Should elected officials who commit crimes while on the job still get their taxpayer-funded pensions? Through a loophole in the law, former Prince George’s County Executive (and convicted felon) Jack Johnson will have taxpayers providing him with retirement benefits of almost $40,000 a year. While that situation seems criminal, it points to the larger need to reform pensions in Maryland. If the state stopped offering pensions and moved towards a defined contribution system, it would be much easier to deal with criminals like Johnson.

Maryland has a law that states elected officials are stripped of their pensions if they are convicted of a felony while in office. Jack Johnson resigned after he was arrested but before he was convicted, making him eligible for his pension. This loophole in the law has drawn the attention of some state lawmakers who want to keep this situation from happening again.

Some, however, point out that stripping pensions from government workers, even if felons, penalizes them too harshly. After all, the reasoning goes, these workers contributed to their pensions like any other worker. Why should they have no retirement benefits when they paid the same as everyone else, the argument goes.

While I don’t agree with this line of reasoning, this situation points to a structural problem that comes with pensions. These defined benefit plans make it impossible to disentangle the benefit that comes from taxpayers and the benefit that is a result of a worker’s payment.

With a defined contribution retirement plan, solving this problem would be much easier. Under such a plan, the worker puts in a certain amount of money and the employer (in this case, the government) matches it. This money stays in an account assigned to an individual and one can easily see what the government has put in and what the individual has put in.

Under such a system, the government could simply take out what the government has put into the account of a felon. If one wanted to be even more punitive, the government could also remove an amount of money equal to the annual rate of return on the government’s contribution for the account. That way, the felon would only have the money he put into the account plus the rate of return on that money left to use for retirement. There would be no taxpayer money going to pay for the retirement of felons.

Moving to a defined contribution system would also have a far more important impact on our state – it would help solve Maryland’s long-term fiscal problems. Helping the state’s fiscal problems and making it easier to stop felons from getting taxpayer handouts? Sounds like a winning combination to me.