Posted on 04/24/2016 4:53:14 AM PDT by C19fan
Among the many complex issues in Puerto Rico’s dire financial situation—the Island owes a staggering $73 billion in debt—is how to treat the pension obligations owed to the more than 100,000 retirees and 125,000 active members in the Puerto Rico Government Employee’s Retirement System (PRGERS). Hedge fund managers who gambled on Puerto Rico, paying 30 and 40 cents on the dollar in hopes for full dollar value repayment plus interest, will say Puerto Rico should pay them first. Close more schools if you have to (Puerto Rico has already closed 100), layoff more public sector workers if need be (30,000 have already lost their jobs in this economic crisis), or throw seniors who depend on their pensions into poverty; the hedge funds really need their money back.
(Excerpt) Read more at thehill.com ...
Puerto Rico finds itself were it is due to the fact that it has been “sucking at the government teat” for so long.
Once the hogs don’t have to hunt for food anymore, they don’t hunt at all. It’s happening in our country too.
I can see what this article is leading up to and it is the same “song and dance” we hear every time the “poor, poor pitiful me” song is played.
“Give a man a fish and he will eat for a day. Teach him to fish and he will eat for a lifetime.” Absolute truth!
However, if the man finds fish laying on the shore, ready to eat, he will not fish at all!
That is the story of Puerto Rico.
“This is no longer a discussion about what is coming down the road; it is here NOW.”
—
That is the very reason I started my own business back in 1979. The money I made through those years has either been reinvested into the business or stashed aside for the future. I could not envision that when I reached 65 years of age that we would have (both in government and private) a viable and stable retirement system in place that would provide from that age on and into the future.
I am now starting to see the worst fears of those who have been duped by both the government and financial industry into paying all of their working lives into a system that has the actual potential of DEFAULT!
Through all of those years I’ve been forced to pay the government 100% of their demand for Social Security at an average 14% of net income while the “so called” poor pay nothing.
Now, we are faced with the very real possibility of total collapse of the financial industry along with total defaults of government promises in the myth of Social Security retirement.
It’s a very dangerous financial world out there today because real tangible wealth is rare but wealth on paper is rampant. I believe we will soon see that the whole retirement scam is a house built on shifting sand in the foreseeable future.
No. Not one dime for PR.
L
That’s a very insightful post on CA and IL debt.
Assuming they fail before the US govt itself does (I think that’s a reasonable assumption) my prediction is those states will be authorized to sell bonds backed by the US govt.
Once Dems get the WH and Senate back, I suspect they will push hard for PR statehood. It looks like 2 guaranteed Dem senators and 3 or 4 representatives.
Well many of the residents are low income.
So they would be eligible for EICs and probably do much better under statehood. Most low income folks actually pay “negative” income tax.
Here in NJ the retirement scam has already been exposed; people can’t afford to retire. Normally they would sell their home and move into something with much lower costs, but now they own homes nobody wants with high taxes (in part to pay for the government worker caste’s retirements). On top of that, the government’s manipulation of inflation figures prevents real cost-of-living adjustments while anyone who buys groceries watches prices climb. The retirement age has been pushed up, while the healthcare that would enable someone to reach retirement is being undercut. The borders are left open in the hopes that Third Worlders will voluntarily pay into the pyramid at the lowest tier, and instead they simply become untaxed wards of the state, devouring “services” while contributing nothing.
These are not prophecies of doom coming down the road; they are here; for example, the financial collapse already happened in 2007/2008; we are dealing with the consequences of the “rescue”.
Does anybody think the federal government would be able to maintain such low interest rates if former government employees had to depend on those same rates for their retirement income like ordinary people?
“the government’s manipulation of inflation figures “?
Man, that sure is a nice way of saying this gub mint of obammy’s is Lying to us.
The federal situation is slightly better. Payouts are much lower and the retirement ages are higher. Then you come back to the funding of the pensions. On the books federal pensions look well funded, but that is only when you ignore the massive deficits and debt being amassed by the federal government.
That mirrors my experience, minus the luggage problem. I guess we lucked out there. I’ve been saying for years I have no interest spending much time in a place where the locals buy wrought iron security fences and bars, and razor wire, by the metric ton.
I understand the issue with loading the last years with overtime to swell the pensions; thankfully that practice has been exposed and will go the way of the dodo. Here in NJ they are also doing away with policies that let gubmint workers amass unused vacation/sick time; people were retiring with six-figure payouts ON TOP OF their pensions (while the municipality also had to pay for their replacement).
These scams that built up momentum during the good times are falling by the wayside as this country comes to grips with the fact that many people will never earn $15 per hour throughout their lives, and will never own homes or produce the successive generations that are needed to keep the scams going. There is literally nothing left to squeeze from an increasing number of Americans.
How about a maximum government pension law for say, $50k?
A simple default.
While they would lose access to further borrowed money there would be few other repercussions to PR.
And they would probably have enough revenue to meet their real obligations afterward.
“Time to cut them free. No Statehood...no commonwealth.”
The People’s Republic of Puerto Rico - PRPR.
Nice to see the 14% number. Must people think it’s 7% because the other 7% is hidden. Some people are dumb enough to believe their “employer pays it” and think it is free money. I get into that argument a lot.
I wouldn’t try to set a fixed figure; I’d rather they just dealt with funding their own retirement with options available to us little people who pay them.
Did the Federal Government promise to support PR’s pension system?
Didn’t think so. Let it burn.
Let the Castro Brothers show them how to live the pure (poor) Marxist life style.
I don’t know why this is so hard:
1. Tell the Creditors to GO POUND SAND, and Default on ALL DEBT.
2.Puerto Rico has never made its required contributions to the system.
Arrest all of those that contributed to this fraud and SEIZE their ASSETS, ALL Public Officials that VIOLATED THE LAW, including said Hedge Fund Managers if you can find anything Fraudulent, like Assuming a 10% return in a 3% market.
Remain on a Cash in Cash out basis and Never Borrow Again.
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