Foundation still determined to eliminate future pension plans for Oklahoma teachers
CATEGORY:
OKLAHOMA CITY -- An informal meeting Friday night, September 5th, between several education officials and Bobby Stem, a long-time lobbyist in Oklahoma, did not turn out the way that he wanted it to.
Stem's business card identifies him as the Executive Director of the Association of Oklahoma General Contractors. Those are the companies who build the big projects around the state, very often for the State of Oklahoma in the form of roads and bridges.
The original invitees to the meeting were some of the Oklahoma Education Association's board of directors and other officials of certain locals. The OEA, sometimes called a “teachers union,” is the primary organization that advocates for public teachers.
As the meeting developed, it was obvious that most around the table, especially those who are in decision-making positions with the OEA, were strongly opposed to his ideas. At least the people there just wouldn't budge. The meeting ended abruptly as those closely associated with the OEA stood up, thanked Mr. Stem for inviting them, and walked out. His proposal was not far off from what the Arnold Foundation has been promoting nationwide, which is to reduce the costs of public employee pensions by converting them to "defined contribution" plans from the current "defined benefit" plans that have been in place for years.
It was also a repeat of what was successfully pushed through the Oklahoma Legislature this last session for other state employees. The Arnold Foundation argument strongly resists any idea that tax subsidies for corporations should be reduced to pay for obligations to state and municipality employees. In their approach, the cost of reform, should be carried solely by the employees.
This year, Stem's idea is to get teachers to agree to the same kind of conversion of their pension plan. The proposal was to develop an “8-year plan”: to fund roads and bridges and to convert pensions for new teacher hires onto a defined contribution pension plan that would be similar to current 401(k) plans.
The difference is that the older public employee defined benefit plans make a commitment to the public employee that if they commit to so many years of service, they will be guaranteed a certain level of benefits -- thus, “defined benefits.” Any kind of “defined contribution” plan is structured so that they employee is required to invest a
