September 18, 2013 :$3ortlanh (Ob semer Page Opinion articles do not necessarily represent the views o f the Portland Observer. We welcome reader essays, photos and story ideas. Submit to news@portlandobserver.com. Danger Ahead: Our Disappearing Pensions I ’ I — — ~ ■ _ _ _ _ _ - _ .a ■ X Ï X - « • The vaunted 401(k) revolution has left few with a nest egg S am P izzigati H o w ’s your 40 l(k ) doing? W orking A m eri c a n s a s k th e m selves this q u e s tion — and angst about the answ er — a great deal these days. A nd w hy not? F or m ost A m ericans, retirem ent reality has turned chillingly stark: E ither you have a robust set o f investm ents in by y o u r 401 (k) o r y o u ’re facing som e really rocky happy years. A generation ago, working Am eri- cans d id n ’t have to obsess ab o u t retirem ent savings accounts. A m eri- cans had pensions back then, not 4 0 l(k )s . T h e se p e n sio n s re p re - sented a com m itm ent from em ploy- ers to w orkers: You w ork here a set num ber o f years, you can count on a m onthly pension at a set am ount, In these traditional pension plans, the risk rested w ith em ployers. T hey shouldered the resp o n sib il ity fo r funding a pension p la n ’s “defined b en efits.” W ith 401(k)s and the like, em ployees have no prom ised “d e fined b en efit.” T h eir future retire m ent incom e depends on how well th eir 401(k) inv estm en ts en d up doing, not how long o r how dili g en tly th e y ’ve w o rk ed o v e r the course o f their careers, In oth er w ords, the retirem ent risk has shifted, from em p lo y er to em ployee. O u r current 4 0 l(k )s actually be- gan in the 1980s as a supplem ent, not a substitute, to traditional pen- s io n p la n s .B u tA m e ric a ’s to p c o r - porate execs q uickly cam e to see th e se in v e stm e n t v e h ic le s as a ch eap er — fo r em p lo y ers — alter- native. B etw een 1990 and 2010, the share o f A m e ric a ’s priv ate-secto r « em p lo y ees in traditional pension plans fell by nearly half, from 42 to 22 percent. T his huge d ro p -o ff in traditional p ension participation, says a new E conom ic Policy Institute report, is g enerating both angst and in eq u al ity. A m ong A m erica’s m ost affluent 20 percent, 88 percent have savings sitting in a 401 (k) o r sim ilar re tire m ent savings account. T he savings in the accounts o f these affluent A m ericans averaged $308,674 in 2010, the m ost recent year w ith data. In A m e ric a ’s statistical m iddle class, by contrast, a totally different reality. O nly 52 percent o f A m eri cans in the m iddle fifth o f the nation ’ s incom e distribution have savings in retirem en t accounts, and these a c counts average only $34,981. A nd A m e ric a ’s poorest fifth has an even bleak er retirem ent outlook. O nly 11 percent o f those A m ericans have any 40 1 (k ) savings, and these savings average ju s t $7,543. T hese unequal outcom es should su rp rise no o n e. P a rticip a n ts in 4 01(k)s and sim ilar plans have to contribute to participate. In an era o f sh rin k in g real p ay ch eck s, m an y em p lo y ees sim ply c a n ’t afford to set aside m uch, if any, m oney for their retirem ent. T hose A m ericans w ith co m fo rt able incom es w ho can afford to set aside the m axim um possible sav ings in their 401 (k)s go on, in turn, to b e n e fit fro m b o th the sta n d a rd e m p lo y er’s 401 (k) m atching contri bution and the tax breaks that all 401 (k) savings enjoy. T he p redictable result: T he gap betw een the affluent and everyone else stretches even wider. W e have m oved, in short, from a traditional pension system w here “m any retirees could count on p re dictable, co n stan t stream s o f in c o m e,” as the new EPI study notes, to a system w here m ost A m ericans c a n ’t afford to retire. “F o r a large sw ath o f A m erica,” M a r k e tw a tc h a n a ly s t M a tth e w H eim er adds, Social S ecurity has becom e “the only rem ain in g fin a n cial crutch fo r retirem en t.” In the m eantim e, m any o f the sam e corporate execs w ho’ve cut back on traditional w orker pension coverage are spearheading the charge for cu t backs in Social Security. L ast fall, m y In stitu te fo r P olicy Studies colleagues lo o k ed at the 71 big-tim e C E O s p u sh in g the “Fix the D ebt” cam paign to trim Social Secu rity and o th er m ajo r federal “en title m en t” program s. T hese 71 top execs have accum ulated, on average, $9 m illion each in their ow n personal co m p an y p ension plans. A dozen o f these C E O s have o v er $20 m illion in th eir pension a cc o u n ts. If at age 65 these dozen co n v erted th eir assets to an annuity, the Institute for Policy Studies re searchers note, “they w ould receive a m onthly check for at least $ 110,000 for life.” OtherWords columnist Sam Pizzigati is an Institute fo r Policy Studies associate fellow. Move My grandma’s words have guided me m e to the core. A fter so m any historic civil rights v ictories, how co u ld it be that m y g eneration had gro w n up ju s t in tim e to find itse lf the m ost m urdered B enjamin T odd J ealous In m y tim e as an I organizer, I have been guided by the w o rd s o f m a n y people - activists and authors, c o l le a g u e s and friends. B ut the m ost pow erful les by so n I e v e r re c e iv e d a b o u t th e struggle fo r civil and hum an rights cam e in 1993, w hen m y grandm other taught m e that history could m ove in tw o directions at once. I w as in college, celebrating a friend's 21st birthday. A round o f toasts w ent up. O ne friend raised his glass to h o n o r the m em ory o f all those w e knew w ho had been killed o r sent to prison before they reached the age o f 21. A nother friend lifted his cup to toast to the fact that one m ore o f us had lived long enough to reach the quintessential age o f adult h ood. I could not raise m y glass on that last toast. In fact, it felt as if the m otion cut m e like a knife. T he notion that a m an o f any race, o f any age, in the w orld's great est and w ealthiest dem ocracy, could think it an accom plishm ent to sim ply breathe past the age o f 21 - it cut g eneration in the co u n try and the m ost incarcerated g en eratio n on the p la n et? So I did w hat I alw ays did w hen I a m s tu c k . I w e n t to m y g ran d m o th er’s table and I laid m y burdens dow n. I said, "G randm a, you told m e that m y g eneration w as supposed to be the first g en eratio n to be ju d g e d not by the co lo r o f o ur skin but by the co n ten t o f o u r character. N ot because o f w hat w e are o r w here w e co m e from - but because o f w ho w e are and w here w e are headed. W hat happened?" M y grandm a go t real quiet. She looked at m e w ith sad eyes and then she said, "Son, it's sad but it's sim ple. W e go t w hat w e fo ught for, but w e lost w hat w e had." T hose are w ise w ords to rem em b er in tim es like this. W e got the rig h t to be police officers, but w e lost the right to live in safe co m m unities. In C hicago, a culture o f po v erty -fu eled gang vio lence h as reinforced the notion that living until 21 is an accom plishm ent. W e g o t th e rig h t to sen d o u r c h ild re n to an y sc h o o l, b u t w e lo st th e rig h t to a ssu m e th a t th ey w o u ld re c e iv e a g o o d e d u c a tio n at w h a te v e r sch o o l th e y a tte n d . In P h ila d e lp h ia , the sch o o l s y s tem is facin g a $ 3 0 0 m illio n b u d g et g a p th a t a lre a d y d e la y e d th e start o f th e sc h o o l y e a r an d th re a te n s to d e v a s ta te s u p p o r t s t a f f a t sc h o o ls in th e m o st u n d e rs e rv e d c o m m u n itie s. W e got the right to live in any co m m u n ity , but w e lost the right to kn o w that o u r children w ould be p ro tected by the p olice - o r the com m unity w atch volunteers - w ho are supposed to serve them . In 2011, before N ew Y ork C ity passed a ra cial pro filin g ban w ith teeth, the N ew Y ork Police D epartm ent m ade m ore stops o f young black m en b etw een the ages o f 14 and 24 than there w ere y o ung b lack m en b e tw een 14 and 24 in the city. In h er sim ple w ay, m y g ran d m o th er spoke volum es about o u r h isto ry and issued a subtle ad m o n i tion fo r the path forw ard. She re m in d ed us that w e m ust be clear on both w hat w e are fighting for, and how w e will protect w hat w e already have. W hat are w e fighting for? First and forem ost, w e are fighting for our children: fo r th eir futures to be ro bust, th eir eq u ality to be affirm ed and th eir lives to be protected. T hat is w hy the civil rights com m unity lifts up education o v er incarcera tion, and econom ic liberation over discrim ination. W h at d o w e n eed to p ro te c t? If e a c h o f us h as a n y th in g - ev en th o s e o f us w h o d o n 't h a v e a h o u se , o r a car, o r a fam ily to feed, m ay no t be th e m o st im p o rta n t is su e to a n y o n e o f us, it n e ed s to b e th e m o st im p o rta n t fig h t fo r all o f us. M y g r a n d m a 's w o rd s h a v e g uided m e o v er the years, and they w ill continue to guide m e th rough o r a n y e a rth ly p o sse ssio n s at all - as so o n as w e tu rn 18, w e h a v e the rig h t to vo te. T h is is the rig h t th at has been w on and expanded th ro u g h the A m erican R ev o lu tio n , C iv il W ar, th e w o m e n 's su ffra g e out m y career. W e should heed her m o v e m e n t an d th e c iv il rig h ts im portant rem in d er that history can, m o v e m e n t - b e c a u se w e h a v e a l and often does, m ove in tw o direc w ay s u n d e rs to o d th a t w e are u lti tions at once. m a tely re n d e red d e fe n se le ss w hen Benjamin Todd Jealous is the o u r a c c e ss to th e b a llo t b o x is president and chief executive of d im in ish ed . So w h ile v o tin g rig h ts ficer o f the national NAACP. 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