Posted on 11/14/2014 1:39:42 PM PST by ThethoughtsofGreg
As newly elected state legislators across the country consider what issues to address, they are likely to encounter the growing storm cloud of unfunded pension liabilities. According to Promises Made, Promises Broken 2014, a new report from the non-partisan government watchdog group State Budget Solutions, unfunded public pension liabilities in the states now total $4.7 trillion.
For years many state governments have been over-promising pension benefits and using accounting gimmicks to hide the true cost of a state pension funds’ actual unfunded liability. Many state governments still utilize a defined-benefit pension system, where retired state employees are paid out a specific amount per year in perpetuity, regardless of actual market returns. This is unlike the vast majority of private sector employees who have a 401(k) style, defined-contribution plan, in which employees and employers contribute a fixed amount to an employee’s retirement account.
Promises Made, Promises Broken 2014 also dives deep into state data to calculate which states are doing better than others in terms of funding pensions. Wisconsin has the best funded public pension fund with a 67 percent funded ratio. The worst funded state pension system is Illinois, which is only 22 percent funded. The tables below show the top ten and bottom ten for best and worst funded public pension systems.
(Excerpt) Read more at americanlegislator.org ...
What do you mean unfunded? There are still people paying taxes, aren’t there?
Well, one good thing about Obama, now 4.7 trillion doesn’t sound like that much.
These “unfunded liabilities” should be characterized properly — overly generous promises that never should have been made and that the states now need to cut back. If I promise to give everyone in the country a million dollars, does that mean I have an unfunded liability that we carry around on the books as if its going to be honored? Or do we recognize its a stupid, irresponsible promise and terminate it? States need to cut pensions back to something reasonable and sustainable. And courts need to get with the program and accept the cuts. Anything less is a national suicide pact.
unfunded pension liabilities
Fancy words for a SLAVE CONTRACT
Better than that, we have a Federal Reserve that can print money to buy up Government debt (via its member banks, of course, so they get a cut). it can also manipulate interest rates so that servicing that debt never becomes too difficult.
No progressive social-engineering scheme ever needs to go unfunded! Its a beautiful thing!
Default is the only way out.
Curious: Melioration of the natural boom/bust cycle of capitalism is currency among the Gruberesque Planner-Class. But it seems they have made it far worse; allowed for themselves...and the pols who think they have swell ideas...advance notice of collapse. How convenient. Stupid? Not so much...if benefiting from the misery of the ‘unwashed’ is no hindrance to conscience. The meaning of ‘Public Service’ in the last century has come to mean BEND OVER (you stupid plebes) AND TAKE IT IN THE......bum?
Oh! Where are you gentlemen who, with great humility and true concern for ALL the people, founded this great nation? Looks like the chronic evils of which you spoke...and erected bulwarks against....have seeped and flooded the land.
You can’t really call them ‘unfunded’ since the Government owns the printing presses. They will just print up more of the Monopoly money. Works well ... for awhile.
Bump
Unions have pushed for lavish pension plans with no means to fund them. Taxpayers are on the hook for the obligation to give hard working public servants their just due.
One way or another, the gap between what has been promised and what is potentially available to meet the commitment has to be addressed. Are states are up to the challenge?
We’ll see.
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