As predicted in this blog a few years ago the benefits enjoyed by the "middle class" at the expense of cheap labor elsewhere are slowly getting squeezed.
Increasing the retirement age for workers is directionally negative for young people wanting to join the workforce, thus a directional negative for employment. On the flip side states can reduce taxes because the expenses are lower. States could reduce borrowing but the need for continuous redistribution of wealth- issuing debt (and putting the burden on all), and distributing it to a few at the top will make debt reduction a pipe dream.
Politicians and bureaucrats are making all-out efforts to hack the benefits of workers, but there are no efforts to curb or reduce the benefits of politicians.
The states are taking aim at long-held and sometimes controversial pension plans. In Utah, new fire and public safety employees as of July 1, 2011, must work 25 years, up from 20, before getting a full pension. Most other state employees must now work 35 years instead of 30 before receiving their pension.
In Illinois, teachers can retire as early as age 55 with 35 years of service. But starting Jan. 1, 2011, new hires must reach age 67 with 10 years of service.
In June, California Gov. Arnold Schwarzenegger reached a tentative contract agreement with six public-employee unions to bump up the retirement age by five years for new hires. The governor's office and six other unions remain in negotiations, with one of the sticking points a proposed increase in the retirement age.
The changes could add momentum to raise the age at which Americans receive payments from Social Security, say industry experts."
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