Receiver to city: Financial ruin near

projo.com ^ | December 17, 2010 | John Hill

[gusopol3]

The major problem is the city, with an annual operating budget of about $16 million, is facing about $32 million in promised after-retirement health-insurance costs in addition to the $48 million in pension obligations.

“That’s $80 million for a city that has 19,000 citizens, approximately,” he said. “That’s a huge problem.”

Pfeiffer raised the specter of a municipal bankruptcy filing as a last resort.....

The crisis in Central Falls has been growing for more than a decade, Pfeiffer said. City administrations approved municipal employee contracts Central Falls could not afford and kept giving out pension and retirement benefits without figuring how to pay for them, and now the funds are running out of money.

[Brilliant]

Nothing to worry about. According to the liberals, debt is good.

[tflabo]

The gravy train has long left the station in better times. Once again muni employees pensions are killing budgets nationwide.

[Anti-Bubba182]

Municipal bankruptcy filing is a valid option to fix these problems. IF the Feds bail them out they should be thrown out of office.

[The Comedian]

"Economic Holocaust" ping.

Increasing volume ping list watching the slow motion Economic Holocaust.

FReepmail me if you want on or off
The Comedian's "Economic Holocaust" ping list...

Frowning takes 68 muscles.
Smiling takes 6.
Pulling this trigger takes 2.
I'm lazy.

[April Lexington]

The companies who created these worker pension funds knew exactly how to screw the pooch. And, folks... the pooch is now screwed...

[blam]

"Municipal bankruptcy filing is a valid option to fix these problems. IF the Feds bail them out they should be thrown out of office."

The Fed will attempt to bail-out the hundreds, maybe thousands, of munis that are going broke before going under itself.

[gusopol3]

It’s amazing to listen to the hand-wringing on county council over the potential of one county employee layoff, while unemployment among the taxpayers soars and their tax rates, often based on property values from real estate boom times,are increased. I think a very legitimate starting point is, that if you want to draw a pension from a locale, you must continue to live in that locale in retirement, just as you did when you were employed (in many places).

[FromLori]

Wash, Rinse, Repeat all over the country the real state of affairs is our entire country is broke.

The First Stage of Inflation Has Already Hit, Next Up Is the Currency Collapse

http://seekingalpha.com/article/242415-the-first-stage-of-inflation-has-already-hit-next-up-is-the-currency-collapse?source=email_watchlist

[BenKenobi]

I disagree, I think they ought to be able to move and do whatever they want with their pension.

I think they shouldn’t get pensions at all. Solve the issue right there. Don’t want to cut staff? Drop their pensions. Choose one or the other.

[Presbyterian Reporter]

Central Falls must go bankrupt just like a corporation that mismanages its business.

Sorry, but these city employees will not get any more benefits than do the employees of corporations that go bankrupt.

[Anti-Bubba182]

We hired a new Congress to raise hell about stuff like that. If they don't, they should be out of office.

[B4Ranch]

“The crisis in Central Falls, RI. has been growing for more than a decade, Pfeiffer said. City administrations approved municipal employee contracts Central Falls could not afford and kept giving out pension and retirement benefits without figuring how to pay for them, and now the funds are running out of money. That situation was exacerbated over the years by municipal officials who ignored it when it was manageable and only reacted when it was too late.”

[gusopol3]

oooh.. the truth hurts. Bernie Madoff couldn’t have set up a better fleecing.

[B4Ranch]

I wonder what the cause of the population boost is? Hispanics or did Zero drop off a load of Somalians? Historical populations Census Pop. %± 1950 23,550 — 1960 19,858 −15.7% 1970 18,716 −5.8% 1980 16,995 −9.2% 1990 17,637 3.8% 2000 18,928 7.3% Est. 2009 18,716 −1.1%

[Capt. Tom]

•Create a single system for pensions and after-retirement health care for all public employees that would standardize benefits and spread out costs. It could be financed with a pension bond.

Borrowing more money to solve a financial problem? - Tom

[Anti-Bubba182]

They don’t deserve a bailout.

[Oatka]

"That situation was exacerbated over the years by municipal officials who ignored it when it was manageable and only reacted when it was too late."

They kicked the can down the road until they ran into a Dead End. It's being repeated in every state as well as the nation.

[FromLori]

Well that will be a huge job...

Unofficial’ Liabilities

Based on the CBO’s data, I calculate a fiscal gap of $202 trillion, which is more than 15 times the official debt. This gargantuan discrepancy between our “official” debt and our actual net indebtedness isn’t surprising. It reflects what economists call the labeling problem. Congress has been very careful over the years to label most of its liabilities “unofficial” to keep them off the books and far in the future.

http://www.bloomberg.com/news/2010-08-11/u-s-is-bankrupt-and-we-don-t-even-know-commentary-by-laurence-kotlikoff.html

[Anti-Bubba182]

Yes the job is huge, but in this case it is a matter of not bailing out profligate localities. Let them go bankrupt and get out of the excessive benefits packages.