Originally published at Forbes.com on May 28, 2020.
Yesterday, as it happens, was slated to be the long-awaited launch of the SpaceX Dragon spacecraft, the first reusable rocket, the first private-sector spacecraft, and the first manned launch from the U.S. in nearly a decade. While it was postponed to Saturday due to weather, the prospect of this new era in spaceflight inspired me to dig out and show my children the newspapers I had personally saved (and recently rediscovered in the process of cleaning out my parents’ longtime home): the Detroit News, the Detroit Free Press, and the New York Times for April 15, 1981, the day after the space shuttle Columbia landed after its inaugural flight.
According to the Detroit News,
“Astronaut [John W.] Young caught the mood of much of the country yesterday. ‘We’re really not too far — the human race isn’t — from going to the stars,’ the world’s premiere test pilot said.”
According to the Free Press,
“The flawless return of the space shuttle Columbia to earth Tuesday opened a new age for Americans in space — an age that will allow space flight to become routine.”
According to the New York Times,
“Ultimately officials envision the shuttle being able to turn around in a matter of weeks. Each shuttle would have a life of 100 missions.”
In reality, the Columbia was returning from its 28th mission when it disintegrated in 2003 and the entire program, with a fleet of 5 space shuttles, had a total of 135 missions.
Of course this is a cautionary tale about believing grandiose claims, and a recognition that “there is nothing new under the sun.”
But — hear me out on this — the same is also true with respect to retirement issues.
Featured on the front page of the Free Press, just below the photograph of the Columbia touching down, in an article with the headline, “Young gives council budget and warning,” by Ken Fireman.
“With a warning that Detroit has one final chance to avoid fiscal disaster, Mayor Young Tuesday presented to the City Council a 1981 – 82 budget containing over $270 million in uncertain revenues.”
The budget contained 5% pay cuts for city employees, a hike in resident and commuter income taxes, and the sale of $100 million in bonds. Specifically,
“Another proposal certain to provoke controversy is Young’s call for the city’s two pension funds to buy ‘their full share’ of city-issued long-term bonds needed to liquidate the current deficit.
“The city currently owes a total of $18 million to the two funds from last year, and lingering bitterness over the longstanding debt may lead pension trustees to balk at buying any city bonds.”
On the op-ed page, syndicated columnist James J. Kilpatrick wrote, “There’s new hope for Social Security.”
“A House subcommittee last week made the first intelligent move in many years toward rescuing our Social Security system from the mess it is in. The subcommittee voted to increase gradually the age at which full retirement benefits are paid from 65 to 68.”
(Half a year later, the Washington Post reported that this legislation was killed in the Democratic-dominated House Ways and Means Committee.)
In the Detroit News, the secondary front page article was, “Plan threatens aid for elderly,” by Gary F. Schuster, which reported, with no details, that “President Reagan has decided to slash Social Security as the primary means of balancing the federal budget by 1985, White House aides said yesterday.”
And, finally, in an April 4 edition of the Detroit News (for which I can discern no reason it had been saved), “Pension dispute continues” (author name no longer legible) reports on court proceedings in which the police and fire pension fund were fighting to for the city to make pension contributions. While the first paragraph is no longer legible, the article reports,
“Olzark opened hearings two days after 6,000 police and fire retirees missed their April 1 paychecks. Faced with only $500,000 in cash to meet the $6.5 million monthly payout, the board’s trustees refused last week to liquidate short-term assets to cover the payment. . . .
“City officials had publicly acknowledged the $14.6 million debt since the suit was filed Feb. 25.
“But Sachs said he learned through ‘a flurry of paperwork this week’ that the city now claims it owes only $59 million, instead of the $102.5 million approved last year by the pension’s actuary and trustees and appropriated by Young and the Detroit City Council.”
(The article does not indicate the pension plan’s actual assets, liabilities, or funded status at the time.)
It’s no surprise that politicians and number-crunchers were worried about Social Security in 1981, and state and local governments have been kicking the can with respect to their pension funds for far longer than these 39 years. But it’s startling that even on a wholly arbitrary day, there’s so much material to illustrate this. And it’s still important to bear in mind how very longstanding these issues are when debating them now.
December 2024 Author’s note: the terms of my affiliation with Forbes enable me to republish materials on other sites, so I am updating my personal website by duplicating a selected portion of my Forbes writing here.
