Retirement Security Law Commons^™

Do Esg Funds Deliver On Their Promises?, Quinn Curtis, Jill E. Fisch, Adriana Z. Robertson

All Faculty Scholarship

Corporations have received growing criticism for their role in climate change, perpetuating racial and gender inequality, and other pressing social issues. In response to these concerns, shareholders are increasingly focusing on environmental, social, and corporate governance (ESG) criteria in selecting investments, and asset managers are responding by offering a growing number of ESG mutual funds. The flow of assets into ESG is one of the most dramatic trends in asset management.

But are these funds giving investors what they promise? This question has attracted the attention of regulators, with the Department of Labor and the Securities and Exchange Commission (SEC) …

Behavioral Finance, Decumulation, And The Regulatory Strategy For Robo-Advice, Tom Baker, Benedict Dellaert

All Faculty Scholarship

This working paper surveys the decumulation services offered by investment robo-advisors as a case study with which to examine regulatory and market structure issues raised by automated financial advice. We provide a short introduction to decumulation, describing some of the uncertainties involved in identifying optimal decumulation strategies and sketching a few of the ‘rules of thumb’ that financial advisors have developed in this area in the face of this uncertainty. Next we describe behavioral effects that could inhibit consumers from following an optimal decumulation strategy, concluding that, left to their own devices, consumers are likely to make sub-optimal decumulation decisions. …

The Knowledge Gap In Workplace Retirement Investing And The Role Of Professional Advisors, Jill E. Fisch, Tess Wilkinson-Ryan, Kristin Firth

All Faculty Scholarship

The dramatic shift from traditional pension plans to participant-directed 401(k) plans has increased the decision-making responsibility of individual investors for their own retirement planning. With this shift comes increasing evidence that investors are making poor decisions in choosing how much to save for retirement and in selecting among their investment options. Studies question the value of efforts to improve these decisions through regulatory reforms or investor education.

This article posits that deficiencies in workplace retirement savings cannot be adequately addressed until the reasons for poor investment decisions are better understood. We report the results of a study designed to simulate …

From Chrysler And General Motors To Detroit, David A. Skeel Jr.

All Faculty Scholarship

In the past five years, three of the most remarkable bankruptcy cases in American history have come out of Detroit: the bankruptcies of Chrysler and General Motors in 2009, and of Detroit itself in 2012. The principal objective of this Article is simply to show that the Grand Bargain at the heart of the Detroit bankruptcy is the direct offspring of the bankruptcy sale transactions that were used to restructure Chrysler and GM. The proponents of Detroit’s “Grand Bargain” never would have dreamed up the transaction were it not for the federal government-engineered carmaker bankruptcies. The Article’s second objective, based …

What Is A Lien? Lessons From Municipal Bankruptcy, David A. Skeel Jr.

All Faculty Scholarship

From the outset of Detroit’s bankruptcy, an unlikely set of issues kept coming up: What exactly is a lien? Who has a property interest or its equivalent in bankruptcy? Did general obligation bondholders have special status, due to Detroit’s promise to use its “full faith and credit” for repayment? What about Detroit’s pension beneficiaries, who could point to a provision in the Michigan Constitution stating that accrued pension benefits cannot be diminished or impaired. In this Article, I explore these and related issues that have arisen in Detroit and other recent municipal bankruptcy cases.

Part I of the Article briefly …

Privatizing Railroad Retirement, Steven A. Sass

Upjohn Press

Sass discusses the evolution of the U.S. Railroad Retirement System and whether its ability to invest its assets in private equities offers any lessons for Social Security.

Social Security And Pension Reform: International Perspectives, Marek Szczepański Editor, John A. Turner Editor

Upjohn Press

Countries around the world are reforming their social security and pension systems. International studies often focus on social security reforms in Europe and North America, and may include Latin America. Reforms, however, are also occurring in Asia and Africa, and include reforms of voluntary and employer-provided pensions as well as social security programs. This book discusses both social security and employer-provided pension reforms, as well as reforms in most regions of the world.

Health Care Spending And Financial Security After The Affordable Care Act, Allison K. Hoffman

All Faculty Scholarship

Health insurance has fallen notoriously short of protecting Americans from financial insecurity caused by health care spending. The Patient Protection and Affordable Care Act (“ACA”) attempted to ameliorate this shortcoming by regulating health insurance. The ACA offers a new policy vision of how health insurance will (and perhaps should) serve to promote financial security in the face of health care spending. Yet, the ACA’s policy vision applies differently among insured, based on the type of insurance they have, resulting in inconsistent types and levels of financial protection among Americans.

To examine this picture of inconsistent financial protection, this Article offers …

Can Pensions Be Restructured In (Detroit’S) Municipal Bankruptcy?, David A. Skeel Jr.

All Faculty Scholarship

This paper, which was written as a White Paper for the Federalist Society, describes and assesses the question whether public employee pensions can be restructured in bankruptcy, with a particular focus on Detroit. Part I gives a brief overview both of the treatment of pensions under state law, and of the Michigan law governing the Detroit pensions. Part II explains the legal argument for restructuring an underfunded pension in bankruptcy. Part III considers the major federal constitutional objections to restructuring, Part IV discusses arguments based on the Michigan Constitution, and Part V assesses several Chapter 9 arguments against restructuring. None …

Managing Social Security Disability & Other Public Benefits: Development Of A Guide For Consumers And Providers, Stephanie L. Derochers

Muskie School Capstones and Dissertations

One in five Americans has a disability, making it the largest minority group in the U.S. (Soffer, McDonald, & Blanck, 2010). In 2011, 13.4 million working-aged adults received a disability cash benefit from the Social Security Administration (Kregel, 2012).

The Social Security Administration (SSA) is the federal agency responsible for managing, executing and overseeing retirement, survivor, old-age and disability benefits. There are over 1,500 Social Security offices and over 65,000 employees nationwide (SSA, 2013). SSA manages at least five disability benefit programs: Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), Disabled Widow(er) Benefit (DWB), Childhood Disability Benefit (CDB), though …

Ensuring Health And Income Security For An Aging Workforce, Peter Budetti, Richard V. Burkhauser, Janice M. Gregory, H. Allan Hunt

H. Allan Hunt

The chapters explore implications of an aging workforce for a number of social programs in the coming decades, and point to the critical policy issues we must face when growing numbers of older workers begin to strain the capacity of those programs.

Longevity Policy: Facing Up To Longevity Issues Affecting Social Security, Pensions, And Older Workers, John A. Turner

Upjohn Press

Turner argues that public policy should recognize longevity policy as a distinct policy area. Rather than separately treating issues raised by life expectancy (e.g., Social Security, pensions, older workers), a unified approach should be developed that recognizes their interrelationship.

The Transformation Of The American Pension System: Was It Beneficial For Workers?, Edward N. Wolff

Upjohn Press

The share of Americans with defined contribution pension plans now exceeds the share of those with defined benefit plans. Wolff refers to this as the "great transformation" and it leads him to examine recent evidence to see whether there are winners and losers resulting from this switch away from traditional pension plans.

Imagining The Ideal Pension System: International Perspectives, Dana M. Muir Editor, John A. Turner Editor

Upjohn Press

Muir and Turner gather an international roster of pension experts who present what they think would be the ideal pension systems for their countries and why. Those countries include the United States, the UK, Ireland, Denmark, Germany, Belgium, France, Switzerland, Poland, and Japan.

Against Financial Literacy Education, Lauren E. Willis

All Faculty Scholarship

The dominant model of regulation in the United States for consumer credit, insurance, and investment products is disclosure and unfettered choice. As these products have become increasingly complex, consumers’ inability to understand them has become increasingly apparent, and the consequences of this inability more dire. In response, policymakers have embraced financial literacy education as a necessary corollary to the disclosure model of regulation. This education is widely believed to turn consumers into “responsible” and “empowered” market players, motivated and competent to make financial decisions that increase their own welfare. The vision is of educated consumers handling their own credit, insurance, …

On Beyond Calpers: Survey Evidence On The Developing Role Of Public Pension Funds In Corporate Governance, Stephen Choi, Jill E. Fisch

All Faculty Scholarship

No abstract provided.

Social Security And The Stock Market: How The Pursuit Of Market Magic Shapes The System, Alicia Haydock Munnell, Steven A. Sass

Upjohn Press

Munnell and Sass explore whether equities could help solve the woes facing the U.S. retirement income system in general, and the Social Security shortfall in particular. They examine the experiences of three nations that added equities to the investment mix of their retirement systems—the U.K., Australia, and Canada. As these experiences show, while equities promise higher returns than government bonds, how they are implemented—as add-ons, carve-outs, or as trust fund supplements—matters greatly.

A Complete Property Right Amendment, John H. Ryskamp

ExpressO

The trend of the eminent domain reform and "Kelo plus" initiatives is toward a comprehensive Constitutional property right incorporating the elements of level of review, nature of government action, and extent of compensation. This article contains a draft amendment which reflects these concerns.

Bond Repudiation, Tax Codes, The Appropriations Process And Restitution Post-Eminent Domain Reform, John H. Ryskamp

ExpressO

This brief comment suggests where the anti-eminent domain movement might be heading next.

Breaking The Bank: Revisiting Central Bank Of Denver After Enron And Sarbanes-Oxley, Celia Taylor

ExpressO

No abstract provided.

Social Security, Generational Justice, And Long-Term Deficits, Neil H. Buchanan

Rutgers Law School (Newark) Faculty Papers

This paper assesses current methods for evaluating the long-term viability and desirability of government activities, especially Social Security and other big-ticket budget items. I reach four conclusions: (1) There are several simple ways to improve the current debate about fiscal policy by adjusting our crude deficit measures, improvements which ought not to be controversial, (2) Separately measuring Social Security’s long-term balance is inappropriate and misleading, (3) The methods available to measure very long-term government financing (Fiscal Gaps and their cousins, Generational Accounts) are of very limited value in setting public policy today, principally because there is no reliable baseline of …

What Is Fiscal Responsibility? Long-Term Deficits, Generational Accounting, And Capital Budgeting, Neil H. Buchanan

Rutgers Law School (Newark) Faculty Papers

This article assesses three basic approaches to assessing the future effects of the government’s fiscal policies: traditional measures of the deficit, measures associated with Generational Accounting, and measures derived from applying Capital Budgeting to the federal accounts. I conclude that Capital Budgeting is the best of the three approaches and that Generational Accounting is the least helpful. Acknowledging that there might be some value in learning what we can from a variety of approaches to analyzing fiscal policy, I nevertheless conclude that Generational Accounting is actually a misleading or--at best--empty measure of future fiscal developments. The best approach to providing …

Ensuring Health And Income Security For An Aging Workforce, Peter Budetti Editor, Richard V. Burkhauser Editor, Janice M. Gregory Editor, H. Allan Hunt Editor

Upjohn Press

The chapters explore implications of an aging workforce for a number of social programs in the coming decades, and point to the critical policy issues we must face when growing numbers of older workers begin to strain the capacity of those programs.

Pensions And Productivity, Stuart Dorsey, Christopher Mark Cornwell, David A. Macpherson

Upjohn Press

Employers typically view their investment in pension plans as a means of providing retirement income for their workers. Economists, on the other hand, view pension programs as a way to increase workplace productivity. Dorsey, Cornwell and Macpherson explore the theoretical and empirical basis for this perspective and, in the process, offer a complete and up-to-date discussion on the productivity theory of pensions.

Pension Incentives And Job Mobility, Alan L. Gustman, Thomas L. Steinmeier

Upjohn Press

Using models developed for this study which incorporate an array of behaviors generally omitted from conventional models relating backloading to turnover, Gustman and Steinmeier find that backloading plays only a slight role in explaining mobility differences associated with pension coverage. They propose that higher wages often paid at pension-covered jobs play a greater role in reducing mobility than do pensions.

Private Pension Policies In Industrialized Countries: A Comparative Analysis, John A. Turner, Noriyasu Watanabe

Upjohn Press

In this comprehensive review of private pension systems in effect world-wide, Turner and Watanabe discuss the fundamental issues facing nations as they adopt and expand private pension systems. Specific policies in effect in several private pension systems are analyzed including those in nations dominating world pension assets (Japan, Germany, the U.K., and the U.S.), as is the country whose system is widely regarded as the model for developing nations, Chile. Turner and Watanabe also provide a compendium on the worldwide trends influencing pension systems and their implications for pension policy.

Pension Policy For A Mobile Labor Force, John A. Turner, Tabitha A. Doescher, Phyllis A. Fernandez

Upjohn Press

Employers often create a conflict between job mobility and retirement security when they deny future pension benefits to workers who quit a job before reaching retirement age. Unfortunately, this deterrent to job-changing inhibits the labor market's ability to adjust. It also means workers may be unprepared financially upon retirement. Turner describes why pension losses are such a significant problem and presents empirical evidence as to the number of workers affected and the amount of losses they incur. He also probes pension portability policy options and looks at portability options in effect in Canada, Japan, the Netherlands, and the United Kingdom.

The Wage Carrot And The Pension Stick: Retirement Benefits And Labor Force Participation, Laurence J. Kotlikoff, David A. Wise

Upjohn Press

Kotlikoff and Wise document the continued backloading of pension benefits and the extent of retirement incentives by examining pension accrual in over 1,500 companies with defined benefit plans. They also perform a detailed analysis on the retirement plan of a "Fortune 500" company.

The Economics Of Aging, Myron H. Ross, Editor

Upjohn Press

Retirement-related issues are discussed including social security, healthcare, and inflation.

Policy Issues In Work And Retirement, Herbert S. Parnes Editor

Upjohn Press

This is a collection of papers that focuses on the human resource implications of individual and population aging.