Category Archives: Pensions/retirement

Is This the Dumbest Thing Phil Scott Has Ever Done, the Most Pointless, or Both?

Words can barely express how inexplicable this is. Why did Gov. Phil Scott veto the public sector pension deal? Well, I know his stated reasons, but they’re stupid. He has expect an override, so his veto won’t accomplish anything except make him look needlessly obstructionist.

There’s more, a lot more, but let’s take ’em one at a time.

This deal came at the end of a years-long search for common ground on how to make the pensions fiscally sound. Last year, the Legislature set up a committee to recommend a way out of the mess. The panel included members of the Legislature and Scott’s administration, and the unions. It worked diligently for months.

At no point did Scott or any of his officials sound the alarm.

The committee brought its recommendation to the Legislature. It went through the entire process of committee hearing after committee hearing, amendments major and picayune, floor debates and floor votes.

At no point did Scott raise a hand and say the deal was unacceptable.

The votes in the House and Senate were UNANIMOUS. Every single goddamn Republican voted in favor of it.

At no point before the votes did Scott think to warn his legislative allies that he didn’t like the deal. Some of them would have happily voted “No” if they thought he had a problem.

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Let’s Talk Civility, Shall We?

The Democrats’ Phil Scott playbook seems to consist of rolling over on their backs and begging for a belly scratch. This all-too-familiar pattern recurred this week, when the governor threatened to veto two very important bills on Tuesday… and then was welcomed as part of the Pat Leahy Statehouse lovefest on Wednesday.

I guess if someone tosses a couple of turds in your punchbowl, the appropriate response is to invite them back for High Tea the following day.

As for the governor, his schedule is arranged far in advance. He had to know before his Tuesday presser that he was going to share the stage on Wednesday with all the top Democrats… but nonetheless, he went ahead and trashed the Legislature’s budget and the hard-fought public sector pension reform plan.

Mr. Civility strikes again. And they let him get away with it. As usual.

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Surrendering Before the First Shot is Fired, and Other Time-Honored Strategeries

One of the consistent themes running through recent Legislatures is Democratic majorities retreating in the face of the slightest pressure — sometimes, even before they feel any pressure at all.

The latest dispiritng entry in this Chronicle of FAIL is a House/Senate task force on public sector pensions. Despite a Democratic majority on the panel, the task force seems determined to rule out possible new revenue sources for the pension funds. If the panel has its way, employees and retirees would absorb the bulk of the pain in a pension reform plan.

As a reminder, both pension plans were massively underfunded from the early 90s to the mid 2000s. In recent years, pension managers issued overly rosy projections on investment returns. That combo platter of ineptitude has resulted in a massive shortfall in both pensions. The Task Force was created by the Legislature last spring, after a reform plan to from House leadership capsized upon launch.

That plan emphasized benefit cuts and higher payments by employees. Leadership abandoned it after furious blowback from the unions. Well, it now seems that the Task Force is bent on following the same course. Members are not even considering measures that Gov. Phil Scott might veto.

Remind me, what’s the difference between legislative Democrats and the Republican administration? Precious little in this case.

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The Bloated Corpse of Bruce Lisman’s Political Career Emerges From the Stygian Depths, Emits a Gas Bubble, Sinks Back Into the Murk From Whence It Came

Oh wait, sorry, that’s Swamp Thing

Once upon a time, there was a retired Wall Street executive named Bruce Lisman*. After his investment firm cratered in the Collapse of 2008, he moved to Vermont and turned his attention to politics. (He should have checked with Rich Tarrant or Jack McMullen on how that tends to work out.) First, he launched a putatively nonpartisan advocacy group called Campaign for Vermont Prosperity. It was usually referred to as “Campaign for Vermont” in an apparent effort to camouflage Lisman’s pro-business agenda.

*Who may or may not have been thoroughly skewered in the movie “The Big Short.”

CFV accomplished little besides spending a goodly portion of Lisman’s fortune. It put out the occasional paper, held sparsely-attended policy forums, did a bit of lobbying, and paid some college students to show the CFV flag at public events. (I dubbed them “Lisketeers.”) There was precious little grass in CFV’s roots.

A few years later, Lisman made the seemingly inevitable run for governor. He spent heavily on his campaign but ran into a buzzsaw named Lt. Gov. Phil Scott, who beat him in the Republican primary by 21 percentage points.

That was the end of Lisman’s political aspirations. He stopped bankrolling CFV, which somehow continued to exist as a center-right, pro-business advocacy group. Some well-meaning people are involved in CFV, but honestly, itbarely makes a ripple in Vermont politics. Whenever CFV does something, I find myself asking “Oh, are you still here?”

CFV’s website is laden with position papers and press releases dated from 2014 and 2015. It does occasionally burp out some new content, as it did last week with a “New Report on Pension Issues.” And though I run the risk of killing a gnat with an elephant gun, I feel compelled to expose this piece of half-assed propaganda. You know, just in case someone takes it seriously.

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A Curious Absence of Drama

As I wrote in my last post, this legislative session looked to be a difficult one at its onset. But there’s been a nearly complete lack of drama, as the House and Senate have made their way through allocating federal Covid relief aid, tackling Covid-related challenges, running the Big Bills smoothly through, and also addressing a notable number of issues that could easily have been kicked down the road till next year. As is common practice in the first year of a biennium.

It’s time to give House and Senate leadership a lot of credit for this. Things are getting done with no untimely eruptions, bruised feelings or twisted arms, no visible splits in the majority caucuses. No muss, no fuss.

What makes this more remarkable is that the two leaders, House Speaker Jill Krowinski and Senate President Pro Tem Becca Balint , are each in their first year. Past leadership changes have usually brought rocky times in Year One. Houses-Senate relations get awfully tetchy.

Not this year. And that’s remarkable.

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Why the Sudden Reticence, Madame Treasurer?

This kinda got lost in the wake of Speaker Jill Krowinski’s retreat on pension reform, but Treasurer Beth Pearce has taken a curious stand on fund management. She seems dead set against a legislative review of the pension funds’ track record.

Normally she’s a fiscal bloodhound, whenever shy about exploring any and all financial issues to the last decimal point and sounding the alarm when she sees fit. But not this one time.

As a reminder, the state treasurer occupies one of seven seats on the Vermont Pension Investment Committee, which makes the investment decisions.

I’d been wondering how the pensions underperformed badly during a historically long bull market. I mean, couldn’t a roomful of monkeys with Bloomberg terminals make money on Wall Street these days? Now, Seven Days’ Kevin McCallum has put numbers to my feeling.

Over the last decade, the S&P 500, a benchmark for the U.S. stock market, enjoyed an average annual return of 13.6 percent. Over that same period, Vermont’s public pension funds earned an average of just 7.2 percent a year from its investments.

That’s not an entirely fair comparison, as McCallum pointed out, since pension funds can’t take chances with their investments. But then he compared Vermont’s funds to other similarly sized public pension funds, and found that Vermont ranked 69th out of 100. Not exactly sterling.

Members of the House Government Operations Committee, who risked political suicide by exploring Krowinski’s reform plan, aren’t happy with the funds’ performance. Committee vice chair John Gannon, who has financial credentials to rival Pearce’s*, called the funds’ performance “horrendous.” Yikes.

*Eleven years at the Securities and Exchange Commission and several at the Financial Industry Regulatory Authority.

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The Speaker Runs for Cover

Well, that didn’t take long.

After steadfastly insisting that Vermont’s public sector pension plans urgently needed an immediate overhaul, House Speaker Jill Krowinski sounded the retreat Friday morning.

It stands to reason, considering the intense backlash her plan received since it was kinda-sorta unveiled on March 24. (Only nine days ago!) Krowinski has now fallen back on the lawmaker’s favorite way to defer tough decisions: a task force.

I guess the situation somehow got a lot less critical.

She deserves credit for gracefully abandoning an unsustainable position. But how did she not see this coming?

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So Many Sad Crocodiles

I tried to watch Tuesday’s kabuki performance hearing of the House Government Operations Committee, but was repeatedly thwarted by a bad Internet connection. (Thanks, Consolidated Communications!) Still, I saw enough to realize what was going on. And enough to be completely fed up with all the expressions of dismay from Democratic officeholders.

The short version: The fix is in. The skids are greased. Following two days of dog-and-pony public hearings, the committee picked up on Tuesday exactly where it left off on Friday afternoon: Charging ahead with a reform plan that will substantially devalue pensions for teachers and state employees.

So, thanks to all those who testified. For your time and trouble, you get a lovely parting gift: our Pension Reform Home Game. Now you can play God with other people’s pensions, just like our legislative leaders!

One thing every committee member can agree on (well, except the three Republicans, they don’t seem to mind at all) is that these are difficult, painful conversations. In the brief statement she read at the beginning of the second public hearing Monday, committee chair Sarah Copeland Hanzas used the word “difficult” three times. “These are really difficult conversations,” “Everyone has had a tremendously difficult year,” “this conversation couldn’t have come at a more difficult time.” In her testimony on Tuesday, Treasurer Beth Pearce said “When we gave our recommendations, we did so with a great deal of reluctance… these are painful.” Other Dems chimed in with similar expressions of saditude throughout Tuesday’s hearing.

Pardon me if I can’t appreciate the self-pity parade. These conversations are waaaaay less “difficult” for elected officials than for the folks who’ll take it in the shorts if this plan (or something like it) takes effect.

Here’s another thing that’s cratering my sympathy for our poor hard-working betters: They’re lying about where we are in the process.

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Phil Scott’s Getting a Free Pass on Pensions, and the Democrats Are Letting Him Get Away With It

Legislative leadership is rightly getting an earful from teachers, state employees and union supporters over the emerging make-workers-pay pension reform plan. But let’s not overlook the fact that Gov. Phil Scott is playing no role whatsoever in devising a solution to this very large problem.

As he has done on issue after issue throughout his governorship, he is sitting back and letting the Legislature do the hard work and take the punishment. Then, after all their blood, sweat and tears, he saunters in, gives a thumbs-up or thumbs-down, and ambles away. If it’s thumbs down, the Legislature gets another try at guessing what will be acceptable to him.

This isn’t my idea of leadership. But who can blame the gov, considering that it works so well for him?

Over and over again, Scott sits out a tough policy debate — and the Democrats let him get away with it. They bargain against themselves. They begin with a position that’s more than halfway to his side, and they only give ground from there. The governor doesn’t get exactly what he wants, but the Democrats get far less. And they look weak in the process.

You’d think the Democrats would have learned by now. But no, here they are doing the same damn thing on pensions — and in the process, betraying one of their core constituencies.

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How to Cost Your Financial Institution a Bunch of Customers in Two Easy Minutes

Submitted for your consideration: Bob Morgan, CEO of the North Country Federal Credit Union. Well, he was as of this writing.

Morgan was the only witness in Friday afternoon’s hearing on public sector pension reform to play the Ebenezer Scrooge role, talking up the urgent need to stick it to state and school employees. All the other witnesses were teachers, state employees and their supporters, all urging the Legislature to hold the pensions harmless.

Morgan’s pro-reform pitch makes sense coming from a member of the Vermont Business Roundtable’s Pension Reform Committee, which he is. But it’s awfully risky for the leader of a financial institution where many teachers and state workers keep their money. After his testimony, Twitter got lit up with calls for people to close their NCFCU accounts.

And eventually, one Twitter sleuth discovered an article describing the generous custom-tailored retirement plan Morgan received from the NCFCU Board. Made it look like a clear case of Steak and caviar for me; hardtack and Alpo for thee.

More on that in a moment, but first, let’s revisit Morgan’s testimony.

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