As rates rise, FHA cuts premiums

From MarketWatch:

After mortgage-rate spike, FHA to cut insurance premium

The Federal Housing Administration will reduce the annual premium borrowers pay, in order to expand credit access to more Americans, the government announced Monday.

Borrowers who close on an FHA mortgage after January 27 will pay 25 basis points less for the mortgage insurance premium, the Department of Housing and Urban Development said.

Like Fannie Mae FNMA, +0.76% and Freddie Mac FMCC, +0.00% , FHA doesn’t make loans but provides a backstop for lenders. The annual premium fees fund the FHA’s Mutual Mortgage Insurance Fund, which helps the agency protect against losses incurred if borrowers run into trouble.

Congress requires that FHA have enough reserves to cover projected losses over 30 years. In 2013, it fell short on that threshold and had to receive a cash bailout of $1.7 billion. Separately, the agency must maintain the fund’s net worth of at least 2% of its loan portfolio.

In a statement, FHA noted that the reserve ratio stood at 2.32% last year, the second year in a row to exceed the 2% threshold.

“After four straight years of growth and with sufficient reserves on hand to meet future claims, it’s time for FHA to pass along some modest savings to working families,” HUD Secretary Julian Castro wrote.

But many analysts think it’s much more than the insurance premium that’s holding back lending.

“I’m not quite sure how much it actually does,” Laurie Goodman, codirector of the Urban Institute’s Housing Finance Policy Center, told MarketWatch.

“When you look at opening the credit box, there are other actions like figuring out how to break down the False Claims Act so lenders aren’t running scared of more risky loans. That seems to me would have been more effective in terms of access to credit.”

Many big banks have left the FHA program after being slapped with heavy fines for what they perceive as minor infractions of the rules of FHA’s program. One large lender, Quicken Loans, sued the government after being fined.

In the wake of the financial crisis, as mortgage lending became more stringent, FHA lending has boomed, in part because it allows borrowers to take out mortgages with down payments as small as 3.5%.

This is the second such cut in insurance premiums. FHA implemented a 50 basis point reduction in Jan. 2015. The agency estimates this cut will save borrowers an average of $500 per year, and projects approximately 1 million people will take out an FHA mortgage in 2017.

This entry was posted in Mortgages, National Real Estate, Risky Lending. Bookmark the permalink.

73 Responses to As rates rise, FHA cuts premiums

  1. Mike says:

    Good Morning New Jersey

  2. grim says:

    Fab – We’ve been having good luck with $11 range point the past few years. Kidani last year, now Poly, and we have commitment to book BLT through the same woman who will do them for $10. Poly wasn’t even her home resort and we had no problem booking for us (looking at tax records, she’s got to own at least 25 units, from long back too). Poly was nice, but I liked Kidani better, probably because we had the 1br suite with the kitchen. Besides, the Monorail was broken every other day.

    Pretty sure at our $11 a point – it’s way cheaper than actually buying one.

  3. The Great Pumpkin says:

    Race to the bottom indeed. I wonder if these jobs received the exact same compensation without the label of “union,” would they receive the same bias attacks? Take away the “union” label and all of a sudden people will pity these poor souls. It’s amazing how well of a job the owners of production have done in brain washing the public to be against unions and their own self interest. It’s simply mind blowing.

    Essex says:
    January 9, 2017 at 2:33 pm
    2:18 — because the pay is below average in these fields and the work somewhat monotonous. If they want to attract anyone to these fields they have to offer some type of compelling compensation. As this is reduced look for major shortages in those fields at least in terms of attracting quality candidates. A race to the bottom.

  4. grim says:

    Isn’t everything a race to the bottom?

  5. The Original NJ ExPat says:

    Can’t wait for the warm-up. I can’t believe how good we had it coming home to 78 degrees in the Winter for the last 15 years of Winters and not having to pay for it. In the Summer we rarely needed to put AC units in the windows because we lived about 75 feet above the North side of Chestnut Hill Reservoir. Another thing I miss is unlimited hot water and the temperature never changes even if someone flushes the toilet. In our new place we have a fancy two person shower something like 9 adjustable jets, but no adjustment for temperature? It seems like you just turn in on and that’s all you can do except move the jets up and down? The temperature is OK, but it’s kind of like using an automatic when you are used to a 4-on-the-floor with a heavy duty clutch. I guess I’ll go out and buy some TrueFuel tomorrow. I’m glad I didn’t waste my 30’s and 40’s on this suburban sh!t. It is nice knowing you can back right up to the mudroom off the kitchen with groceries though, I’ll give you that.

  6. D-FENS says:

    I enjoy working on the house. Much like I enjoy working on the car.

  7. Fast Eddie says:

    Fabius,

    Your guy is responsible for losing thousands of seats thereby killing the democratic party, dividing a nation, fostering resentment and obstructing anything to do with potential prosperity. That’s his domestic legacy. On foreign policy, half the world is in flames and he’s made a mockery of MY country in the eyes of world leaders, both good and bad. Anything Trump does will benefit those who wish to obtain our legacy as a nation, not become a p1ss hole for the rest of the world nor a free ride for those trying to define their purpose in life.

  8. The Original NJ ExPat says:

    I might just take Pumpkin’s advice and keep our original place after remodeling it. It would be better still if I could find a greater fool to buy it from me and I could rent it back. Somehow I think our teenagers after having a taste of 3 bathrooms, sleepovers with their friends (including out back with our tent), etc. won’t be keen on it.

  9. The Great Pumpkin says:

    Shocker. Weren’t we just talking about this the other week. It’s just hilarious that supply and demand doesn’t apply to this, and the public can thank the big bad unions for holding these wages down. The same union they accuse of over compensating their workers. Funny, the pay is so damn good, nobody in their right mind wants to do it. Christie and that whole corporate educational reform movement has done a phenomenal job at destroying education. Got the whole public to buy into the propaganda of bashing/blaming teachers the past 8 years. Now no one wants to be a teacher. BRAVO! Corporatism has no business sticking their profit driven mindset in education. Just creating a f’n mess that the taxpayer will have to pay to clean up.

    Best part, just imagine what happens when you take the pension away. They will have no one going to teaching. Absolutely no one. Grab the popcorn and enjoy the show.

    “Widespread media reports of local teacher shortages have become a hot topic in education since the summer of 2015. After years of teacher layoffs, districts began hiring again as the economy recovered from the Great Recession. Many were surprised to find they had serious difficulty finding qualified teachers for their positions, especially in fields like mathematics, science, special education, and bilingual education/English language development. A number of states greatly expanded emergency permits to allow hiring of untrained teachers to meet these demands—which is the classic definition of shortage. To date, however, there has not yet been a detailed national analysis of the sources and extent of these shortages, and the prognosis for the future.”

  10. The Original NJ ExPat says:

    You can’t work on cars any more. Sure, I can work on my Miata or my ’72 El Camino, but I hardly drive them (in a garage I’ve rented for 16 years 5 miles away), but I hardly drive them, so there is really no work to do. When I blew a spark plug out of one of our “real” family cars over Thanksgiving I was not only pissed off to pay $400 for a job I could have done myself (“helicoil” insert, not really a spring helicoil, like they used to be, but a solid insert), but I recently noticed how much I don’t even know the underhood of our 2002 that well. I did notice that the garage that re-bedded our blown out spark plug lost one of the 8mm nuts (you need a deep 8mm socket, btw) of the plastic engine shroud. That pissed me off, because I know how hard it is to take that cover off and not lose a nut or at least re-find it on the ground. But also we went down to NJ a tiny bit low on oil (normally I sent my wife to Valvoline to get it topped off) and in NJ I was down a bit more than a quart, so I bought a quart and realized I was putting oil in our 15 year old car for the very first time myself. I realized this when I removed the oil fill cap for the first time, and was actually astounded that I could see the timing chain, which made me realize I never took the cap off before. Never, ever, since 2002.

    I enjoy working on the house. Much like I enjoy working on the car.

  11. The Great Pumpkin says:

    Well said! I’ve had my battles with ethanol, and boy is it not fun. Replaced a good number of carbs before I realized the fuel was the got damn problem. Can’t even get real gas these days. It’s like they took a playbook out of the coke dealers, dilute it, maximize your profit to the gas junkies.

    “Yes, you can get ethanol-free unleaded gasoline at some airports — mostly smaller ones (think Lincoln Park, Blairstown, or Greenwood Lake; not even as large as Morristown or Caldwell). Call and ask if they sell “MoGas”; if they do it will be ethanol-free by default or try airnav.com under “Aviation Fuel” tab). Marinas that sell gas will also be ethanol-free — boats have an even harder time with ethanol in the fuel than small yard equipment. There are other websites that are a backlash against fuel polluted with “corn squeezins”– buyrealgas.com; pure-gas.org. Coastal blue states and regions near refineries almost always have ethanol; places away from refineries its less common — ethanol has to be added at the terminal and can’t be pipelined otherwise it does to the pipeline the same damage it does to the small engine innards. Last thing, gas stations that sell ethanol-free tend to be off-brand independents; you might also get luck sniffing around near a race track (even/especially a small dirt track) if you know where one is nearby.”

  12. The Original NJ ExPat says:

    Heh-heh. Yeah, right. They’ll just turn their nose up and be lifetime baristas along with all the other entitled losers who didn’t take up a “real” major in college. (apologies to Ben in advance).

    Best part, just imagine what happens when you take the pension away. They will have no one going to teaching.

  13. The Great Pumpkin says:

    Come on, you can’t tell me you are not sleeping better now. It’s rough trying to sleep in apartment buildings when you can hear your neighbor’s every move(esp the fighting and sex marathons). Grocery shopping has to be much better too, who wants to carry that many bags up to whatever floor you were living on. You also must have went through hell raising your kids. Can’t just let them play in the backyard, and your apartment is too small to ever get a break from crying babies.

    Biggest positive, you prob jerk off/have sex regularly now that your kids aren’t basically sleeping right next to you. Your wife actually gets to scream without waking the kids. That’s priceless right there.

    “I’m glad I didn’t waste my 30’s and 40’s on this suburban sh!t. It is nice knowing you can back right up to the mudroom off the kitchen with groceries though, I’ll give you that.”

  14. The Great Pumpkin says:

    Bingo! The private sector unions were hijacked by mobster thugs. They should have never used the mobsters as a tool. Nothing good comes from dealing with criminals. It opened the door for attacks on the union image. Gave the owner class all the ammunition they needed to take down the unions. The mobsters just started extorting the union workers. That’s what happens when you play with the devil.

    Against The Grain says:
    January 9, 2017 at 2:53 pm
    “Isn’t it amazing how nearly the only unions remaining are for public service? I wonder why that is?”

    Mostly because public employee unions are the only unions that never let themselves become Mafia subsidiaries, like most of the others who were then eventually destroyed by it.

  15. The Original NJ ExPat says:

    BTW, did anybody know that the Ford 3.0L Duratec V6 was actually initially developed by Porsche? Actually by Porsche and Cosworth. Porsche decided not to go forward with the engine and Ford bought all of the engineering from them, finished it and put it into production. Every Ford or Mazda V6 is based on this engine since about the mid 90’s.

    On the other side of the coin, until a couple years ago, *EVERY* Ford or Mazda 4 cylinder (even diesels!), going back about a dozen years, all start from the same Mazda MZR engine block casting. Even if a 4 cylinder block or head is embossed as a Ford Duratec, it is actually Mazda engineering.

  16. STEAMturd says:

    Do you read what you post Pumps?

    “”To date, however, there has not yet been a detailed national analysis of the sources and extent of these shortages, and the prognosis for the future.””

    I’m not sure how the 100 million hole will be plugged, but I am sure that the office of union propaganda will be working overtime to try to convince the taxpayer that they are getting a raw deal.

    I’ll ask you to present one honest study on NJ’s pension (and healthcare liability) issue. I want to see one study that basis the salary on the number of days worked, rather than on an annual basis. Or a study that shows how oversized the benefits are and how little workers paid for them. Or when they talk about average pension sizes of $25,000, they intentionally look only at those currently collecting (including great grandma who retired 40 years ago) and conveniently leave out what the average pension size going forward looks like. You will never be able to find such a study of course. I wonder why?

  17. Essex says:

    8:58 Interesting! Never a huge v6 fan. Always seem middling on the power side and not particularly efficuent. Tend to Like a Turbo 4 or a V8.

  18. STEAMturd says:

    This is why I can’t read the NYTimes any longer. They play the same games with the numbers.

    From my perch it seems to work like this. The right tends to straight up simply make up stories, repeating it over and over until their audience doesn’t even check the validity of the initial claims. It’s why half of America thinks Obama is still a Muslim born in Kenya.

    The Left though. They are probably worse. They make up stories too, but are much more subtle with their lies. They knowingly and intentionally leave out facts and figures since their elitist audience need not question the reliability of their news. If it’s in the Times or WAPO, then it has to be true. It’s why the left has no clue that Trump is more aligned with them politically than he is with the red team. Heck, yesterday he was touting single-payer as the only solution to Obamacare’s faults and was still getting on house republicans for trying to water down the ethics committee. He sure sounds like a Nazi. Doesn’t he?

  19. STEAMturd says:

    And ChiFi…I am not the new ClotPoll. I’ve never faked a character here (well, not without immediately admitting to it afterwards).

  20. D-FENS says:

    VW Touraeg is also a Porche Cayenne

  21. STEAMturd says:

    Remember when the Geo Prizm was the Chevy Nova?

  22. The Original NJ ExPat says:

    Essex – I tend to agree, though I’ve never owned a turbo 4, just normally aspirated 4’s and v8s. The first V6 I was acquainted with was a Ford 3.8L in my wife’s ’83 or ’84 Mustang convertible and it was just awful, awful, awful on all fronts! Actually going way back, by first V6 was the 2.6L in my Dad’s ’73 Capri. There were actually two different Capri V6’s, an English one and a German one (all the cars were built in Germany) that shared no parts but both were 2.6L. I forget which one we had and I forget which one was better, but that was a fun car with heavy, heavy manual rack and pinion steering and a 4-on-the-floor, some decent torque and handling for the time. My wife’s V6 in her Mustang was just total trash. 3.8L with no power, poor gas mileage and not too reliable either. The Duratec V6’s from Ford are much better engines, I think they ran from 2.5L up to 3.5L or so, but the 3.0L is the most common. I think Jaguar would be out of business if they weren’t pretty good motors.

    I think Turbo 4’s are pretty good these days, but also planned obsolescence. I don’t think you’ll find too many 15 year old Turbo 4’s going forward, they’ll just go to seed rather than undergoing costly repairs.

    8:58 Interesting! Never a huge v6 fan. Always seem middling on the power side and not particularly efficuent. Tend to Like a Turbo 4 or a V8.

  23. STEAMturd says:

    I decided to look into the teacher shortage. The report was produced by…wait for it…

    The Center for Public Education (Center) is a national resource for accurate, timely, and credible information about public education and its importance to the well-being of our nation. The Center provides up-to-date research, data, and analysis on current education issues and explores ways to improve student achievement and engage public support for public schools.

    The Other study I found, was published by…the learning policy institute.

    Both of these groups are heavily funded by (wait for it)…the teacher’s unions. Is it peculiar that these teacher shortage reports are coming out just as the pension crisis is coming to the forefront?

    I would argue that less people want to become teachers, not due to the lack of compensation, which I will admit is one of the factors. But mainly due to the self-demonizing these unions have been propagating to try to garner support for their oversized benefits.

    I would argue further that salary and benefits are much less an attraction for most millenials than simply wanting to work a job that interest their entitled selves.

  24. Fast Eddie says:

    Fabius,

    Getting great and he isn’t even sworn in yet. I hope Oblammy uses his basketball skills to avoid that door from hitting him in the @ss.

    https://finance.yahoo.com/news/u-small-business-optimism-index-110000763.html

  25. Tywin says:

    “Barack Obama, the first African-American president of the Harvard Law Review, was born in Kenya and raised in Indonesia and Hawaii.”

    http://www.snopes.com/politics/obama/birthers/booklet.asp

  26. STEAMturd says:

    OK. So I just read the report Pumps was touting. There isn’t an overall teacher shortage at all. The shortage is only in the inner city/urban school districts. As one reads the report, you find out retention rates are increasing, much of the so-called shortage has been caused by post recession rehiring and a reduction in class sizes. There appears to be no link whatsoever to benefits and wages. Hmmmmmm. Pumps…please stop posting!

    https://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&cad=rja&uact=8&ved=0ahUKEwizkbuz6rfRAhUTYFAKHY0PDNEQFggsMAM&url=http%3A%2F%2Fwww.ecs.org%2Fec-content%2Fuploads%2FTeacher-Shortages-What-We-Know.pdf&usg=AFQjCNE4s80HW_OZIsrqUcDNMogeZI-jLQ&sig2=2KIfR7K6wRsFGVE1Ko3c-A

  27. Ben says:

    Best part, just imagine what happens when you take the pension away. They will have no one going to teaching. Absolutely no one. Grab the popcorn and enjoy the show.

    This is not true. I’m teaching and fully expect to get $0 from my pension. Most get into the profession because they had a passion for it. As it stands, you get tons of applications for most teaching jobs, despite the low pay. For anything requiring technical expertise or a background in science or math, not so much. But for the most part, outside of Physics, all positions get filled.

    The real repercussion is that the best candidates opt to just make more money elsewhere. We are downgrading the quality of our workforce. You get what you pay for.

  28. STEAMturd says:

    My position has always been to pay teachers more but reduce the benefits to what is common in the private sector. As Ben has stated many times in the past…it’s the unions that are holding salaries down.

  29. The Great Pumpkin says:

    First, Ben stated he pays 35% of his healthcare costs and prob doesn’t even use it. Do you know how bad he is getting raped for having those “great” benefits? He’s paying for it, and prob not voluntarily. Guess how many people the teachers are supporting with their high cost benefits? They are subsidizing how many people by paying a much higher cost?

    Second, there will be a teacher shortage if there is not one already. I really don’t know anyone becoming a teacher anymore. Almost no one, and if they are, they go for English.

    Think about it, if you were 18 right now, going to college, would you invest in two or three degrees to become a teacher? You would be okay with investing that money in your education to make 60,000 after 13-14 years? If you say yes, you are lying. Unless they really love teaching, you are not going to sign up for this based on it being a terrible investment. It’s capitalism, you go where the money is if you are smart.

    Have you seen those videos of teachers getting knocked out on youtube? All are inner city schools. No one wants to sign up for that. You end up teaching the wall, while putting your life on the line, and then get sh!t on by the general public for why the kids are failing. Yes, where do I sign up?

    After listening to the bashing the profession has received from people like you for the past 8 years, why would a kid sign up for this? You can go into so many other professions and easily make 100,000- 200,000. Why would you settle for teaching?

    I truly pray that the education system gets back to where it belongs. Now that the only jobs that are available are high skilled, it’s more important than ever to get a good education.

    “OK. So I just read the report Pumps was touting. There isn’t an overall teacher shortage at all. The shortage is only in the inner city/urban school districts. As one reads the report, you find out retention rates are increasing, much of the so-called shortage has been caused by post recession rehiring and a reduction in class sizes. There appears to be no link whatsoever to benefits and wages. Hmmmmmm. Pumps…please stop posting!”

  30. The Great Pumpkin says:

    First, this is not an attack on you, but you work in a top district where probably every teacher wants to end up.

    Second, how many of those applicants are actually qualified to sit in front of a classroom and teach? Every job gets massive amounts of applications these days, the trick is getting through all the bs people put on their applications. You know how many people in that application pool prob don’t have certification, yet applied for the job?

    “you get tons of applications for most teaching jobs, despite the low pay.”

  31. The Great Pumpkin says:

    Lib, what does the education commission have to do with unions? Why would they make this up? Please explain.

    “October 2015, the president of the Nevada State Board of Education described the state’s teacher shortage
    as “horrific” and warned that absent improvement “we’re going to all sink.” 1 In the same month, the Texas
    Education Commissioner labeled the state’s shortage as the “biggest threat” to schools”

  32. The Great Pumpkin says:

    Lib, from your same source. You see the method they employ to combat a teacher shortage? Instead of raising the pay, they lower standards to fill positions. Aka they are okay with fixing the teacher shortage by putting people that don’t belong in the classroom instead of raising pay to attract real teachers. People have no respect for education. Short term thinkers incapable of seeing long term results.

    “In order to fill vacant teaching positions, many states and districts choose to loosen hiring standards by, for instance, issuing emergency teaching certificates and allowing teachers to teach in classrooms for which they are not qualified to teach. While these responses limit vacancies, they might also contribute to staffing inadequacies, where students are receiving instruction from the least experienced and/or least qualified teachers.26 This is especially a problem in high-poverty, urban and low-performing schools where staffing inadequacies and turnover are most common.27 Unfortunately, “when the labor supply improves […] there isn’t the same countervailing pressure to tighten up hiring practices.”28 Over time, desperate recruitment efforts might lower teacher workforce quality. In addition, efforts focused solely on recruitment fail to address longstanding retention issues, and as a result, contribute to a “revolving door of in-and-out recruits.”29
    Accordingly, with a ready supply of entrants into most teaching positions, efforts to address shortages should be less about recruiting teachers generally, and more about recruiting and retaining the right teachers, in the right subjects, for the right schools”

  33. STEAMturd says:

    Nevada schools are horrific. I know a teacher in Reno and a teacher in Las Vegas who have told me so. These are not schools. These are government run day care centers for derelicts. The underlying problem is not teacher compensation. No amount of compensation or quality of environment will get a kid who doesn’t have an interest in learning to learn. Look at the Abbotts in NJ. Look at Bebo. You would be better off promising the parents of Laquishus a pension dependent on the kid showing up in class, rather than paying his teacher one.

    You are saying there is a teacher shortage due to lack of compensation. There is no proof in that report that this is the issue. And I am not demonizing teachers. I respect their craft greatly. We volunteer in our schools and always go out of our way to support them. Raise their salaries and make their benefits the same as everyone elses. What don’t you understand about this?

    As for Ben paying 35% of his Cadiallac plan. Well it’s about time. For the longest time, educators paid nothing, had no copays, had no networks, and had family coverage. Want to know what I pay? Bet a lot more than Ben does and for a lot less care.

    Teacher shortages. Half the country is unemployed. Yet there’s a teacher shortage. And I thought you understood economics.

  34. STEAMturd says:

    ““In order to fill vacant teaching positions, many states and districts choose to loosen hiring standards by, for instance, issuing emergency teaching certificates and allowing teachers to teach in classrooms for which they are not qualified to teach. ”

    All in the inner city where it doesn’t matter how much they pay. Get it through your empty skull that there is no shortage of teachers where kids want to learn. You are truly a dolt!

  35. STEAMturd says:

    I’m done with you on this issue. You are simply a fool.

  36. Fast Eddie says:

    STEAMturd,

    It’s an attempt at trolling. Why do you guys respond?

  37. Essex says:

    my humble opinion – NJ will probably have to institute a tax reform plan like CA’s Prop 13.

  38. Essex says:

    …also taxpayers will probably be on the hook for any pension bailout. stay tuned.

  39. Essex says:

    Ben – if you aren’t counting on your pension for retirement you’d better win the lottery son…

  40. Ben says:

    No need. Growing up poor taught me to live modestly. Besides…Im no longer underpaid and bring in a hefty amount of cash tutoring. The rest of the teachers in this state are screwed.

  41. homeboken says:

    I disagree that the taxpayer will end up on the hook for the underfunded pension liability. Perhaps for a part, but politically it will cost less votes to screw the teachers than it will to screw non-teachers. So I follow that simple math. Either outcome will be unpopular to some, but you can win an election without the teacher vote, you can’t with only the teacher vote.

  42. The Great Pumpkin says:

    Please answer honestly. Would you sign your kid up to be a teacher based on my passage below? Would you sign up?

    “Think about it, if you were 18 right now, going to college, would you invest in two or three degrees to become a teacher? You would be okay with investing that money in your education to make 60,000 after 13-14 years? If you say yes, you are lying. Unless they really love teaching, you are not going to sign up for this based on it being a terrible investment. It’s capitalism, you go where the money is if you are smart.”

    “You are saying there is a teacher shortage due to lack of compensation. There is no proof in that report that this is the issue. “

  43. Essex says:

    1:11 Good Luck with that. You know a lot of teachers are women who are married to bankers or pharma execs, or other types of high earners….so they are not exactly, “screwed” . Teaching has become a nice ‘second income’ but certainly not a recipe for a breadwinner. Unless bread is all you intend to eat.

  44. Essex says:

    1:33 not in some places. in others it is a great living. I think the whole industry will experience massive shortages based on growth in population and the sea-change will occur when the country wants to drive achievement again. That. and/or vouchers will completely upend the system.

  45. Essex says:

    1:26 possible, but highly unlikely. They’ll lawyer up and make it really difficult to default on the obligation. The citizens, won’t have a say.

  46. The Great Pumpkin says:

    So the teachers with the most challenging jobs, who put their life on the line everyday, and have to teach people that don’t want to learn, deserve the least amount of pay. I get it, makes a whole lot of sense. Too many people with your mindset infecting education.

    What you might not get, everyone has got damn right to an education. A lot of kids are successful that come out of these inner city schools, but you hardly ever hear about it because the media and people like you only focus on the bad kids. You expect unrealistic graduation rates and test scores, and then murder the school by saying see, you are a FAILING SCHOOL and deserve nothing when they don’t meet the impossible goals. Do you really expect a poor inner city school to be on par with rich suburban schools? It doesn’t mean they are not getting an education if they are not on par with their rich counterparts. You have to have different expectations for different classes of society.

    “All in the inner city where it doesn’t matter how much they pay. Get it through your empty skull that there is no shortage of teachers where kids want to learn. You are truly a dolt!”

  47. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    I posit that the hole is too big to fix. The gas tax raised 1.2 billion. The pension and medical liability is estimated to be around 100 billion and that’s with the stock market at record highs. Think about how much the gas tax hurts every time you fill your car this year. Now multiply that by 100. I’ve done the math for you all before. You all just choose to ignore it. The state takes in about 33 billion per year IN TOTAL!!! We are not talking a run of the mill 1% sales tax increase. We are talking about a purely draconian increase in your income taxes. NJ takes in about 14 billion a year in income taxes. We could pay double for the next 7 years to break even. If your married and your family nets 200K a year, you’ll be paying an extra 9K per year until 2024. If the market tanks? That number will go up even higher. It’s simply not payable. Not without creating a diaspora. And then the whole thing collapses. It will require a federal bailout or nothing. Too bad you don’t teach for Goldman Sachs.

  48. Essex says:

    1:50 Either way, it doesn’t bode well for anyone actually staying in the job (mid career) if there are options. In some cases, there might be. Mark Knopfler was a teacher.

  49. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    Essex…the taxpayer will pay some of it and the unions will concede some. But the hole is just too big for both. The truth of it is, we over benefit our public workers here in NJ.

  50. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    I have a lot of friends who are teachers and like Ben, they all fight to keep their pensions but are weary of it being paid in full. They also know that the hole wasn’t wholly due to state underfunding. Some actually understand math and know the going was too good.

  51. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    And this whole equating demonizing with cutting someone’s benefits is getting old really quick. They better be careful or they’ll end up getting the HRC treatment.

  52. The Great Pumpkin says:

    If every dime that was supposed to be paid by the state, and no money was taken out of the fund, you are telling me that we would be having this conversation right now? That’s the part you always miss in your math. Sure, the fund wouldn’t be paid in full based on demographic headwinds with a higher percentage of retirees to workers, but don’t sit here and claim it’s failing because it’s overgenerous. Go back and do the math again.

    Steamturd, Part Time Orientalist and Full Time Mysoginist says:
    January 10, 2017 at 2:00 pm
    I have a lot of friends who are teachers and like Ben, they all fight to keep their pensions but are weary of it being paid in full. They also know that the hole wasn’t wholly due to state underfunding. Some actually understand math and know the going was too good.

  53. The Great Pumpkin says:

    Of course, you want to cling to this idea that it’s overgenerous. What do you have to say about social security then? Should the state take that away from you on the basis it’s too generous? Same damn argument. Don’t say it’s not either. Social security and the pension are one in the same. So if the govt is broke, why don’t we start with social security instead of pensions, so everyone feels the pain equally, not a specific group of people carrying all the burden. Make no doubt about it, single earner households relying on a teacher salary are dead without the pension. Glad you have no problem killing that family.

  54. Ben says:

    The pension has become just another way to funnel money to Horizon. The insistence of full health care coverage ad infinitum is the primary problem. It’s a pipe dream only possible on the backs of existing contributions.

    Anyone that verbally fights tooth and nail for their pension is a lot more invested in it emotionally than I am. If we could ever fix the corrupt insurance industry in this country, it would go a long way to fixing pension problems. Everyone involved needs to take a haircut. Also, the idea that anyone was able to play the system and get more than 100k out of the pension system is criminal. They should be forced to take a haircut.

  55. Tywin says:

    https://www.cnet.com/news/asteroid-2017-ag13-passes-earth-moon-slooh

    An asteroid roughly the size of a 10-story building gave Earth a particularly close pass Monday morning.

    Asteroid 2017 AG13 came within half the distance from Earth to the moon as it buzzed by early Monday morning at 4:47 a.m. PT. The fly-by happened shortly after scientists at the Catalina Sky Survey first discovered the space rock on Saturday.

  56. The Great Pumpkin says:

    Amen, Ben. Amen. But the regular worker takes all the heat and will take it on the chin.

  57. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    I’ve done the math about ten times here already. I’m not going to let it fall on deaf ears again. Show me a system where you contribute 75K in and get paid 2 to 4 million out. Raise the salaries, cut the pensions. Enough with the charade already.

  58. Ben says:

    Show me a system where you contribute 75K in and get paid 2 to 4 million out.

    Ahem…the Clinton foundation.

  59. The Great Pumpkin says:

    If I recall, did your math account for state’s contribution on top of worker’s contribution? Did it account for the people that contributed, but never received a penny because they passed away? Also, does your math include no cola?

    Also, you understand how the math works on pensions? That’s why I brought up social security.

  60. The Great Pumpkin says:

    If they live for 20 years, with avg rate of inflation at 2%, that pension is worth ahi!.

  61. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    Yes…I understand how it works. No, I did not include the state contributions because the state is not contributing at the rate it needs to to make these things work. I’ll let you know when my company pays $10 for every $1 I contribute. You might be waiting a while though. Perhaps if my CEO ran for public office, would he then make such an ignorant promise.

  62. Steamturd, Part Time Orientalist and Full Time Mysoginist says:

    By the way…teachers in NJ pay into and receive SS if you were not aware.

  63. The Great Pumpkin says:

    I did not know that. I was under the assumption that cops and teachers don’t get SS.

    Steamturd, Part Time Orientalist and Full Time Mysoginist says:
    January 10, 2017 at 3:15 pm
    By the way…teachers in NJ pay into and receive SS if you were not aware.

  64. The Great Pumpkin says:

    Listen, the only people making off on a pension are the people that abuse the 3 year avg rule. They are politically connected, they are not regular workers. The 40 year worker is the sucker, who’s contributions go to pay this bs( remember the state barely paid anything in the past 25 years, so the nj taxpayer has nothing to bitch about). The 40 year worker does not have a lucrative pension. They paid into it their entire life, and don’t come close to getting a 2 million payout. Even if they were given a 50,000 pension (they are not given that), what do they get paid out in 20 years? The 2million and 4million payouts are not the norm, and represent the 1% of the population that always takes advantage of the rest. Wish you could understand this. If anyone should take the hit, it’s anyone that has a pension that is twice the amount of the 40 year worker’s annual salary. Those poor souls pay for this, not you, or any other tax payer. So imagine how these poor souls feel when they have to hear people like you attack their pension. It’s not cool. If it costs me more money in taxes, I’ll support the worker, but I want those cows in the 1% kicked out of the system.

    “Yes…I understand how it works. No, I did not include the state contributions because the state is not contributing at the rate it needs to to make these things work. I’ll let you know when my company pays $10 for every $1 I contribute. You might be waiting a while though. Perhaps if my CEO ran for public office, would he then make such an ignorant promise.”

  65. Raymond Reddington says:

    Pumps, you keep mentioning 40 year workers. Can’t they retire after 25, collect a pension and start a new gig?

  66. grim says:

    Pumpkin – Wrong
    Stu – Right

    Move along

  67. The Great Pumpkin says:

    Amazing read on my fav subjects inequality and globalization. Never thought about it in this way, love when someone opens up my mind. He has a point, first 60 years of the industrial revolution actually made it worse for people, but the gains eventually came through for everyone.

    “Nonetheless, Milanović is an heir to the great social scientists of yore — Smith, Marx, Keynes and Hayek — and part of a merry band of economists, Piketty included, who are rescuing their profession from popular irrelevance. His contribution? A single chart that describes 30 years of world economic history. Some have called it “the most important chart in economics.” But it has an even catchier nickname: “The Elephant Curve.””

    “Milanović doesn’t talk too much about potential solutions in his book, which he now thinks was a “mistake,” because the current wave of inequality will at some point come to an end. The winds of globalization and technology could shift, he says, perhaps targeting more highly skilled sectors (think outsourcing coding jobs to Africa, or the rise of robot surgeons). And policies can help too, but not the tired “20th century” policies of taxing the rich and spending on benefits. Instead, Milanović is typically creative and intellectually ambidextrous: Improving the quality of public education, he says, citing Sanders, and creating incentives for the middle classes to financially invest, a la Margaret Thatcher. Now those are two names that only he could cite in the same sentence and still sound smart.”

    http://ow.ly/SOFf307juZ3?fb=ozy&type=cpc

  68. God says:

    “Love when someone opens up my mind.”

    We all want that too. I expects lots of sawdust and gerbil turds.

  69. Essex says:

    Lastly, overall compensation for New Jersey’s public-sector workers is comparable to the state’s private-sector workers. Total annual compensation is 4.1 percent lower for public employees than for comparable private employees (with similar levels of education and other characteristics), according to a 2010 study by Professor Jeffrey Keefe of Rutgers University’s School of Management and Labor Relations.[2] The study confirmed that benefits are indeed higher for public employees than for comparable private employees, but found that public wages and salaries are lower by a more than offsetting amount, with the result that overall public-sector compensation slightly trails that in the private sector. There’s a reason people never say, “I’m leaving the private sector to go and make more money.”

  70. Clotpoll says:

    cmon man. i was never a bojangles fan, but at least the guy had dignity, a nice family…and didn’t seem prone to blowing up the planet after getting pilloried on a comedy show. drumpf is mentally unbalanced and will prob have to be removed from office by his own party. he is no more than a charlatan, pandering to the worst in everyone, especially the dumbest and least fortunate among us.

    drumpf is a measurement of how sick and craven we have become as a nation. nothing more.

  71. Essex says:

    7:57 true

  72. The Great Pumpkin says:

    7:57

    This might be the post of the year so far. I wish had your writing skills. You have some way with words.

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