Media Watch: A Tale of Two Pension Stories

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How does editorial bias affect newspaper coverage? A pair of newspaper stories out today gives us a textbook example, highlighting the Oregonian’s use of the front page to push an editorial agenda against public employee pensions. 

Here are the basic facts: The Pew Center on the States released a report examining the public pension plans of all 50 states. Oregon PERS (Public Employee Retirement System) ranked near the top of the list at Number 8, meaning that we have one of the best-funded public pension plans in the country.

Here’s how the Statesman Journal covered the story, with a headline reading “Report praises pension funding”:

The Oregon Public Employees Retirement System continues to rank among the best-funded public pension plans in the United States, according to a new report by the Pew Center on the States.

Oregon ranks eighth in the nation in terms of the funded status of its pension plan, said the Pew Center in a report released Monday called “The Widening Gap Update.”

The report found that Oregon PERS in 2010 owed active and former public employees about $59.3 billion in pension payments, with 87 percent of that amount funded. In other words, for every dollar of pension payments the state must pay out, it has on hand 87 cents.

It’s an improvement over last year’s Pew report on public pensions, in which Oregon ranked 11th in the country. Pension experts say a funded status greater than 80 percent is a sign of a healthy pension plan. In 2010, 34 states were below the 80 percent threshold, up from 31 in 2009 and 22 in 2008.

“This is something that Oregon policymakers certainly need to keep an eye on, but they are not facing the same challenges or showing the same level of irresponsibility as places, like Illinois,” Pew researcher David Draine said.

In short, Oregon’s public pension system is doing pretty well. Elected leaders should keep an eye out for improvements, the researchers say, but no major reforms are needed.

But, for most of recent memory, the Oregonian has been on a crusade against Oregon’s public pension system. So how did they approach the Pew report? By burying it in the 23rd paragraph of a front page article titled “Pensions replace people in budgets.”

The editors later updated the online version with an even more incendiary headline: “PERS: Unfunded liability of pension funds tightens its grip around Oregon.”

Online, the story also features a photo of students protesting school budget cuts, captioning it with “Forest Grove High School students carry signs down Main Street protesting school cuts. As PERS unfunded liability grows, the future looks worse.”

In contrast to the Statesman Journal and the data in the Pew research, the Oregonian breathlessly paints the pension system as the cause of school budget cuts that are leading to increasing class sizes and school closures, using the Forest Grove School District as an example.

From the Oregonian:

At Forest Grove School District, as at many districts across the state, the cuts keep coming.

On the chopping block this summer: 12 more teachers, six more calendar days, special education staff, music and PE classes, counselors, staff for the English Language Learners program and funding for athletics.

Oregon's stagnant state school funding is partially to blame. But the single biggest driver of budget cuts in Forest Grove, the one relentlessly forcing schools around the state to reallocate money out of the classroom, is the Oregon Public Employees Retirement Fund.

Last year, the district's required contribution to PERS jumped by 160 percent. Next year, the bill will go up again.

But! Reporter Ted Sickinger didn’t provide any of the actual numbers from Forest Grove, hoping that you’ll just trust his highly editorialized statements as “fact.”

Allow us:

Forest Grove is facing a budget shortfall of around $3.1 million in a total proposed budget of $49.1 million. And yes, while expenses—including PERS, supplies, and “purchased services”—have increased, the biggest reason for the district’s shortfall is far more straightforward: The legislature cut school funding and Congress shut off recovery funds.

The reason Forest Grove and every other district in the state are struggling is because lawmakers are failing to adequately fund education.

In fact, if the legislature merely kicked in the same amount it did in the 2009-10 school year, more than $2 million of the district’s shortfall would be wiped out.  If Congress renewed the recovery funds from 2009, the district would have another $1.77 million—more than enough to overcome the budget shortfall AND add back some laid-off teaching staff.

Here’s another fact: Between the 2009-11 budget and the current 2011-13 budget, the State of Oregon increased the amount we give away in tax breaks by $3.4 billion—that’s more than 1,000 times the size of Forest Grove’s budget shortfall.

In the last full legislative session, state lawmakers voted to give away $93 million in new tax breaks to corporations, and then another $75 million to real estate investors.

And yet, the Oregonian has never, ever, ever printed a story with the headline “Skyrocketing tax loopholes tighten their grip around Oregon” or “Tax breaks replace people in budgets.”

Both of those headlines, by the way, would be far more accurate than the Oregonian’s PERS scaremongering.

One other important fact the Oregonian ignored: PERS costs are increasing because of the financial meltdown caused by CEO greed and a lack of regulations. Wall Street CEOs tanked our economy and devastated retirement plans around the country—so why isn’t the Oregonian placing blame where it belongs?

The contrast between how the Statesman Journal and the Oregonian covered this story speaks volumes. It’s the difference between reporting and agenda-driven editorializing masked as reporting.

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