Posted on 01/02/2015 11:11:55 AM PST by Libloather
This year, judges in California and Michigan approved the exit plans of two of the largest municipal bankruptcy filings in the country’s history. In California, Stockton upheld its obligations to the state’s pension system behemoth, Calpers, while paying its other creditors as little as pennies on the dollar. Detroit, meanwhile, was able to restructure its obligations to all of its creditors, including city pensioners. While the exit plans differed, both judges ruled similarly: public pension obligations could be shortchanged like any other debt.
Stockton and Detroit aren't alone. Cities and states across America are facing catastrophic budget shortfalls. After decades of promising municipal employees pensions and healthcare benefits, municipalities do not have the savings to pay them out. According to a Pew report released last year, some cities had only 50 percent of the funds needed to cover pension promises, and Charleston, West Virgina, had only 24 percent funding. Now, paying off these shortfalls—and serving the debts incurred—is taking up a growing portion of municipal budgets, at the expense of essential public services.
(Excerpt) Read more at newrepublic.com ...
Wow! How did that happen? Its not like one can’t project annuities/pensions years in advance. And all these cities run by genius liberals, not evil, stupid conservatives?
Must be a conservative plot to work against progressive utopia, right?
But never fear! The Progressive solution will be to tax PRODUCTIVE Americans @ 120% to make up the difference!
Public pensions - I don’t care. Let progressives eat their own.
BUT - while they are reducing public pensions, they will be printing money like crazy, issuing capital controls to keep you from fleeing the US Dollar, and making new laws which steal your pensions as well.
The article, as opposed to the headline, is remarkably reasonable.
Methinks you wrong....
...or to put it another way, public pension promises have long been an attack on sanity, reason, taxpayers, etc.....
They have known for years that the pensions were unsustainable.
Illinois’ public employee pension fund is underfunded by over $115 Billion dollars. They raised income and corporate taxes, but gave a lot of it back when big corporations (e.g., Caterpillar) threatened to move out of state.
If Cat goes, Peoria becomes a slum. If John Deere goes, Moline becomes a slum. Actually, it’s already moving in that direction. Iowa is just across the river. Lots of Deere employees live here and a lot of manufacturing is done here.
Illinois is a dying state due to corruption and extremely generous public sector union pensions = the Blue Model.
This is a dangerous road to go down. "Just another contract"?
Maybe your rent or mortgage or car payment or taxes or borrowed college money is crippling you.
You shouldn't feel too bad about declaring bankruptcy.
Shame is old school. -Tom
I worked for a peu in CA for years. One CALPERS guy I was forced to listen to was bragging about the difference between private and public pensions; being that the gov’t has no limits on taxation to pay their pensions.
Drain those fraudulent pension plans dry.
The Dems have been chomping at the bit to do just that for years. All in the name of fairness and retirement security, of course.
Shrill shill at New Republic calls these public pensions, but they aren’t, they are taxpayer-funded private pensions.
“Yeah, and that’s when they will have made me an outlaw, because I will get my money back, even if I have to rob the Federal Reserve.”
Keep in mind that the Federal Reserve defends itself with the fully-automatic , military-grade weapons that they deny you have a RIGHT to own.
They base their return assumptions on an unrealistic discount rate. They are not stupid, they know it is unrealistic, but they get away with it because they know the taxpayers will have to pay up.
They did know, but kept ratcheting them up to win votes and funnel money back to the Democratic Party via teachers’ union dues.
As a taxpayer I have no problem with those pensions not being honored at all; if the retirees have an issue with that they can chase down the politicians, and even voters, that made those promises to them.
“Illinois is a dying state due to corruption and extremely generous public sector union pensions = the Blue Model.”
Just like NJ...
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