The holidays bring multiple generations together, although that won’t mean they’ll see eye to eye on every issue. In fact, if the discussion turns to pension benefits, it might be tempting for younger family members to respond by saying, “OK Boomer.”
That now-viral phrase expresses the general frustration that Millennials and Gen Z have with older generations doling out dismissive lectures and being unable to see the perspective of younger generations.
Teacher pensions (or public pensions generally) may be one of those triggers – largely because it pits generations against each other: Older generations racked up billions in debt and the younger generations are now supposed to pay for it.
There’s no guarantee pensions will come up at your next family gathering, but if it does, here’s one way that conversation might go:
Gen Z high school student: Supposedly our state is spending more money on schools, but it sure feels like my school is getting less.
Millennial teacher: I agree. We teachers haven’t seen our salaries grow very much.
Retired Boomer: Education spending is up, but a portion of that money is being used to pay for the promises we made to retirees. The pension debt for teachers and other educators is more than $500 billion, and that has to be paid by someone.
Millennial teacher: Wait, “we” didn’t make those promises. Why should I pay for those? Even if I stay in teaching, my pension won’t be that generous. Since they changed the rules, I won’t get to retire in my late 40s or early 50s like some of my older colleagues did. And my take-home pay is smaller because I’m paying higher retirement costs than those colleagues did when they were teaching.
Boomer: A promise is a promise.
Millennial: But aren’t the Boomers the ones who made those promises? We weren’t even there. You made promises that obligated US to pay for YOUR retirement?
Boomer: Pensions help attract and retain high-quality teachers.
Millennial teacher: Not for my generation! My teacher friends are tired of being asked to take on more responsibilities without any increases in pay.
Boomer: Young teachers just need to stick it out. You’ll see. Pensions reward those who are truly committed.
Millennial: That sounds like a system that worked well for your generation, but not for mine. The current trajectory is simply not sustainable.
Boomer: We can't go back in time and change what was done. Retirees are depending on their pension income.
Millennial: Then they should have figured out how to pay for those obligations without passing the buck.
Boomer: Let me explain how our government works. People elect their representatives to make decisions for how our public funds are obligated.
Gen Z high school student: Ha! Next year I’ll be able to vote. We’ll see how government works then!
Millennial: (Frustrated). Our generation will be the first that isn’t as well off as our parents. Why should we be the ones to pay for your generation’s debts?
Boomer: Look, this just has to be paid. There’s no way around it. You don’t really have a choice. Leaders will just need to be more fiscally responsible going forward.
Gen Z and Millennial: Ok Boomer.
This is intended as a fictional dialogue, and no actual Boomers, Millennials or Gen Zers were harmed in the process.
That said, it is increasingly representative of the current public debate over pension funding. At least for now, most states are tackling their pension problems by decreasing benefits for new generations of workers or by diverting funding meant for today’s students. While we aren’t proposing any specific solutions here, the current trajectory may not be tolerable for new generations asked to pay for the promises of the past.
Marguerite Roza is the Director of the Edunomics Lab at Georgetown University and belongs to none of the generations listed here. Chad Aldeman is a Senior Associate Partner of Bellwether Education Partners and is technically a Millennial.