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Somebody Needs a 401(k) Plan

I confess that I am far removed from the NYC transit strike, and so I have not been following the details. But this item in the New York Times is just sad. The issue seems to be the pension plan. The key paragraph:

The strike began after talks between the union and the transportation authority were halted Monday night after the union rejected the authority's last offer. The authority had agreed to drop its previous demand to raise the retirement age for a full pension to 62 for new transit employees, up from 55 for current employees, but said it expected all future transit workers to pay 6 percent of their wages toward their pensions, up from the current 2 percent.

If this is right, the remaining issue is whether new employees (i.e., NOT the ones currently on strike) will have to pay 6 rather than 2 percent of their wages for the same pension benefits as those currently employed. For people they've never met, who might be willing to work under the new terms, they cost the city hundreds of millions a day? Not the way to score points.

In fairness to the employees-to-be-named later, I wouldn't want a 6 percent contributory pension to be managed by a public bureacracy. Give the new employees a 401(k) plan with an employer match on the first 6 percent of wages contributed and let that be the end of it.

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