Public pensions are beneficial to taxpayers in a variety of ways that are both under-reported and poorly understood by many observers. In the quest for simple answers to complex questions about public pensions, facile observers routinely overlook salient facts. For example, taxpayers get public services from dedicated nurses, firefighters, teachers, and police officers and pay only 20 cents on the dollar for their retirement benefits. The rest of the money comes from investment earnings and employee contributions. Taxpayers benefit from $3.7 trillion of pension fund assets invested in our economy, providing capital for established businesses and start-ups. Additionally, taxpayers benefit because retirees typically spend their pension checks locally, creating new jobs. Above all, tax revenues created through retiree spending and pension investments may exceed what taxpayers pay into public pensions.
