There I was, sitting on the veranda with Jerry and a few of his buddies and a 160 pound mastiff named Winston Churchill, letting the conversation wash over me.
As reported earlier, I was not there to argue.
The ire of the progressives was pro forma. It was too warm to get really angry but certain conventions must be upheld.
Since I chose not to rebut the arguments there, I will rebut them here.
The Post Office
The socialist railed about the demise of the Post Office. He was angered that the "bastard conservatives" had written legislation that the Post Office had to self-fund the postal pension and it had to be 100% funded
Since then, he claimed, the Post Office had been forced to economize and service had been cut.
"It is not like private industry where pensions can be 20% or 30% and it doesn't matter" he expounded. "The Post Office is being forced to operate against the private sector which has an unfair disadvantage."
It was news to me that private industry could fund their pensions at 20% and "it doesn't matter". But there are many things I don't know, so I looked it up.
Surprise! 80% funding is NOT the bogie for private pension funding level
The target funding level for private pension funds is 100% with the understanding that variation in market returns and changes in the business environment (perhaps employing more people) will cause the actual funding level to oscillate around that target.
Not 20%. Not 80%. The target is 100%.
At one level, the US Postal Service is in competition with UPS and Fed-Ex and other parcel delivery services. They do, however, have a monopoly on the delivery of mail. Only a carrier approved by the US Postal Service can put an item into the mail box you bought.
Perhaps the pension funds of those two companies, UPS and Fed-Ex are funded at 20% of the amount actuarials determine is required to meet future pension obligations. Maybe the socialist was referring specifically to the US Post Office's private sector competition?
As of Dec. 31 (2018), (UPS) U.S. pension plan assets totaled $39.55 billion, while projected benefit obligations totaled $45.33 billion, for a funding ratio of 87.3%, down from 91.5% a year earlier. As of that same date, international plan assets totaled $1.28 billion, while projected benefit obligations totaled $1.55 billion, for a funding ratio of 82.7%, up from 80.7% a year earlier. Source
Granted, 87.3% is not 100% but it is not the 20%-to-30% the socialist wanted to believe.
Perhaps Fed-Ex is the one he was talking about?
As of May 31 (2021), U.S. pension plan assets totaled $29.785 billion, while projected benefit obligations totaled $31.423 billion, for a funding ratio of 94.8%, up from 89.3% a year earlier. Source
Socialism can only thrive in a fact-free zone where non-performance is a virtue and costs and risks can be "disappeared" by transferring them to the private sector.