuts or their elimination if the message for doing so can be properly framed.

For example, 81 percent agreed that financial sustainability should be one of the top goals for public pension systems and 71 percent agreed that providing public employees a secure retirement was important. Sixty-five percent had a favorable view of cash balance retirement plans,  a defined contribution plan with features of a defined benefit plan.

Recently, supporters of cutting or eliminating public pensions succeeded in Kentucky by arguing that replacing the state’s defined benefit pension plan with a cash balance plan would make public pensions sustainable and provide retirement security.

Pew, which in partnership with former Enron executive John Arnold, has been urging pension cuts and the elimination of defined benefit pension plans under the banner of “pension reform,” points to Kentucky as a model for successful pension reform.

Kentucky for years made a mistake that a few other public pensions have made: it gave cost of living raises without  funding them, leaving the pension seriously under funded

To deal with the problem, the legislature and governor agreed to a bi-partisan solution that among other things barred new hires from enrolling in the state’s defined benefit pension and moved them into a cash balance plan.

According to Pew, “Kentucky’s cash balance plan provides workers with the opportunity to reach a secure retirement” and along with other changes puts the state’s retirement system on a path toward financial sustainability.

What Pew failed to mention is that workers enrolled in the cash balance plan will end up with a smaller pension benefit because the benefit amount is based on a career long salary average rather than an average of an employee’s highest earning years.

In her book Retirement Heist, Ellen Schultz writes that some corporations in the 1990s converted their employees’ defined benefit pension to a cash balance plan to disguise pension reductions.

One company, Cigna a health care insurer, sent employees a fact sheet emphasizing some of the same points as Pew did a decade and a half later.

According to Cigna’s fact sheet, the cash balance plan would deliver a secure retirement and meet the needs of a more mobile workforce while making the company more competitive.

What Cigna didn’t tell employees was that their cash balance benefit would be less than their defined benefit, a fact that was common knowledge among those advocating cash balance plans.

Schultz in her book reported the following exchange at a 1998 panel entitled “Introduction to Cash Balance/Pension Equity Plans” put on by consulting companies that helped corporations convert defined benefit plans to cash balance plans:

“It is not until they are ready to retire that they understand how little they are actually getting (from cash balance plans),” said (an actuary from) Watson Wyatt (a pension consulting company). That got a good laugh from the audience, as did the response by a fellow panelist. “Right, but they’re happy while they’re employed. . . You switch to a cash balance plan where people are probably getting smaller benefits, at least the older, longer service people; but they are really happy, and they think you are great for doing it.” More laughter.


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