Michigan House Republicans have so far failed to say "yes" to a Senate-passed bill that would close the school pension system to new employees and instead offer them a generous 401(k) plan.

The failure is based on a concern promoted by teachers unions and state pension bureaucrats that if the system is closed, then accounting rules require allocating hundreds of millions of dollars over several years to "front load" the amortization of unfunded pension liabilities.

Ironically, these new converts to the "holy writ" of accounting rules were all but silent during 10 years of serial pension-rule violations by this state in the form of persistent annual underfunding of the school retirement system. All that contribution low-balling is a major reason taxpayers here now carry a burden of $22 billion in unfunded pension liabilities, or some $6,000 per Michigan family (pension fund investment returns not meeting expectations is the largest reason). In only two of the past 10 years has the state met or exceeded a "required annual contribution" to the pension system. In most years the shortfall was 10 to 28 percent.

Given the incentives inherent in all government pension systems, it would be foolish to expect unfunded liabilities not to grow even more in the future. This is why closing the system to new employees is the single most important reform Michigan could make right now.

Nevertheless, rather than leaping to say "yes" to the Senate-passed bill doing just that, some in the House Republican caucus have bought into the union and the "pension industrial complex" claims that doing so requires coming up with hundreds of millions of dollars almost immediately to "catch up" more quickly on all that past underfunding.

It doesn't, and in any event the House has already found a better answer to a genuine concern those false claims exploit: The money to "catch up" on unfunded pension liabilities has to come from somewhere. The House proposes doing this with a simple change in the formula for allocating those "catch-up" costs to future school district budgets.

There is zero chance that Michigan won't meet its obligation to future retirees, and everyone knows it. The bad faith arguments being made by a special interest with zero credibility on the issue aren't about accounting rules, but  instead are part of a campaign to halt a transformational reform: Making Michigan just the second state in the nation to place itself on a glide path to eventual elimination of government employee legacy costs.*

House Republicans should say "yes" to the Senate and stop listening to people who have good reasons to mislead them.

* A State Police pension system would remain open, but this is tiny compared to the system for school employees and the one for state employees (which was closed to new hires in 1997). Separate municipal pension systems would also remain open. But the magnitude of these bits of uncompleted business pales in comparison to the acheivement that having closed both the state and school employee pension systems to new members would represent.

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See also:

Teacher Pension Underfunding Hits $22B

Taxpayers Agree: 401(k)s for New Hires

House GOP on Verge of Surrendering to MEA

Madison, Wisc. — Democrats and union members here screamed about government employee union collective bargaining when reforms were introduced by Gov. Scott Walker. But as voters head to the polls today those protesters must have decided the issue was a loser.

Ads attacking Gov. Walker have centered on two themes: one is that education spending was cut, tuition rates went up and the middle class was being destroyed (the ads also claim that under Gov. Walker, Wisconsin has lost more jobs than any other state); another alleges corruption in a so-called John Doe probe, an investigation involving events that took place when Gov. Walker was Milwaukee County executive (Gov. Walker denies that the investigation is focused on him).

But the issue of limiting government union employee collective bargaining is nowhere in sight.

"The recall was about our reforms," Gov. Walker said recently after being grilled by reporters about the John Doe probe. "Our opponents don't want to talk about them."

But they did in 2011.

"Majority in Poll Back Employees in Public Sector Union," was a headline in the Feb. 28, 2011 edition of The New York Times.

"New Polls Bring More Bad News for Wisconsin Gov. Scott Walker," read a March 1, 2011 headline in U.S. News and World Report.

Adam Geller, CEO of National Research Inc., and the pollster for New Jersey Gov. Chris Christie, said he wasn't surprised to see that the reality today doesn't line up with the picture the national news media presented in 2011, and for much of 2012.

"It doesn't surprise me at all, based on what I've seen in New Jersey." Geller said. "Gov. Christie has been a guy who has been willing to take on the unions as well. Now his popularity has gone up.

"I think I read some place that under Walker, Wisconsin has a balanced budget for the first time in 30 years. It takes a guy who is willing to do what needs to be done for that accomplishment. It's not easy to defeat someone like that."

In 2011, Geller wrote that the polls that claimed to show that a majority of Americans were opposed to Walker's collective bargaining reforms were flawed.

"Often times, sadly, public polls are done in the least expensive way possible," Geller said. "When that happens the pollsters take short cuts that strongly affect the results. In the worst case scenario the polls you're talking about last year were done that way on purpose. In the best case scenario, the pollsters were taking short cuts, and not choosing the wording carefully because they were trying to do it quickly."

In some cases that means pollsters get too many non-voters in their responses or talk to too many Democrats, for example. Or, as was the case with the U.S. News report, the story was based on a survey done by a Democrat-leaning polling company.

Many, of those polls published about collective bargaining were surveys of "Americans," instead of "likely voters," which was the case with the Feb. 28, 2011, New York Times story. Geller said that often makes a big difference.

"Then you see very lazy analysts and members of the news media cite the polls without noting who was being surveyed," he said. "Another one we see a lot is poll results from surveys of adults. But many adults don't vote. Even polls of voters can be misleading, all voters aren't likely voters. Those kinds of polls aren't particularly accurate."

"There's a sign on a business near here that says, 'Educated customers are our customers'," Geller said. "What we need are more educated voters. At the end of the day, tea party voters are educated voters. God bless them. They refuse to swallow everything they're being fed."

Today's vote in Wisconsin is seen by many as the beginning of a major battle unions are trying to wage nationally against reforms that modify the perks and benefits they've enjoyed for decades. Unions in Michigan are backing efforts to enshrine union friendly protections in the state constitution.