When Teachers Choose Pension Plans: The Florida Story

Although long ignored by education-policy analysts, the structure of teacher retirement benefits has come under increasing scrutiny in recent years. The vast majority of teachers, like other state and local public employees, are covered by traditional defined-benefit (DB) pension plans. Now rare in the private sector of the United States economy, these plans provide a retired teacher with a guaranteed lifetime benefit, the annual value of which is typically based on his number of years of service and average salary during the final years of his career. A teacher is often required to contribute from her salary to funds set aside to pay for this plan, but the size of her benefit is not tied to the amount of any contributions.Critics of existing teacher pension systems raise two broad sets of concerns. First, they note that the time lag between when the government funds and pays out retirement benefits encourages politicians to contribute too little to their pension systems, effectively borrowing from future taxpayers to fund current spending on government services.The shortfalls facing state and local pension systems covering teachers and other public workers due to persistent underfunding are staggering. Novy-Marx and Rauh13 estimate that achieving full funding of promised pension liabilities nationally over thirty years would require a tax increase of $1,385 per household each year. A more likely outcome is substantial cuts to public services such as education.Second, critics note that the reliance on traditional DB pension plans makes total teacher compensation severely back-loaded, potentially hindering efforts to improve teacher quality. Most of these plans have vesting periods of five or more years and are structured so that employees do not amass substantial benefits until late in their careers -- at which point benefits increase rapidly. These features may make teaching less attractive to individuals who are uncertain of whether they will remain in the profession long enough to benefit or would prefer to receive a higher salary to support present consumption. Recent evidence confirms that DB pension plans lead some veteran teachers to continue teaching solely for the sake of increasing pension wealth, while encouraging others to retire prematurely so as not to sacrifice years of benefit payments.The back-loading of benefits also imposes heavy costs on career-switchers and geographically mobile teachers, who typically stand to receive benefits worth far less than the pension contributions made on their behalf. The most prominent alternative to a traditional DB pension plan is the defined contribution (DC) model. Under DC plans, an employee builds up an individual retirement account through her or her employer's regular contributions throughout her career and exercises some control over how the account is invested. Because the value of that account is tied directly to these contributions (and the performance of investments), DC plans, by definition, cannot be underfunded. Rapidvesting, portability, and the smooth accrual of benefits over time eliminate the problematic end-of-career incentives created by existing DB plans and could make teaching more attractive to young workers, possible career-switchers, or those likely to be geographically mobile.Finally, because benefits take the form of a personal account that can be converted into a lifetime annuity, the employee gains control over the timing and structure of her retirement benefit. An important potential drawback of the DC model is that employees, rather than taxpayers, bear the consequences if disappointing investment returns or poor withdrawal decisions yield inadequate retirement savings. Unions representing teachers and other public employees have vigorously opposed proposals to convert public pension plans to the DC model, largely on these grounds. Proponents of DB pensions cite survey data suggesting that public employees strongly prefer the DB model and contend that "when given the choice between a primary DB or DC plan, public employees overwhelmingly choose the DB pension plan."Yet there is reason to believe that many current and potential teachers could find well-designed DC plans as or more attractive than traditional DB plans. As noted above, DB plans typically provide minimal benefits to those who do not remain in the profession (and in the same state retirement system) for many years. They may therefore be unappealing to a younger generation of workers prone to exploring multiple career paths before settling on one. Other teachers may simply prefer to exercise greater control over their retirement savings, either due to confidence in their investment abilities or to doubts as to whether public pension funds will be able to deliver on their promises. Consistent with this logic, a survey of Washington State teachers found that a plurality of teachers would prefer to invest additional retirement savings in a DC plan rather than in a DB plan. The extent to which preferences expressed on surveys correspond to the actual behavior of teachers when given the option remains unclear.In this paper, we examine teacher preferences as revealed by their decisions when empowered to choose between alternative pension-plan structures. Since 2002, public school teachers (and most other state and local employees) in Florida have been permitted to choose between a traditional DB retirement plan and a new DC plan. During the time period of our study, school districts were required to contribute 9 percent of the salary of teachers taking the DC option to personalinvestment accounts in their names. Neither DB nor DC choosers were required to contribute from their own salaries to the retirement system, meaning that teachers' plan choice did not alter their take-home pay. The benefits of teachers choosing the DC plan vested after just one year, as compared with six under the DB plan

Microbial Effects on Repository Performance

This report presents a critical review of the international literature on microbial effects in and around a deep geological repository for higher activity wastes. It is aimed at those who are familiar with the nuclear industry and radioactive waste disposal, but who are not experts in microbiology; they may have a limited knowledge of how microbiology may be integrated into and impact upon radioactive waste disposal safety cases and associated performance assessments (PA)

Detection limits for close eclipsing and transiting sub-stellar and planetary companions to white dwarfs in the WASP survey

We used photometric data from the WASP (Wide-Angle Search for Planets) survey to explore the possibility of detecting eclipses and transit signals of brown dwarfs, gas giants and terrestrial companions in close orbit around white dwarfs. We performed extensive Monte Carlo simulations and we found that for Gaussian random noise WASP is sensitive to companions as small as the Moon orbiting a $V\sim$12 white dwarf. For fainter stars WASP is sensitive to increasingly larger bodies. Our sensitivity drops in the presence of co-variant noise structure in the data, nevertheless Earth-size bodies remain readily detectable in relatively low S/N data. We searched for eclipses and transit signals in a sample of 194 white dwarfs in the WASP archive however, no evidence for companions was found. We used our results to place tentative upper limits to the frequency of such systems. While we can only place weak limits on the likely frequency of Earth-sized or smaller companions; brown dwarfs and gas giants (radius$\simeq$ R$_{jup}$) with periods $\leq$0.2 days must certainly be rare ($<10\%$). More stringent constraints requires significantly larger white dwarf samples, higher observing cadence and continuous coverage. The short duration of eclipses and transits of white dwarfs compared to the cadence of WASP observations appears to be one of the main factors limiting the detection rate in a survey optimised for planetary transits of main sequence stars.Comment: 8 pages, 3 figure

Variational Multisymplectic Formulations of Nonsmooth Continuum Mechanics

This paper develops the foundations of the multisymplectic formulation of nonsmooth continuum mechanics. It may be regarded as a PDE generalization of previous techniques that developed a variational approach to collision problems. These methods have already proved of value in computational mechanics, particularly in the development of asynchronous integrators and efficient collision methods. The present formulation also includes solid-fluid interactions and material interfaces and, in addition, lays the groundwork for a treatment of shocks

Do More Effective Teachers Earn More Outside of the Classroom?

We examine earnings records for 90,000 classroom teachers employed by Florida public schools between the 2001–02 and 2006–07 school years, roughly 20,000 of whom left teaching during that time. Among grade 4–8 teachers leaving for other industries, a 1 standard deviation increase in estimated value-added to student achievement is associated with 6–9 percent higher earnings outside of teaching. The relationship between effectiveness and earnings is stronger in other industries than it is for the same teachers while in the classroom, suggesting that existing compensation systems do not account for the higher opportunity wages of effective teachers.

Nonsmooth Lagrangian mechanics and variational collision integrators

Variational techniques are used to analyze the problem of rigid-body dynamics with impacts. The theory of smooth Lagrangian mechanics is extended to a nonsmooth context appropriate for collisions, and it is shown in what sense the system is symplectic and satisfies a Noether-style momentum conservation theorem. Discretizations of this nonsmooth mechanics are developed by using the methodology of variational discrete mechanics. This leads to variational integrators which are symplectic-momentum preserving and are consistent with the jump conditions given in the continuous theory. Specific examples of these methods are tested numerically, and the long-time stable energy behavior typical of variational methods is demonstrated

A Modified Stern-Gerlach Experiment Using a Quantum Two-State Magnetic Field

The Stern-Gerlach experiment has played an important role in our understanding of quantum behavior. We propose and analyze a modified version of this experiment where the magnetic field of the detector is in a quantum superposition, which may be experimentally realized using a superconducting flux qubit. We show that if incident spin-$1/2$ particles couple with the two-state magnetic field, a discrete target distribution results that resembles the distribution in the classical Stern-Gerlach experiment. As an application of the general result, we compute the distribution for a square waveform of the incident fermion. This experimental setup allows us to establish: (1) the quantization of the intrinsic angular momentum of a spin-$1/2$ particle, and (2) a correlation between EPR pairs leading to nonlocality, without necessarily collapsing the particle's spin wavefunction.Comment: 12 pages, 2 figure

E_11 and M Theory

We argue that eleven dimensional supergravity can be described by a non-linear realisation based on the group E_{11}. This requires a formulation of eleven dimensional supergravity in which the gravitational degrees of freedom are described by two fields which are related by duality. We show the existence of such a description of gravity.Comment: 21 pages, some typos corrected and two references adde