Well, there is the fact that NYC’s spending instructional wages per student was $1,000 per student lower than the Downstate suburban average and its spending on benefits, including pensions, was much higher.

Since then pension costs have soared more, a teacher wage freeze has been imposed, the number of teachers has been cut, and Klein has resigned.  All due to irrevocable decisions in the past.   And because of those decisions Klein’s point, like all the reform drama, is pretty irrelevant.

After a long battle, NYC school spending did soar.  And it all went to pension enhancements.  So now the idea is since the past increase went to retirement benefits, another increase of a similar proportion is needed in the highest school spending state in the country?   The extra money was supposed to go to teacher hiring, retention and pay.  And it’s gone. 

 $       12,965  $       12,795

Ah, I had forgotten about your expertise in economics.  This is like telling somebody that it’s not the bullet lodged in their chest that’s the problem, but the gun.  Noted.  But let me try to explain this again in simple terms.

Why are pension costs out of control?  Partly because the economy is not growing fast enough to allow the pension funds to earn the kind of return they need to meet their enormous obligations. Partly because of the enormity of the obligations, which would be huge even without the retroactive enhancements that Larry’s always talking about.  And partly because of the city’s failure to fund the pensions in accordance with what reality dictates.  

Note that these are all inter-related.  Say you start a mutual fund for retirement, and your goal is to have $750,000 in it by the time you’re 65.  10 years later you show your 401k statements to an accountant, who tells you that you’re only on track for $500,000, and that if you want to get back on track for $750,000, you’ll have to start doubling the amount that you put into the fund each month.  You ask your accountant how this could be.  Would I be on track if the fund had performed better in the past?  Would I be on track if I had contributed more money in the past?  Would I be on track if I had set more realistic goals for retirement?  Technically speaking, the answers are yes, yes, and yes.  So what do you do?  You have two choices:  (1)  double your contributions and find a way to reduce your living expenses accordingly, or (2) lower your expectations for retirement.
That’s a decent analogy to New York City’s pension funds, with one gigantic exception:  The State Constitution bars New York City from lowering public employees’ expectations for retirement.  It can increase its pension contributions and cut spending by the same amount.  It can also play with the accounting and hope nobody complains. The city’s doing both.The city now spends 12% of its budget–$8 billion–on contributions to the pension funds.  In 2002 it spent $1.3 billion. Why is it spending so much money now on pensions? It’s partly because of the market’s performance relative to the actuarial assumptions that the city’s contributions were based on.  This also explains why the city spent so much less in the late 1990s, when market returns were insanely and unsustainably high.  But it’s also partly because the pension obligations have increased, not because of an unexpected increase in the number of retirees, but because the retirement benefits of those retirees were retroactively enhanced.  I don’t think this is actually disputed (although the amounts of the enhancements are disputed).  For example, John Liu’s office released a report last year that listed the causes of “unanticipated” pension cost increases.  The first cause was “lower investment returns,” which he estimated caused 48% of the increases.  The second cause was benefit enhancements that went into effect in 2000, accounting for 40%.  Benefit enhancements that went into effect after 2000 caused another 4% of the increase, he wrote.  So 48% caused by the market, 44% by pension enhancements.  That’s from John Liu, not Larry Littlefield.  As much as the city’s spending on pensions now, it’s going to get worse, and that’s also not in dispute.  The city’s actuary has recommended a revision in the funds’ annual rate-of-return assumption to 7% from 8%.  The city isn’t following that recommendation because if it did, it would immediately blow another $2 BILLION hole in the budget.  So, unable to deal with reality now, the city decided to deal with it later.  This means that the city is intentionally underfunding the pensions today in hopes that it will be able to afford to make up that funding later.  But the city knows that this will be even more costly in the long term, because anytime you shortchange the pension funds on contributions, there’s less money in the funds earning *any* return.  It’s like deciding to underpay your mortgage payments today because you can’t afford to make the full payments, or to reduce your 401K contributions this year so you can afford to meet your mortgage.  Unless you start making a lot more money or changing your spending habits, the difficulty in paying off your mortgage or accumulating enough money to retire will increase exponentially.We’re talking about BILLIONS of dollars annually here. And this is not some abstract argument about accounting and the future.  This is already hitting New York City, and it will keep hitting us for many, many years.  This is big, big money, and it’s why there are fewer teachers, firefighters, and police officers every year.  This is why class sizes can’t come down, and why firehouses are closing.  I understand why public employees don’t like to hear about it, but I would hope you’d understand why it’s important. 

“Poor and minority students will never get their fair share of
educational opportunity — and are far more likely to lead unsuccessful
lives — until administrators and political leaders commit to
fundamentally changing the way teachers are recruited, rewarded, and
retained.”
– Joel Klein

http://www.huffingtonpost.com/joel-klein/transforming-the-teaching_b_200616.html 

I am on topic.  There are a series of posts above this and a series below this and a series below this that do not interest me, and on which I provided no comment.  
This post raised the issue of conflict of scarce fiscal resources in Chicago.  I provided additional information on what is causing that fiscal scarcity in Chicago, the same thing that is doing so in New York.
 
You just don’t want to hear about it.  But unfortunately, it is what has been driving and will be driving everything in public education for years.  And being nasty isn’t going to prevent me from pointing that out.

And I did serve as a volunteer tutor in the schools some years back, as a matter of fact.  Early 1990s. 
  

I post census data showing actual facts, and links to articles.  Some others just toss out insults.  People keep repeating “hidden agenda.”  When the biggest hidden agenda of the past decade was a large increase in school funding that went not to education, as promised, but to pension enhancements, as the UFT probably planned all along.

You may not want to hear about it, but that’s too bad.

How  do  you  two  have  this  much  time  to  spend  at  this  site  complaining  about  teachers,  and  their  pensions? 

Pensions  are  NOT  the  problem! The  weak  economy  is..You  should  be  focusing  in  ways  to  grow  the  economy,  and   not  obsess over  bringing  other  people  down.  That  will  only  make  things  worse.

 http://www.bloomberg.com/news/2012-05-24/firefighters-lose-as-rising-pensions-spur-broken-promises.html

And North was the pension actuary, wasn’t he?  Long time kicking this can down the road. 

Liu may be in charge of the pension funds now, but the disaster was already there when he arrived.  Most people don’t get those subtleties, but certainly Thompson wouldn’t dare bring the pension situation up.

And that ex-state legislator who is running voted for all the deals up in Albany.  Quinn and the Council had no say.

Bottom line — everybody’s guilty.  Which is why no one brings it up.